Final Order 1

Order Details: Notice of Motion
Pdf Text: 1 NM no. 2181-18 in S.C.SUIT no.2091-17
IN THE CITY CIVIL COURT FOR GREATER BOMBAY
AT MUMBAI.
NOTICE OF MOTION NO. 2181 OF 2018
(CNR no. MHCC01-007058-2018)
IN
SHORT CAUSE SUIT NO. 2091 OF 2017
(CNR no. MHCC01-008598-2017)
Parksons Packaging Pvt. Ltd.
Indiabulls Finance Centre, Tower-1, 701-702,
7th Floor, Senapati Bapat Marg,
Elphinstone (West), Mumbai-400013.
]
]
]
]...
Plaintiff
Versus
1. R. B. Trading
402, B Wing, 4th Floor, Business Suits-9,
SV Rd, Santacruz (West), Mumbai-54.
]
]
]
2. Wockhard Ltd.
Wockhardt Towers, Bandra Kurla Complex,
Bandra (East), Mumbai-51.
]
]
]
3. Paramount Consultant and Corporate
Advisors Pvt. Ltd.
205, Crecent Business Park, Andheri Kurla
Road, Saki Naka Telephone Exchange, Saki
Naka,
Andheri (East), Mumbai-72.
]
]
]
]
]
]...
Defendants
Appearances:-
Ld. Advocate Mr. Vishesh Kaura for the Plaintiff.
Ld. Advocate Ms. Astha Thakar for Defendant no.2.
None for Defendants no. 1 and 3.
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2 NM no. 2181-18 in S.C.SUIT no.2091-17
CORAM : HIS HONOUR JUDGE
SHRI C.V. MARATHE
(Court Room no. 4)
DATED : 10th February, 2020.
O R A L O R D E R
1. This is Notice of Motion for passing judgment under
Order XII Rule 6 of The Code of Civil Procedure, 1908.
2. Before adverting to prayers in this notice of motion it
will be useful to reproduce relevant plaint allegations which are as
under:
The Plaintiff Company is engaged in the business of
manufacture and supply of packaging material. The Defendant
no.2 Company is engaged in the business of manufacturing of
drugs. The Plaintiff Company used to supply packaging
material to Defendant no.2. The Defendant no.3 Company is
engaged in the business of providing facilitation services for
finding lenders in the market for the purposes of bill
discounting. The Defendant no.1 provides finance by
discounting Bills of Exchange.
After receipt of Purchase Orders of Rs.34,95,942/-
(Rupees Thirty Four Lakhs Ninety Five Thousand Nine Hundred
Forty Two only) from defendant no.2 towards purchase of packing
materials, the plaintiff Company completed the Orders and raised tax
invoice as tabulated below :
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3 NM no. 2181-18 in S.C.SUIT no.2091-17
Sr. No. Invoice No. Invoice Date Invoice Value Exhibit
1. 1400875 29-April-17 3,46,546.00 D-1
2. 1400621 23-April-17 3,56,508.00 D-2
3. 1101383 30-April-17 3,69,436.00 D-3
4. 1101281 29-April-17 4,31,994.00 D-4
5. 1101260 29-April-17 38,391.00 D-5
6. 1101152 27-April-17 92,811.00 D-6
7. 1101386 30-April-17 3,29,045.00 D-7
8. 1101385 30-April-17 1,64,522.00 D-8
9. 1101384 30-April-17 2,25,602.00 D-9
10. 1101602 06-May-17 39,899.00 D-10
11. 1101601 06-May-17 48,273.00 D-11
12. 1101600 06-May-17 17,733.00 D-12
13. 1101458 03-May-17 41,788.00 D-13
14. 1101413 30-April-17 1,23,145.00 D-14
15. 1101387 30-April-17 3,28,059.00 D-15
Total 29,53,752.00
Said Tax Invoices were accepted by Defendant no.2.
With intention of receiving early payment. The plaintiff Company
issued 4 Bills of Exchange which are tabulated below:
Hundi
No./Bill
of
Exchange
Amount
Date of
Bill of
Exchange
Due
Date
Invoice
No.
Invoice
Date
Invoice
Value EXH
PPL/WL/
17-18/P/
004
7,03,054.00 29.04.17 04.09.17
1400875 29-Apr-17 3,46,546.00
E-1	1400621 23-Apr-17 3,56,508.00
7,03,054.00
PPL/WL/
17-18/P/
006
9,32,632.00 30.04.17 04.09.17
1101383 30-Apr-17 3,69,436.00
E-2
1101281 29-Apr-17 4,31,994.00
1101260 29-Apr-17 38,391.00
1101152 27-Apr-17 92,811.00
9,32,632.00
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4 NM no. 2181-18 in S.C.SUIT no.2091-17
Hundi
No./Bill
of
Exchange
Amount
Date of
Bill of
Exchange
Due
Date
Invoice
No.
