Karnataka High Court
M/S Akay Industries Pvt vs Shree Sai Infra on 2 April, 2024
Author: S.R. Krishna Kumar
Bench: S.R. Krishna Kumar
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COMAP No. 100009 of 2022
C/W COMAP No. 100010 of 2022
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 2ND DAY OF APRIL, 2024
PRESENT
THE HON'BLE MR JUSTICE S.R. KRISHNA KUMAR
AND
THE HON'BLE MR JUSTICE G BASAVARAJA
COMMERCIAL APPEAL NO. 100009 OF 2022
C/W
COMMERCIAL APPEAL NO. 100010 OF 2022
IN COMAP NO.100009 OF 2022
BETWEEN:
M/S AKAY INDUSTRIES PVT. LTD.,
A COMPANY INCORPORTATED UNDER
THE PROVISIONS OF THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
POST BOX NO.86, STATION ROAD, HUBLI AND
FACTORY AT PLOT NO. 124, BELUR INDUSTRIAL
GROWTH CENTRE, BELUR.
DHARWAD 580 011.
KM
SOMASHEKAR
(REPRESENTED BY ITS MANAGING DIRECTOR
Digitally signed by K M
SHRI. UDAY KHIMJI,
SOMASHEKAR
Location: HIGH COURT
OF KARNATAKA
DHARWAD BENCH
S/O BHANJI KHIMJI,
Date: 2024.04.23
12:13:40 +0530
AGED ABOUT 75 YEARS,
RESIDENT OF MUMBAI)
...APPELLANT
(COMMON)
(BY SRI. PRABHULING K.NAVADAGI, SENIOR ADVOCATE FOR
SRI.G.K.HIREGOUDAR AND SRI.ANEESH SHAHADE, ADVOCATES)
AND:
SHREE SAI INFRA BUILDER
A REGISTERED PARTNERSHIP FIRM
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COMAP No. 100009 of 2022
C/W COMAP No. 100010 of 2022
HAVING REGISTERED OFFICE AT NO.38A,
38S, II FLOOR EUREKA JUNCTION
TRAVELLERS BUNGALOW ROAD,
HUBLI -580 020
(REPRESENTED BY ITS MANAGING PARTNER
SHRI. ASHWINI S. CHAVAN
AGED ABOUT 40 YEARS)
...RESPONDENT
(COMMON)
(BY SRI.PRAKASH K.JAWALKAR, ADVOCATE)
THIS COMAP 100009/2022 IS FILED UNDER SECTION 13 (1-A)
OF THE COMMERCIAL COURTS ACT, 2015, PRAYING TO, CALL
FOR RECORDS AND SET ASIDE THE ORDER DATED 31ST JANUARY
2022 PASSED BY THE LEARNED V ADDITIONAL DISTRICT JUDGE
DHARWAD SITTING AT HUBBALLI IN COM.OS.NO.11/2021.
THIS COMAP NO.100010 OF 2022 IS FILED UNDER SECTION
13(1-A) OF THE COMMERCIAL COURTS ACT, 2015, PRAYING TO,
CALL FOR RECORDS AND SET ASIDE THE ORDER DATED 31ST
JANUARY 2022 PASSED BY THE LEARNED V ADDITIONAL
DISTRICT JUDGE DHARWAD SITTING AT HUBBALLI IN
COM.OS.NO.10/2021.
THESE APPEALS ARE BEING HEARD AND RESERVED ON
03.10.2023 COMING ON FOR PRONOUNCEMENT OF JUDGMENT
THIS DAY, S.R.KRISHNA KUMAR J DELIVERED THE FOLLOWING:-
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COMAP No. 100009 of 2022
C/W COMAP No. 100010 of 2022
JUDGMENT
Since both these appeals arise out of the impugned common
judgment and decree, they are taken up together for consideration
and disposed of by this common judgment.
2. COMAP No. 100009/22 is filed by the sole Defendant in
COM.O.S No.10/2021, while COMAP No. 1000010/22 is filed by
the Plaintiff in COM.O.S.No.11/2021. The Plaintiff in
COM.O.S.No.10/2021 is the Defendant in COM.O.S No.11/2021.
The Defendant in COM.O.S.No.10/2021 is the Plaintiff in
COM.O.S.No.11/2021.
