Final Order 2

Order Details: Copy of Judgment
Pdf Text: MHCC010075412019 Presented on 17/07/2019
Registered on 09/10/2019
Decided on 02/05/2025
Duration 05Y: 09M: 16D
Exhibit 22
IN THE CITY CIVIL COURT AT MAZGAON, MUMBAI
SUMMARY SUIT NO.987 OF 2019
Pagariya Industries Pvt. Ltd. ]
A Company registered under the ]
Companies Act, 1956 ]
And having its registered office address ]
at Jai Hind Building No.1, 2nd Floor, ]
Block No.1B Bhuleshwar, Mumbai-400002. ]
Occupation: Business, through its authorized]
person Shri Rajesh Kumar Mahto, ]
Age 43 years. ]...Plaintiff
V/s. ]
1. Bhageria Exports Pvt. Ltd. ]
A company registered under the Companies ]
Act, 1956, Occupation Business having ]
address at 725, Pragraj Gally, M. J. Market, ]
Mumbai – 400002, Maharashtra. ]
2. Mahesh Kumar Mahabir Bhageria ]
Director, Occupation: Business ]
An Adult male Indian inhabitant, ]
having address at 504/B Phoenix Tower ]
Senapati Bapat Marg, Lower Parel, Delisle ]
Road, Mumbai – 400013, Maharashtra. ]...Defendants
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Appearance :
Ld. Adv. Dhiraj Rathod for the plaintiff.
Ld. Adv. Yashodhan Divekar a/w. Adv. Rohan Karande i/b. Divekar &
Co. for defendants.
CORAM : HHJ SHRI SANGRAM SHRIHARI SHINDE
C. R. NO. : 81
DATE : 02/05/2025.
JUDGMENT
( Dictated and pronounced in open Court)
01] This is the suit filed under Rule 2 of Order XXXVII of Code
of Civil Procedure, 1908 (C.P.C.) for recovery of amount of
Rs. 86,208/- along with further interest from defendants.
Brief facts of plaintiff’s case may be summarized as under:
02] As per plaintiff, it is a registered company and
manufactures and sales Grey Fabrics materials to purchasers in the local
market. Plaintiff company has filed suit through Mr. Rajesh Kumar
Mahto, who is authorized by plaintiff vide Board Resolution dated
14/03/2018. Plaintiff purchase Yarn and Grey Fabrics and sales and
supply it to other purchasers and dealers. Defendant No. 1 is a company
and defendant No. 2 is the Director of company. The representative of
defendant approached plaintiff and placed purchase order. Accordingly,
plaintiff company sold, supplied and delivered materials to defendants.
Accordingly plaintiff raised Invoice No.PI-708/16-17 dated 01/12/2016
for sum of Rs. 58,835/-. Plaintiff supplied said material through vide
Challan No. 708 dtd 01/12/2016. Defendants have never raised any
objection with respect to quality, quantity supplied to them. The
plaintiff has filed suit on the basis of said Invoice and Delivery Challan.
As defendants failed and neglected to pay amount of Invoice, plaintiff
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issued legal notice dated 19/01/2019 and called upon defendants to
make the payment. Defendants replied to the said notice on
02/02/2019 but failed to pay the outstanding amount. Therefore,
plaintiff is entitled for 18% interest on principal amount. The cause of
action has arose within Mumbai therefore, this Court has jurisdiction.
The plaintiff is entitled for an amount of Rs. 86,208/- from defendants
including interest as well as further interest on principal amount.
Hence, this suit.
03] Defendants have filed their written statement vide Exh. 7
and denied adverse contentions against them. As per defendants there
is no cause of action defendant No. 2. Further, defendant No. 2 is
Director of defendant No. 1 therefore, he cannot be made personally
liable for alleged debt of defendant No. 1. Defendants have never dealt
with plaintiff directly but through agent namely Shankar J. Patel and his
son Yogesh Patel. It is their contention that defendants used to place
orders through agent who used to procure goods for them from
plaintiff. It is their contention that plaintiff has supplied goods i.e.
Greige Fabric to defendant No. 1. Thereafter, defendant No. 1 used to
have process on it and thereafter, it was able to know Patta problem.
