Jyoti Textile Dyeing & Printing Works v. M/s.B.N.Chandra & Co.

BEFORE THE HIGH COURT OF JUDICATURE AT MADRASDATE : 07.07.2009CORAMTHE HONOURABLE MR.JUSTICE V.PERIYA KARUPPIAHA.S.No.333 of 1999Jyoti Textile Dyeing & Printing Works, rep by its Power of Attorney Mr.Arvind H.Chhatbar.. Appellant/PlaintiffVs.M/s.B.N.Chandra & Co. .. Respondent/DefendantPrayer :- This appeal has been preferred under Section 96 of CPCagainst the decree and judgment, dated 21.03.1998, made inO.S.No.14599 of 1996 on the file of the II Additional Judge, CityCivil Court, Chennai.For Appellant : No appearance For Respondent : Mr.K.Bijai Sundar JUDGMENTThis appeal has been directed against the judgment and decreepassed by the lower Court in dismissing the suit filed by theplaintiff. The suit was filed by the appellant/plaintiff before thelower Court for recovery of sum of Rs.3,20,008.25, with subsequentinterest at the rate of 18% per annum with costs.2.The brief facts mentioned in the plaint are as follows:-The plaintiff is a registered partnership firm and isrepresented by its Power of Attorney, Mr.Arvind H.Chhathar,S/o.Hardoss aged about 50 years and residing at No.1, Marnaby Road,Devdarshan Apartments, Madras-10. The defendant is a partnershipfirm and the constitution of the firm is not known to the plaintiff.The defendant is required to furnish 'for JYOTI TEXTILE DYEING &PRINTING WORKS' names and address of all its partners. Theplaintiff supplied goods to the defendant from time to time on theorders placed by the defendant. In the course of dealings with thedefendant a sum of Rs.2,37,924.25 as on 03.04.1996 became due andpayable by the defendant. The plaintiff supplied goods to thedefendant by the following Invoice Numbers: https://hcservices.ecourts.gov.in/hcservices/ a)Invoice No.204 dated 29.6.1992 for Rs.1,05,031.00 balanceRs.7886.25.b)Invoice No.268 dated 31.8.1992 for Rs.41,787.00c)Invoice No.300 dated 12.9.1992 for Rs.30,314.25d)Invoice No.304 dated 17.9.1992 for Rs.50,713.00e)Invoice No.353 dated 16.10.1992 for Rs.35,478.00f)Invoice No.396 dated 31.10.1992 for Rs.35,721.00g)Invoice No.403 dated 31.10.1992 for Rs.36,024.75 ----------------Total Rs.2,37,924.25 -----------------The plaintiff demanded the payment from defendant in person as wellas through its representatives. The defendant neglected to pay thebalance inspite of repeated demands by the plaintiff. The plaintiff,therefore, issued Lawyer's notices dated 24.05.1993, 29.06.1993,03.08.1993 & 11.10.1993 from Jetpur, Gujarat and finally on07.10.1996. The defendant has sent the following replies to theabove Notices, claiming adjustment of Rs.51.001.00 in the credit ofanother concern M/s.B.N.D.Enterprises:-a) Reply dated 28.05.1993b) Reply dated 21.07.1993c) Reply dated 14.06.1993d) Reply dated 25.10.1993The defendant has written a letter dated 28.05.1993 to the plaintiffpromising to settle the bills. The plaintiff sent a final lawyer'snotice dated 07.10.1996 calling upon the defendant to pay the balanceof Rs.2,37,924.25 as on 03.04.1996 after adjustment of Rs.51,001.00in the credit of M/s.B.N.D.Enterprises, with interest at the rate of24% per annum within one week from the date of receipt of the saidnotice. The defendant had sent a reply notice. But the defendant hasnot paid the balance amount till date. The plaintiff is entitled tothe following amounts:-Principal amount 2.37,924.25Interest @ 10% pa from 16.11.1994 to 16.10.1996 23/12 x 18/100 x 2,37,924.25 82,084.00 --------------Total amount payableRs. 3,20.008.25 --------------Total amount payable is Rs.3,20,008.25. The plaintiff is entitled tointerest at the rate of 18.5% per annum till the date of payment.The amount due is in respect of commercial transactions andtherefore, the minimum lending rate of interest at 18% per annum byNationalised Banks is applicable. The cause of action for the suit https://hcservices.ecourts.gov.in/hcservices/ arose at Madras on 29.06.1992; when the defendant purchased textilesfrom the Plaintiff and subsequently on various dates when thedefendants purchased goods from the plaintiff and when the plaintiffissued a lawyer's notice on various dates and finally on 08.10.1996.The suit has been properly valued. Hence, the suit.3.The plea raised in the written statement by the respondentwould run as follows:-The plaintiff firm is not a registered firm. The saidMr.Arvind.H.Chhatbar is not the duly authorized agent of theplaintiff. The power of attorney has not been validly executed. Theamounts demanded by the plaintiff in their several legal notices hasnot been consistently made. The plaintiff itself is not clear aboutthe amount allegedly due by the defendant. The defendant stated thatit is true that the defendant had business dealings with theplaintiff and had placed few orders with the plaintiff. Theplaintiff had not supplied goods to the defendant on the