1 rest part of s-202-99 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION jmi SUIT NO. 202 OF 1999. Everest Advertising Private Limited, registered office at Kitab Mahal, 192, D.N. Road, Mumbai-400 001. ..Plaintiff. vs. Media Entertainment Company (I) Private Limited, registered Office at 84, Amit Estate, near High Point Hotel, Lokhandwala Complex, Andheri (West), Mumbai-400 056. ..Defendant. .... Ms. Sneha Phene, i/b. Little & Company, for Plaintiff. None for Defendant. .... CORAM : S.J. KATHAWALLA, J. DATE : 7TH DECEMBER 2011. JUDGMENT : By this Suit, the Plaintiff prays for an order and decree against the Defendant to pay to the Plaintiff an amount of Rs.27,12,676.35 towards charges for releasing advertisements in newspapers, for putting up hoardings and charges payable to Doordarshan for telecast of a television programme produced by the Defendant, as per the Particulars of Claim being Exhibit ‘O’ to the Plaint and to further pay to the Plaintiff interest on the sum of Rs.27,12,676.35 at the rate of 18% per annum from the date of filing of the Suit till payment and/or realization. Though the Defendant is served with the Writ of Summons and an Affidavit of Service to this effect dated 29th September, 1999 is filed in this Court, the Defendant has not filed its Written Statement and has also not come forward to defend the Suit. 2 rest part of s-202-99 The Suit has therefore appeared under the caption ‘For Ex-parte Decree’. 2. Mr. Ravindra Pamadi, who was working as a Senior Accounts Officer with the Plaintiff from 1987 to 1998, has filed his Affidavit in lieu of evidence dated 6th May 2011. The said Affidavit is taken on record and marked ‘X’ for identification. A Compilation of Documents is also filed on behalf of the Plaintiff. Mr. Pamadi has also filed a Further Affidavit of Evidence dated 16th November, 2011, rectifying an error in calculation made by him in his Affidavit of Evidence dated 6th May, 2011. Mr. Pamadi has filed his evidence pursuant to the letter of authority dated 2nd May, 2011 issued by the Plaintiff in his favour. The said letter of authority is marked Exhibit ‘P-1’. 3. It is stated in the Plaint as well as in the Affidavit in lieu of evidence dated 6th May, 2011, as follows:- 4. In about December 1995, the Defendant approached the Plaintiff and requested the Plaintiff to carry out various jobs in connection with a "Parle Roller Coaster" New Year programme to be executed by the Defendant on Doordarshan Metro Channel (hereinafter referred to as "the said Programme") for the Defendant such as releasing advertisements in various daily newspapers in major metropolitan cities in India promoting the said Programme, putting up hoardings at prime spots in major metropolitan cities promoting the said Programme and to obtain sponsors for the Curtain Raiser for the said Programme to be telecast on Doordarshan Metro Channel on 29th December, 1995 and the said Programme to be telecast on 31st December, 1995 as the Plaintiff as 3 rest part of s-202-99 an advertising agency had accreditation with Doordarshan and the Newspapers. 5. Thereafter, by letter dated 29th December, 1995 addressed to the Assistant Controller of Sales, Doordarshan Commercial Services, the Defendant informed Doordarshan that the Defendant had authorised the Plaintiff to place contracts for the Curtain Raiser and the said Programme on 29th and 31st December, 1995 respectively. Mr. Pamadi has deposed that the letter dated 29th December, 1995 was received by the Plaintiff from the Defendant as a facsimile message. The Plaintiff therefore holds a copy of the said letter. A copy of the letter dated 29th December 1995 addressed by the Defendant to the Assistant Controller of Sales, Doordarshan Commercial Services is tendered in evidence. The said copy is taken on record and marked Exhibit ‘P-2’. 