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2008 DIGILAW 939 (CAL)

Himani Alloys Limited v. Tata Steel Limited

2008-09-22

PINAKI CHANDRA GHOSE, SANKAR PRASAD MITRA

body2008
JUDGMENT: GHOSE, J (1.) This appeal is directed against an order dated 22nd February, 2008 passed by the Honble Interlocutory Judge whereby His Lordship was pleased to pass a judgment on admission for a sum of Rs. 74,57,074.50 subject to furnish a bank guarantee for a sum of Rs. 48 lakhs within a period of six weeks from date in favour of the Registrar, Original Side. His Lordship further held that the bank guarantee should otherwise be unconditional and should provide that upon the Court finding that it had no authority to receive the same, the bank would make over the sum of Rs. 48 lakhs on the Registrars first demand and without any reference to the plaintiff. (2.) The appeal was filed by the Tata Iron and Steel Company Limited as well as the Himani Alloys Private Limited. The appeal which was filed by the defendant-Himani on the ground that His Lordship granted liberty to the appellant-defendant that no part of the cause of action arose within the jurisdiction of this Honble Court at the time of the trial of the suit. By an order dated 28th January, 2008 passed by His Lordship Sanjib Banerjee, J. in G. A. No. 3386 of 2003 made in C. S. No. 12 of 2003 (The Tata Iron and Steel Company Ltd. v. Himani Alloys Ltd.) and thereby entertaining the application of the plaintiff for judgment on admission, His Lordship has erred in passing the said order. According to the appellant-Himani, since this Honble Court has no jurisdiction to receive, try and determine the above suit, no judgment upon admission could have been passed by the Honble First Court. (3.) It is the case of the appellant-defendant that the said company was incorporated on 13th February, 1997 with the name of Himani Alloys Private Limited. Subsequently, the said name was changed to Himani Alloys Limited on 27th May, 1997. Admittedly, the defendant supplied diverse materials to the plaintiff and accounts were not settled between the parties. Therefore, it is submitted that on proper accounts being taken, it would be evident that nothing is due and payable by the defendant to the plaintiff. (4.) It is further submitted that diverse bills and/or invoices were not received. It would be evident that some of the bills were raised by the plaintiff on Himani Ferro Alloys Limited which is a separate legal entity. (4.) It is further submitted that diverse bills and/or invoices were not received. It would be evident that some of the bills were raised by the plaintiff on Himani Ferro Alloys Limited which is a separate legal entity. (5.) It is also submitted that no meeting was or could be held between the parties on 9th December, 2000. Therefore, the appellant also denied the existence, legality, validity and correctness of the alleged meeting. (6.) The defendant has also filed an application for revocation of the leave granted under Clause 12 of the Letters Patent to the plaintiff. The said application was disposed of on 28th January, 2008 where His Lordship was pleased to dismiss the application with a liberty to take the first ground that no part of the plaintiffs cause of action arose within the jurisdiction to the trial. Subsequently, the application for judgment on admission was taken up and the order was passed on 22nd February, 2008. (7.) Learned Counsel appearing on behalf of the appellant contended before us that such judgment upon admission could not have been passed since it would be evident from the facts of the case that there are triable issues between the parties and according to him, the same cannot be decided without having trial between the parties. (8.) In these circumstances, it is submitted that no decree and the judgment upon admission could have been passed by the Honble Court when triable issues are present. In support of his contention he relied upon the decisions reported in AIR 1988 Delhi 153, State Bank of India v. M/s. Midland Industries and Ors.; (2005)2 Cal HN 601, Dinesh Kumar Singhania v. Calcutta Stock Exchange Association Limited and AIR 2000 Delhi 349, Parivar Seva Sansthan v. Veena Kalra and Ors. (9.) On the contrary, Mr. P. C. Sen, learned Senior Counsel appearing in opposing the application submitted that His Lordship has specifically passed the order in favour of the plaintiff. He drew our attention to page 74 of the Paper Book being a letter addressed by the defendant wherefrom it would appear that the "C" forms were supplied by the defendant to the plaintiff for the year 1998-1999. (10) Mr. Sen further drew our attention to a letter addressed by the defendant to the plaintiff, dated December 20, 2000. He drew our attention to page 74 of the Paper Book being a letter addressed by the defendant wherefrom it would appear that the "C" forms were supplied by the defendant to the plaintiff for the year 1998-1999. (10) Mr. Sen further drew our attention to a letter addressed by the defendant to the plaintiff, dated December 20, 2000. It would be evident from the said letter that they have not received the account reconciliation with TISCO and requested to provide the same within a week. Therefore, it