IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED :18.06.2009 CORAM THE HONOURABLE MR.JUSTICE M.VENUGOPAL APPEAL SUIT NO.417 OF 2002 - - - - Southern Petrochemicals Industries Corporation Limited, Registered office at No.36-40, Armenian Street, Chennai 600 032. having its Branch Office at: No.97, Mount Road, Guindy, Chennai - 600 032. rep by its Secretary Santhana Krishnan ... Appellant/Plaintiff Vs. K.Bhoomaiah ... Respondent/Defendant Appeal suit filed under Section 96 of Code of Civil Procedure, against the judgment and decree dated 20.04.1998 in O.S.No.15027 of 1996 on the file of the IV Additional City Civil Judge, Madras. For appellant : Mr.Rangarajan For Respondent : Mr.B.Giridhara Rao J U D G M E N T The appellant/plaintiff has filed this appeal against the judgment and decree dated 20.04.1998 made in O.S.No.15027 of 1996 by the learned IV Additional City Civil Judge, Madras in dismissing the suit. 2.The necessary facts for disposal of the appeal are set out below: (i)The appellant/plaintiff is engaged in the manufacture and sale of fertiliser products. The respondent/defendant is carrying on business as Dealer in fertiliser products under the name of M/s.Sri Siddirameshwara Fertilisers as Proprietor. The appellant and the respondent have entered into an agreement dated 26.6.1984 at https://hcservices.ecourts.gov.in/hcservices/ Madras in and by which the defendant has been appointed as a Dealer for the appellant/plaintiff's products on a non-exclusive basis for the location at Nizampet in Medak District. (ii)By virtue of the agreement dated 26.6.1984 the respondent/ defendant has been placing orders with the appellant/plaintiff for supply of its products in various quantities. The appellant has made supplies to the respondent/defendant as per orders. In regard to the said supplies, the parties do have a running account. The payments effected by the respondent/defendant in regard to the supplies made have been given credit to after debiting the cost of the supplies made by the appellant to the respondent. Because of the said supplies made by the appellant to the respondent/defendant, there is an outstanding sum of Rs.3,87,079/- as per the running account. (iii)When the appellant presented the cheques to its bankers, the same have been dishonoured by the respondent's bankers for the reason 'Refer to Drawer'. Though the respondent/defendant has been given credit against each purchase order, the defendant has not been given credit for more than 30 days in regard to the supplies made. Despite many reminders and personal request made by the appellant's representatives, the respondent/defendant has not bothered to pay. Still there is an outstanding amount of Rs.2,69,299.84 towards principal, due from the respondent. As per the covenants of agreement dated 26.6.1984 the respondent/defendant is to make the payment to the appellant/ plaintiff at Madras by way of crossed demand drafts/cheques. (iv)The respondent is liable to pay an amount of Rs.2,69,229.84 in respect of principal and Rs.1,17,849.16 towards interest at the prevailing rate fixed in the invoice by the appellant at 20% per annum till the date of plaint and in all a sum of Rs.3,87,079/- is due as per the statement of accounts. Since the claim is a commercial cause, the appellant claims future interest at the rate of 20% per annum from the date of plaint till the date of realisation. (v)The appellant/plaintiff has issued a legal notice dated 29.10.1987 to the respondent/defendant claiming the payment of balance amount along with interest. The respondent/defendant received the notice but has not issued any reply. Hence, the suit is laid for recovery of sum of Rs.3,87,079/- along with interest at 20% per annum on Rs.2,69,229.84 from the date of plaint till the date of decree and for future interest at the rate of 20% per annum on the https://hcservices.ecourts.gov.in/hcservices/ decree amount from the date of realisation in full and for costs. 3(i). The respondent/defendant has taken the pleas in the written statement that no invoices have been raised on 25.4.1986, 28.4.1986, 30.4.1986, 13.6.1986, 29.5.1986 and 30.6.1986 and that no goods have been delivered to him on the aforesaid dates from Hyderabad or Kamareddy where the appellant's warehouses are located and further that he has issued 10 or 12 blank signed undated cheques to one Mr.B.Ashokan, Resident Sales Officer of the appellant company and this has been the policy of the appellant's company and that the dates of 10.7.1986, 21.7.1986, 22.8.1986, 21.5.1986, 28.5.1986 and 5.8.1986 have been filled by the said Sales Officer, who deposited the said cheques drawn on a Bank in Kalvakunta, Medak District, Andra Pradesh, in Hyderabad, outside the jurisdiction of the trial Court, without the supply of goods and moreover, the agreement