3. For the sake of convenience, the parties are referred to as
their respective rankings before the trial court.
4. Brief facts leading to the case are as under:-
O.S.No.10/2021 was filed by respondent-plaintiff herein with
a prayer for payment of a sum of Rs.1,10,29,853.00/- with interest
at the rate of 21% , while O.S.No.11/2021 was filed by the
appellant - defendant herein with a prayer for payment of a sum of
Rs.52,00,000/- with interest at the rate of 10% from the date of suit
till realization. Both these suits were initially filed before the court of
Principal Senior Civil Judge, Hubli.
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4.1 The suit filed by the respondent-plaintiff was numbered
at O.S No.264/2015, which after coming into force of the
Commercial Courts Act was transferred to the Commercial Court
and renumbered as COM.O.S. No. 10/2021. Similarly, the suit filed
by appellant-defendant was originally numbered as
O.S.No.289/2015 and it came to be renumbered as
COM.O.S.No.11/2021 after the coming into force of the
Commercial Courts Act.
4.2 It is the case of the respondent-plaintiff in
COM.O.S.No.10/21 that the respondent-plaintiff is a civil contactor.
The appellant-defendant was desirous of constructing a factory and
in this regard, he had entrusted the construction contract to the
respondent-plaintiff. The scope of work/ contract involved the
construction of the following buildings which formed one single
complex viz. Shed No. 1, Shed No. 2, Shed No. 3,Old Office
Building, New Office and Pantry, Shifting of Parking Shed and
Building new generator room. It is the further case of the
respondent-plaintiff that for the various construction undertaken by
him, only part payment was made and that there was an
outstanding amount that required to be made which is described as
under as averred in the Plaint;
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Sl. Particulars of the Date of Amount Balance
No. Construction Purchase Quoted (Rs.) Payable (Rs.)
Order
1. Shed No. 1 15.12.2009 1,86,75,000/- 57,22,500/-
2. Old Office Building 17.07.2010 25,20,000/- 5,30,000/-
3. Shed No. 1 & 2 21.04.2012 2,22,28,800/- 2,28,800/-
4. New Office Building 26.07.2012 1,16,06,968/- 4,41,144/-
and Pantry
5. Shifting of Parking 04.08.2014 39,00,000/- 24,00,000/-
Shed and Building
New Generator
Room
6. Machine Foundation 23.09.2014 38,497/- 38,497/-
Bed
7. Miscellaneous piece 4,09,380/- 4,09,380/-
of work i.e., chain
link mesh for
transformers etc.
8. Shifting of Parking 22,796/- 22,796/-
Shed and Building
New Generator
Room
On the basis of the above, the respondent-plaintiff claims a total
sum of Rs. 97,92,617/- exclusive of tax and Rs. 1,10,29,853/-
inclusive of tax.
4.3 It is the case of the respondent-plaintiff that he always
maintained cordial relationship with the appellant-defendant and
made efforts for settling the accounts amicably. In this regard, he
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had sent two (2) emails dated 24.06.2015 and 01.02.2015; that on
08.07.2015, he issued a notice seeking the payment of the above
amount. The appellant-defendant denied the claim. It is in this
background, cause of action arose for filing the suit. On issuance of
suit summons, the appellant-defendant appeared before the Court
and filed his written statement. Though, the appellant-defendant
admits that the contract for construction was awarded to the
respondent-plaintiff but has seriously disputed the claim made by
the respondent-plaintiff referred to above.
4.4 It is the case of the appellant-defendant that the claim
made by the respondent-plaintiff is without basis and is a clear
case to unjustly enrich himself. The appellant-defendant states that
the details of all the contracts are recorded by way of written
agreements, purchase orders, debit note and exchange of
correspondence. In fact, it is the case of the appellant-defendant in
COM.O.S.No.11/2021 that it was the respondent-plaintiff firm which
was in due of a sum of Rs.52,00,000/-. The appellant-defendant in
this regard had raised a debit note, according to which, the
defendant was due a sum of Rs.52,00,000/-. The appellant-
defendant had appointed one H.K. Sharma, a government
registered valuer and chartered engineer to assess the loss caused
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by the faulty construction of the respondent-plaintiff and secured a
report. As per the book of accounts and statements maintained by
the Defendant, the appellant-defendant is not liable to make any
payments.