6. On or about 5th January 1996, the Plaintiff placed the final contracts with Doordarshan. Mr. Pamadi has stated in his Affidavit in lieu of evidence that the said contract was stored and/or preserved in the Plaintiff’s office at Kitabmahal with other documents. He has further deposed that some time in the year 2002, a fire broke out in the office premises at Kitabmahal wherein the office furniture, computer installations, numerous other documents and other equipments got destroyed. The Plaintiff has therefore produced a typed copy of the contract before this Court. The same is taken on record and marked Exhibit ‘P-3’. 7. The Plaintiff released advertisements/press releases in respect of the said Programme between 22nd December, 1995 and 31st 4 rest part of s-202-99 December, 1995, in various leading daily newspapers in India such as Bombay Times, Bombay, Delhi Times, New Delhi, Times of India (Ahmedabad, Bombay and Delhi), Mid-day (Bombay), Afternoon Desp & Courier, Bombay, Hindustan Times (New Delhi), Deccan Chronicle (Hyderabad), Deccan Herald (Bangalore), the Telegraph etc., as per the press estimates submitted to the Defendant by the Plaintiff which were approved/accepted by the Defendant. Computer generated print outs of two press estimates both dated 20th December, 1995 for advertisements to be placed in Bombay Times & Delhi Times respectively are produced before this Court. As per the said computer generated printouts, the Defendant has approved the estimates and authorized the Plaintiff to proceed with releasing the advertisements. Mr. Pamadi also identifies the signature of Mr. Shridhar Raman (Media Manager) on the computer generated printouts of the press estimates. The said computer generated printouts are taken on record and marked Exhibits ‘P-4’ and ‘P-5’ respectively. 8. Mr. Pamadi has also tendered in evidence, photocopies of computer generated printouts of two other press estimates dated 20th December, 1995 and 28th December, 1995. The said photocopies bear the original stamp of the Defendant, acknowledging receipt of the press estimates. Mr. Pamadi also identifies the signature of Mr. Shridhar Raman (Media Manager) on the same. As per the said photocopies, the Defendant has approved the estimates and authorised the Plaintiff to proceed with releasing the advertisements. The same are taken on record and marked Exhibits ‘P-6’ and ‘P-7’ respectively. 5 rest part of s-202-99 9. Thereafter, the Plaintiff raised invoices on the Defendant in respect of the advertisements/press releases executed by the Plaintiff on behalf of the Defendant. As per the agreement, the invoices were payable within 30 days from the last day of the month of release of the advertisements. Second copies of the computer generated printouts of the following invoices raised by the Plaintiff on the Defendant are produced before this Court: : (i) Invoice dated 22nd December, 1995 in respect of press release published in Bombay Times on 22nd December, 1995 (ii) Invoice dated 29th December, 1995 in respect of advertisements/press release published in Delhi Times on 26th December, 1995 (iii) Invoice dated 29th December, 1995 in respect of advertisement/press release published in Mid-day on 29th December, 1995 (iv) Invoice dated 29th December, 1995 in respect of advertisements /press release published on 31st December, 1995 in Times of India in Ahmedabad, Bombay and Delhi, Midday in Bombay, Afternoon Despatch and Courier, Hindustan Times in Delhi, Deccan Chronicle in Hyderabad, Ananda Bazar Patrika in Calcutta, The Telegraph in Calcutta and Statesman in Calcutta (v) Invoice dated 15th January, 1996 in respect of advertisements/press releases published in Deccan Herald, Bangalore on 31st December, 1995 (vi) Invoice dated 29th January, 1996 in respect of advertisements/press releases published in Hindu (Southern Edition) on 31st December, 1995. The invoices are for a total amount of Rs.12,79,600/- (Rupees Twelve Lakhs Seventy-Nine Thousand and Six Hundred only). The invoices also specify that interest @ 18% per annum will be charged on delayed payments. Mr. Pamadi identifies the signature of Mr. R. L. 6 rest part of s-202-99 Prabhu (Bill Manager) on the said computer generated printouts of the invoices. The same are taken on record and marked Exhibit ‘P-8’ collectively. 