After processing fabric defendant No. 1 could find whether the quality
of said fabric was sub-standard or not. It is also their contention that
last few orders defendant No.1 found at the time of processing the
Greige Fabric supplied by plaintiff was of sub-standard and inferior
quality. The problem of patta arises only when there is mixing of Yarn.
Defendants upon realizing Patta problem in fabric used to inform agent
Mr. Yogesh Patel. Further, Mr. Yogesh Patel informed defendant No. 1
that he will talk to the plaintiff and on the said assurance defendants
continued to deal with plaintiff. In the month of December, 2016
plaintiff supplied 2501.50 meters of fabrics for an amount of
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Rs. 60,036/- less 2% fold of Rs. 1200.72/- i.e. Rs. 58,835/-. Defendant
has not made payment of said material as said fabric was of inferior
quality. Therefore, defendant No. 1 immediately contacted agent and
told them about sub-standard quality of material supplied by plaintiff. It
was also informed to defendants that plaintiff will take the finished
goods back however, defective fabric is lying with defendant No. 1 since
then and plaintiff has not taken any action. It is their further contention
that due to sub-standard material supplied by the plaintiff defendant
has suffered loss and therefore, defendant entitled for compensation. It
is further their contention that defendants are paying processing
charges of Rs. 21,817/- and warehouse charges of Rs. 1,000/- per
month from December 2016 till date. Therefore, defendants are entitled
for said amount with interest at the rate of 18% p.a. Hence, suit may
be dismissed.
04] Considering the rival contentions of either side issues were
framed at Exh. 8. The issues are reproduced as follows. I have recorded
my findings thereon, for the reasons detailed as under:-
Sr.
No
Issues Findings
1 Whether plaintiff proves that plaintiff is
entitled to claim an amount of Rs. 58,835/-
towards goods supplied to the defendants ?
Yes
2 Whether defendants prove that plaintiff
supplied inferior quality of goods ?
No
3 Whether defendants prove that there is no
cause of action against defendant No. 2 ?
Yes
4 Is plaintiff entitled for reliefs claimed ? If
yes, at what rate of interest ?
As per final order
5 What Order and decree? As per final order
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05] In support of claim, the plaintiff has filed his affidavit of
claim Rajesh Kumar Mahto, authorized person of plaintiff company as
P.W. 1 at Exh. 9. The plaintiff has closed his evidence vide Exh. 18. The
plaintiff has filed and relied upon the following documents.
Sr.
No. Exhibit No. Particulars
1 Exh. 11 Original Invoice No. PT-708/16-17 dated
01/12/2016.
2 Exh. 12 Original delivery challan No. 708 dated 01/12/2016.
3 Exh. 13 Office copy of legal notice dated 19/01/2019.
4 Exh. 14 Original postal receipts.
5 Exh. 15 Original returned postal AD cards.
6 Exh. 16 Original defendants advocate reply dated
02/02/2019.
7 Exh. 17 Original Authority letter dated 14/03/2018.
06] The defendants in their defence have filed evidence on
affidavit of Asim Mahesh Bhageria as D.W.1 at Exh. 19. The defendants
filed evidence closed pursis vide Exh. 20. The defendants have not filed
documents.
REASONS
As to Issues No. 1 to 4 :-
07] All issues are inter-related hence, require common
discussion in order to avoid repetition of facts and evidence. On
perusing pleadings of both parties and their submissions, it appears it is
not disputed that plaintiff and defendants have transaction of supplying
and purchasing Gragie Fabrics. Thus, it appears as per plaintiff Gragie
Fabrics was supplied to defendants in view of invoice No. P1 708/16-17,
dated 01/12/2016 for an amount of Rs. 58,835/-. Plaintiff has filed said
invoice on record at Exh.11. Further, plaintiff to prove that said material
was delivered to defendant has relied on Delivery Challan No. 708
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dated 01/12/2016 at Exh. 12. Even, defendants have not denied said
fact and they have admitted said fact in the written statement that in
the month of December, plaintiff had supplied fabrics for an amount of
Rs. 58,835/-. However, it is the only contention of defendants that the
said fabric was of sub-standard and inferior quality.