4.5 Based on the above pleadings, the trial court (wherein
the suit was initially instituted) framed the following issues for its
consideration:-
1. Whether the Plaintiff proves that it has spent
Rs. 1,10,29,853/- towards the costs of construction carried
out for the Defendant Company?
2. Whether the Plaintiff proves that the
Defendant Company is liable to pay the claim with interest?
If so, interest at what rate?
3. To what reliefs the Plaintiff is entitled for?
4. What order or Decree?
1. Does the Plaintiff prove that the Defendant
has caused a loss of Rs.52,00,000/- by making
substandard construction work in violation of terms and
conditions?
2. Whether the Plaintiff proves that the
Defendant is liable to pay suit claim together with interest?
3. Whether the court fee paid by the Plaintiff is
proper and sufficient?
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4. To what reliefs the Plaintiff is entitled for?
5. What order or decree?
5. The trial court recorded common evidence and both the
suits were tried together. On behalf of the respondent-plaintiff PW-1
who is the Managing Partner of the Respondent/Plaintiff Firm was
examined and Exs.P1 to P53 were got marked on his behalf. The
appellant-defendant examined two witnesses viz., DW-1 - The
Director of the company and DW-2 was the Associate who along
with Sri H.K. Sharma conducted the joint inspection of the Factory
which resulted in the submission of the report. Exs.D1 to D6 were
produced and marked in support of their claim.
6. The Trial Court by the impugned common judgment has
decreed the suit of the respondent-plaintiff to the effect that the
appellant-defendant herein is liable to pay to the respondent-
plaintiff a total sum of Rs.79,78,633/- with future interest of 6% p.a.
from the date of the suit till its realization. The respondent-plaintiff is
also entitled for a sum of Rs.1,00,000/- as compensatory costs.
The suit of the appellant-defendant herein for recovery of a sum of
Rs.52,00,000/- in COM.O.S.No.11/2021 was dismissed. The said
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common judgment is assailed before this Court in the present
Commercial Appeals.
7. Both Commercial Appeals have been preferred by the
Appellant-Defendant therein, who was arrayed as Defendant in
COM.O.S No.10/21 and Plaintiff in COM.O.S No.11/21.
8. We have heard learned Senior counsel appearing for the
appellant and learned counsel appearing for the respondent and
perused the material on record.
9. In addition to reiterating the various contentions urged in
the memorandum of petition and referring to the material on record,
learned Senior Counsel for the appellant has made the following
submissions:-
(i) That the purchase orders relied upon by the respondent -
plaintiff are distorted and do not convey the clear picture of the
claim and in this regard, it is submitted that insofar as Shed No. 1 is
concerned, the purchase order at Ex.P6 is for Rs.1,86,75,000/- and
the said entire amount stands paid vide Ex.D3 and that the extra
claim made for Rs.49,00,000/- is not maintainable as there is no
purchase order for the same and as such, the additional
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expenditure as claimed for Rs.15,00,000/- is without any basis and
no evidence in this regard is produced.
(ii) As regards the old office building no. 2 is concerned, the
appellant-defendant was liable only to the extent of Rs.25,20,000/-
vide purchase order at Ex.P12 dated 17.07.2010. The payment for
the same excluding Rs.4,91,000/- has been made vide Ex.D3 and
insofar as the balance of Rs.4,91,000/- is concerned, the same
stands adjusted vide debit note dated 08.06.2015. In so far as
Shed Nos. 2 and 3 is concerned, the purchase order at Ex.P16 is
for Rs.2,00,00,000/-, which was paid vide Ex.D3 and further claim
of Rs.28,00,000/- is without any basis.
(iii) Insofar as the new office and pantry is concerned, a sum
of Rs.1,02,00,000/- which was liable to be paid, has been paid vide
Ex.D3. The same is referrable to the purchase order at Ex.P23
dated 26.07.2012 and therefore, the balance amount of
Rs.4,41,144/- is without any basis.
(iv) With regard to Shifting of Parking Shed and Building New
Generator Room is concerned, the total claim made by the
respondent-plaintiff is without any basis and according to the
appellant-defendant, he is liable to pay only Rs.39,00,000/-, out of
which, Rs.10,00,000/- has already been paid vide Ex.D3. It was
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further contended that the construction of the same was not
completed and only 80% was completed and balance of
Rs.29,00,000/- has been adjusted to the debit note.