10. Pursuant to the request made by the Defendant, besides the advertisements/press releases, the Plaintiff through one Mr Anil Chhabria of ‘Movement Advertising and Marketing Limited’, also put up hoardings announcing the telecast of the said Programme on 31st December, 1995 on prime spots in major cities like Delhi, Mumbai, Calcutta, Madras, etc. Accordingly, the Plaintiff raised an invoice in respect of the said hoardings for Rs.2,86,150/- (Rupees Two Lakhs Eighty-Six Thousand One Hundred and Fifty Only) being Invoice No. 06/20168 dated 29th December, 1995. The invoice specified that interest @ 18% per annum would be charged on delayed payments. A second copy of the computer generated printout of the invoice in respect of the hoardings is produced before this Court. The same is taken on record and marked Exhibit ‘P-9’. 11. As per the contract, the Plaintiff obtained sponsorship for telecast of the said Programme and contracts with Doordarshan in respect of the said Programme and the Curtain Raiser for the said Programme. The said Programme was exclusively produced and executed by the Defendant on 31st December, 1995. The Plaintiff thereafter submitted estimate letters in respect of the Curtain Raiser and the said Programme, which estimate letters were approved and accepted by the Defendant. The Plaintiff then raised invoices in respect of the charges payable to Doordarshan for telecast of the said Programme, which were also accepted by the Defendant. Second copies of the computer generated print outs of the Television 7 rest part of s-202-99 Estimates dated 10th January, 1996 and 16th February, 1996 are produced before this Court. The same are taken on record and marked as Exhibits ‘P-10’ and ‘P-11’ respectively. Second copies of the computer generated print outs of invoices dated 22nd February, 1996 and 29th February, 1996 are produced before this Court. The invoices are for a total amount of Rs.35,78,125/- (Rupees Thirty-five Lakhs Seventy-Eight Thousand One Hundred And Twenty Five Only). The invoices also specified that interest @ 18% per annum would be charged on delayed payments. Mr. Pamadi identifies the signature of Mr. Shridhar Raman (Media Manager) on the said invoices. The second copies of the computer generated printouts of the invoices are taken on record and marked Exhibit ‘P-12’ collectively. 12. All the invoices raised by the Plaintiff in respect of all the jobs executed by the Plaintiff contained a condition as follows : "Objection, if any for the subject job be raised within 10 days from the date of the receipt of the bill". However, the Defendant did not raise any objection within 10 days or thereafter. 13. Thereafter, the Defendant raised two invoices being Invoice No.MECPL/45/95-96 and MECPL/46/95-96 January 9, 1996 for Rs. 29,59,688/- and Rs.8,37,250/- respectively payable to the Defendant by the Plaintiff. As the invoice for Rs.29,59,688/- included an amount due to the Defendant from one ‘Rediffusion Dentu Young and Rubicam Limited’, and the Defendant collected the said amount directly, the said invoice was revised accordingly by the Defendant for Rs 24,15,657/-. Thus, an amount of Rs.32,52,937/- was payable by the Plaintiff to the Defendant. 8 rest part of s-202-99 14. The Plaintiff by its letter dated 17th April, 1996, enclosed an outstanding statement and requested the Defendant to confirm the outstanding amount of Rs.51,43,875/- (Rupees Fifty-One Lakhs Forty-Three Thousand Eight Hundred And Seventy-Five Only) by counter signing a copy of the letter. The Defendants accordingly accepted and acknowledged the letter dated 17th April, 1996. An office copy of the letter dated 17th April, 1996 bearing the original stamp of the Defendant acknowledging receipt of the same is produced before this Court. Mr. Pamadi has identified his own signature on the said letter. The same is taken on record and marked Exhibit ‘P-13’. 