O.S.190 of 2007 Page No. 1
IN THE COURT OF III ADDL. SENIOR CIVIL JUDGE (FTC)
AT L.B.NAGAR, R.R.DISTRICT
PRESENT:- D. Ravindra Sharma, III Addl.Senior Civil Judge (FTC).
Dated on this the 25th day of October, 2016
O.S.No.190 of 2007
Between:
M/s. BINTEX CORPORATIONS, 11-5-19/2, Bhavaninagar, Moosapet, Hyderabad 500 018, represented by its Proprietrix Smt. Madhu Biyani W/o. Suresh Biyani
...Plaintiff.
AND
The Managing Director M/s.FILTRON ENGINEERS LTD Filtron House, 6, Sitabag Colony, Sinhagad Road, Pune 411 030.
..Defendant.
This suit is coming up for hearing before me in the presence of Sri. Shaik Zakeer Hussian, Counsel for the Plaintiffs and Sri. Venkat Rao, Counsel for Defendant and the matter having stood over for consideration till date, this Court made the following:
J U D G M E N T
This suit is filed for recovery of Rs.3,31,773 /- with interest and costs.
2.The brief averments of the plaint are that:
The plaintiff company M/s.BINTEX CORPORATION, Hyderabad, is engaged in business of manufacturing Polyester Non Woven Filter Bags etc. The Defendant Company is incorporated under the Companies Act, 1956. The representative of the defendant made deliberations with the plaintiff company and furnished various quotations for their requirement of three items with code numbers viz.20910101, 20910102 and 20910103 with Job No.2091 vide quotation, dated 23-01-2006. Having accepted the quotation the defendant issued purchase order
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No.PPD/2091/43, dated: 27-01-2006 for a total Ex-Works value of
Rs.2,60,984/- with the terms enumerated therein that Central Sales Tax @ 4% against Form-C, Packing and Forwarding, Frieght charges etc., shall be extra, indicating the delivery requirement by 04-03-2006 and the terms of payment as 50% against delivery and the balance 50% payable in 30 days. Ultimately, the entire ordered quantity was manufactured. The plaintiff vide delivery Challan No.H-515, dated: 04- 03-2006, have booked the consignment to Defendant for door delivery vide consignment Note No.3883, dated 04-03-2006 of ATS Road carriers.
The total fixed freight charges was Rs.10,305/- out of which the plaintiff had paid an advance of Rs.5,000/- and the balance freight charge of
Rs.5,305/- to be paid by the defendant. The Defendant had received the consignment and as the same is in defendant's custody and enjoyment, it signifies the defendants acceptance to their entire satisfaction.
Thereupon, the plaintiff herein had accordingly raised invoice No.654,
dated: 04-03-2006 for a total sum of Rs.2,76,423/-, the due date of
payment being 04-03-2006 and upon the expiry of due date, when the payment was demanded by plaintiff, the Defendant had been dilly dallying to expedite the same. That the Plaintiff's firm is an organization of a Lady entrepreneur. For executing the Defendant's bulk value order she had invariably invested huge amount by mobilization from her and from private borrowings etc. besides spending considerable amount of time, labour force and energy. It may not be out of place to mention that the commercial nature of transaction is binding on the Defendant to
honour it. The delay in expediting the payment from the due date, i.e.,
04-03-2006 has literally crippled the Plaintiff's industry substantially, driven her to huge financial losses leave alone the enjoyment of meager profit due to passage of time. The inordinate delay may literally force the plaintiff to close down her industry, ruining her prestige and tarnishing goodwill established by her in the industry and resulting in
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putting her in the delicate situation of being under the clutches of pressure from private financiers. That despite Plaintiff's vivid, oral appraisal of the above piquant situation to defendant over phone periodically and demanding defendant to clear the payment, they are deliberately not caring to expedite the same with an illegal motto to deceive the Plaintiff and deprive her legitimate payment. Thus, it is clear that the action of defendant in receiving the goods supplied and not making payment by due date or subsequent dates of demand to plaintiff, tantamounts to illegal and unlawful acts. The defendant is liable for criminal and civil actions including suit under Sale of Goods
Act, appropriate action for recovery under Companies Act. Thus, the plaintiff has a right to claim not the amount of Rs.2,76,423/- covered by the invoice, but also interest at commercial rate from 04-04-2006 till the date of actual realization, besides for compensation for the loss of goodwill, mental agony and such other hardship suffered by her.