(v) Insofar as the Machine Foundation Bed is concerned, the
appellant-defendant though admits that a sum of Rs.38,497/- is to
be paid to the respondent-Plaintiff, the same has been adjusted to
the debit note.
(vi) Insofar as the Miscellaneous piece of work is concerned,
it is the case of the appellant-defendant that the entire sum of
Rs.4,09,380/- is without any basis and no evidence whatsoever has
been produced.
(vii) According to the appellant-defendant, the admitted
balance of Rs.34,29,497/- was to be paid by the appellant-
defendant to the respondent-plaintiff. Insofar as the dues on
taxation is concerned, it is the specific claim made by the appellant-
defendant that whenever amount has been paid, tax has been
deducted at source and the same has been credited to the account
of the Income Tax Department.
10. Per contra, learned counsel appearing for the
respondent-plaintiff has contended that the impugned common
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judgment and decree passed by the trial Court is based on
appreciation of both oral and documentary evidence on record. It
is further submitted that even according to the appellant-defendant
there is a due of a sum payable even to the respondent-plaintiff as
shown in Ex.D3. But it is his contention that Ex.D3 does not depict
the complete payment made and certain amounts which were paid
from the sister concern of the appellant-defendant company and
therefore, the said amount cannot be accounted for in the name of
the appellant-defendant company.
10.1 Learned counsel for the respondent further submitted
that several additional works were undertaken on oral
understanding between the parties and that merely because all
amounts are not reflected in the purchase orders, the same cannot
be made a ground to deny the claim. As regards the report made
by Sri. H.K. Sharma, learned counsel contends that not much
reliance can be placed. It is also submitted that the joint inspection
report was conducted unilaterally without his presence. The
respondent-plaintiff seriously disputes the claim of the appellant-
defendant of a sum of Rs.52,00,000/-. He therefore submits that
the impugned common judgment and decree passed by the trial
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court does not warrant interference by this Court in the present
appeals.
11. The following points arise for consideration in the
present appeals:-
(i) Whether the plaintiff had proved before the Commercial
Court his claim against the defendant for a sum of Rs.97,92,617/-
exclusive of tax and Rs.1,10,29,853/- inclusive of tax as balance of
payment for the construction carried out by him?
(ii) Whether the appellant-defendant had proved his claim for
recovery of a sum of Rs.52,00,000/- in the connected suit in
COM.O.S.No.11/2021?
(iii) Whether the findings recorded by the commercial court in
COM.O.S.Nos.10/2021 and 11/2021 require interference by this
Court?
Re-Point No.1:-
12. The evidence of the respondent-plaintiff is led by
Sri.Ashwin Surendra Chauhan who is the Managing Partner of the
respondent-plaintiff Firm. The following features in his evidence
may be taken into consideration. In the course of his evidence,
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more particularly, in his cross examination, he states that for every
work including additional work there must be an estimation and
purchase order made from the respondent-plaintiff. He further
admits that he did not complete Shed No.4 on account of balance
of payments. He denies the report of H.K. Sharma as a registered
valuer. He further states that he has not produced the statement of
accounts maintained by him for the works undertaken and goes on
to state that there is no purchase order for the work and the extract
of the work done to the tune of Rs.97,92,617/-. It is further stated
by him that they have not maintained any measurement book to
show that the additional construction made by him was actually
undertaken by him. He has stated that he does not have any
evidence to show that he had undertaken additional construction
work. He has been confronted with Ex.D3, which he denies in the
course of his evidence.
12.1 The evidence of appellant-defendant is one Mr.Ramesh
Chandra, who is the Director of the appellant-defendant Company.
He has relied upon a tabular column depicting the purchase orders
raised by the respondent-plaintiff in the form of quotation, the
payment made by the appellant-defendant and the balance
payment which was pending as on the date. Reliance is placed
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upon Ex.D3 which is the certified statement of the payments made
to the respondent-plaintiff. He has also relied upon the photographs
of the building and the valuation of the report given by chartered
Engineer H.K. Sharma.
12.2 It is not in dispute that the construction contract for the
construction of the factory building of the appellant-defendant was
entrusted to the respondent-plaintiff. Ex.P5 is the original quotation
issued by Sri.Sai Infra Builder, which is dated 27.11.2009.