15. On about 14th June, 1996, the representatives of the Plaintiff including its Chairperson had a meeting with Mr. Anupam Kher, Director of the Defendant. Mr Anupam Kher assured the Plaintiff that initial payment of Rs.10,00,000/- (Rupees Ten Lakhs Only) would be cleared by 17th June, 1996 and that a letter confirming the account of events that led to execution of the said Programme would be sent shortly. Thereafter, the Plaintiff's representatives went to the Defendant's office on the appointed date i.e. 17th June, 1996, when they were told that Mr. Anupam Kher was out on a shooting and he had left no instructions to pay any amount to the Plaintiff. Thus, the Defendant failed to pay any amount to the Plaintiff. 16. Thereafter, the Plaintiff by its letter dated 16th July, 1996, recorded the fact that Mr. Kher had assured payment by 17th June, 1996 and that the Defendant had failed to pay the money as assured by Mr. Kher. The Plaintiff also pointed out that the Plaintiff being the 9 rest part of s-202-99 placement agency for the Defendant's programme, was bound to pay Doordarshan its bills on behalf of the Defendant, which the Plaintiff had done. An office copy of the said letter dated 16th July, 1996 is produced before this Court. Mr. Pamadi identifies the signature of Ms. Niloufer Kapadia on the said office copy of the letter. The same is taken on record and marked Exhibit ‘P-14’. 17. In the meantime, Doordarshan by its letter dated 19th June, 1996 reminded the Plaintiff to pay Rs.8,71,250/- (Rupees Eight Lakhs Seventy-One Thousand Two Hundred and Fifty Only) towards its bill for the said Programme. Doordarshan also warned the Plaintiff that if the amount was not paid within ten days, action would be taken against the Plaintiff as per the accreditation rules. The original letter dated 19th June, 1996 addressed by Doordarshan to the Plaintiff is produced before this Court. The same is taken on record and marked Exhibit ‘P-15’. 18. By its letter dated 17th July, 1996, addressed to Doordarshan, the Plaintiff clarified that the modalities including rate structure for the said Programme were finalised by Mr. Anupam Kher and the Defendant was the sole producer of the programme. The Plaintiff further clarified that as the Defendant lacked the Doordarshan accreditation, the Plaintiff was requested to sign the contract with Doordarshan at the last minute. The Plaintiff also explained to Doordarshan that the payment was supposed to be made to Doordarshan by the Defendant through the Plaintiff. Referring to letters dated 29th January, 1996 and 8th April, 1996 addressed by Doordarshan directly to the Defendant, and to letter dated 6th March, 1996 addressed by the Defendant directly to Doordarshan, the 10 rest part of s-202-99 Plaintiff pointed out that the liability to pay the bill was that of the Defendant directly. The Plaintiff also pointed out that it had paid Rs. 23,37,500/- and Rs.2,33,750/- to Doordarshan in good faith as it had signed the contract with Doordarshan. The Plaintiff also requested Doordarshan to stop telecasting serials produced by the Defendant till the Defendant paid up its dues. An office copy of the letter dated 17th July, 1996 bearing the original stamp of Doordarshan acknowledging receipt of the same is produced before this Court. Mr. Pamadi identifies the signature of Ms. Niloufer Kapadia on the said office copy. The same is taken on record and marked Exhibit ‘P-16’. 19. Thereafter, in reply to the Plaintiff's letter dated 16th July, 1996, the Defendant, by its letter dated 2nd August, 1996, denied that any amount was payable by the Defendant to the Plaintiff. Mr. Pamadi has deposed that the Defendant wrongly denied having made any commitments. The Defendant, in its letter further alleged that on the basis of one fascimile communication from one of the executives of the Plaintiff, Mr M P Singh, informing the Defendant that he could get it a sponsor for Rs.1.5 crores, the Defendant had agreed to give a minimum guarantee of Rs.20 lakhs to Doordarshan. The Defendant also alleged that it had suffered a loss of Rs.27,25,000/- on account of the alleged fascimile message. The Defendant further stated that the entire deal was breach of faith by the Plaintiff’s officials and denied having made any promise to pay Rs.10,00,000/- on 14th June, 1996. The original letter dated 2nd August, 1996 received by the Plaintiff from the Defendant is produced before this Court. Mr. Pamadi has deposed that the said letter bears the signature of Mr. Anupam Kher (Chairman and Managing Director of the Defendant). The original letter dated 2nd August, 1996 is taken on record and 11 rest part of s-202-99 marked Exhibit ‘P-17’. 