between the parties has been signed in Nizampet and therefore, the same will not confer jurisdiction on the trial Court. (ii)Added further, the respondent/defendant has taken a stand that the cheques in favour of the appellant's company, in the Indian Overseas Company in Hyderabad by the said Sales Officer without the knowledge of the respondent/defendant. Furthermore, the practice of the appellant's company is to have their agents give blank, signed, undated cheques to their Sales Officer which are them filled by him against goods delivered and in the present case, no goods have been delivered and no delivery notes have been signed by the respondent/defendant since no supplies have been effected to the respondent. In short, no goods have been delivered between 25.4.1986 to 30.6.1986 to the respondent/defendant. Besides the above, the respondent/defendant has complained to the Manager Mr.Vasudevan of the fraud committed by the said Ashokan. Since the respondent does not owe to the appellant/plaintiff the principal sum of Rs.2,69,329.84, the issue of interest does not arise. (iii)On the basis of the above pleadings, the trial Court has framed as many as eight issues and resultantly has come to the conclusion that the appellant/plaintiff is not entitled to claim the suit amount and dismissed the suit without costs. (iv)Before the trial Court, on the side of appellant, P.W.1 has been examined and Exs.A.1 to A.52 have been marked. On the side of respondent/ defendant, D.W.1 has been examined and no exhibits have been marked. 4.The points that arise for determination are: (1)Whether the plaintiff is entitled to claim the suit https://hcservices.ecourts.gov.in/hcservices/ amount along with interest as prayed for in the plaint? (2)Whether the respondent/defendant has issued blank unsigned undated cheques to the Resident Sales Officer of the appellant company Mr.B.Ashokan? (3)Whether the appellant/plaintiff company has proved the delivery of supplies of fertilisers to the respondent/defendant? 5.Findings on Point Nos.1 and 3:- P.W.1 in his evidence has deposed that the respondent/defendant has placed orders with the appellant/plaintiff's company for supply of fertilisers and the said invoices are Exs.A.2 to A.14 and that the appellant/plaintiff company has supplied the fertilisers to the respondent/defendant as per Exs.A.2 to A.14 and the delivery notes are Exs.A.15 to A.27 and that the respondent/ defendant has issued cheques Exs.A.28 to A.39 and they have returned by the Bank as per endorsements Ex.A.40 to A.49 and the factum of return of cheques by the bank has been informed to the respondent/defendant and that the respondent/defendant has not paid the amount and therefore, the lawyer's notice Ex.A.50 has been issued, for which the respondent/defendant has not replied and Ex.A.51 is the acknowledgement for the notice issued and that the account copy is Ex.A.52 and that the respondent has to pay a sum of Rs.3,87,079/- as on date of filing of the plaint along with interest at 20% per annum. 6.The evidence of P.W.1 during his cross examination is to the effect that the respondent/defendant has signed Ex.A.1 agreement at Chennai and at that time, he has not been present and that the delivery notes have been issued by the Sales Officer B.Ashokan and that the letters given by the respondent/ defendant has not been filed and that the signatures found in Ex.A.15 to A.27 are that of the agent of the respondent and that the said Ashokan is not in service at present. 7.At this stage, it is useful to refer to the evidence of D.W.1/respondent to the effect that he has signed in Ex.A.1 agreement at Nizampet in Andra and that the said Ashokan has brought Ex.A.1 agreement and obtained his signatures and the appellant's company's sales representative is Ashokan and the Secretary of the appellant/plaintiff's company has already affixed his signature when he has signed in Ex.A.1 and also the agreement contained the seal and after signing the agreement he has given the unfilled cheques with his signatures affixed therein the cheques will be filled up and presented before the Bank after the supplies are effected and that he has not issued supply orders Exs.A.2 to Ex.A.14 and in the https://hcservices.ecourts.gov.in/hcservices/ delivery notes Exs.A.15 to A.27 he has not signed and that he has not received the goods and the cheques Ex.A.28 and A.39 have been filled up by the appellant/plaintiff's Sales Officer Ashokan and the signatures found in the cheques belonged to him and when he asked the said Ashokan as to why he has deposited the cheques in the banks without supply of goods the said Ashokan has replied that he will sell the goods to third party and remit the money and that he has not complained to the appellant/plaintiff since the said Ashokan threatened him that