Karnataka High Court
M/S A B C Trading Company Ltd vs Sri Ruben Colaco @ U R W Colaco on 30 September, 2024
Author: S.G.Pandit
Bench: S.G.Pandit
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 30th DAY OF SEPTEMBER, 2024
PRESENT
THE HON'BLE MR. JUSTICE S.G.PANDIT
AND
THE HON'BLE MR. JUSTICE C.M. POONACHA
R.F.A. No.438 OF 2011 (MON)
BETWEEN
M/S A B C TRADING COMPANY LTD
K M ROAD, CHIKMAGALUR,
REP ITS CHAIRMANAND AND
MANAGING DIRECTOR
SRI V G SIDDARTHA HEGDE
BY HIS DULY CONSTITUTED S P A HOLDER
SRI A R VISHWA
AGED ABOUT 38 YEARS,
S/O.A V RAMIAH NAIK
R/O.MUDIGERE TOWN
CHIKKAMANGALUR DIST 577101
...APPELLANT
(BY SRI VIGNESHWAR S SHASTRI, SENIOR ADVOCATE FOR
SRI VINOD GOWDA, ADVOCATE)
AND
SRI RUBEN COLACO @ U R W COLACO
S/O.LATE LOUIS COLACO
AGED ABOUT 42 YEARS
COFFEE PLANTER,
R/O.HATTIKULI ESTATE
KOPPA TALUK,
CHIKMAGALUR DISTRICT 577101
...RESPONDENT
(BY SRI RUBEN COLACO @ U.R.W. COLACO RESPONDENT )
2
THIS RFA IS FILED U/SEC.96 OF CPC, R/W, O-XLI, RULE-1 OF
CPC, AGAINST THE JUDGMENT AND DECREE DATED 02.12.2010
PASSED IN O.S.06/2008 ON THE FILE OF THE ADDL. SENIOR CIVIL
JUDGE, CHIKMAGALUR, DISMISSING THE SUIT FOR THE RECOVERY OF
MONEY AND ETC.
THIS APPEAL HAVING BEEN RESERVED FOR JUDGMENT ON
24.09.2024, COMING ON FOR PRONOUNCEMENT THIS DAY,
POONACHA J, DELIVERED THE FOLLOWING:
CORAM: HON'BLE MR JUSTICE S.G.PANDIT
and
HON'BLE MR JUSTICE C.M. POONACHA
CAV JUDGMENT
(PER: HON'BLE MR JUSTICE C.M. POONACHA)
The present appeal is filed by the plaintiff under Section 96
of the Code of Civil Procedure, 19081 challenging the judgment
and decree dated 02.12.2010 passed in O.S. No.6/2008 by the
Addl. Senior Civil Judge, Chikmagalur2 whereunder the suit for
recovery of money filed by the plaintiff has been dismissed by the
Trial Court.
2. For the sake of convenience, the parties herein are
referred as per their rank before the Trial Court.
3. It is the case of the plaintiff that it is a coffee trading
company dealing with coffee purchase and sale. That the
Hereinafter referred to as the 'CPC'
defendant was approaching the plaintiff for supply of fertilizers
and also for an advance. That the defendant was supplied
fertilizers worth `54,825/- on 05.10.1997 and also received an
amount of `74,039/- towards coffee kept by him under
consignment with the plaintiff and the said amount has been
adjusted by the purchase of coffee on 19.01.1997.
3.1. It is further case of the plaintiff that the defendant
had received a sum of `5,00,000/- on 12.02.1998 vide cheque
bearing No.983049 and that he had pooled 2,500 Kgs of coffee
and `70,481/- has been adjusted towards his dues and that he
also received consignment advance of `12,892/- on 06.03.1998.
That the defendant agreed and undertook that he will supply
coffee grown in his estate in future also towards the dues. But
thereafter, the defendant stopped supply of coffee even though
he was due amounts to the plaintiff.
3.2. It is further case of the plaintiff that the defendant
has not supplied the coffee as agreed and plaintiff has made
repeated requests and demands. That on 31.05.2000, an
amount of `1,68,823/- has been credited towards account of the
Hereinafter referred to as the 'Trial Court'
defendant as per invoice No. 4241. That since the defendant
was due to the plaintiff, he came over to the office of the
plaintiff and promised to repay the amount and issued cheque
No.0622790 dated 12.01.2005 for a sum of `14,07,456/- drawn
on Karnataka Bank Limited, Koppa Branch in favour of Sri. V.G.