Therefore, the plaintiff has issued a legal notice, dated: 19-12-2006 to the defendant demanding to repay the amount of Rs.2,76,423/- covered by the invoice together with the applicable interest but the defendant to the said notice caused a blunt reply, dated: 27-12-2006 under the style “interim notice reply”. Therefore, the plaintiff had no other go except to file this suit.
3.The Defendant filed written statement in which they denied the plaint allegations about their company's liable to pay the suit claimed amount. The defendant admitted that the representative of the plaintiff company has furnished the quotation to the defendant company for supply of goods. He also admitted that the defendant company had issued purchase order No.PPD/2091/43, dated: 27-01-2006. They submit that they did not receive the material as per purchase order as such the payment of amount does not arise. They informed to the plaintiff
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company on phone about the defective material supplied by the plaintiff company. The plaintiff did not react for the complaint made by the defendant company and in rectifying the mistake in supplying defective goods. Thereby, the defendant is not under obligation to make the payment for the defective goods supplied by the plaintiff. The plaintiff without waiting and without giving opportunity to the defendant to give a detailed reply by the defendant to the legal notice, dated: 19-12-2006 has filed this case in hasty manner. There is no cause of action for filing the suit and the suit is not maintainable and it is liable to be dismissed.
The defendant further submits that the material as per order of the defendant with specifications was not supplied. The plaintiff has not supplied sample piece for checkup the quality and specifications before supply. Therefore, the defendant had no opportunity to check the quality, specifications of the material to be supplied before the supply of the same.
The conditions as contained in the purchase order are (1) one year
Guarantee from the date of Commissioning of above items, if any defect found in the same should be attended/replaced by plaintiff free of cost at their site. (2) Test Certificate should be provided by plaintiff along the above materials. (3) 1 No. sample piece of snap band type to be sent to our works immediately to check the fitting of the same with our tube plates were not complied. The place of delivery of the goods was at the place of defendant company. The defendant submits that the goods supplied by the plaintiff are not as per the specifications ordered by them and they are defective. Therefore, the defendant company informed the same to the plaintiff company. Though the defendant received letters, dated: 06-04-2006, 20-04-2006 for payment, the defendant informed that the material has been rejected by the inspection authority and has shown the inspection report to the
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representative of the plaintiff and discussed over the telephone. The defendant company have issued a letter bearing No.FEL/BC/2091, dated:
20-04-2006 and 04-12-2006 and informed about the defects and bad quality of material supplied by the plaintiff.
The defendant further submit that 200 Nos. (4 gunny bags) of Non
Woven Filter Bag were sent to the Plaintiff vide Challan No.149, dated 23-09-2006 for repairs to the Plaintiff. That even when the Plaintiff company supplied the material after making rectification, it was observed that there were wrinkles/folding to the bags and as such even after rectification the Defendant company could not use the material.
That the Plaintiff agreed to take back the material if it is of no use to the
Defendant Company. Finally, the defendant has no option but to return the material to the Plaintiff through Pacific Road Carriers vide
Consignment Note No.36112, dated: 23-12-2006. That the said fact of returning the material was brought to the notice of the Plaintiff. That the
Plaintiff inspite of returning of the material has not collected the material from the transporter's go-down. The Defendant on account of aforesaid fact once again vide letter, dated: 28-12-2006 informed the plaintiff that the material rejected is still lying in one of the go-down of the
Transporter at Hyderabad and if the material is not collected from the go-down the hiring charges, local delivery charges and damage to the material will be on the Plaintiff's account.
That the plaintiff has made unilateral breach of contract by not supplying the material as per the purchase order, therefore, the plaintiff is not having any obligation to make the payment. There is no cause of action for this suit. This court has no jurisdiction to try/entertain and decide the suit as the defendant company is located in Pune and the order was made and the material was supplied at Pune. For these reasons the suit is not maintainable and liable to be dismissed.
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4.Basing upon the pleadings, the following issues are settled for trial:
i) Whether the plaintiff is entitled for recovery of the suit amount as prayed for?
ii) To what relief?
Heard both sides.
5.Issue No.1: Whether the plaintiff is entitled for recovery of the suit amount as prayed for?
The plaintiff company to prove its contention had examined the G.P.A. of the Company namely Suresh Kumar Biyani, who is the husband of
Madhu Biyani was examined as PW-1. He reiterated the plaint averments and through him Exs.A1 to A21 are marked. Defendant on the other hand has examined Venkatagiri as DW-1 and marked Exs.B1 to
B10.