his dealership will be cancelled and since he has not received the goods, he is not liable to pay the said amount claimed for. 8.It is the specific case of the appellant/plaintiff that it has effected the supplies to the respondent/defendant as per orders placed. Further the appellant/plaintiff claims in the plaint that the appellant is liable to pay a sum of Rs.3,87,079/- as due for the supply of fertilisers effected to the respondent/ defendant along with interest at 20% per annum etc. In Ex.A.1 agreement dated 26.6.1984 entered between the appellant/plaintiff and the defendant/respondent it is mentioned as 'this agreement entered into at Madras on 26th day of June 1984'. In Ex.A.1 agreement (printed form at page 4) the witness Niranjan Bhatt of the appellant's company, Guindy, Madras-32 has signed. Further, after the respondent/defendant has signed in Ex.A.1 agreement, the witness has signed for Laxmi Narsimha Trading Company, as Manager on the side of respondent/ defendant. Admittedly, the respondent/defendant has not examined the witness who signed for Laxmi Narsimha Trading Company on his behalf before the trial Court to substantiate his contention that the said agreement has not been executed at Madras and it has been executed only at Nizampet at Medak District in Andra Pradesh. Though the respondent/defendant has averred in his evidence that the sales representative of appellant's company B.Ashokan has come to Nizampet and obtained his signature, the said Ashokan has not been examined as a witness in the case on behalf of the respondent/defendant to prove to the satisfaction of the Court that the said agreement has been signed by the respondent only at Nizampet of Medak District. In the absence of the said Ashokan being examined as a material witness before the trial Court on behalf of the respondent/ defendant and in view of the fact that the Ex.A.1 agreement clearly mentions that the same has been entered at Madras on 26.6.1984 it is held by this Court that Ex.A.1 agreement has been entered into between the parties only at Madras on 26.6.1984 and the same is answered accordingly. 9.In view of the fact that Ex.A.1 agreement dated 26.6.1984 has been executed at Madras the City Civil Court, Chennai has jurisdiction and in view of the fact that Ex.A.1 agreement clearly https://hcservices.ecourts.gov.in/hcservices/ satisfies that 'the Courts at Madras only shall be deemed to the Courts of jurisdiction in respect of any suits, claims, disputes etc. arising out of or relating to this agreement, this Court comes to the inevitable conclusion that the trial Court has jurisdiction to entertain the suit and decide the same in accordance with law. 10.A perusal of the Exs.A.2 to A.14 dealer invoices of the appellant's company has only the signature of the authorised signatory of the appellant/ plaintiff's company. These documents which are in printed format have been typed out in the relevant portions and in all these, the respondent/defendant signature is not found. In Exs.A.15 to A.27 delivery note of the appellant's company, the respondent/defendant's fertilisers is found and in the portion received the materials in good condition, one individual has signed in Telugu as Consignee/Carrier. In these also the signature of the respondent/defendant Boomaiah is not to be seen. 11.It is the categorical stand of the respondent/defendant that he has not placed orders for the supply of fertilisers as per Exs.A.2 to A.14 and further, he has not received the goods in issue and therefore, the appellant/plaintiff company cannot saddled the respondent/defendant with that of the liability to pay the suit amount. 12.It is to be remembered that in a civil suit the plaintiff is the dominus litus and the same is not an absolute or a universal rule in the eye of law. The contention of the appellant/plaintiff's company is that the respondent/ defendant's agent has received the fertilisers on behalf of the principal viz., the respondent/defendant and therefore, the respondent/defendant is in law under obligation to pay the amount for the goods supplied by the appellant. 