IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION APPEAL APPEAL APPEAL NO.195 OF 2002 NO.195 OF 2002 NO.195 OF 2002 IN IN IN SUMMONS SUMMONS SUMMONS FOR JUDGMENT NO. 927 OF 1999 FOR JUDGMENT NO. 927 OF 1999 FOR JUDGMENT NO. 927 OF 1999 IN IN IN SUMMARY SUMMARY SUMMARY SUIT NO.1590 OF 1999 SUIT NO.1590 OF 1999 SUIT NO.1590 OF 1999 D.S.A. Engineers ] A firm, having its registered ] Appellants Office at RNA Arcade, R.No.14, ] (Original Lokhandwala Complex, ] Defendants) Andheri (West), Mumbai -400 053 ] Vs. TATA IRON & STEEL COMPANY LTD. ] A Company incorporated under ] the provisions of the Companies ] Respondents Act, 1956 and having its ] (Original registered Office at Bombay ] Plaintiffs) House, 24 Homi Modi Street ] Fort,Mumbai - 400 023 ] Mr. Harvinder Toor with Mr. Mahesh Joshi i/by Ms. Sindha Shreedharan for appellant. Mr. Chirag Balsara with Mr. Avinash Joshi i/by M/s Mulla & Mulla and Crague Blunt & Caroe for the Respondents. CORAM CORAM CORAM : R.M.S. KHANDEPARKAR & : R.M.S. KHANDEPARKAR & : R.M.S. KHANDEPARKAR & P.B. P.B. P.B. MAJMUDAR, JJ MAJMUDAR, JJ MAJMUDAR, JJ. DATE DATE DATE : 3RD JUNE, 2008 : 3RD JUNE, 2008 : 3RD JUNE, 2008 ORAL ORAL ORAL JUDGMENT (PER P.B. MAJMUDAR, J.) :- JUDGMENT (PER P.B. MAJMUDAR, J.) :- JUDGMENT (PER P.B. MAJMUDAR, J.) :- 1. By filing this appeal, the appellants have challenged the judgment and decree passed by the learned Single Judge dated 15th October, 2001 in 2 Summary Suit No.1590 of 1999. 2. The Respondents herein instituted the aforesaid suit for recovering certain amount in connection with the goods supplied by it to the defendants. The suit claim of the Plaintiffs is based on 21 invoices and the particulars of the same are given in the plaint. The plaintiffs have claimed a decree of Rs.12,83,676.11 towards principal amount of Rs.4,58,726.84 as interest thereon at the rate of Rs.21% per annum. The plaintiffs have given relevant details in the plaint in connection with 21 invoices, on the basis of which the suit is filed. It is the case of the plaintiffs that it had sold , supplied and delivered the goods to the defendants at their site of their project at Goa. The plaintiffs have based their claim on the basis of aforesaid 21 invoices and delivery challans to show that the defendants had received the said goods. Along with the plaint, the plaintiffs have annexed only one invoice and the delivery challan, but the reference is made in connection with other 20 invoices and delivery challans. The inspection of the documents have also given by the plaintiffs to the defendants which includes the invoices and the 3 delivery challans, the said aspect has been discussed by the learned trial Judge in para no. 2 of the judgment. It is the case of the plaintiffs that it had supplied the goods against the purchase orders placed by the defendants from time to time for supply of different quantities of steel tubes of specified quality and the same was sent at the site of the project of the defendants. Since the defendants failed to make requisite payments, the plaintiffs called upon them by sending letter dated 10th June, 1997 asking the defendants to pay the dues giving details of 17 bills. The plaintiffs thereafter sent various reminders asking the defendants to pay their dues. It is the case of the plaintiffs that on 2nd October, 1997 the defendants forwarded two cheques dated 28th September 1997 and 2nd September, 1997 for Rs.2.00 Lacs each, but the said cheques were dishonoured and therefore the plaintiffs by their letter dated 9th October 1997 informed the defendants to pay their outstanding bills. The defendants subsequently assured the plaintiffs that their dues will be cleared by 25th October, 1997. Even thereafter no payment was made and plaintiffs went on sending letters demanding the said amount from time to time. The plaintiffs 4 thereafter have filed the present suit for recovering the amount in question. 3. The defendants on receipt of summons, have appeared in the suit. The plaintiffs thereafter took out the summons for judgment verifying the facts in the affidavit in support of the summons for judgment. It is the case of the plaintiffs that the suit claim has arisen from the written contract in the form of invoices and the delivery challans, which are signed on behalf of the defendants as acknowledgment of receipt of the goods at the site. According to the plaintiffs the whole claim is an ascertained and liquidated amount and that the defendants have no defence in the suit. The defendants on the other hand have filed an affidavit of one Vineet Singh, partner of the defendants and have prayed for unconditional leave to defend the suit. 4. The learned Single Judge framed various points for determination and after considering the material on record came to the conclusion that the defence of the defendants is not at all bonafide and the same is frivolous. The learned Single Judge has considered various letters produced on 5 record by the plaintiffs and after considering the documentary evidence on record came to the conclusion that the point raised by the defendants are frivolous and vexatious. The learned Single Judge accordingly came to the conclusion that no case is made out by the defendants for leave to defend the suit and the summons for judgment was accordingly made absolute with costs and the suit was decreed accordingly. 