R.S.A. No.658 of 2008 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** R.S.A. No.658 of 2008 Date of Decision:21.11.2008 The Ludhiana District Co-operative Milk Producers Union Ltd., Jagraon Road, Ludhiana and another .....Appellants Vs. M/s. Arun Poly Packs Pvt. Ltd., Chandigarh and another .....Respondents CORAM:- HON'BLE MR. JUSTICE HARBANS LAL Present:- Mr. Ajay Mahajan, Advocate for the appellants. Mr. Arun Sharma, Advocate for respondent No.1. **** JUDGMENT HARBANS LAL, J. (Oral) This appeal is directed against the judgment/ decree dated 30.11.2007 passed by the Court of learned Additional District Judge, Chandigarh whereby he dismissed the appeal preferred against the judgment/ decree dated 15.10.2004 rendered by the Court of learned Civil Judge (Junior Division), Chandigarh vide which he decreed the suit to the effect that the plaintiff is entitled for recovery of the balance amount due of 10% from the total principal amount due towards the defendants along with interest at the rate of 12% per annum from the date it became due till filing of the suit and at the rate of 6% per annum as pendente lite and future interest till the realisation of the decretal amount. The learned Additional District Judge finding that the learned trial Court's decree is uncertain with regard to payment of total decretal R.S.A. No.658 of 2008 -2- amount and interest observed as under:- “However for the sake of clarification, it is ordered that the plaintiff company is entitled to recover Rs.1,41,609/- i.e. Rs.71427/- from the Ludhiana Union and remaining amount from the Ropar Union along with interest @ 12% per annum from the date it was due i.e., the date when the goods were supplied and on the earnest money from the date it was deposited i.e. 12.9.1994. The plaintiff company is also entitled to pendente-lite interest and future interest @ 6% per annum from the date of filing of the suit till the date of realization of the decretal amount.” The factual matrix is that the defendants No.2 and 3 placed an order vide letter No.LMU/PUR/221/PS/16847 dated 24.9.1994 with the plaintiff - M/s Arun Poly Packs Private Limited Company (for short, `the Company') for supply of certain material. As per the orders, the goods were supplied by the Company at the agreed rate. The defendants failed to make payment of the dues. Although, the tenders of the Company were the lowest, yet its tender was not accepted and order was given on trial basis. The defendants had executed an agreement for supply of 10 MT of material, which was supplied by the Company. The defendants while releasing the payment of the Company held up an amount of Rs.83,309/-. The Company served a legal notice upon the Ludhiana District Cooperative Milk Producers Union Limited, Ludhiana- defendant on 14.4.1997 and in pursuance thereof, the Ludhiana Union has released an amount of Rs.11,882/-. Thus, a balance amount of Rs.71,427/- remains due from the Ludhiana Union. R.S.A. No.658 of 2008 -3- The Ropar District Cooperative Milk Producers Union Limited, SAS Nagar- defendant had also placed an order with the plaintiff- Company and in pursuance thereof, material worth Rs.1,19,182 was despatched to them, against which an amount of Rs.1,51,000/- was released. A balance of Rs.40,182/- was retained by the Ropar Union without assigning any reason. Adding this amount, the balance works out to Rs.1,11,609/-. The plaintiff had deposited Rs.30,000/- as earnest money, which is also retained by the defendants. That some other miscellaneous amounts are also due towards the defendants as are shown in the account books of the plaintiff. A legal notice was served upon the defendants on 14.4.1997 vide which the demand of the balance amount of Rs.1,41,609/- was made for the material which was supplied, but the defendants did not refund this amount. On these allegations, the suit was filed for recovery of Rs.2,27,604/- including principal amount Rs.1,56,968.30 and interest Rs.70,636/- at the rate of 18% per annum. In the written statement, defendant No.1 has admitted that the tenders were called and the plaintiff- Company had deposited Rs.15,000/- as earnest money for the year 1994-95, but the Ludhiana Union claimed that the third defendant- Ropar Union intimated that a sum of Rs.21,230.10 stood recoverable from the Company on account of sub-standard milk film. The amount of Rs.15,000/- deposited as earnest money was sent to the Ropar Union for adjustment of the said recovery amount. In the written statement, the defendant- Ludhiana Union has admitted that it placed purchase orders with the plaintiff- Company on 24.9.1994 on the terms and conditions/ specifications and rates as per tender submitted by the plaintiff- Company to the Ludhiana Union. But the milk R.S.A. No.658 of 2008 -4- film supplied by the plaintiff- Company was defective as there was a leakage, when the milk was filled therein. Thus, the answering defendant suffered huge losses and in this view of the matter, the deductions to the tune of Rs.88,309/- were made from the bills of the plaintiff- Company. In the written statement, the defendant- Ropar Union has admitted that it placed order with the plaintiff- Company through letter dated 7.12.1994 and the plaintiff- Company had supplied 2720 kilograms of Poly-film blue (milk film) short and the total quantity as per rates if calculated comes to Rs.1,90,691.20 out of which, Rs.1,51,000/- was sent to the plaintiff- Company through a bank draft and Rs.1533/- were deducted as expenses of bank charges for preparing the bank drafts (totalling Rs.1,52,553/-). The remaining amount was deducted as the material supplied by the plaintiff- Company was sub-standard. The following issues were framed:- 1. Whether the plaintiff is entitled for recovery of Rs.2,56,958/- ? OPP 