13.It is not out of place to make a mention that the essentials of Sale of Goods are: (1) the existence of goods for sale and further there must be a contract of sale and there shall also be a promise or payment of consideration. It is for the Court to ascertain the intention of parties in regard to the contract they have made. Also there must be an agreement or a contract to pay the interest also. The appellant/plaintiff company has issued Ex.A.50 a lawyer's notice dated 29.10.1987 addressed to the respondent/defendant company wherein it is made mention of that the respondent/defendant has been appointed as a dealer of the appellant/plaintiff under the agreement dated 26.6.1984 and that the respondent/defendant has been drawing the products from the appellant and making payments for the same on a running account basis and that the respondent/defendant has issued various cheques and the same have been dishonoured by the bankers and that a total https://hcservices.ecourts.gov.in/hcservices/ of Rs.3,53,182.84 published is due to the appellant/plaintiff and the same is liable to be paid at the rate of 20% per annum as per the terms of the agreement from 1.9.1987 till the date of payment in full etc. The acknowledgement for the receipt of Ex.A.50 notice has been marked as Ex.A.51. The learned counsel for the appellant/ plaintiff has drawn the attention of this court to the fact that the appellant/plaintiff company has issued a lawyer's notice Ex.A.50 dated 29.10.1987 and the same has been acknowledged by the respondent/defendant, but the respondent/defendant has not replied to the said notice and non-sending of a reply to Ex.A.50 notice is fatal to the case of the respondent/defendant. One cannot ignore an important fact that a sale can be completed without effecting without immediate delivery and even without immediate payment and it cannot be forgotten that fixing of prize is not invariably ruled in a contract of sale. 14.It is well settled principle of law that even after the goods have been delivered into the actual possession of the buyer the performance of the seller's duties may still be incomplete by a reason of the breach of the some of the conditions or warranty expressed or implied whether as to title, or quality or fitness to which it has to bound itself by the contract. In such cases, even if there is breach of a clause a covenant purchaser by taking delivery may treat the same as a breach of warranty in the eye of law. As far as the present case is concerned, Exs.A.15 to 27 relates to the warehouse delivery note of appellant/plaintiff's company and a perusal of the same indicates that an individual has signed in Telugu as Consignee/Carrier. The appellant/plaintiff's company's stand is that the said signature in Telugu as Consignee/Carrier represents the agent/representative of respondent/defendant company and therefore, it is clear that the appellant/plaintiff's company has supplied the fertilisers to the respondent/defendant. Generally, if an agent receives the goods on behalf of the buyer then the same is valid in law but in the present case before us, the contention of the respondent/defendant company is that the goods have not been delivered on 25.4.1986, 30.4.1986, 13.6.1986, 30.6.1986, 29.5.1986 and 30.6.1986 from Hyderabad or Kamareddy whether the appellant/ plaintiff's warehouses have been located. Therefore to the satisfaction of this Court it is for the appellant/plaintiff company to establish that the goods delivered by it have been received by the respondent/defendant or its agent or authorised representatives as the case may be. 15.On a careful consideration of the facts and circumstances of the case and upon perusing the oral and documentary evidence available on record, this Court comes to the conclusion that the appellant/plaintiff has not discharged its burden to establish that https://hcservices.ecourts.gov.in/hcservices/ the goods delivered by it to the respondent/defendant have been received by him either personally or through his authorised representative or his agent. Added further, the non-examination of one Mr.Ashokan, Sales Officer of the company is a circumstance which goes against the case of appellant/plaintiff. When the averments in written statement are centred around one Mr.B.Ashokan, being the Resident Sales Officer of the appellant/plaintiff company then the appellant/plaintiff company is duty bound to examine him as a material witness to rebut the version projected by the respondent/defendant. Nothing prevented the appellant/plaintiff to examine B.Ashokan (Resident Sales Officer) even though he is not in service. In fact, the evidence of P.W.1 who speaks from records of the case is not helpful to the side of appellant/plaintiff in establishing the suit claim, in the considered opinion of this Court. 16.Be that as it may, another circumstance which goes against the appellant/plaintiff is that they have not identified the person who has signed in the delivery note as Consignee in Telugu language and the said person has not also been examined as a witness before the trial Court. 17.Hence, this Court is of the considered view that the appellant/plaintiff is not entitled to claim the suit amount and that it has not proved to the subjective satisfaction of this Court that the fertilisers it has supplied to the respondent/defendant company have been actually received by the respondent/defendant either personally or through his agent or authorised representative. Hence, these points are answered against the appellant/plaintiff. 