However, for every subsequent work undertaken by the
respondent- plaintiff Firm for the construction regular purchase
orders have been issued and these purchase orders has been
marked by the respondent-plaintiff. The key evidence led by the
appellant-defendant and which would form the foundation of the
case between the parties is Ex.D1, which is the account statement
and Ex.D3 marked by the appellant-defendant, which illustrates the
payment made to Shree Sai Infra Builders and the same has not
been disputed. The contents of Ex.D3 have been explained in the
following manner in the deposition of DW-1 states as under:-
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Details of Amount of Amount of Quotation Total Amount paid Admittedly
Project Quotation offered Accepted by the for by the Defendant amount received
by the Plaintiff which P.O. was to Plaintiff by the Plaintiff
issued from the
Defendant
Shed No.1 Rs.1,86,75,00.00 Rs.1,86,75,000.00 Rs.1,65,00,000.00 Rs.1,44,80,000.00
Ex. P-10 Ex. P-6
Shed No. 2 Rs.2,27,28,800.00 Rs. 2,00,00,000.00 Rs.2,00,00,000.00 Rs.2,25,00,000.00
&3
Ex. P-20 Ex. P-15
New Office Rs.1,15,91,688.00 Rs. 1,16,06,968.00 Rs.1,16,50,544.00 Rs.1,11,50,544.00
& Pantry
Ex. P-24 Without tax-
Rs. 1,02,00,000.00
Ex P-23
Machine Rs. 38,497.00 Rs. 38,497.00 - -
Foundation
Bed Ex. P-25 Ex. P-26
Shed No. 4 Rs.44,32,116.00 Rs.39,00,000.00 Rs.10,00,000.00 Rs.10,00,000.00
Ex. P-27 Ex.P-28
Old Office Rs. 25,20,000.00 Rs. 25,20,000.00 Rs. 25,00,000.00 Rs.25,20,000.00
Ex. P-11 Ex. P-12
TOTAL Rs.5,53,33,497.00 Rs.5,16,50,544.00
12.3 A perusal of Ex.D3 would show that a total amount of
Rs.5,53,33,497/- was towards the total construction of the contract
as per the various purchase orders issued by the respondent-
plaintiff Firm. Ex.D3 also shows the amount of payment made by
the appellant-defendant to the respondent-plaintiff Firm. These
payments are reflected by way of cheques as referred to in Ex.D3.
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All these amounts issued through cheques shows that a sum of
Rs.5,19,50,544/- has been paid. This excel sheet which has been
produced before the Court is a computer-generated document and
has been certified under Section 65-B of the Indian Evidence Act,
1872.
12.4 It is relevant to note that the aforesaid document has
not been disputed by the respondent-plaintiff Firm. Moreover, no
explanation has been offered about the figures therein except for
making a vague denial. As per Ex.D3, the amount which is to be
paid by the appellant-defendant to the respondent-plaintiff would be
Rs.33,82,953/-. As referred to in the evidence of the respondent-
plaintiff, he admits that for every work undertaken for the
construction of the buildings purchase orders were necessary to be
issued and that indeed purchase orders were actually issued for
every work undertaken. All these purchase orders are reflected in
Ex.D3. Apart from this, there is no material evidence produced by
the respondent-plaintiff to show that there was any other work
entrusted by the appellant-defendant, for which the respondent-
plaintiff Firm undertook the construction and that there was denial.
In matters of construction agreements where parties by practice
have shown that the construction was undertaken by documentary
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evidence, it is difficult to believe the version of the respondent-
plaintiff that by oral understanding some work was undertaken and
that there is balance to be paid.
12.5 A perusal of the judgment of the Trial Court would
show that practically there has been no discussion of the effect of
Ex.D3. In fact, the non-consideration of Ex.D3 which has a vital
bearing on the suit casts serious infirmity on the findings recorded
by the Trial Court. It is settled position of law that when
documentary evidence is bought on record, particularly in
construction agreements to show reconciliation of accounts, oral
evidence contrary to the documentary evidence without impeaching
the documentary evidence cannot be considered. The veracity of
Ex.D3 is practically uncontested. It is not the case of the appellant-
defendant that Ex.D-3 is a concocted document. In view of the
same, once Ex.D3 stands proved the claim of the respondent-
plaintiff claiming amounts has no support of any documentary
evidence except for the self-serving statements of the respondent-
plaintiff in his evidence. He has failed to show as to the basis of the
claim made by the respondent-plaintiff. In fact, the various
purchase orders produced by the respondent-plaintiff tallies with
the purchase orders reflected in Ex.D3. It is therefore clear that
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once the purchase orders had been settled as per Ex.D3, the
question of paying any additional amount did not arise.