allegedorders placed by the defendant. The defendant denied that thedefendant-firm is liable to pay a sum of Rs.2,37,924.25 as on3.4.1996. The defendant further denied that it had purchased goodsfrom the plaintiff under seven invoices as alleged in the plaint.The defendant denied that the plaintiff had demanded payment throughits representatives as alleged in the plaintiff. The plaintiff hadnot supplied goods as stated by them in the legal notices. Thesuitable replies have been sent by the defendant to the noticesissued by the plaintiff denying the liability of the defendant tomake the payment. The plaintiff has not given credit to a sum ofRs.51,000/- deposited by its sister concern B.N.D.Enterises andinterest has also not been credit to on the said deposit. Theincentive agreed to be paid by the plaintiff has not been givencredit to. The defendant would submit that even during the previoustransactions the plaintiff had not supplied goods in accordance withthe specifications made by the defendant and as a result thedefendant had discontinued to do business with the plaintiff. Thegoods supplied were not in accordance with the sample as shown by theplaintiff and the same was not accepted by the defendant. Thedefendant had on many occasions complained to the plaintiff's localrepresentatives that the goods supplied were defective and damagedand the defendant had to incur additional expenditure and suffers aloss. The amount stated by the plaintiff both in the final legalnotice and in the plaint is excessive, arbitrary and without anybasis. The statement of account filed along with the plaint doesnot reflect the true state of affairs and the correctness of thefigures mentioned therein is disputed by the defendant. Thedefendant has no agreement with the plaintiff to pay any interest atall. The defendant also stated that there has been no custom orpractice to pay interest in the previous dealings and no demand forinterest was also made by the plaintiff. The defendant is not liableto pay interest to the tune of Rs.82,084/- as claimed by the https://hcservices.ecourts.gov.in/hcservices/ plaintiff. The plaintiff has filed the present suit to harass thedefendant and malign its reputation in the trade. Hence, the suit isliable to be dismissed. 4.Before the lower Court the Power of Attorney of plaintiff wasexamined as P.W.1 and Ex.A.1 to Ex.A.33 were marked on the side ofthe plaintiff. No evidence both oral and documentary was produced onthe side of the defendant. The lower Court had framed the followingissued for disposal of the case:1)Whether the plaintiff-firm is a registered partnershipfirm?2)Whether Mr.Arvind H.Chhatbar is holding valid power ofattorney?3)Whether the defendant is liable to pay the amount?4)Whether there is no agreement to pay interest andwhether the defendant is not liable to pay the interest?5)To what relief the plaintiff is entitled?The lower Court had appraised the evidence adduced by the plaintiffbefore the lower Court and had come to the conclusion that theplaintiff could not maintain the suit and the claim of the plaintifffor the said amount and the subsequent interest thereon could not beawarded in favour of the plaintiff and accordingly, the suit wasdismissed with costs.5.On a careful consideration of the pleadings, the evidenceproduced before the lower Court, judgment and decree passed by thelower Court, the grounds raised in the memorandum of appeal and otherrecords and the arguments made by the learned counsel for therespondent/defendant, this Court could see the following pointsemanated for disposal in this appeal_1)Whether the suit filed by the plaintiff as apartnership firm through the power of attorney ismaintainable?2)Whether the defendant is liable to pay the suitclaim made in the plaint?3)Whether the plaintiff is entitled for 18% interestfor the outstanding sum as claimed in the plaint?4)Whether the judgment and decree passed by the lowerCourt are liable to be set aside and the appeal isallowable?6.No representation for the appellant/plaintiff despite the nameof the appellant is printed in the cause list. Heard the learnedcounsel for the respondent/defendant.7.Point No.1:-The appellant was the plaintiff, who lost the casebefore the lower Court. The suit was filed by the plaintiff for https://hcservices.ecourts.gov.in/hcservices/ recovery of sum of Rs.3,20,008.25 together with interest at the rateof 18% per annum on the principal amount of Rs.2,37,924.25 till thedate of payment. The suit claim was made by the plaintiff on thefoot of seven invoices namely_a)Invoice No.204 dated 29.6.1992 for Rs.1,05,031.00 balanceRs.7886.25.b)Invoice No.268 dated 31.8.1992 for Rs.41,787.00c)Invoice No.300 dated 12.9.1992 for Rs.30,314.25d)Invoice No.304 dated 17.9.1992 for Rs.50,713.00e)Invoice No.353 dated 16.10.1992 for Rs.35,478.00f)Invoice No.396 dated 