18.Point No.2: The plea of the appellant/plaintiff company is that the respondent/defendant has made payments in regard to the supply of fertilisers by means of various cheques and when the said cheques have been presented to the bankers, the same have been dishonoured for the reason 'Refer to Drawer'. The respondent/defendant has taken a contra stand that the respondent/defendant has issued 10 or 12 blank, signed, undated cheques to one B.Ashokan, Resident Sales Officer of the appellant/plaintiff company and the policy of the appellant/ plaintiff company is to take the blank, signed, undated cheques and that the dates viz., 10.7.1986, 21.7.1986, 22.8.1986, 21.5.1986, 28.5.1986 and 5.8.1986 have been filled by the said Sales Officer who deposited the said cheques drawn on a bank in Kalvakunta, Medak District, Andra Pradesh in bank in Hyderabad. In Exs.A.28 to A.40 the original cheques, the Proprietor of the respondent/ defendant has signed in Telugu. It is to be noted that in para 13 of the written statement an averment has been made to the effect that 'the https://hcservices.ecourts.gov.in/hcservices/ practice of the plaintiff company is to have their agents give blank, signed, undated cheques to their Sales Officer which are they filled by them against the goods delivery and in this case, no goods have been delivered.' It is pertinent to make a mention that the respondent/defendant has admitted his signatures in the cheques viz., Exs.A.28 to A.39. In law, the Holder of Due Course is entitled to fill up the cheque, which is being a negotiable instrument. When D.W.1/respondent/defendant in his evidence has categorically stated that he has studied upto 3rd standard and that he does not know English and further that when that the dates in the cheques have been filled by the Sales Officer of appellant company Mr.B.Ashokan then a heavy burden is cast on the appellant/plaintiff to examine the said Ashokan on appellant/plaintiff's side to establish that the fertilisers have been supplied as per the payment made by the respondent/ defendant and that the respondent/defendant has issued the 10 or 12 blank, signed and undated cheques in regard to the payments to be made for the supply of fertilisers. Unfortunately, the said Mr.B.Ashokan has not been examined on behalf of the appellant/plaintiff company as a witness and the reason ascribed for the same is that he is not in service and that he has not been dismissed from service. In the present case, Mr.B.Ashokan, Resident Sales Officer of the appellant/plaintiff company has played a vital and big part and the fact that he has not been examined on behalf of the appellant/plaintiff's company to prove its case in entirety much less in regard to the receipt of 10 or 12 blank, signed, undated cheques a circumstance which clearly goes against the appellant/plaintiff's company. In this case, the appellant/plaintiff's company has not proved to the satisfaction of this Court that the respondent/defendant who does not know English and who has studied only upto 3rd standard has issued the blank, signed, undated cheques after knowing the consequences thereto. When a person is a semi-illiterate and not knowing English language then it is for the appellant/plaintiff to prove its case before a Court of law to the subjective satisfaction of the Court. 19.Looking at from any angle and on an overall assessment of the facts and circumstances of the case and taking note of the oral and documentary evidence adduced on both sides and after analysing the same meticulously in an in-depth fashion and the non examination of Ashokan, the Resident Sales Officer of appellant company probabalises the case of the respondent/defendant that the latter has issued 10 or 12 blank, signed, undated cheques to the said officer of the appellant/plaintiff company for filling the same against the goods delivery and further the appellant/plaintiff company has not proved that the fertilisers it has delivered have been received by the respondent/defendant either personally or by his authorised representative or agent as the case may be and the https://hcservices.ecourts.gov.in/hcservices/ point is answered against the appellant/plaintiff. 20.In fine, for the foregoing reasons, the appeal fails and the same is hereby dismissed. The judgment and decree passed by the trial Court are affirmed by this Court in this appeal. Considering the facts and circumstances of the case, there shall be no order as to costs. Sd/ Asst.Registrar /true copy/ Sub Asst.Registrar sgl To 1.The IV Additional Judge,City Civil Judge, Madras. 2.The Section Officer, VR Section, High Court,Madras. +2ccs to Mr.Rangarajan,Advocate Sr 24124 +1cc to Mr.B.Giridhara Rao, Advocate Sr 24158 NTK(CO) km/8.7. A.S.No.417 of 2002 https://hcservices.ecourts.gov.in/hcservices/