Madras High Court
T. Senthil Prasad vs M/S. Sri Sastha Enterprises on 18 July, 2025
S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Reserved on 03.07.2025
Pronounced on 18.07.2025
CORAM
THE HONOURABLE MRS.JUSTICE K.GOVINDARAJAN THILAKAVADI
S.A.No.1063 of 2019 and
C.M.P. No.22858 of 2019
T. Senthil Prasad ...Appellant
Vs.
M/s. Sri Sastha Enterprises
Represented by its Proprietor
K. Jayakumar,
S/o. D. Kothandan,
41, Singara Mudali Street,
D.R.R. Nagar,
Karayanchavadi
Chennai 600 056 ... Respondent
Prayer : Second Appeal filed under Section 100 CPC, 1908 against the
judgment and decree dated 08.02.2019 made in A.S. No.14 of 2015 on
the file of the learned Principal District Court, Tiruvallur, confirming the
judgment and decree dated 20.07.2011 made in O.S. No.130 of 2007 on
the file of the learned Sub Court, Poonamallee.
Page 1 of 12
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
For Appellant : Mr. N. Manoharan
For Respondent : Mr. G. Janakiraman
JUDGMENT
In this Second Appeal challenge is made to the judgment and
decree dated 08.02.2019 passed in A.S. No.14/2015 on the file of the
Principal District Court, Tiruvallur, confirming the judgment and decree
dated 20.07.2011 passed in O.S. No.130 of 2007 on the file of the Sub-
court, Poonamallee.
2. The Second Appeal has been admitted on the following
substantial question of law.
"Whether the lower courts below were right in foisting the
the liability on the appellant when admittedly the purchaser
is an independent proprietorship concern owned by
Mr.M.V.Sellamuthu?
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
3. For the sake of convenience, the parties are referred to as per
their ranking in the trial court.
4. The plaintiff laid a suit against the defendant for recovery of
money directing the defendant to pay a sum of Rs.1,15,596/- to the
plaintiff with interest at the rate of 12% per annum on Rs.1,02,615/- from
the date of plaint till the date of realisation.
5. Briefly stated, the plaintiff is a stockist and distributor of Satin
Tape, Buttons and its accessories. The defendant has given purchase
orders to the plaintiff on various dates and is liable to pay a sum of
Rs.1,02,615/-. In spite of several demands made by the plaintiff, the
defendant has not come forward to make the payment. Hence, the
plaintiff issued a legal notice (Ex.A13) dated 12.09.2007 to the defendant
demanding to pay the said amount, for which reply notice (Ex.A14) dated
24.09.2007 was sent by the defendant stating that he is not concerned
with the MVS exports and has not placed any purchase orders.
According to the plaintiff, the defendant himself has signed in the
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
purchase orders and that only with a view to defraud the plaintiff, the
defendant alleged so. Hence, he prayed to decree the suit in his favour.
6. The defendant, in his written statement, resisted the claim of the
plaintiff by stating as follows:
i. The allegations are false.
ii. The defendant is not concerned with MVS exports and he is
having his business in the name and style of 'Active Apparels'.
iii. MVS Exports and Active Apparels are two different
proprietorships and are managed by two different proprietors.
iv. Actually one Chellamuthu is the proprietor of MVS Exports.
v. The suit is bad for non joinder of necessary party.
Hence, it is contended that the suit is liable to be dismissed.
7. On the basis of the materials placed on record and appreciating
the same, the courts below were pleased to decree the suit in favour of
the plaintiff'. Impugning the same, the present Second Appeal has been
preferred by the defendant.
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
8. Heard on both sides and perused the records.
9. Mr. N. Manoharan, learned counsel appearing for the appellant
submits that the plaintiff had transactions only with M.V. Chellamuthu,
proprietor of MVS Exports. The appellant has produced Ex.B10 and
Ex.B11 to show that one M.V. Chellamuthu is the proprietor of M/s.MVS
Exports and whereas the suit has been filed against the
appellant/defendant, who is the proprietor of M/s. Active Apparels. Even
in the reply notice (Ex.A14) dated 24.09.2007, the appellant/defendant
had denied his liability and also disputed the identity with M/s. MVS
Exports. In spite of that, the plaintiff has not filed any application to
amend the plaint and continued to prosecute the litigation against the
present appellant. He would submit that the actual transactions of the
plaintiff are with MVS Exports, who used to place work orders to
M/s.Active Apparels. In view of the same, the appellant's name has been
misquoted as an authorised signatory in the purchase order marked as
Ex.A1. He further submits that both the courts below miserably failed to
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
apply the concept of lifting of corporate veil. When the sole proprietor of
MVS Exports is Chellamuthu and not the appellant, a wrong decree has
been passed against the appellant under mistaken identity.
9.1. The further contention of the counsel is that the trial court has
erroneously come to a conclusion that there is no need to include
M.V.Chellamuthu, who was only a sleeping proprietor. The said
conclusion is against the public records marked as Ex.B10 and Ex.B11.