The plaintiff company contends that they have supplied the goods to the defendant company as per the purchase order No.PPD/2091/43,
dated: 27-01-2006 for a total works value of Rs.2,60,984/- with terms
and conditions mentioned therein, with Freight Charges of Rs.10,305/- out of which plaintiff paid advance of Rs.5,000/- and balance of
Rs.5,305/- shall be paid by the defendant. Though the defendant received the material did not make any payment inspite of repeated demands and even after issuing legal notice, dated: 19-12-2006.
The defendant company contends that the plaintiff company without furnishing a sample for testing and analyzing the quality had supplied the material, which was found to be defective and substandard, therefore, it cannot be used. The same was communicated and the material was returned to the plaintiff company. When, the material
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supplied is not in accordance with the terms and conditions of the purchase order and the material returned was not resupplied by rectifying the mistake by the plaintiff company, the question of payment for the defective goods does not arise. The inspection report Ex.B2 was admitted by the plaintiff company. The plaintiff company did not give any reason for their entitlement inspite of specific plea of the defendant company for return of the material in their written statement. The plaintiff in their evidence of PW-1 also did not whisper about the defects in the material and return of the same by the defendant company. The plaintiff company did not plead and prove that they have attended the defects of the material supplied by them. Since, the defendant returned the material to the plaintiff company and plaintiff company failed to replace the same, the defendant company is not liable to pay any amount to the plaintiff company.
Basing upon the record the admitted facts are that the plaintiff company has supplied three items with code numbers viz.20910101, 20910102 and 20910103 for Job No.2091 vide quotation, dated 23-01- 2006, having accepted the quotation the defendant company issued purchase order No.PPD/2091/43, dated: 27-01-2006 for a total Ex-Works value of Rs.2,60,984-00. The defendant company admitted that they did not make any payment for the goods supplied.
The plaintiff company, which is represented by its proprietress
Smt. Madhu Biyani was not examined as witness. The G.P.A. of the
Company namely Suresh Kumar Biyani, who is the husband of Madhu
Biyani was examined as PW-1. The said Suresh Kumar Biyani is authorized under Ex.A21 G.P.A. There is no dispute that the material was supplied by the plaintiff to the defendant company under Ex.A2
Purchase Order, the goods were supplied by the plaintiff company to the defendant company on 27-01-2006 for an amount of Rs.2,60,984/- 50%
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of the amount of the bill to be paid on the delivery and remaining 50% has to be paid within 30 days. The receipt of the goods is acknowledged and admitted by the defendant company under Exs.A3 to A5. The plaintiff company demanded money as under Ex.A8 Reminder, dated:
03-07-2006. As per Ex.A10 Purchase Order, dated: 13-09-2006 and
Ex.A13 Purchase Order, dated: 22-09-2006 the defendant company placed order of Filter Bag, Stainless Steel Cage, which shows that the material was to the satisfaction of the defendant company. The defendant company had relied upon Ex.B2 Inspection Report, dated: 06- 03-2006, which was prepared unilaterally in the absence of representative of the plaintiff company. The defendant company had returned the material as under Ex.B3, dated: 22-12-2006 and Ex.B9
Consignment Note No.36112, dated: 23-12-2006 of Pacific Road Carriers,
Hyderabad, but the same is not acknowledged by the plaintiff company.
DW-1 in his cross examination stated that, they have not verified sample piece before placing purchase order. After placing the Order the material was manufactured, he admitted that no amount was paid by his company. That they have not filed any proof or acknowledgement about receipt of Ex.B4 letter sent to the plaintiff company by the defendant company. That they have not filed any proof to show that the defendant company informed through phone about rejection of material to the plaintiff company as mentioned in Exs.B6 and B7. That there is no endorsement on Ex.B5 about receiving of rejected material so also on
Ex.B3. He further expressed his ignorance whether the rejected material was received by the plaintiff or not. He admitted that there is no signature of the plaintiff company on Ex.B2, the Inspection Report and the plaintiff company was not present at the time of inspection report was prepared. The defendant company did not produce any document or witness to prove that the material received by them was returned to the plaintiff company and the plaintiff company received the same.
