Delhi High Court
Pccare247 Solutions Pvt Ltd vs Pay Commerce India Private ... on 19 November, 2018
1
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(COMM) 488/2016
PCCARE247 SOLUTIONS PVT LTD ..... Plaintiff
Through: Mr. Ashish Agarwal, Advocate
with Ms. Shruti Gupta, Advocate.
versus
PAY COMMERCE INDIA PRIVATE LIMITED .....Defendant
Through: None.
% Date of Decision: 19th November, 2018
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
JUDGMENT
MANMOHAN, J: (Oral)
1. Present suit has been filed for recovery of Rs.1,14,96,715/- along with
pendente lite and future interest at 18% per annum. The prayer clause in the
present suit is reproduced hereinbelow:-
"(a) pass a decree in favour of the Plaintiff and against the
defendant for a sum of Rs. 1,14,96,715.00 (Rupees One
Crore Fourteen Lac Ninety Six Thousand Seven Hundred
and Fifteen only);
(b) grant pendente lite future interest at the rate of 18 per cent
per annum to the Plaintiff and against the defendant;
(c) award costs of suit in favour of plaintiff and against
defendant;
(d) pass any other order or such further orders as this court
may deem fit and proper in the interest of justice."
2. Since none appeared for the defendant despite service by way of
publication, it was proceeded ex-parte vide order dated 08th May, 2017.
3. The contentions and submissions advanced by learned counsel for the
plaintiff are as under:-
i. The plaintiff and defendant entered into a 'Platform as a Service and
Settlement Processing Customer Agreement' dated 30th September,
2011. Some of the important terms of agreement are as under:-
a) "Whereas, PAYCOMMERCE is engaged in the business of
providing products, solutions and services that facilitate and
manage the CUSTOMER's receivables, payables and cash
management processes PAYCOMMERCE may also provide the
processing of paper based and electronic data representing
financial transactions conducted through the use of the Federal
Reserve System and other systems, networks, clearinghouses
and financial institutions.
Whereas, CUSTOMER desires to use the PAYCOMMERCE
platform, products, services and solutions to facilitate and
manage their receivables, payables and cash management
processes. In addition, CUSTOMER may use
PAYCOMEMRCE to process their Financial Transactions and
agree to honor ECP and Financial Transactions in connection
with the sales of their products, services and solutions and to
submit sales records and refunds representing such
transactions to PAYCOMMERCE for processing and
submission of Payments to CUSTOMER's vendors for products
or services received. CUSTOMER agrees to fully comply with
all policies, procedures, guidelines and rules imposed by
PAYCOMMERCE.
b) PROCESSING AND PAYMENT.
CUSTOMER hereby agrees to comply with all of the
PAYCOMMERCE policies, rules, conditions and procedures
and to pay PAYCOMMERCE fees, all in accordance with the
terms hereafter, set forth. PAYCOMMERCE will provide the
agreed to services and solutions conditionally upon
CUSTOMER's payment of fees and compliance with terms of
this AGREEMENT. PAYCOMMERCE will pay the
CUSTOMER on a net basis by deducting any fees, expenses or
reserves from the gross proceeds of the CUSTOMER
transactions. The payment of the net proceeds to the
CUSTOMER will be governed by this AGREEMENT and the
policies and procedures of PAYCOMMERCE.
CUSTOMER will exclusively use the PAYCOMMERCE
products, services and solutions for all of the processing of
their merchant services and card transactions. CUSTOMER
will not use another processor for US Dollar transactions while
this AGREEMENT is in effect.
c) PURCHASE OF SALES RECORDS AND RETURNS
a. CUSTOMER shall present SALES RECORDS to
PAYCOMMERCE within acceptable time frames in accordance
with any applicable laws and regulations. All such presented
transactions must be supported by a previously obtained
WRITTEN AUTHORIZATION, if required, from the
business/consumer. CUSTOMER shall present REFUNDs to
PAYCOMMERCE within two business days from the date that
the REFUND was issued to the business/consumer. Such
SALES RECORDS and REFUNDS to PAYCOMMERCE within
two (2) business days from the date that the REFUND was
issued to the business/consumer. Such SALES RECORDs and
REFUNDs shall be presented in a manner and format
acceptable to PAYCOMMERCE. PAYCOMMERCE shall
deliver to a participant in the Federal Reserve System data
representing such SALES RECORDS and REFUNDS that pass
the VALIDATION process in a timely manner allowing for the
initiation of an ECP transaction to the business/consumers
bank account. PAYCOMMERCE shall report to CUSTOMER
those transactions which fail the VALIDATION or
VERIFICATION process....