2. Whether the plaintiff is entitled for interest, if so, at what rate? OPP 3. Whether the suit has not been filed by competent person? OPD 4. Whether this Court has no jurisdiction to entertain & try the present suit? OPD 5. Relief. After hearing the learned counsel for the parties and examining the evidence on record, the learned trial Court decreed the suit as noted supra. Feeling aggrieved therewith, the defendants went in appeal which R.S.A. No.658 of 2008 -5- was dismissed by the First Appellate Court with the observations noted hereinbefore. Being undaunted and dissatisfied therewith, the defendants have preferred this appeal. I have heard the learned counsel for the parties, besides perusing the record as well as the findings returned by both the Courts below with due care and circumspection. Mr. Ajay Mahajan, Advocate representing the appellants urged with great eloquence that the amounts have been deducted by the appellants due to quality cut as there was leakage in the milk film depicted in Ex.R.2/6 to Ex.R.2/8 and Ex.D3/3 to Ex.D3/9. He further argued that the appellants witnesses were not cross-examined on the point that the milk films were of specified quality and there was no leakage and thus whatsoever was stated by them will be deemed to have been admitted as correct. The next argument raised by Mr. Mahajan is that the plaintiff did not file with the plaint registration certificate nor proceedings book showing that the person who instituted the suit was duly authorised and thus, the suit is not maintainable. To tide over these submissions, Mr. Arun Sharma, Advocate appearing on behalf of the respondent contended that the appellants have not adduced any cogent evidence showing that there was leakage in the milk film. I have well considered the rival contentions. The following substantial question of law arises for determination by this Court:- “Whether civil suit in absence of registration certificate of firm and proceedings book showing resolution is competent?” R.S.A. No.658 of 2008 -6- If there was leakage in the milk film, it was obligatory upon the appellants to have produced the report of some expert committee or scientific body in proof of this fact. In the absence of such report, it is very difficult to say that there was leakage in the milk film. This apart, there is no evidence to the effect that the material was ever checked by the technical staff. It is further argued on behalf of the appellants that as would follow from the record, no registration certification or resolution or the proceedings book was filed by the plaintiff with the plaint or with the affidavit of the plaintiff- respondent and thus, the suit was not filed by the duly authorised person. This contention does not find favour with me. Ex.PW15 is the resolution dated 15.2.1997 vide which Captain Arun Sharma, Managing Director of the plaintiff- Company was authorised to file the suit for recovery, sign affidavit, engage counsel, settle fee and take other necessary steps for the purpose. In the face of this document, the contention raised by learned counsel for the appellants pales into insignificance. The production of registration certificate or the proceeding book was not necessary. The resolution referred to above was suffice to authorise Mr. Arun Sharma to file the suit. Thus, the substantial question of law stand determined against the appellants. It is further argued on behalf of the appellants that the Civil Court at Chandigarh did not have the jurisdiction to entertain and try the suit. This contention again has no legs to stand upon for the reason that the head office of the plaintiff- firm is situated at Chandigarh and that being so, the jurisdiction of the Civil Court at Chandigarh could be invoked. The order was placed by defendants No.2 and 3 with the plaintiff at Chandigarh. Thus, cause of action had also arisen at Chandigarh. If it is assumed that this suit was not cognizable by the Civil Court at Chandigarh, it was R.S.A. No.658 of 2008 -7- imperative upon the defendants- appellants to have got the issue with regards to jurisdiction decided at the earliest possible opportunity in view of the provisions as enshrined in Section 21 of the Code of Civil Procedure. The learned First Appellate Court has observed in the impugned judgment that Rs.83,309/- was due towards the defendants, which fact is also not disputed by the defendants. However, it is an admitted fact that out of this amount, Rs.11,882/- were sent to the plaintiff- Company by Ludhiana Union. Thus, an amount of Rs.71,427/- was due towards the Ludhiana Union and this amount is legally recoverable from the Ludhiana Union along with interest as calculated by the learned trial Court. It is also admitted that an amount of Rs.1,91,182/- was due and out of this amount, Rs.1,51,000/- was paid to the plaintiff- Company. This defendant Ropar – Union has produced the payment bill voucher Ex.DW3/4. However, it is alleged that an amount of Rs.1,553/- was deducted on account of the charges with regards to the preparation of the bank draft. This amount cannot be deducted and thus plaintiff- Company is entitled to recover the balance amount of Rs.40,182/-. It is also an admitted fact that the defendants had also received material per packing paneer worth Rs.15,000/- which has not been paid by Ludhiana Union. On going through the concurrent findings returned by both the Courts below, it transpires that no interference is warranted therein. Sequelly, this appeal is dismissed being devoid of any merit. Of course, having regard to the peculiarity of facts and circumstances of the case, the parties are directed to bear their own costs. November 21, 2008 ( HARBANS LAL ) renu JUDGE R.S.A. No.658 of 2008 -8- Whether to be referred to the Reporter? Yes/No