1 99 sj.538.09 ndm IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION SUMMONS FOR JUDGMENT NO. 538 OF 2009 IN SUMMARY SUIT NO. 1824 OF 2009 Reuters India Private Limited. ... Plaintiffs Vs. Prompt Commodities Limited. ... Defendants -------- Ms. Kavita Brid i/b Dholakia Law Associates for the Plaintiffs. Ms. Merlyn Monterio for the Defendants. -------- CORAM : A.S.OKA, J. DATE : 10 th January, 2011. P.C. 1 Heard the learned counsel appearing for the Plaintiffs in support of summons for judgment and the learned counsel appearing for the Defendants. 2 Suit is filed for recovery of sum of Rs.1,97,920.87 as per the particulars of claim set out in Exhibit – M annexed to the plaint. Out of the sand amount, sum of Rs.1,64,419.37 represents amount allegedly due and payable by the Defendants under the agreement dated 30 th November, 2006 between the Plaintiffs and the Defendants and rest of the amount represents the interest at the rate of 18% per annum. 2 99 sj.538.09 3 According to the case of the Plaintiffs, sometime in November 2006, the Defendants subscribed certain services provided by the Plaintiffs and accordingly, agreement called as Reuters Services Contract was entered into on 30 th November, 2006. Reliance is placed on Global Exchange Order Form dated 30 th November, 2006 executed by the Defendants. A sum of Rs.1,11,683/- was paid by the Defendants towards security deposit for the services being provided. According to the case of the Plaintiffs, the Defendants were provided services with effect from 1 st December, 2006. Reliance is placed on email sent by the Defendants to the Plaintiffs on 26 th February, 2008 by which the Defendants informed the Plaintiffs that they would like to discontinue the services provided by the Plaintiffs from the next quarter. Reply was sent by the Plaintiffs to the said communication by contending that until the services are cancelled as permitted under the agreement, both the parties will have to continue performing the respective obligations under the contract. 4 The Plaintiffs have relied upon invoice dated 3 rd April, 2008 in the sum of Rs.1,51,663.37. Reliance has been placed on communications dated 12 th May, 2008 and 17 th June, 2008 sent by the Plaintiffs to the Defendants calling upon them to pay the amount. By letter dated 14 th October, 2008, the Plaintiffs informed the Defendants that the outstanding amount was Rs.5,27,757.56 as on 14 th October, 2008. It is stated in the said letter that the Plaintiffs had continued providing 3 99 sj.538.09 services till 8 th July, 2008. Therefore, a demand was made for payment of Rs.5,27,757.56. The said letter was followed by the legal notice dated 9 th March, 2009 sent by the advocate for the Plaintiffs to the Defendants. In the said notice, a demand was made for a sum of Rs.4,16,074.56 towards outstanding invoices and liquidated damages after giving credit for the security deposit held by the Plaintiffs. As the amount was not paid, the present suit has been filed. In paragraph No.12 of the plaint, it is stated that after giving due credit for the security deposit of Rs. 1,11,683/- and all the payments made, a sum of Rs.1,97,920.87 is still payable by the Defendants. 5 The learned counsel appearing for the Plaintiffs invited the attention of the Court to various clauses in the agreement between the parties. Inviting attention of the Court to clause 2.2, the learned counsel submitted that in the present case, sub-clause (c) of clause 2.2 will apply and notice of 12 months was required. The learned counsel also invited the attention of the Court to clauses 3.3, 3,6 and 4.8 of the agreement. The learned counsel submitted that absolutely no defence available to the Defendants and therefore, the decree must follow. 6 The learned counsel appearing for the Defendants pointed out that admittedly there was a security deposit of Rs.1.11,683/- and in the rejoinder, the Plaintiffs have claimed that they had appropriated the security deposit towards the applicable liquidated damages in terms of 4 99 sj.538.09 the contract. The learned counsel submitted that there is absolutely no basis as to how liquidated damages have been quantified. The learned counsel pointed out that the demand made by letters issued by the Plaintiffs in the sum of Rs.1,51,663.37 and the claim amount mentioned Rs.1,64,419.37. The learned counsel appearing for the Defendants therefore, submitted that several triable issues were involved. 7 The learned counsel appearing for the Plaintiffs pointed out that in view of clause 3.6 read with clause 4.8, the Plaintiffs were entitled to recover liquidated damages equivalent of 75% of the relevant service fees, which would have been payable until the date on which the relevant service may be cancelled under clause 2.2. The learned counsel submitted that the security deposit was adjusted against the liquidated damages in view of clause 3.6 and 4.8 of the agreement. The learned counsel appearing for the Plaintiffs submitted that the claim of Rs. 1,64,419.37 has been made taking into consideration the charges payable upto 8 th July, 2008. 8 I have given careful consideration to the submissions. As stated earlier, the claim made in letter dated 12 th May, 2008 and 17 th June, 2008 was on the basis of the invoice of 3 rd April, 2008. The amount claimed was Rs.1,51,663.37. To justify the claim of Rs.1,64,419.37, the learned counsel appearing for the Plaintiff submitted that on the basis of the invoice, charges upto 8 th July, 2008 have been added. However, 5 99 sj.538.09 there is no document produced on record to show as to how service charges from 1 st July, 2008 to 8 th July, 2008 have been calculated. Admittedly, a security deposit in the sum of Rs.1,11,683/- was paid by the Defendants to the Plaintiffs. That deposit amount is sought to be adjusted against the liquidated damages allegedly payable under the agreement. There is no basis as to how the liquidated damages have been calculated. There is no explanation even in the rejoinder. 9 Thus, this is a case where there are triable issues involved and therefore, a case for grant of unconditional leave to defend has been granted. 10 Accordingly, summons for judgment is disposed of by granting unconditional leave to defend the suit. Written statement to be filed within a period of three months from today. Suit shall be transfered to the list of commercial causes. [ A.S.OKA, J ]