Kalinga Industrial Fasteners Pvt Ltd. v. Itw India Limited
2025-04-04
ABHINAND KUMAR SHAVILI, TIRUMALA DEVI EADA
body2025
DigiLaw.ai
JUDGMENT : Tirumala Devi Eada, J. This is an appeal filed by the appellant being aggrieved by the judgment and decree, dated 14.03.2005, passed in O.S.No.268 of 1996 by the learned III Senior Civil Judge, City Civil Court, Secunderabad (for short “the trial Court”). 2. The appellant herein is the defendant and the respondent herein is plaintiff before the trial Court and the parties herein are referred to as they were arrayed in the suit before the trial Court for the sake of convenience and clarity. 3. The brief facts of the case before the trial Court are that the plaintiff is a company which supplies industrial components, epoxies/cold welding components etc., and the defendant has been carrying on the business of distribution and sale of this material and therefore, it has been buying and distributing the plaintiff’s products. Since the defendant has been purchasing large quantities of material, the plaintiff has permitted the defendant to avail the credit facility. But during the course of transactions, the defendant failed to pay the amounts, inspite of reminders made by the plaintiff and when the plaintiff has presented the cheques they were dishonoured. Even after the dishonor of cheques, when the plaintiff requested the defendant company, the defendant has failed to pay the same and further raised invoices and the plaintiff has supplied the material but the defendant has failed to pay any amount, thereafter, the plaintiff getting vexed with the attitude of the defendant, filed the suit for recovery of money. 4.
Even after the dishonor of cheques, when the plaintiff requested the defendant company, the defendant has failed to pay the same and further raised invoices and the plaintiff has supplied the material but the defendant has failed to pay any amount, thereafter, the plaintiff getting vexed with the attitude of the defendant, filed the suit for recovery of money. 4. The defendant company has filed its written statement admitting that he is a dealer of the plaintiff company but had denied the averments with regard to the payment saying that the plaintiff is playing fraud on him and that he was induced by M/s.Rourkela Steel Plant to place such bulk order and that the same could not be consumed by the customers and the fact of non receipt of orders from any of the customers was brought to the notice of the plaintiff but the plaintiff still induced them to purchase more material and thus, he raised the invoices and it is further contended that the letter dated 30.03.1996 written by the defendant to the plaintiff would also make it clear that the payment released by M/s.Rourkela Steel Plant, and that the orders placed by the defendant on 19.04.1996 also show that the order was being placed on the assurance given by the Area Sales Manager of the plaintiff company and that the defendant was ready and willing to return the goods that were supplied to them but the plaintiff avoided to receive the same. He further averred that as per the terms and conditions of the dealership issued to the defendant by the plaintiff, the defendant was to be the sole distributor of the products and that he is entitled to a trade commission of 23% in the sales made by the plaintiff company in the area for which the defendant was appointed as authorized dealer. It is his further contention that the Rourkela branch of the company has taken goods worth Rs.90,000/- by duly signing the challan and the defendant has not received any payment for the same. Thus, the defendant is entitled to a sum of Rs.90,000/-and thereby, he filed a counter claim to that effect. 5. To the said counter claim, the plaintiff has again filed a written statement denying the material allegations and contended that the defendant is not entitled for the amount claimed in the counter claim. 6.
Thus, the defendant is entitled to a sum of Rs.90,000/-and thereby, he filed a counter claim to that effect. 5. To the said counter claim, the plaintiff has again filed a written statement denying the material allegations and contended that the defendant is not entitled for the amount claimed in the counter claim. 6. Based on the above rival pleadings, the trial Court has framed the following issues: “1. Whether this Court has no territorial jurisdiction to try the suit claim? 2. Whether the defendant is a dealer of the plaintiff company? 3. Whether there is short supply of goods to the defendant vide invoice dt. 19.04.1996? 4. Whether the plaintiff is liable to account for the commission at the rate of 23% to the sales effected through M/s Usha Engineering of Jharsuguda? 5. Whether the defendant is entitled to a decree of Rs.90,000/- against the plaintiff? 6. Whether the plaintiff is entitled to the suit claim? 7. To what relief?” 7. On behalf of the plaintiff, PW1 was examined and Exs.A1 to A9 were marked. The defendant has not adduced any evidence before the trial Court. 8. Based on the evidence on record, the trial Court has decreed the suit for a sum of Rs.20,30,145.20 ps. with costs together with interest on Rs.19,51,005/- @ 12% per annum from the date of suit till the date of decree and @6% p.a. from the date of decree till realization against the defendant. The counter claim of the defendant is dismissed. Aggrieved by the said judgment and decree, the present appeal is filed by the defendant. 9. Heard Smt.Manjari S.Ganu, learned counsel for the appellant and Sri M.S.Srinivasa Iyengar, learned counsel for the respondent. 10.