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The defendant did not explain as to why they placed order without testing the sample, though there is condition to test the sample material prior to placing the order. Though as per terms and conditions there is a one year guarantee as admitted by PW-1 in his cross for the defective products supplied by them, but the defendant company failed to prove that the material was successfully returned to the defendant company and the defendant company failed to replace or repair the same. The defendant company thus failed to prove its contention that they returned the material to the plaintiff company. The defendant company admittedly did not make any payment to the plaintiff company. The subject matter of the suit is material. The plaintiff company as per the order of defendant company has manufactured the material in Hyderabad and they were supplied from Hyderabad. Thus part of cause of action for the suit taken place in Moosapet, R.R. District.
Therefore this court is having jurisdiction to entertain the suit. The facts and circumstances and evidence as discussed above, proves that the plaintiff company has supplied the material to the defendant company and the defendant company is liable to pay Rs.2,76,423/-. The issue
No.1 is answered in favour of the plaintiff by holding that the plaintiff is entitled to recover the suit claim amount.
6.Issue No.2: To what relief?
In the result, the suit is decreed with costs for Rs.3,31,773/- with interest @ 6% p.a. on Rs.2,76,423/- from the date of suit till the date of realization.
(Typed to my dictation by Typist, corrected and pronounced by me in the Open Court on this the 25 th day of October, 2016)
III ADDL. SENIOR CIVIL JUDGE (FTC),
RANGA REDDY DISTRICT.
O.S.190 of 2007 Page No. 10
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
For Plaintiff:For Defendant:
P.W.1:Suresh Kumar Biyani DW-1: Venkatagiri
EXHIBITS MARKED
For Plaintiff:
Ex.A1: Original Letter, dated: 23-01-2006 from the plaintiff to
Defendant.
Ex.A2: Purchase Order, dated: 27-01-2006 of the defendant.
Ex.A3: Invoice No.654, dated: 04-03-2006 of Plaintiff for Rs.2,76,423/-.
Ex.A4: Delivery Challan, dated: 04-03-2006 of the Plaintiff.
Ex.A5: Consignment Note No.3883, dated: 04-05-2006 of ATS Road
Carriers.
Ex.A6: Reminder, dated: 04-05-2006 from plaintiff to defendant.
Ex.A7: Receipt from Courier (Professional Couriers).
Ex.A8: Reminder, dated: 03-07-2006 from plaintiff to defendant.
Ex.A9: Reminder, dated: 24-08-2006 from plaintiff to defendant.
Ex.A10: Purchase Order No.PPD-2093/031, dated: 13-09-2006.
Ex.A11: Letter, dated: 15-09-2006 from plaintiff to defendant.
Ex.A12: Letter, dated: 18-09-2006 from plaintiff to defendant
Ex.A13. Purchase Order No.PPD-2093/032, dated: 22-09-2006.
Ex.A14: Letter, dated: 21-11-2006 from plaintiff to defendant.
Ex.A15: Registered Post Acknowledgment Receipts.
Ex.A16: Office Copy of Legal Notice, dated: 19-12-2006.
Ex.A17: Postal Receipts.
Ex.A18: Postal Acknowledgment, dated: 23-12-2006.
Ex.A19: Registered Notice Returned Undelivered.
Ex.A20: Interim Notice Reply, dated: 27-12-2006.
Ex.A21: G.P.A. executed by the plaintiff.
For Defendant:
Ex.B1: Quotation in Fax Message on Letter Pad, dated: 27-10-2006 sent by Plaintiff company to the defendant.
Ex.B2: Carbon Paper of Inspection Report, dated: 06-03-2006.
Ex.B3: Delivery Challan, dated: 22-12-2006.
Ex.B4: Letter bearing No.FEL/BC/2091, dated: 20-04-2006 sent by defendant to the plaintiff.
Ex.B5: Delivery Challan No.149, dated: 23-09-2006 of Filtron i.e., the
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defendant for rejection of the material.
Ex.B6: Letter bearing No.FEL/AA/VG, dated: 04-12-2006 sent by Filtron i.e., the defendant to the plaintiff.
Ex.B7: Letter bearing No.FEL/BC/2091, dated: 21-12-2006 sent to plaintiff by defendant.
Ex.B8: Letter bearing No.FEL/BC/2091, dated: 28-12-2006 sent to plaintiff by defendant.
Ex.B9: Consignment Note No.36112, dated: 23-12-2006 of Pacific Road
Carriers, Hyderabad.
Ex.B10: True copy of Board Resolution of Board of Directors of Filtron
Engineers Ltd., Pune, dated: 22-10-2011 at registered office of the Company.
III ADDL. SENIOR CIVIL JUDGE (FTC),
RANGA REDDY DISTRICT.