Invoice
Date
Invoice
Value EXH
PPL/WL/
17-18/P/
007
7,19,169.00 30.04.17 04.09.17
1101386 30-Apr-17 3,29,045.00
E-3
1101385 30-Apr-17 1,64,522.00
1101384 30-Apr-17 2,25,602.00
7,19,169.00
PPL/WL/
17-18/P/
009
5,98,897.00 06.05.17 04.09.17
1101602 06-May-17 39,899.00
E-4
1101601 06-May-17 48,273.00
1101600 06-May-17 17,733.00
1101458 03-May-17 41,788.00
1101413 30-Apr-17 1,23,145.00
1101387 30-Apr-17 3,28,059.00
5,98,897.00
Total 29,53,752.00
These Bills of Exchange are referred to as “the Said Bills
of Exchange” for brevity.
The said Bills of Exchange were handed over to
Defendant no.3 for discounting. Defendant no.3 identified defendant
no.1 as a lender to get the said Bills of Exchange discounted and
thereafter, filled the name and bank details of Defendant no.1
therein along with Bill Discounting Advice (Exhibits “F-1 to F-4” in
the plaint) dated 09.06.2017. The Defendant no.3 informed the
plaintiff that the said Bills of Exchange were accepted by defendant
no.2 on 09.06.2017 and thereafter, the said bills were submitted to
defendant no.1 for the purposes of discounting on 10.06.2017. The
copies of the said bills are at Exhibits “G-1 to G-4” in the plaint.
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5 NM no. 2181-18 in S.C.SUIT no.2091-17
3. Despite of the acceptance, the Defendant no.1 did not
discount the same as per bill discounting Advice and did not pay
any heed. The reminders of defendant no.3 in that regard are
tendered vide Exhibit “H (colly)” in the plaint. The defendant no.3
proposed that the plaintiff should cancel the Bills of Exchange vide
email dated 06.07.2017 (Exhibit “I” in the plaint). Thereafter,
Defendant no.3 informed the plaintiff to take legal recourse against
defendant no.1 vide email dated 14.07.2017 (Exhibit “J” in the
plaint). Thereafter, the plaintiff sent letter to defendant no.2 to treat
the Bills of Exchange as cancelled and not to make any payment to
defendant no.1 as the defendant no.1 failed to discount the
abovementioned Bills of Exchange. On 15.07.2017 the defendant
no.3 also wrote to defendant no.2 and informed that the original
Bills of Exchange were not traceable and the same be treated as
cancelled and payment be directly released to the plaintiff by the
above mentioned Tax Invoices, the said letter dated 17.07.2017 and
15.07.2017 are at Exhibits “K” and “L” respectively along with the
plaint.
4. Thereafter, the plaintiff issued legal notice to defendants
no.1 to 3 calling upon defendant no.1 to immediately return the
original Bills of Exchange to the plaintiff to enable the plaintiff to
cancel the same. On 28.07.2017, the defendant no.1 replied to the
notice of the plaintiff dated 24.07.2017 denying the relation with the
plaintiff and the said Bills of Exchange. In the reply dated
28.07.2017, the defendant no.3 accepted the position that the
defendant no.1 had accepted the said Bills of Exchange but
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6 NM no. 2181-18 in S.C.SUIT no.2091-17
intentionally withheld the payments due to some disputes between
the promoter of Defendant no.3 and Defendant no.1. Despite notice,
the defendant no.2 did not treat that the said Bills of Exchange as
cancelled. On 22.08.2017 the defendant no.2 company informed the
plaintiff that it would not be in a position to withhold the payment
after 04.09.2017 without order of competent Court. Therefore, the
plaintiff Company has filed the instant suit for following reliefs :-
a) That this Hon’ble Court be pleased to declare that the
bills of exchange at Exhibit E-1 to E-4 as not enforceable
in law.
b) This Hon’ble Court be pleased to pass an order of
injunction restraining the Defendants from acting on the
said bills of exchange at Exhibit E-1 to E-4.
c) This Hon’ble Court be pleased to pass an order of
mandatory injunction thereby directing the Defendant no.2
to make payments directly to the Plaintiff for the amounts
due and payable under the invoices at Exhibit D-1 to D-
15 along with interest @_% computed from 4th
September, 2017 till the date of realization.
d) This Hon’ble Court be pleased to direct the Defendants
No.1 to 3 to pay damages to the tune of Rs.10 lakhs
jointly or severally to the plaintiff.