The counter claim of the defendant is dismissed. Aggrieved by the said judgment and decree, the present appeal is filed by the defendant. 9. Heard Smt.Manjari S.Ganu, learned counsel for the appellant and Sri M.S.Srinivasa Iyengar, learned counsel for the respondent. 10. The learned appellant counsel has submitted that the judgment of the trial Court is contrary to law and evidence and that the trial Court has grossly erred in answering issue No.1 in favour of the plaintiff and that the trial Court has failed to appreciate the fact that the appellant was the sole distributor of the respondent and that the appellant was entitled to trade commission and that it was appointed as a distributor in M/s.Rourkela Steel Plant to sell the respondent’s material and that it had sold the same but no commission was paid to the appellant and that though the trial Court has framed several issues none of the issues were answered based on the evidence and that the trial Court has simply answered all the issues in favour of the appellant and that the appellant ought to have been given a chance to lead evidence and to substantiate its counter claim for a sum of Rs.90,000/-, that the trial Court has acted in a haste and disposed of the suit in a hurried manner without giving any opportunity to the appellant to lead evidence. 11. Learned counsel for the appellant raised a specific contention that the chief examination of PW1 is sworn on 30.11.2002, though the same is filed on 22.09.2003, further the said PW1 was recalled on 27.10.2003 for marking the documents. Pleading the said averments, learned counsel for the appellant has prayed this Court to set aside the judgment and decree passed by the trial Court dated 14.03.2005 by allowing this appeal and further prayed to allow their counter claim. 12. The learned respondent counsel, on the other hand, has submitted that the appellant failed to lead any evidence inspite of several opportunities before the trial Court and that the trial Court has rightly decreed the suit, based on the evidence placed by the plaintiff, he therefore, prayed to uphold the judgment and decree passed by the trial Court. 13. Based on the above rival submissions, this Court frames the following points for consideration: 1. Whether the plaintiff is not entitled to recover the suit amount? 2.
13. Based on the above rival submissions, this Court frames the following points for consideration: 1. Whether the plaintiff is not entitled to recover the suit amount? 2. Whether the defendant is entitled to the counter claim? 3. Whether the judgment and decree dated 14.03.2005 passed by the trial court is sustainable in law and under the facts? 4. To what relief? 14. POINT NO.1 a) The case of the plaintiff is that the defendant was its dealer distributing their products i.e. components, epoxies/cold welding components etc., and since it was a major distributor for purchasing large quantities, they permitted the defendant to avail credit facility and while the business was going on, the defendant raised an invoice for purchase of material on 20.11.1995 vide invoice No.350877 for a sum of Rs.3,56,175/- and on 30.12.1995 vide invoice No.351052 for the materials worth Rs.4,63,038/- and another invoice dated 19.04.1996 for the material worth Rs.16,68,702/- respectively. That the plaintiff has supplied the material and has deposited the cheques issued by the defendant, but the cheques were returned dishonoured due to insufficient funds and the defendant failed to pay the said amount. The plaintiff has reminded the defendant but the defendant has promised to clear the outstanding amount and placed further orders. Since the defendant has been carrying on the business with bulk orders, the plaintiff has relied upon the defendant and went on supplying the goods, though the defendant has not made a prompt payment, with an understanding that he would pay the amount. But the defendant failed to pay the said amount and therefore, the plaintiff got issued a legal notice on 28.06.1996, requesting for payment of the outstanding dues, the defendant has received the notice but instead of paying the amount, he has issued reply notice. b) To prove the case of the plaintiff, they relied upon Exs.A1 to A9. A perusal of the said exhibits reveals that the defendant was raising invoices requesting the plaintiff company to supply the material under different dates. Exs.A1 to A3 are the invoices dated 30.08.1995, 25.10.1995 and 30.11.1995 respectively. Ex.A3 further reveals that the materials are required most urgently and that immediate action in the matter is appreciated, which shows that the defendant required the material on an urgent basis and thus, it placed an invoice to the plaintiff company.