20. By letter dated 13th August, 1996, the Plaintiff once again called upon the Defendant to clear its dues. The Plaintiff further denied having made any commitment for sponsorship of 1.5 crores through its executive and pointed out that the fascimile message dated 29th November, 1995 referred by the Defendant was only a message conveyed to the Defendant by Mr M. P. Singh that the negotiations to get a sponsor were on and it did not amount to any commitment on the part of the Plaintiff. The Plaintiff pointed out that the Defendant had written to Doordarshan on 21st December, 1995 confirming minimum guarantee of Rs.20,00,000/-, without ascertaining whether sufficient sponsorship was available to the Defendant. The Plaintiff further stated that IT was not aware of any minimum guarantee clause signed by the Defendant with the Doordarshan as it was not informed by the Defendant of any such commitment before it filed contracts with Doordarshan. Thereafter, the estimates submitted by the Plaintiff to the Defendant on 10th January, 1996 did not reflect any such commitment of minimum guarantee of Rs.20 lakhs. An office copy of the said letter dated 13th August, 1996 bearing the original stamp of the Defendant acknowledging receipt of the same is produced before this Court. Mr. Pamadi identifies the signatory of the said letter as Ms. Niloufer Kapadia. The said office copy is taken on record and marked Exhibit ‘P-18’. 21. By letter dated 20th November, 1996 and telegram dated 22nd November, 1996, Doordarshan once again demanded payment of Rs. 8,71,250/- (Rupees Eight Lakhs Seventy One Thousand Two 12 rest part of s-202-99 Hundred And Fifty Only) from the Plaintiff. Accordingly by its letter dated 29th November, 1996, the Plaintiff once again explained to Doordarshan that the Defendant as the producer of the Programme had directly negotiated the deal with Doordarshan and the Plaintiff was merely involved at the last minute because of its accreditation with Doordarshan as an advertising agency. However, to protect its status as an accreditated agency, the Plaintiff paid Rs.1,65,750/- (Rupees One Lakh Sixty Five Thousand Seven Hundred And Fifty Only) to Doordarshan under protest on 29th November, 1996. An office copy of the said letter dated 29th November, 1996 bearing the original stamp of Doordarshan, acknowledging receipt of the same is produced before this Court. The same is taken on record and marked Exhibit ‘P-19’. 22. The Defendant failed to reply to the Plaintiff's letter dated 13th August, 1996 nor did it clear the Plaintiff's outstanding. The Plaintiff finally by its Advocate’s letters dated 6th January, 1997, 12th February, 1997 and 19th May, 1997 recorded the brief facts mentioned above and called upon the Defendant to pay the outstanding amount to the Plaintiff. The Defendant neither replied to the said letters, not did it clear the Plaintiff’s dues. 23. Thereafter, the Plaintiff filed a Winding-Up Petition being Company Petition No. 551 of 1997 in this Court against the Defendant. However, in view of the disputes raised by the Defendant, the said Petition was withdrawn with liberty to file fresh proceedings against the Defendant. 24. By its Advocate’s letter dated 12th August, 1998, the Plaintiff 13 rest part of s-202-99 once again called upon the Defendant to pay the outstanding amount of Rs.18,90,938/- (Rupees Eighteen Lakhs Ninety Thousand Nine Hundred and Thirty Eight Only) with interest thereon at the rate of 18% per annum after adjusting the amount of the bills raised by the Defendant of Rs.32,52,937/- on 9th January, 1996. An office copy of the letter dated 12th August, 1998 along with a postal acknowledgement receipt is produced before this Court. The same is taken on record and marked Exhibit ‘P-20’. 