Ld. Advocate for the Plaintiff Company has submitted
that the defendants have not appeared in the suit and the
communications between parties in the form of letters, e-mails, Bills
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7 NM no. 2181-18 in S.C.SUIT no.2091-17
of Exchange are clear admissions of facts in the case and he prays
to pass judgment on admission. He has tendered judgment of
Hon’ble Appex Court in the case of Uttam Singh Duggal & Co. Ltd.
Vs. United Bank of India and Others [(2000)7 SCC 120]. Paragraphs
No.12 and 13 of the said judgment are important which read as
under:-
12. As to object of Order 12 Rule 6, we need not say anything
more than what the legislature itself has said when the said
provision came to be amended. In the Objects and reasons set
out while amending the said Rule, it is stated that “where a
claim is admitted, the court has jurisdiction to enter a
judgment for the plaintiff and to pass a decree on admitted
claim. The object of the Rule is to enable the party to obtain
a speedy judgment at least tot he extent of the relief to
which according to the admission of the defendant, the
plaintiff is entitled”. We should not unduly narrow down the
meaning of this Rule as the object is to enable a party to
obtain speedy judgment. Where the other party has made a
plain admission entitling the former to succeed, it should
apply and also wherever there is a clear admission of facts in
the face of which it is impossible for the party making such
admission to succeed.
13. The next contention canvassed is that the resolutions or
minutes of the meeting of the Board of Directors, resolution
passed thereon and the letter sending the said resolution to
the respondent Bank cannot amount to a pleading or come
within the scope of the Rule as such statements are not made
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8 NM no. 2181-18 in S.C.SUIT no.2091-17
in the course of the pleadings or otherwise. When a statement
is made to a party and such statement is brought before the
court showing admission of liability by an application filed
under Order 12 Rule 6 and the other side has sufficient
opportunity to explain the said admission and if such
explanation is not accepted by the court, we do not think the
trial court is helpless in refusing to pass a decree. We have
adverted to the basis of the claim and the manner in which
the trial court has dealt with the same. When the trial Judge
states that the statement made in the proceedings of the
Board of Directors’ meeting and the letter sent as well as the
pleadings when read together, leads to unambiguous and clear
admission with only the extent to which the admission is
made in dispute, and the court had a duty to decide the
same and grant a decree, we think this approach is
unexceptionable.
In the case of Ultramatix Systems Vs. State Bank of India
[2007(4) Mh.L.J.] Division Bench of Hon’ble Bombay High Court laid
down principle in paragraph no.8 in respect of Rule 6 of Order XII
of The Code of Civil Procedure, 1908 which read as under:
8. Having come to the conclusion that the amounts set out in
the profit and loss account are an admission of amounts due
by the petitioner to respondent no.1, the question that has to
be answered is whether the admission has to be in the course
of the proceedings. We may refer to the judgment of the
Supreme Court in Uttam Singh Dugal and Co. Ltd. Vs. Union
Bank of India and ors. The issue there arose considering the
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9 NM no. 2181-18 in S.C.SUIT no.2091-17
provisions of Order XII, Rule 6 of the Civil Procedure Code.
The contention urged was that resolutions or minutes of the
meeting of the Board of Directors and resolution thereof
cannot amount to a pleading to come within the ambit of the
rule. The Supreme Court noted that before the trial Court,
there was no pleading much less an explanation as to the
circumstances in which the said admission was made so as to
take it out the category of admission. The Court noted that
the matter could be decided even without referring to the
expression “otherwise” in Rule 6 of Order XII of Civil
Procedure Code and that an inference of liability could be
drawn on the basis of the pleadings. In the instant case also,
in the application, the respondent no.1 had pleaded based on
the profit and loss account of the petitioners that the amount
set out therein was an admission that the amount was due
and payable. There was no specific denial except for such
vague pleadings. It is, therefore, clear that there was an
admission by the petitioner in response to the application
taken out by the respondent no.1. No material was produced
or explanation given of the circumstance under which the
admission was made to take it out of the category of
admissions which created the liability. On this count itself,
the petition, in our opinion is liable to be dismissed as the
admission would be admission binding on the petitioner and
it was open to the Tribunal to pass an order in terms of
Section 19(20) of the Act read with Rule 12(5) of the Rules.