Exs.A1 to A3 are the invoices dated 30.08.1995, 25.10.1995 and 30.11.1995 respectively. Ex.A3 further reveals that the materials are required most urgently and that immediate action in the matter is appreciated, which shows that the defendant required the material on an urgent basis and thus, it placed an invoice to the plaintiff company. Ex.A4 is a letter addressed by the plaintiff company to the defendant reminding for clearance of payments and the amount payable is also reflected vide invoice numbers i.e. 350877 and 351052 dated 20.11.1995 and 30.12.1995 respectively and the total amount is to an extent of Rs.4,80,754/-. Then a perusal of Ex.A5 reveals that it is another invoice dated 19.04.1996, wherein there is an endorsement made by the defendant saying that payment will be made in two installments in the month of May, 1996 i.e. first payment by 10 th May and second payment by 30th May, the old outstanding is being cleared on 30th April. Ex.A6 is another invoice dated 29.04.1996. Exs.A7 and A8 are the delivery challans. Ex.A9 is the reply notice given to the counsel for plaintiff asking them to wait for some more time till their advocates issue a reply to their claim. The said reply notice under Ex.A9 is dated 19.07.1996. c) Thus, it is made clear from the exhibits that the defendant was a dealer with the plaintiff company and was receiving materials as per the invoices under ExsA1 to A3, A5 and A6. There is also a specific endorsement on Ex.A5 that he shall clear the outstanding dues in the month of May in two installments, thus the plaintiff could make out its case with regard to the dues to be paid by the defendant, whereas the defendant though it has raised a counter claim has failed to place on record any document along with the counter claim. d) The defendant has not adduced any evidence either to prove its counter claim or to disprove the claim of the plaintiff. There was no rebuttal evidence at all with regard to the plaintiff’s contention. e) The learned appellant counsel has relied upon the judgment of the Apex Court in the case of Robin Thapa v. Rohit Dora , [(2019) 7 Supreme Court Cases 359] wherein the defendant was set ex parte before the trial Court, after which he has approached under Order 9 Rule 13 of CPC which was allowed.
e) The learned appellant counsel has relied upon the judgment of the Apex Court in the case of Robin Thapa v. Rohit Dora , [(2019) 7 Supreme Court Cases 359] wherein the defendant was set ex parte before the trial Court, after which he has approached under Order 9 Rule 13 of CPC which was allowed. The High Court has reversed the said decision, then it has reached the Apex Court and the question before the Apex Court was whether the ex parte decree should be set aside and the case heard on merits. Thus, the Apex Court has restored the trial Court’s order allowing the case to proceed on merits. It has further emphasized that the litigation should not be terminated due to procedural defaults but should ensure substantive justice. The learned appellant counsel has further relied upon the judgment of the Apex Court in the case of N.Mohan v. R.Madhu, (2020) 20 Supreme Court Cases 302 wherein an ex parte decree was passed by the trial Court and the defendant has filed an application under Order 9 Rule 13 claiming that he has not received summons as he moved from Trichy to Chennai. The said application was dismissed by the trial Court and the High Court has upheld its decision. Subsequently, the defendant has filed first appeal with a delay of 546 days and the High Court has rejected the appeal refusing to condone the delay. The matter went upto the Apex Court and the Apex Court has condoned the said delay and allowed the appeal to be heard on merits and reaffirmed that the procedural technicalities should not override substantive justice. f) The present case was not adjudicated ex parte. The defendant has filed written statement but has failed to cross examine the plaintiff’s witnesses and has not adduced any evidence and the case was not dismissed for default either. Thus, the facts of the cited decision are not applicable to the case on hand. It is for the defendant to have adduced evidence before the trial Court which is not done. In this case, the question of Order 9 Rule 13 does not arise. Thus, the facts of the cited decisions are not applicable to the case on hand.