08] On perusing evidence of Mr. Rajesh Kumar Mahato P.W.1,
he has reiterated contents in the plaint. The defendants have contended
that Mr. Rajesh Kumar Mahato P.W.1 has no authority to file present suit
and has no personal knowledge regarding transaction. It is also
submitted that issue regarding Mr. Rajesh Kumar P.W.1 has no authority
to file suit and to give evidence is not framed though defendants have
specifically raised in written statement as per Order 14, Rule 1 of C.P.C.
Further, during cross examination defendants had brought on record
that Mr. Rajesh Kumar PW.1 does not know defendant No. 2 and he has
no personal knowledge about transaction between Kishorkumar Pagaria
and defendants. Further, it is brought on record that he has stated that
Mr. Kishorkumar Pagaria used to make communication with defendants.
Mr. Rajeshkumar P.W. 1 has stated during cross-examination that he has
no knowledge of entire fact of present case but suit is filed as payment
was not received. Further, Rajesh Kumar P.W.1 has stated that he does
not know whether plaintiff company has given authority to him to file
the suit. Even, Rajesh Kumar P.W.1 has stated 2that his Seth Mr. Kishor
Pagaria has filed suit. It is pertinent to note that in para 5 of written
statement, defendants have pleaded that they are not aware whether
Mr. Rajesh Kumar is authorized or not on behalf of plaintiff company.
Thus, it appears that defendants have not denied authority of Mr.
Rajesh Kumar and only raised doubt. Further, on perusing plaint, it
appears that Mr. Rajesh Kumar P.W.1 has filed suit on the basis of
authority at Exh. 17. On perusing said document, it appears that
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Director of Plaintiff company has authorized Rajesh Kumar Mahto P.W.1
to contest the present proceeding. Therefore, though witness has stated
that he does not know whether plaintiff company has given any
authority, it will not affect the evidence of P.W.1.
09] Further, defendants have brought on record that
Mr. Rajesh Kumar P.W.1 has no personal knowledge of suit transaction.
However, as discussed above, delivery of goods to defendants is not
disputed only dispute of defendants is that said goods were of inferior
quality. It is pertinent to note that it is specific defence of defendants
that the goods supplied in the month of December, 2016 by plaintiff
were of inferior quality. However, on perusing cross-examination of
Rajesh Kumar P.W.1, there is not a single suggestion put to
Mr. Rajesh Kumar P.W.1 that fabrics supplied in the month of December,
2016 was of inferior quality. Therefore, even though it has not come on
record that Mr. Rajesh Kumar was not having personal knowledge, the
burden was on the defendants to prove that goods supplied were of
inferior quality.
10] Further, it is specific case of defendant that they used to do
transaction with plaintiff through agent. However, not a single
suggestion is given to Mr. Rajesh Kumar P.W.1 in that regard. It is
specific defence of defendants that they had informed about inferior
quality of fabrics to Mr. Yogesh Patel who had assured them that he will
talk with plaintiff. It is pertinent to note that defendants have not
examined said Mr. Yogesh Patel to support their contention. On perusing
cross-examination of Mr. Asim D.W.1, he has stated that he has not filed
any authority to show that he is authorized to give evidence in the
present case. Further, in cross examination he has stated that plaintiff
was not informed in writing regarding patta problem in the materials.
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Further, it is specific contention of defendant that plaintiff has not taken
back said inferior quality of material. There is no suggestion in that
respect in the cross examination to Mr. Rajesh Kumar P.W.1. On the
contrary, Mr. Asim D.W.1 in his cross-examination stated that they have
not written any letter to plaintiff to take back defective goods and
further they have not returned the said goods to the plaintiff. It is
argued on behalf of plaintiff that as per provisions of Section 41 and 42
of Sale of Goods Act, defendants ought to have examine the goods and
return it if same were of inferior quality. As discussed above, defendants
have neither informed plaintiff that goods were of inferior quality nor
returned the goods. It has come on record that goods are lying with
defendants. Further, it is also contention of plaintiff that he had not sent
goods to defendants as gratuitous. Therefore, as per provisions of
Section 70 of Indian Contract Act, it is obligatory on the part of
defendants to pay compensation. It is pertinent to note that it is also not
the case of defendants that plaintiff had supplied goods as a gratuitous.