12.6 Under these circumstances, we are of the opinion that
the respondent-plaintiff has failed to prove that apart from the
amount reflected in Ex.D3 which clearly shows the purchase orders
and payments made to the respondent-plaintiff Firm thereon
through cheques, there was any amount outstanding. The balance
amount as per Ex. D3 would be Rs.33,82,953/- and that the claim
for payment of tax amount is also not correct as the appellant-
defendant has clearly stated that the tax has been deducted at
source and payments have been made to the Income Tax
Department. As the appellant-defendant has also claimed a sum of
Rs.52,00,000/- being the loss suffered by him and for the finding to
be recorded by us on Issue No. 2, we hold that the appellant-
defendant has not proved his claim as made in the Plaint and not
entitled for any relief.
Accordingly, Point No.1 is answered in favour of the
appellant against the respondent.
Re-Point No.2:-
13. The Appellant- defendant has filed a suit namely
COM.O.S No.11/2021 making a claim of Rs.52,00,000/- and in this
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regard, it is stated that a debit note was raised and this amount
stood adjusted towards the claim of the appellant-defendant. In
support of his case in COM.O.S.No.11/2021, the appellant-
defendant has relied upon the report of H.K.Sharma, who is a
Government registered valuer and chartered Engineer. In the said
report, it is stated that about 53,000 sq.ft. was constructed by the
respondent-plaintiff firm in all and out of which, the observation
drawn by the registered valuer is that the Report of Mr.H.K.Sharma
is vivid and comprehensively examines the defective work
undertaken by the respondent-plaintiff firm. He has concluded that
on account of defective / incomplete work undertaken, the amount
of loss incurred by the appellant-defendant is to the tune of Rs.
40,94,077/-.
13.1 DW-2 is one Mr. Srinivas Sherur who was working with
Mr. H.K. Sharma and was also a part of the team who carried out
joint inspection of the premises constructed by the respondent-
plaintiff firm. It is stated in his evidence that it was he along with
Mr.Sharma who went to the spot on 05.06.2015 and inspected the
constructed building. He reiterates the report made by Mr.H.K.
Sharma. The report or the evidence of DW- 2 has not been
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significantly impeached in his cross examination. The report at
Ex.D4 shows the following defects:-
(i) The workmanship was improper and the quality of
materials was substandard;
(ii) That the vacuum dewatered flooring is not properly done
in the methodology. There were several cracks in the flooring of the
Factory.
(iii) The embedded column portions at every vertical and
horizontal length shows visible cracks and that the construction has
been done which could not take the load of the building.
(iv) The constructed masonry walls are unsafe and required
further technical remedy for stability.
(v) In the terrace floor, there is no provision for slope for rain
water drains.
13.2 The registered valuer in the Annexure to the Report has
given in detail the defective construction undertaken and a
comprehensive remedy for the same. Annexure-2 to the report,
states about the incomplete work of Shed No.4. In fact, in the
photographs appended to Annexure-2 shows only some steel bars
erected without any construction. The said witness has been cross-
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examined extensively by the respondent-plaintiff. No suggestion
has been made that the report is made to suit the case of the
appellant-defendant. In the cross examination, the witness has
explained in detail about the report including technical explanation
about the same. An overall reading of the evidence of Mr. Srinivas
Sherur (DW-2), it is clear that the document produced vide Ex.D4
also stands proved. The fact that respondent-Plaintiff has made a
double claim over the item of shifting of parking shed and has
practically left the construction half way as is evident from the
photographs annexed to Exhibit D4 does not inspire confidence. It
cannot also be lost sight of the fact that the debit note raised by the
appellant-defendant on 08.06.2015 which is marked at Ex.P30 was
at an undisputed time. The contents of Ex.P30 clearly correlated to
the valuation report. In fact, as early as in the year 2015 itself, the
appellant-defendant records that it has to recurs repair work of
Shed No.2 and also of the Office Building. It is relevant to note that
Exs.P31, P32 and P33 are the correspondences between the
parties. In the communication at Ex.P31, the contents of the debit
note is not disputed.