He would also submit that mere purchase order is not sufficient to grant a
decree; that the materials placed under Ex.A1 has nothing to do with the
invoices/delivery notes marked as Ex.A2 to Ex.A11 and that mere
admission of signature found in Ex.A1 does not tantamount to admission
of liability in the absence of legal presumption under the law for the time
being in force. It is further submitted that there is nothing on record to
show that the materials placed under Ex.A1 were delivered to the
appellant/defendant. It is also submitted that the very description of
defendant is not in compliance with Order 30 Rule 10 CPC and that no
law permits to grant decree against an authorised signatory unless the
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
proprietor or partner of a firm, or director of a company has been made
as a party defendant. In support of his contentions, he relied on the
following judgments.
1. Raghu Lakshminarayanan vs. Fine Tubes reported in (2007) 5
Supreme Court Cases 103.
2. Ashok Transport Agency vs. Awadhesh Kumar and another
reported in (1998) 5 Supreme Court Cases 567.
Hence, the learned counsel for the appellant prayed for setting aside the
judgment and decree dated 08.02.2019 made in A.S. No.14/2015 on the
file of the learned Principal District Court, Tiruvallur, confirming the
judgment and decree dated 20.07.2011 made in O.S. No.130 of 2007 on
the file of the learned Sub Court, Poonamallee.
10. Per contra, Mr. G. Janakiraman, learned counsel for the
respondent/plaintiff contended that both the courts below,after
analysing the evidence on record, rendered a concurrent finding and
therefore, there is no need for this Court to interfere with the same.
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
11. It is not in dispute that the plaintiff company supplied materials
to M/s. MVS Exports having its office at Salem, under Ex.A1 purchase
order dated 26.12.2006 in which the appellant T.Senthil Prasad, has
affixed his signature in the capacity of authorised signatory for MVS
Exports. Even in the foot note of Ex.A1, it is mentioned that the goods
to be delivered to Active Apparels having its address at Nerkundram,
Chennai. On the side of the appellant/defendant it is contended that the
said Senthil Prasad is not the proprietor of M/s. MVS Exports and non
inclusion of the actual proprietor Mr. Chellamuthu in the above suit is
fatal to the claim of the plaintiff. In the written statement as well as in
the evidence of D.W.1, it is made clear that the plaintiff company
delivered the goods as per the purchase order which was signed by the
appellant in the capacity of authorised signatory. It is also admitted by
D.W.1 that the said Chellamuthu did not sign in Ex.A1. Furthermore,
Ex.A12 e-mail was sent by one K. Raman of the plaintiff company to the
defendant on 02.06.2007. The said K. Raman was examined as P.W.2.
and he deposed about the placement of purchase order by the defendant
Company, delivery of goods and the failure on the part of the defendant
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
company to pay the amount. If really the appellant is not at all connected
with MVS Exports, there is no need for him to place the purchase order
to the plaintiff company and signed the same in the capacity of
authorised signatory. Therefore, by marking Ex.B10 and Ex.B11, the
appellant cannot be absolved from the liability to pay the due amount to
the plaintiff company. Having placed the purchase order and having
received the goods from the plaintiff company, the claim of the
defendant that he is not connected with M/s.MVS Export and it is only
Mr.Chellamuthu who is liable to pay the amount, cannot be accepted.
Therefore, the courts below have rightly decided that it is only the
appellant/defendant, as an authorised signatory of MVS Exports, placed
the purchase order under Ex.A1 and the goods were delivered under
Ex.A2 to Ex.A11 only to the defendant company, namely, Active
Apparels and that the defendant alone is liable to pay the amount to the
plaintiff and accordingly decreed the suit. I do not find any perversity,
irregularity or material error in the concurrent findings reached in the
above suit, warranting interference under Section 100 of the Code of
Civil Procedure.
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
12. For the above reasons, the substantial question of law is
answered against the appellant.
13. In the result,
i. The Second Appeal is dismissed. No costs. Consequently,
connected miscellaneous petition is closed.
ii. The judgment and decree dated 08.02.2019 made in A.S. No.14 of
2015 on the file of the learned Principal District Court, Tiruvallur,
confirming the judgment and decree dated 20.07.2011 made in
O.S. No.130 of 2007 on the file of the learned Sub Court,
Poonamallee, is upheld.
18.07.2025
Index: Yes/No
Internet: Yes/No
Speaking/Non-Speaking order
bga
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
To
1. The Principal District Judge, Tiruvallur.
2. The Subordinate Judge, Poonamallee.
3. The Section Officer, VR Section, High Court, Madras.
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S.A.No.1063 of 2019 and C.M.P. No.22858 of 2019
K.GOVINDARAJAN THILAKAVADI,J
bga
S.A.No.1063 of 2019 and
18.07.2025
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