31.10.1992 for Rs.35,721.00g)Invoice No.403 dated 31.10.1992 for Rs.36,024.75 ----------------Total Rs.2,37,924.25 -----------------The plaintiff is described as a Registered Partnership Firmrepresented through the Power of Attorney viz., Mr.Arvaid.H.Chhatbar.In order to substantiate the claim of the plaintiff, he had examinedthe alleged power of attorney as P.W.1. The said deed of power ofattorney was produced as Ex.A.33. The case of the appellant/plaintiffwould be that the lower Court had grossly erred in not believing theverification affidavit of one L.Dayalan endorsed in the power ofattorney itself and the lower Court did not give any opportunity tothe plaintiff to produce ratification regarding the due execution ofthe Power of Attorney by the partner of the plaintiff firm. Thefurther contention of the appellant would be that the said partner ofthe plaintiff firm viz.Narsidas Gangji could have ratified the powerof attorney executed by him at any time, but the lower Court haddismissed the suit without giving the said opportunity. It is alsothe contention of the appellant that the said ratification of thedeed of power of attorney deed could be done by the said partner evenin the appeal stage and he was also arranging for another Power ofAttorney to be executed by him after rectifying the action of thepresent power agent including the filing of the suit against thedefendant/respondent. The further contention of the appellant wouldbe that the registration of firm certificate was produced into theoffice at the time of filing the suit and therefore, it could not besaid that the plaintiff was not a registered partnership firm and itcould not maintain the suit in view of Section 62 of the PartnershipAct. The said registration certificate copies are being arranged tobe produced by the appellant. Similarly, it is also the contention ofthe appellant that the lower Court was grossly erred in refusing theinterest for the outstanding sum of money in the transaction theplaintiff had with the defendant. The contention of the appellantwas also to the effect that the liability of the defendant was provedthrough the documentary evidence produced by P.W.1, but, however, thesuit claim was not found to have been proved by the plaintiff beforethe lower Court, which is incorrect. The appellant has alsorequested to decree the suit as prayed for on the basis of the https://hcservices.ecourts.gov.in/hcservices/ evidence submitted by the appellant before the lower Court. Apartfrom these grounds made in the appeal memorandum, no othersubmissions were made by the appellant himself or through hiscounsel.7(a)From the submissions made by the learned counsel for therespondent/defendant this Court could understand that thetransactions were said to have been had with the plaintiff during theyear 1992 and the invoices produced as Ex.A.1 to Ex.A.7 will go toshow that all the invoices are prior to 31.01.1992 and the lorryreceipts produced as Ex.A.8 to Ex.A.14 would also confirm the saiddates of dealings. The dispute in between the plaintiff and thedefendant would be culled out from the exchange of letters producedin Ex.A.23 to Ex.A.26. According to the case of the defendant, theplaintiff had supplied the sub-standard quality of goods and had notsupplied the goods in time and no incentives have been credited tothe account of the defendant. It is also the case of the defendantthat a deposit of Rs.51,000/- with the plaintiff in the name of thedefendant's sister concern viz., B.N.D.Enterprises was not adjustedtowards the said amount. No documents were produced to show theunconditional undertaking or acknowledgment of the defendant to paythe said outstanding amount on the foot of the invoices viz., Ex.A.1to Ex.A.7. Admittedly the suit was filed on 28.10.1996 clearly afterthe period of three years. Moreover, the plaintiff had specificallydenied that the plaintiff claimed to be the registered firm shouldhave comeforward with necessary documents to prove that it is aregistered firm and the partner, who is said to have executed thepower of attorney to P.W.1, is shown as one of the partners in thelist of partners. However, the plaintiff had not comeforward withthe registration certificate and the list of partners in order toshow that the plaintiff firm is a registered firm under IndianPartnership Act and the executant of power of attorney- Ex.A.33 isalso one of the partners to the said firm. The case of the appellantin this appeal was to the effect that the registration certificatewas produced along with the plaint at the time of filing the suit.If it was so, nothing would prevent him from marking the saiddocument at the time of the examination of P.W.1. It was not doneso. Similarly the person, who was said to have authorised P.W.1 tofile a suit and to depose on behalf of the said firm, was not shownas one of the