xxx xxx xxx
c. PAYCOMMERCE agrees to purchase from CUSTOMER
all SALES RECORDS and REFUNDS presented to
PAYCOMMERCE as purchased which have been generated by
business/consumers who have provided CUSTOMER WRITTEN
AUTHORIZATION when required for such transactions and
have been successfully transmitted to the participant of the
Federal Reserve System by PAYCOMMERCE on behalf of the
CUSTOMER."
ii. The defendant failed to perform its obligations and the payments in
terms of the agreement were not released by the defendant in spite of
the fact that the plaintiff had complied with all formalities.
iii. Vide letter dated 30th May, 2012, the defendant acknowledged the
summary of transactions processed by the plaintiff from the start of
the said Agreement till 30th May, 2012 as follows:
Sale Volume USD 2,88,702.42
Refunds Processed USD 17,008.42
Chargeback Received USD 31,125.93
-----------------------------------------------------
Net Sales Volume USD 2,40,568.07
-----------------------------------------------------
The defendant claimed that it was entitled to an amount of USD
8666.70 as the processing charges/service charges from the plaintiff
and after deducting the said amount of USD 8666.70 from the Net
Sales Volume an amount of USD 2,31,901.37 remained due and
payable by the defendant to the plaintiff.
iv. Since March, 2012, the plaintiff by e-mails, oral requests, phone calls
and personal visits called upon the defendant to release the entire
balance payments to the plaintiff. However, the defendant cited the
issues being raised by its processor as a reason for delay in release of
payment. The plaintiff had reasons to believe that the
ground/explanation cited by the defendant to the effect that the
processor was not releasing the payments, was false and cooked up in
order to avoid payment.
v. In order to maintain cordial business relations and relying upon the
assurances and representation, the plaintiff agreed to the delay in
release of payment as per the requests made by the defendant.
vi. Thereafter, vide e-mail dated 18th April, 2012, the defendant informed
the plaintiff that the amounts were being held back as charge-backs
were being received by the defendant and that the amounts held back
shall be released within a maximum period of 180 days with effect
from 15th March, 2012 i.e. by 15th September, 2012 at any cost. It
was also assured by the defendant that it would pay 5-10 per cent of
the withheld payment on weekly basis and that payments which had
fallen due for the period 22nd March, 2012 to 27th March, 2012 would
be released on the 90th day from 27th March, 2012 i.e. by 27th June,
2012.
vii. Despite confirmations and assurances given by the defendant in
various mails addressed to the plaintiff since month of April, 2012, till
end of September, 2012, only a meager sum of Rs.30.00 lacs was
released and the plaintiff started facing third party actions, liabilities
from its customers on account of failure on the part of defendant to
release the payments as per the agreement/understanding.
viii. The plaintiff issued notice dated 04th September, 2012 thereby calling
upon the defendant to release the balance of 1,50,000 US Dollars.
ix. The defendant sent a reply dated 21st September, 2012 to the plaintiff,
wherein the defendant admitted that:-
(i) last payment of Rs.7.5 lacs was made on 03rd September, 2012;
(ii) there were other payments to be made to the plaintiff;
(iii) the payments could not be made as those were under review by
the processor; and
(iv) the defendant would release the payments as and when those
were received from the processor.
x. The plaintiff found the said reply to be false, frivolous, misconceived
and perfunctory and only a dilatory tactic adopted by the defendant to
avoid making payment of the dues.
xi. Out of the amount of US Dollar 2,31,901.37, the total sales volume as
acknowledged by the defendant in its letter dated 30th May, 2012;
during the period from 17th February, 2012 to 03rd September, 2012,
the defendant has paid US Dollar 1,02,869.78 on the dates mentioned
herein below and the amounts paid by the defendant on various dates
has been adjusted by the plaintiff in each transaction of sale equally
on pro rata basis/proportionately:-
Date Rupees In US Dollar Rate
(Rupees/Per
Dollar)
17.02.2012 Rs.2,06,269.00 $ 4,178.86 49.36
24.02.2012 Rs.19,87,948.00 $ 40,570.36 49.00
04.04.2012 Rs.7,50,000.00 $ 14,705.88 51.00
05.07.2012 Rs.15,00,000.00 $ 28,339.31 52.93
03.09.2012 Rs.7,50,000.00 $ 15,075.37 49.75
Total Amount paid USD $ 1,02,869.78
xii. After adjusting the aforesaid amount of USD 1,02,869.78 from the
total sales of US Dollar 2,31,901.37, an amount of US Dollars
1,29,031.59 remains due and payable by the defendant to the plaintiff
as on 03rd September, 2012.