11] Thus, from oral and documentary evidence on record, it is
crystal clear that plaintiff had supplied goods to the defendants in
pursuance of invoice at Exh. 11 for an amount of Rs. 58,835/- in view
of delivery challan at Exh. 12. Even, defendants have admitted said
facts as discussed above. Though, defendants have taken specific
defence that plaintiff supplied inferior quality of goods, they failed to
prove the said fact by oral and documentary evidence.
12] As per Rajesh Kkumar P.W.1, as defendants failed to pay an
amount of Rs. 58,835/-, plaintiff issued legal notice dated 19/01/2019
at Exh. 13 to defendants which is received by them vide Exh. 14. It
appears that defendants have given reply on 02/02/2019 at Exh. 16 to
said notice to plaintiff, wherein he has admitted receipt of goods. Thus,
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admittedly there is nothing on record to show that plaintiff had
supplied inferior quality of goods to defendants. Therefore, plaintiff is
entitled for an amount of Rs. 58,835/-. As per plaintiff, he is entitled for
interest at the rate of 18% p.a. on the said amount. Defendants have not
specifically raised any objection to the rate of interest. However, on
perusing terms and conditions of invoice at Exh. 11, it is specifically
mentioned that if amount is not paid before due date, plaintiff will be
entitled for interest at the rate of 1.5% p.m. Therefore, I am of the view
that plaintiff is entitled for interest at the rate of 18% p.a. on principal
amount. Thus, plaintiff is entitled for an amount of Rs. 27,373/-
towards interest. Thus, plaintiff is entitled for total amount of
Rs. 86,208/-.
13] So far as further rate of interest is concerned, plaintiff has
claimed interest at the rate of 18% p.a. Admittedly, plaintiff is entitled
for interest as per terms and conditions in invoice at Exh. 11. However,
the said rate of interest is excessive in nature as compared to rate of
interest of Nationalized Bank. Therefore, in view of Section 34 of C.P.C.,
it would be just and proper to grant interest at the rate of 7% p.a. from
17/07/2019 i.e. the date of filing of the suit till its realization of
principal amount. So far as defendant No. 2 is concerned, admittedly
he is Director of defendant No. 1. It is settled law that Director of
company is not personally liable for debt of company. Therefore, I am of
the view that defendants have proved that there is no cause of action
against defendant No.2 and he is not liable to pay debt of defendant
No. 1 to the plaintiff. Hence, I answer Issues No. 1 and 3 in affirmative,
Issue No. 2 in negative and Issue No. 4 accordingly. Hence, in answer to
Issue No. 5, I proceed to pass following order.
O R D E R
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1] Summary Suit No. 987 of 2019 is partly decreed with costs.
2) Defendant No.1 shall pay an amount of Rs. 86,208/- ( Rupees
Eighty Six Thousand Two Hundred and Eight only) to the
plaintiff.
3] Defendant No. 1 shall pay simple interest at the rate of 7% p.a.
on amount of Rs. 58,835/- from 17/07/2019, i.e. the date of
filing suit till its realization.
4] The plaintiff may be entitled to get refund the court-fees paid, if
provided for in Rules.
5] Decree be drawn up accordingly.
(Sangram S. Shinde)
Adhoc Judge,
City Civil Court Mazgaon, Mumbai.
Date: 02/05/2025 Court Room No.81
Dictated on: 02/05/2025
Corrected and signed on: 07/05/2025
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“CERTIFIED TO BE TRUE AND CORRECT COPY OF THE ORIGINAL
SIGNED JUDGMENT/ORDER”
UPLOAD DATE NAME OF STENOGRAPHER
07/05/2025 Mrs. V. V. Malgaonkar
Name of the Judge
(with Court Room No.)
Shri S. S. Shinde
C.R. No.81
Date of Pronouncement of JUDGMENT/
ORDER 02/05/2025
JUDGMENT/ORDER signed by P. O. on 07/05/2025
JUDGMENT/ORDER uploaded on 07/05/2025
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