13.3 The respondent-plaintiff has expressly admitted that
he had not completed Shed No.4. When the debit note is compared
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with the report of Sri.H.K.Sharma led in by the respondent-plaintiff,
it would depict that the claim of the appellant-defendant of
Rs.52,00,000/- was maintained by them throughout even at an
undisputed time. Under these circumstances and for the reasons
referred to above, we are of the view that appellant-defendant has
proved the claim of Rs.52,00,000/-.
Accordingly, Point No.2 is answered in favour of the
appellant against the respondent.
Re- Issue No.3:-
14. The findings recorded by the commercial court on the
issues raised before it suffers from various infirmities. The
impugned judgment is liable to be set aside for non-consideration
of vital evidence which has material bearing on the case of the
parties.
14.1 As stated supra, Ex.D3 was the foundation of the
appellant-defendant's claim. The fact that the appellant-defendant
themselves showed that they were due in a sum of Rs.33,82,953/-
and the document was unimpeachable and was decisive in
deciding the case of the parties. The amounts mentioned in Ex.D3
were all bank transactions and correlated with the purchase orders
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which were also produced by the respondent-plaintiff themselves.
Under these circumstances, we are of the view that the trial court
fell in error in decreeing the suit of the respondent-plaintiff without
considering the effect of Ex. D3. On re-appreciation of evidence on
record, we have considered the effect of Ex.D3 and have recorded
our finding on Issue Nos. 1 and 2.
14.2 In so far as the approach of the Trial Court towards the
debit note at Ex.P30 is concerned, it has doubted the genuineness
of the same and required to be recorded that the authenticity of
Ex.P30 was never in doubt. In fact, Ex.P30 was produced by the
respondent-plaintiff themselves since they had custody of the
same, as it was a letter addressed by the appellant to the
respondent. Therefore, we find that the approach of the Trial Court
in this regard is erroneous.
14.3 Under these circumstances, the approach of the Trial
Court being erroneous and the finding recorded by it on account of
non-consideration of material evidence stands vitiated and is liable
to be set aside.
Accordingly, Point No.3 is also answered in favour of the
appellant against the respondent.
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15. In the result, we pass the following:-
ORDER
(i) Both the appeals are hereby allowed.
(ii) The impugned common judgment and decree passed in
Com.O.S.No.10/2021 and Com.O.S.No.11/2021 is hereby set
aside.
(iii) Com.O.S.No.10./2021 filed by the respondent is hereby
dismissed.
(iv) Com.O.S.No.11/2021 filed by the appellant is hereby
decreed directing the respondent to pay to the appellant a sum of
Rs. 52,00,000/- together with interest at the rate of 6% from the
date of the suit till realization.
(v) By virtue of an interim order dated 14.06.2022, the
Appellant/ Defendant was directed to deposit 35% of the decreetal
amount as security for grant of stay. The Appellant/Defendant had
accordingly deposited a sum of Rs. 28,00,000/- before this Court.
(vi) Subsequently, on 16.03.2023, permitted the respondent
to withdraw a sum of Rs. 20,00,000/- out of the deposited amount
of Rs.28,00,000/- subject to the condition that the respondent -
plaintiff would repay the same to the Appellant/Defendant if the
appellant were to succeed in the appeal.
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(vii) Accordingly, in view of the present judgment and decree
passed in favour of the appellant-defendant, the respondent-
plaintiff is hereby directed to tender/ repay a sum of Rs.20,00,000/-
to the appellant-defendant within a period of three months from the
date of receipt of a copy of this order.
(viii) The balance amount of Rs.8,00,000/- presently
deposited in the Registry shall be refunded to the appellant-
defendant forthwith immediately upon a receipt of a copy of this
order.
(ix) In view of disposal of the appeals, all earlier interim
orders including the order whereby the Appellant/ Defendant was
directed not to alienate or encumber the machinery and premises
stands discharged / dissolved.
Sd/-
JUDGE
Sd/-
JUDGE
Srl.