5. The aforesaid judgment of the learned Single Judge is impugned at the instance of the original defendants in this present appeal. 6. The learned Advocate for the appellants- original defendants argued that since there is no written contract between the parties in connection with the transaction, the suit which is instituted under Order XXXVII of the Code of Civil Procedure is not maintainable. It was further argued that the defendants have good defence for defending the suit and therefore the learned Single Judge should have granted leave to defend the suit. The learned Counsel further submitted that the plaintiffs had not given particulars of invoices and therefore it cannot be said that the suit is 6 filed in connection with the particular invoice or bill. It is also argued that since there is no written contract regarding payment of interest, the learned Single Judge has erred in awarding the interest at the rate of 21% as claimed by the plaintiffs in the suit and that since there is no written contract, the defendants were entitled to get leave to defend the suit. 7. On the other hand, learned Counsel for the respondents- original plaintiffs submitted that the defence raised by the defendants is frivolous and misconceived. It is further argued that after getting delivery of goods, the defendants are not making any payment in spite of various letters sent by the plaintiffs. It is submitted that looking to the documentary evidence on record in the nature of bills, it is clear that the plaintiffs had sold the goods to the defendants. 8. The learned counsel for the respondents- original plaintiffs further submitted that the fact that the defendants sent two cheques towards part payment of the dues which cheques ultimately dishonoured would show that the defendants have accepted the transaction in question. It is 7 further submitted that in connection with the documents which have been referred in the plaint, the inspection was also given to the defendants. 9. So far as the question about the payment of interest is concerned, learned Counsel for the plaintiffs has submitted that the plaintiffs are giving up their claim regarding interest in toto upto the period of filing of the suit. It is submitted that the suit may accordingly considered only for the purpose of recovering principal amount with a prayer of appropriate interest from the filing of the suit. 10. We have heard learned Advocates appearing in the matter. We have also gone through the documentary evidence produced on record. We have also perused the judgment and order of the learned Single Judge. So far as the claim of the plaintiffs regarding the payment towards supply of goods is concerned, the Plaintiffs have given appropriate details in the plaint and have placed their claim in connection with the goods supplied to the defendants. It is not in dispute that the suit claim is based on 21 invoices and various bills in connection with the transaction in 8 question regarding supply of material by the plaintiffs to the defendants. It is required to be noted that in this connection there are voluminous documentary evidence on record to show that the plaintiffs have sold the goods to the defendants and demand was made for payment towards the same from time to time. In this connection, the reference is required to be made to one of the letters written by the Plaintiffs to the defendants dated 26th August, 1997, which is at Page 74 in compilation. In the said letter, the plaintiffs have enclosed the details of the bills which are pending at the defendants-end in connection with the material sold. In the said letter, it is specifically mentioned that the payment terms as per the terms of the contract is 30 days interest free credit and inspite of several repeated reminders and follow-ups, the payments has not been released by the defendants. In the said letter, the plaintiffs have also referred about the factual discussion which took place on 23/8/1997. Along with the said letter, the particulars have been given by the plaintiffs which is finding place at page 75. Thereafter subsequently the defendants sent two cheques to the plaintiffs dated 22/9/1997 and 2/10/1997 9 amounting to Rs.2.00 lacs each, but the said cheques ultimately bounced back. The plaintiffs thereafter sent a letter dated 1/9/1997 informing