Siddartha Hegde, Chairman and Managing Director of the
plaintiff. That when the cheque was presented through
Corporation Bank, Chikkanahalli branch, the said cheque was
dishonoured with an endorsement dated 18.01.2005 as 'funds
insufficient'. That the said fact of dishonour was brought to the
knowledge of the defendant and requested to pay the amount
due. Since defendant did not pay the amount dues, the plaintiff
got issued a legal notice dated 14.02.2005 which was served on
defendant on 19.02.2005, despite which no payment was made
by the defendant.
3.3. It is further averred in the plaint that the defendant
had transactions with the plaintiff and he had issued the cheque
in favour of Sri. V.G. Siddartha Hegde, Chairman and Managing
Director of the plaintiff and hence, the said Sri. V.G. Siddartha
Hegde, has executed a separate Special Power of Attorney in
favour of Sri. A.R. Vishwa, to conduct the case. It is further
averred that the plaintiff has filed a private complaint in P.C.No.
124/2005 before the Additional JMFC, Chikmagalur which is
registered in CC.No.814/2006 and the original cheque and other
documents have been produced in criminal Court and certified
copies are produced along with the plaint. Hence, the plaintiff
has filed the suit for recovery of the principal amount of
`14,07,456/-, interest at the rate of 18% p.a, in sum of
`7,51,697/-, as also the legal notice charges at `500/-. Hence, a
total sum of `21,59,653/- has been claimed in the plaint.
4. The defendant entered appearance in the suit and
contested the case of the plaintiff by filing written statement. The
case of the plaintiff has been denied. It is further contended that
the defendant is not liable to pay any amount to the plaintiff as he
had supplied coffee to the plaintiff. It is further contended that
while advancing the amount of `5,00,000/-, the plaintiff insisted
for a blank cheque and the defendant handed over the blank
check bearing No.0622790 which was duly signed by him. That
the defendant had no transaction with Sri. V.G. Siddartha Hegde
and the question of issuing the cheque in favour of Sri. V.G.
Siddartha Hegde, does not arise. It is further contended that the
plaintiff has no locus standi to file the suit and the suit is not
maintainable. Hence, the defendant sought for dismissal of the
suit.
5. The Trial Court, consequent to the pleadings of the
parties, the Trial Court framed the following issues and additional
issues:
i. "Whether plaintiff proves that the defendant
has issued a cheque `14,07,450/- in his favour
for the amount due to the plaintiff as stated in
para two of the plaint?
ii. Whether the plaintiff proves that the defendant
is liable to pay the suit claim?
iii. Whether the defendant proves that he has
handed over a blank cheque signed by him as
insisted by the plaintiff while advancing rupees
five lakhs as stated in para 2 of the written
statement?
iv. Whether the defendant proves that the suit is
barred by limitation?
v. What order or decree?
Additional issues:-
vi. Whether the defendant proves that, the plaintiff
Company has no locus standi to file this suit?"
6. PW.1 - PA holder has been examined in support of
the case of the plaintiff and another witness has been examined
as PW.2. Ex.P.1 to Ex.P.8 have been marked in evidence. The
defendant examined himself as DW.1 and Ex.D.1 has been
marked in evidence. The Trial Court vide judgment and decree
dated 02.12.2010, dismissed the suit.
7. Being aggrieved the plaintiff has filed the present
appeal.
8. Learned Senior Counsel Sri. Vigneshwar S. Shastri,
appearing along with learned counsel Sri. Vinod Gowda for the
appellant/plaintiff vehemently contends that the defendant has
admitted the transaction of the plaintiff as also issuance of the
cheque and hence, the Trial Court has erred in dismissing the suit.
It is further contended that the S.P.A. (Ex.P.7) has been issued in
favour of PW.1 who was authorized to act on behalf of the said
Sri. V.G. Siddartha Hegde. It is further contended that PW.1 has
adequately deposed regarding the case of the plaintiff and that
the Trial Court has erred in dismissing the suit. In the alternative,
it is contended that the matter may be remanded to the Trial
Court. Hence, learned Senior counsel seeks for allowing of the
above appeal and granting of reliefs sought for.
9. The defendant is served and unrepresented.
10. The submissions of learned Senior counsel for the
appellant have been considered and the material on record
including the Trial Court records have been perused. The only
question that arises for consideration is 'whether the Trial Court
was justified in dismissed the suit of the plaintiff?'