xiii. Since the transaction between the plaintiff and defendant is
commercial in nature, the defendant is liable to pay interest at the rate
of 18% per annum, being commercial market rate of interest, on the
amounts due and payable by the plaintiff to the defendant. However,
in the present suit the plaintiff is claiming interest at the rate of 12%
per annum only for the period prior to the filing of the suit.
xiv. Consequently, in the aforesaid facts and circumstances the plaintiff is
entitled to the following amounts:
Amount as on 03rd September, 2012 : USD 1,29,031.59
Interest on USD 1,37,698.29
From 01st September, 2012 to 31st August, 2015:USD 45,161.06
Total amount due as on 31st August, 2015: USD 1,74,192.60
Converted to Rupees at the rate of
Rs.66 per dollar being rate of US Dollar
As on 31st August, 2015 Rs.1,14,96,715.00
xv. The suit of the plaintiff is within the period of limitation inasmuch as
last payment was made on 03rd September, 2012 (acknowledged by
plaintiff in reply 21st September, 2012) and suit has been filed on 01 st
September, 2015, witin three years.
4. The plaintiff has filed its evidence by way of affidavit in support of
the averments made in the suit and inter alia relied upon the following
documents:-
i. Ex. PW1/2 to PW1/5 are emails dated 15th May, 2012 and 17th
May, 2012 exchanged between the parties.
ii. Ex. PW1/6 is the Platform as a Service and Settlement Processing
Customer Agreement dated 30th September, 2011.
iii. Ex. PW1/8 is the letter dated 30th May, 2012 of defendant.
iv. Ex. PW1/9 is the email dated 18th April, 2012 of defendant.
v. Ex. PW1/10 is the plaintiff's legal notice dated 4th September,
2012.
vi. Ex. PW1/11 is the defendant's reply dated 21 st September, 2012 to
notice dated 4th September, 2012.
vii. Ex. PW1/12 is the plaintiff's legal notice dated 20th October, 2014.
viii. Ex. PW1/13 to PW1/15 are the defendant's replies dated 3rd
November, 2014, 6th November, 2014 and 13th November, 2014.
5. Having perused the paper book, this Court is of the opinion that the
defendant having acknowledged the summary of transaction vide letter dated
30th May, 2012 has failed to pay the amount due to the plaintiff in
accordance with the Agreement. Further, despite receipt of the legal notices
dated 4th September, 2012 and 20th October, 2014, the defendant has failed
to pay the plaintiff the amount as demanded by the said legal notices. In
fact, this Court is of the view that no plausible defence was raised by the
defendant in its replies to the legal notices.
6. In any event, as the averments in the plaint have not been rebutted by
the defendant nor did it bother to put forth its stand in spite of ample
opportunities given by this Court, they are deemed to have been admitted.
7. Accordingly, the suit is decreed in favour of the plaintiff and against
the defendant for USD 1,29,031.59 along with interest @ 8 % per annum
FROM 03RD September, 2012 till the date of filing of suit. The plaintiff
shall also be entitled to pendente lite and future interest @ 8% per annum.
This Court may mention that it is awarding the interest @ 8% per annum as
that is the normal rate at which the banks are lending monies now-a-days.
The plaintiff is also held entitled to actual costs of litigation. Accordingly,
the amount payable by the defendant to the plaintiff is as under:-
(i) Amount as on 03rd September, 2012 USD 1,29,031.59
(ii) Interest @8 per cent on USD1,29,031.59 USD 30,967.58
from 01st September, 2012 to 31st August,
Total amount due as on 31st August, 2014 USD 1,59,999.17
Converted to Rupees at the rate of Rs.66 per dollar Rs.1,05,59,945.22
being rate of US Dollar as on 31st August 2015
8. The plaintiff is given liberty to file on record the exact cost incurred
by it in adjudication of the present suit. Registry is directed to prepare a
decree sheet accordingly.
MANMOHAN, J
NOVEMBER 19, 2018
js/as