the defendants about the dishonour of the said cheques and on receipt of said letter, defendants replied to the plaintiffs by their letter dated 17th January, 1998 pointing out that because of financial difficulties, they are not in a position to make the payment and requested to wait for some time. The contents of the said letters are as under : "We regret to inform you that our funds to come have been delayed further by a fortnight. Kindly bear with us for the same. Best efforts for releasing payments arranging funds are being made at our end". Inspite of aforesaid assurances by the defendants, the defendants failed to make any payment. The plaintiffs thereafter after serving the notice through Advocate, instituted the suit for recovering the amount. 11. Considering the documentary evidence on 10 record, in our view, it is clear that the defendants after receiving the goods failed to make the payment. There is nothing on record to show that the defendants had not received the goods at their site. On the contrary, defendants themselves wrote to the plaintiffs to wait for some time, in view of the financial difficulties. The said fact would suggest that the defence taken by the defendants in the suit is absolutely frivolous. Learned counsel for the defendants could not point out as to in connection with which transaction two cheques were sent by the defendants to the plaintiffs. The defendants accordingly after receiving the goods failed to make any payment and ultimately the plaintiffs were required to file the present suit for recovering its just dues. Since the suit is based on invoices and bills, the same is maintainable under Order XXXVII of the C.P.C., as the summary suit is based on written documents which constitutes contract between the parties. Though this particular point was not canvased before the learned Single Judge still we have considered this aspect, we have accordingly find that the suit is maintainable under Order XXXVII of C.P.C. 11 12. Considering the facts and circumstances of the case and evidence on record, we agree with the view taken by the learned Single Judge that the defence taken by the defendants and inspite of assurances and promises given to the plaintiffs for paying the dues of the plaintiffs, the defendants ultimately denied the just claim of the plaintiffs by taking vexatious and dishonest defence. 13. The defendants are therefore not entitled to get leave to defend the suit and it is clear that the defendants are only interesting in delaying the payment. It is also required to be noted that at the time of admitting this appeal, the Division Bench of this Court passed an order in Notice of Motion No. 195 of 2002, by which decree of the trial Court was stayed on condition that the appellants to deposit the decretal amount within six weeks and the plaintiffs were permitted to withdraw the same on furnishing an adequate security. However, even the appellants have not complied with the said directions and have not deposited any amount, inspite of the said order. 14. Learned counsel for the defendants 12 however, submitted that the suit in question is not maintainable under Order XXXVII of C.P.C. as the plaintiffs have demanded interest in the suit, for which there was no contract. However. since the learned counsel for the plaintiffs submitted that the plaintiffs are giving up the claim of interest from the suit claim, the decree passed by the learned Single Judge is modified to the said extent by decreeing the suit of the plaintiffs for principal amount claimed in the suit and the plaintiffs will not be entitled to interest upto the date of filing the suit, however from filing of the suit till realisation, plaintiffs are entitled to get interest at the rate of 12%. 15. In our view, since the defendants have taken absolutely vexatious defence, the suit of the plaintiffs is decreed as aforesaid with a direction that the original defendants shall pay special costs of Rs.15,000/- to the plaintiffs. The suit is therefore decreed as aforesaid with a special costs to be borne by the defendants, which is quantified at Rs.15,000/-. 13 16. The appeal is accordingly partly allowed and the claim of the interest made by the plaintiffs in the suit stands rejected. The suit of the plaintiffs is accordingly decreed for the principal amount claimed in the suit. The plaintiffs however, shall be entitled to get interest from filing of the suit till realisation of the amount at the rate of 12%. As pointed out earlier, the plaintiffs also be entitled to get special costs of Rs.15,000/-. Decree of the trial Court is modified to the aforesaid extent, however, there shall be no order as to costs, so far as this appeal is concerned. ( R.M.S. KHANDEPARKAR, J.) R.M.S. KHANDEPARKAR, J.) R.M.S. KHANDEPARKAR, J.) ( P.B. MAJMUDAR, J.) P.B. MAJMUDAR, J.) P.B. MAJMUDAR, J.)