11. The defendant has admitted he has transacted with
the plaintiff. However, it is the case of the defendant that when
the plaintiff advanced a sum of `5,00,000/-, a blank cheque was
insisted upon and that the defendant handed over a blank cheque
bearing No. 0622790 which was duly signed by him to the
plaintiff. It is the further specific case of the defendant that he has
had no transactions with Sri.V.G. Siddartha Hegde and the
question of issuing cheque in favour of Sri.V.G. Siddartha Hegde
does not arise.
12. It is relevant to note that from the certified copy of
the cheque dated 13.01.2005 (Ex.P.1), that the said cheque has
been drawn in the name of Sri. V.G. Siddartha Hegde and not in
the name of the plaintiff. It is further relevant to note that the
legal notice dated 14.02.2005 (Ex.P.4) has been issued on behalf
of Sri. V.G. Siddartha Hegde.
13. It is forthcoming from the S.P.A. (Ex.P.7) that Sri.
V.G. Siddartha Hegde has authorized PW.1 Sri. A.R. Vishwa to
represent him to defend any case on his behalf. However, in the
beginning of Ex.P.7, it is noticed that the same is issued by the
plaintiff, represented by its Chairman - Sri. V.G.Siddartha Hegde.
The account extracts of the plaintiff with respect to its
transactions with the defendant have been produced as Ex.P.8.
14. The Trial Court appreciating the material on record
while considering issue No.1 and additional issue No.1 has noticed
that the relevant documents i.e., cheque (Ex.P.1) and bank
endorsements (Exs.P.2 and Ex.P.3) are in the name of Sri. V.G.
Siddartha Hegde, in his individual capacity. It is further held that
Ex.P.7 (S.P.A.) is executed by Sri. V.G.Siddartha Hegde, in his
individual capacity and not as Managing Director of the plaintiff,
since he was not authorized by the company by passing any
resolution and that no seal of the company is affixed on Ex.P.7.
Hence, it is held that there is no basis for PW.1 to file the suit on
behalf of the plaintiff.
15. The Trial Court has further noticed that the plaintiff
has filed the suit based on the cheque issued by the defendant
which cheque admittedly stands in the individual name of Sri. V.G.
Siddartha Hegde and that the cheque has also been presented to
the personal account of Sri. V.G. Siddartha Hegde. Also that the
legal notice (Ex.P5) has been issued on behalf of Sri. V.G.
Siddartha Hegde, in his individual capacity. Hence, the Trial Court
has recorded a finding that the plaintiff being a company
registered under the provisions of the Companies Act, 2013, is a
separate legal entity from its members or the Managing Director
and that the company has no right to file the suit based on the
cheque issued in the name of Sri. V.G. Siddartha Hegde. Further,
the Trial Court has recorded a finding that the defendant has
issued a blank cheque in favour of the plaintiff. Hence, the Trial
Court has dismissed the suit.
16. It is forthcoming that the plaintiff, while filing the suit
for recovery of money has narrated its transaction with the
defendant by averring the name of the plaintiff as well as Sri. V.G.
Siddartha Hegde, the Chairman and Managing Director of the
plaintiff interchangeably. The entire suit is filed on the same basis
by using the name of the plaintiff and Sri. V.G. Siddartha Hegde
interchangeably. However, in law, the plaintiff being a Company,
registered under the Companies Act, is a separate legal entity
from its members or its Chairman and Managing Director.
17. As rightly noticed by the Trial Court, the basis of the
suit is the cheque dated 13.01.2005 issued by the defendant and
the said cheque having been drawn in the personal name of
Sri.V.G. Siddartha Hegde, the question of the plaintiff filing the
suit does not arise.
18. Although, learned Senior counsel for the appellant -
plaintiff vehemently contended that the finding of the Trial Court
is erroneous, the appellant has failed in demonstrating that the
plaintiff was entitled in law to file the suit for recovery of money
on basis of the cheque (Ex.P.1). Although, learned Senior counsel
for the appellant also contended that in the alternative, the matter
be remanded, the said contention is not liable to be accepted
having regard to the fact that the appellant has failed in
demonstrating that the findings recorded by the Trial Court are
erroneous. In the absence of any valid ground to set aside the
findings recorded by the Trial Court, the question of remanding
the matter once again for consideration of the suit on its merits
does not arise.
19. In view of the above discussion, the question framed
for consideration is answered in the Negative.
20. The above appeal is dismissed as being devoid of
merits. Parties to bear their respective costs.
Sd/-
(S.G.PANDIT)
JUDGE
Sd/-
(C.M. POONACHA)
JUDGE
BS/PNV