25. The Plaintiff carried out various advertising jobs as per the instructions/approval of the Defendant and raised invoices on the Defendant in respect of the same. The Defendant has duly accepted the said invoices but failed to discharge the same on the ground of alleged losses suffered by it. The Plaintiff has also incurred out of pocket expenses on behalf of the Defendant aggregating to Rs. 38,03,546/- (Rupees Thirty Eight Lakhs Three Thousand Five Hundred and Forty Six Only) by way of payment to various newspaper agencies and Doordarshan as it wanted to protect its accreditation as advertising agency. 26. Mr. Pamadi has tendered in evidence, the Account Statement of the Plaintiff, evidencing that the Defendant is liable to pay to the Plaintiff a sum of Rs.27,12,676.35 (Rupees Twenty Seven Lakhs Twelve Thousand Six Hundred And Seventy Six and Paise Thirty Five Only) as on 6th January, 1999, inclusive of interest @ 18% per annum. The same is taken on record and marked Exhibit ‘P-21’. However, in the Further Affidavit of Evidence dated 16th November, 2011, Mr. Pamadi has stated that there was an error in calculation of the amount due to the Plaintiff from the Defendant, as reflected in 14 rest part of s-202-99 the Account Statement. As per the revised calculation, the total amount actually due to the Plaintiff upto 6th January, 1999 is Rs. 16,59,954.37, (Rupees Sixteen Lakhs Fifty-Nine Thousand Nine Hundred And Fifty-Four And Paise Thirty-Seven Only) comprising of a principal amount of Rs.11,85,438/- (Rupees Eleven Lakhs Eighty- Five Thousand Four Hundred And Thirty-Eight Only) and an interest amount of Rs.4,74,516.37 (Rupees Four Lakhs Seventy-Four Thousand Five Hundred And Sixteen And Paise Thirty-Seven Only). 27. Since the Defendant failed to pay the amount due to the Plaintiff or any part thereof, the Plaintiff filed the present Suit to recover from the Defendant the sum of Rs.27,12,676.35 (Rupees Twenty Seven Lakhs Twelve Thousand Six Hundred And Seventy Six and Paise Thirty Five Only) as per the Particulars of Claim annexed as Exhibit ‘O’ to the Plaint, with further interest on Rs. Rs. 27,12,676.35 (Rupees Twenty Seven Lakhs Twelve Thousand Six Hundred And Seventy Six and Paise Thirty Five Only) at the rate of 18% per annum from the date of filing of the suit till payment and/or realization. However, as stated above, Mr. Pamadi has now deposed that the total amount actually due to the Plaintiff upto 6th January, 1999 is Rs.16,59,954.37, (Rupees Sixteen Lakhs Fifty-Nine Thousand Nine Hundred And Fifty-Four And Paise Thirty-Seven Only) comprising of a principal amount of Rs.11,85,438/- (Rupees Eleven Lakhs Eighty-Five Thousand Four Hundred And Thirty-Eight Only) and an interest amount of Rs.4,74,516.37 (Rupees Four Lakhs Seventy-Four Thousand Five Hundred And Sixteen And Paise Thirty- Seven Only). 28. I have perused the Plaint, Evidence and the Documents 15 rest part of s-202-99 produced by the Plaintiff. From Exhibits P-2 to P-12, it is established that the Plaintiff carried out various jobs for the Defendant in connection with “Parle Roller Coaster” New year programme to be executed by the Defendant on Doordarshan Metro Channel for the Defendant, such as releasing advertisements in the various daily newspapers in Metropolitan Cities in India, putting up hoardings at prime spots in Metropolitan Cities, etc. for promoting the said programme. It is established from Exhibit P-13 that the Defendant has confirmed that an outstanding amount of Rs. 51,43,875 is due and payable by the Defendant to the Plaintiff. The Plaintiff has admitted that an amount of Rs. 32,52,937/- was payable by the Plaintiff to the Defendant under two invoices being Nos. MECPL/45/95-96 and MECPL/46/95-96, dated 9th January 1996 for Rs. 29,59,688/- and Rs. 8,37,250/- respectively. Though the Defendant has by letter dated 2nd August 1996 (Exhibit-P-17) alleged that no amount is due and payable by the Defendant to the Plaintiff, they have not explained as to why they had countersigned Exhibit- P-13 thereby acknowledging that an amount of Rs. 51,43,875/- was due and payable by them to the Plaintiff. The Defendant has also not come forward to oppose the Suit and establish before this Court that no amount is due and payable by the Defendant to the Plaintiff. The case of the