would show that the account was settled and already reconciled, only a copy as requested was forwarded to them. (11.) Mr. Sen also drew our attention to another letter dated 10th March, 2000 addressed by the plaintiff to the defendant and it would show that Rs. 188.40 lakhsremain payable by the defendant to the plaintiff and the settle of payment was already annexed thereto. (12.) Mr. Sen further contended before us that the Honble Court could not have directed to furnish the security by the plaintiff when the judgment upon admission was passed in favour of the plaintiff. According to Mr. Sen, the Honble Court after having been satisfied that the part of the cause of action had arisen within the jurisdiction of this Court and was pleased to pass the said order. According to him, the conditional order which has been passed by His Lordship could not have been passed since the decree was passed for a sum of Rs. 47,06,775.70 on a condition of furnishing a bank guarantee for a sum of Rs. 48 lakhs on the Registrars first demand and without any reference to the plaintiff. (13.) After considering the facts and circumstances of this case and after perusing the order so passed by His Lordship, it appears that a meeting of the parties held on February 23, 2001 and the plaintiff also relied upon a writing of December 9, 2000 which has been declared to the minutes of the meeting held on such date for settling the accounts between the parties till March 31, 1999. According to the plaintiff, the closing balance on March 31,1999 to be Rs. 61,49,449.30 but there were disputes between the parties in respect of certain items. Accordingly, the parties arrived at for a sum of Rs. 47,06,775.70 as the undisputed balance on March 31, 1999. According to the plaintiff, the closing balance on March 31,1999 to be Rs. 61,49,449.30 but there were disputes between the parties in respect of certain items. Accordingly, the parties arrived at for a sum of Rs. 47,06,775.70 as the undisputed balance on March 31, 1999. (14.) It appears from the fact that His Lordship has specifically dealt with the matter in question at paragraph 2 that no meeting was held between the parties on December 9, 2000 and lack of territorial jurisdiction of this Court and balance of convenience. In respect of such document dated December 9, 2000 His Lordship has been able to find out that the same signatory was appended to such letter where the signatory had described himself as an authorized signatory of the defendant. The fact that the defendant had denied that Parveen Aggarwal was ever appointed Manager (Accounts) of the defendant but on the facts and documents placed before the Court on the basis of the materials, the Honble Interlocutory Court came to the conclusion that there was no apparent challenge to the said documents. His Lordship also dealt the matter with regard to the document of December 9, 2000 and came to the conclusion that disputes were raised by the defendant covering sum of Rs. 14 lakhs and as a result whereof, His Lordship came to the conclusion for the balance of Rs. 47,07,775.07. (15.) After considering the materials and the facts of this case, His Lordship came to the conclusion that there was no defence of the defendant with regard to the said amount and furthermore, the judgment upon admission was passed by His Lordship on the basis of the minutes of February 23, 2001 and since the plaintiff has relied upon the minutes of the meeting on February 23, 2001, His Lordship felt that the Court would not refuse to grant judgment on admission and require a fresh application for such purpose to be brought by the plaintiff. (16.) His Lordship also found that the case of the plaintiff founded on the basis of the minutes dated February 23, 2001. His Lordship further directed to the plaintiff to furnish a bank guarantee only to safeguard, in case the defendant succeeds in establishing that this Court had no jurisdiction. (16.) His Lordship also found that the case of the plaintiff founded on the basis of the minutes dated February 23, 2001. His Lordship further directed to the plaintiff to furnish a bank guarantee only to safeguard, in case the defendant succeeds in establishing that this Court had no jurisdiction. In that case, the defendant shall not have any remedy to recover the said amount which is being passed by the Court in favour of the plaintiff excepting by filing a suit. Therefore, only to prevent the multiplicity of proceedings, it appears to us that His Lordship was pleased to pass the said order and directed the plaintiff to furnish the bank guarantee to the tune of Rs. 48 lakhs. (17.) In our considered opinion, we find that the Court has passed the said order putting a cheque and balance on the parties and we do not find that there is any irregularity or illegality in respect of the order so passed by the Honble Interlocutory Judge. Hence, we dismiss both the appeals affirming the conditional judgment upon admission so passed by His Lordship. In this event, we also direct the plaintiff-Tata Steel Limited to furnish the bank guarantee within a period of two weeks after vacation. (18.) For the reasons stated hereinabove, we dispose of both the appeals on the above terms by this common judgment.