Assuming it not to be so, then whether the admission
is required to be made only in the pleadings. The language of
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10 NM no. 2181-18 in S.C.SUIT no.2091-17
the Rule does not lend itself to that construction, as the
expression does not require that the admission must be made
by the defendant in the pleadings before the Tribunal. The
expression “defendant” has to be considered in the context of
the opponent in the proceeding. The language used is to
order such defendant to pay the amount to the extent of such
admission. The language, therefore, used is susceptible of a
wider meaning to include any admissions by the defendant. In
other words, in proceedings either before the Tribunal or also
in any other document. The object of the Act being to enable
financial institutions to recover their debts expeditiously. Any
other construction would defeat the very object of the Act.
The language used in Order XII, Rule 5 of Civil Procedure
Code is in the pleadings or otherwise, unlike the language of
Rule 12(5) of the Rules. As we have noted, the statement
contained in the profit and loss account duly certified by the
auditor is based on the records of the company. Once the
balance sheet/profit and loss account shows the amount and
that as a statutory requirement of the Companies Act, we fail
to understand as to how that cannot be an admission which
can be proved against the company. It is for the company to
establish by relevant facts that the admission would not be an
admission in the eyes of law. In the instant case, the
petitioner has been unable by any relevant fact to displace
the admission made in the balance sheet. In our opinion,
therefore, the admission in the balance sheet has been proved
against the petitioner and as we have held earlier that such
an admission even other than in the pleadings before the
Tribunal can be proved against the party in making the
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11 NM no. 2181-18 in S.C.SUIT no.2091-17
admission. We have, therefore, no hesitation in holding that
the expression “admission” in Rule 12(5) of the Rules can be
read to mean an admission both in the pleadings, in the
proceedings as well as an admission of fact not in the
proceedings and which is evidenced by any document or
mode provided under section 17 of the Indian Evidence Act.
That contention must, therefore, be rejected.
As stated hereinearlier, the defendants have not turned
up despite service of Notice of Motion and the Notice of Motion is
heard
ex parte against them vide order dated 15.03.2019. The
Written communications narrated above in the plaint clearly disclose
the liability of defendant no.1 to discount the bills of the plaintiff.
The Bills of Exchange at Exh. G-1 to G-4 along with the plaint have
signatures of authorized signatory of defendant no.1. Similarly, bill
discounting advice dated 09.06.2017 (Exh. F-1 to F-4) issued by
defendant no.3 to defendant no.1 clearly shows the contractual
relation between the plaintiff and the defendant no.1. The
acceptance of the said bills of exchange was completed by delivery
thereof to the defendant no.1. Under section 114(c) of Indian
Evidence Act, 1872 there is presumption that bill of exchange,
accepted, was accepted for good consideration. Moreover, the
defendant no. 1 has not turned up to set up a defense of forgery of
its stamp, signatures on the said bills of exchange. In that view of
the matter, the defendant no.1 cannot deny its liability under the
said contract and the suit can be disposed off by giving judgment on
admission of the defendants as narrated above. Hence, Order:
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12 NM no. 2181-18 in S.C.SUIT no.2091-17
ORDER
1. Notice of Motion No. 2181 of 2018 is allowed.
2. Suit No.2091 of 2017 is partly decreed with costs.
3. The Bills of Exchange No. PPL/WL/17-18/P/004, PPL/WL/17-
18/P/006, PPL/WL/17-18/P/007, PPL/WL/17-18/P/009 are
declared as not enforceable in law.
4. The defendants are permanently restrained from acting on the
aforesaid Bills of Exchange.
5. The Defendant no.2 is directed to make payment of
Rs.29,53,752/- (Rupees Twenty Nine Lakhs Fifty Three
Thousand Seven Hundred Fifty Two only) to the plaintiff
within 2 months from today with interest @ 18% p.a. from
the date of the suit till the date of payment.
6. The Defendants No.1 to 3 are directed to pay damages to
plaintiff to the tune of Rs.2,00,000/- (Rupees Two Lakhs only)
jointly and severally.
7. Decree be drawn up accordingly.
sd/-
(C. V. Marathe)
Judge,
Date : 10.02.2020. City Civil Court, Gr. Mumbai.
Dictated on : 10.02.2020.
Transcribed on : 11.02.2020.
Signed by HHJ on : 14.02.2020
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13 NM no. 2181-18 in S.C.SUIT no.2091-17
CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER.”
UPLOAD DATE AND TIME : 14.02.2020 at 1.01 p.m.
NAME OF STENOGRAPHER : Mrs. G. P. Acharekar
Name of the Judge (With
Court Room no.)
HHJ Shri. C. V. Marathe
C.R. no.04
Date of Pronouncement of
JUDGMENT/ORDER
10/02/2020
JUDGMENT/ORDER signed by
P.O. on
14/02/2020
JUDGMENT/ORDER uploaded
on
14/02/2020
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