Thus, the facts of the cited decision are not applicable to the case on hand. It is for the defendant to have adduced evidence before the trial Court which is not done. In this case, the question of Order 9 Rule 13 does not arise. Thus, the facts of the cited decisions are not applicable to the case on hand. A perusal of trial Court record reveals that ample opportunities were given to the defendant and the trial Court has not adopted any technical approach but for following normal procedure. g) Though the learned appellant counsel has relied upon the above cited decisions, the record discloses that the suit pertains to the year 1996 and the judgment was delivered in the year 2005 that means after nine years, the suit was decreed. Further, a perusal of the docket proceedings of the trial Court would reveal that ample opportunities were given to the defendant. The issues were framed in this case on 06.02.1999, after which the plaintiff’s side evidence commenced on 22.09.2003 and PW1 was further examined on 27.10.2003, after which it was posted for the cross examination of PW1 through a commissioner and then four adjournments were granted till 30.12.2003 and it was posted on 07.01.2004 finally. Then, a memo was filed by the Advocate Commissioner saying that the defendant counsel is not present for proceeding with cross examination. Observing the same, the trial Court has forfeited the right to cross examine the witness and it was posted for defendant evidence. The defendant has not taken any steps to get the said orders set aside. From then on the case was adjourned for several times for over a period of one year till 10.02.2005, in spite of which the defendant company did not chose to lead any evidence on its behalf. Thereby, on 25.02.2005 the judgment was reserved by the trial Court, even then the defendant had a chance to seek for reopening the case, which was not done. Thus, the judgment was delivered on 14.03.2005. All these proceedings before the trial Court would show that the defendant has not chosen to cross examine the plaintiff’s witness and has also not shown any interest in leading evidence in spite of several adjournments granted over a period of one year, by the trial Court.
Thus, the judgment was delivered on 14.03.2005. All these proceedings before the trial Court would show that the defendant has not chosen to cross examine the plaintiff’s witness and has also not shown any interest in leading evidence in spite of several adjournments granted over a period of one year, by the trial Court. h) Therefore, in view of the above discussion, it is held that the plaintiff could prove that the defendant is due to a sum of Rs.19,51,005/- to the plaintiff company and the plaintiff is entitled to recover the same from the defendant. Point No.1 is answered accordingly. 15. POINT NO.2: The written statement of the defendant reveals that there are clear admissions with regard to the dealership under the plaintiff company and the fact of transactions held with the plaintiff company but only averment made by the defendant is that it has purchased the material due to the inducement made by the plaintiff’s branch at Rourkela. The defendant being a company cannot simply go by an inducement made by another company, since it was a distributor; it was its duty to conduct the business as per the agreement. The defendant company in its written statement has stated that they conducted the business as per the dealership agreement and has failed to place the same before the Court. Even at the time of appeal, the appellant who is the unsuccessful defendant failed to place any material on record along with the appeal. Though the defendant company was unsuccessful before the trial Court, even after filing the appeal, it did not come forward with any document to prove its case. In the absence of any evidence in its favour, it is difficult to hold that the plaintiff is due by any amount to the defendant. Therefore, it is held that the counter claim of the defendant fails and that the defendant is not entitled to recover any amount from the plaintiff. Point No.2 is answered accordingly. 16. POINT NO.3: In view of the reasoned findings arrived at point Nos.1 and 2, it is held that the judgment and decree passed by the trial Court do not need any interference and the same are held to be sustainable in law and under the facts and circumstances of the case. 17.
Point No.2 is answered accordingly. 16. POINT NO.3: In view of the reasoned findings arrived at point Nos.1 and 2, it is held that the judgment and decree passed by the trial Court do not need any interference and the same are held to be sustainable in law and under the facts and circumstances of the case. 17. POINT NO.4: In the result, the appeal is dismissed upholding the judgment and decree, dated 14.03.2005, passed in O.S.No.268 of 1996 by the learned III Senior Civil Judge, City Civil Court, Secunderabad. No costs. Miscellaneous Applications, if any, pending in this appeal shall stand closed.