partners of the plaintiff firm. 7(b)The law is very clear in this aspect and according toSection 69(2) of Indian Partnership Act, an unregistered firm cannotmaintain a suit on behalf of the said firm. Reliance was placed bythe learned counsel for the respondent on a judgment of this Courtreported in 1999(II) CTC 540 (M/s.K.R.M.Money Lenders rep by itsPower Agent Karuppiah s. Mr.A.Manohara @ Doss). The relevant passagewould run as follows:- https://hcservices.ecourts.gov.in/hcservices/ "Merely because at the time of taking the plainton file notice has been ordered and a copy of theregistration had been produced and the plaintiff had beenpermitted to institute the suit, it cannot be assumed thatthe plaintiff is a registered firm and it is not as if theplaintiff exonerated from establishing that it is aregistered firm or that the suit has been validlyinstituted or no objection is permissible on any letterdate. The formality that has been complied with at theinitial stage before taking the plaint on file and at thetime of institution of the suit is always subject to allexceptions. Therefore, it follows that the defendants areentitled to raise such an objection in respect of theplaint which is non est in law. It cannot be said thatthe defendants have waived such an objection by theirfailure to raise or on the part of the court to frame anissue in this respect. The failure to establish that theplaintiff is a registered firm and the failure to establishthat the power of attorney is competent to institute thesuit, in my considered view and in the light of the abovepronouncements renders the suit plaint a nullity whichcannot be cured."Apart from that, the validity of the power of attorney-Ex.A.33 isalso questioned by the defendant. On a careful perusal of theevidence of P.W.1, this Court could see that P.W.1 goes to speak thatthe power of attorney was registered at Jetpur. Moreover, on acareful perusal of Ex.A.33-Power of Attorney Deed, I could see thatit is not a registered power of attorney, but was notarized at Madrasas rightly pointed out by the lower Court . The stamp papers werepurchased in Madras and the person viz. L.Thayalan S/o.V.L.Nanthanhad given a verification in the power deed itself declaring that theexecutant Mr.Narsudas Gangji had subscribed his signature on08.10.1996 in his presence. It has not been stated in the saidverification, as to where it was signed by the said Mr.NarsidasGangji either at Madras or at Jetpur. The said Mr.L.Dayalan was notexamined before the lower Court. Therefore, the evidence of P.W.1 tothe effect that the said deed of power of attorney was executed bythe alleged partner of plaintiff MR.Narsidas Gangji at Jetpur runcontrary to the other documentary evidence. The appellant'scontention that Mr.Narsidas Gangji, the partner of the plaintifffirm, could at any time rectify the authorization given to P.W.1 andtherefore, it would not be fatal to the case and the dismissal of thesuit is gross error committed by the lower Court, can not besustained as it was not complied with. 7(c)The appeal was filed in the year 1999 and despite 10 yearspast no document was produced on the side of the appellant in respectof the ratification of the power conferred upon P.W.1. No https://hcservices.ecourts.gov.in/hcservices/ registration certificate nor the list of partners were filed by theappellant in this appeal by way of additional evidence. Therefore,the failure to prove the power of attorney said to have beenauthorized in favour of P.W.1 is still without any change. Theaforesaid judgment of this Court reported in 1999(II) CTC 540(M/s.K.R.M.Money Lenders rep by its Power Agent Karuppiah s.Mr.A.Manohara @ Doss) is applicable in this stage also. Therefore,the appellant/plaintiff has no legs to stand on his pleadings norproved them to maintain the suit before the lower Court, despite noplea has been raised in respect of limitation point. Therefore, Ifind no reason to hold that the suit filed by the plaintiff ismaintainable.8.Points 2 & 3:- The appellant/plaintiff had filed the suit forrecovery of money on the basis of the business transactions madethrough Ex.A.1 to Ex.A.7 – invoices. Admittedly all those invoiceswere dated 31.10.1992 and prior dates to the said date. The suit hasbeen filed on 28.10.1996. The plaintiff did not specifically averin the plaint regarding the exemption to be pleaded for maintainingthe suit filed beyond the period of three years. There is no plea ofany acknowledgment of liability of the defendant found in the plaint.Therefore, the claim made by the plaintiff is also not liable to bepaid by the defendant to the plaintiff. Similarly, there is noagreement for payment of interest as seen through Ex.A.1 to Ex.A.7-invoices. It has also been found that the defendant is not liable topay the suit claim made through Ex.A.1 to Ex.A.7 and therefore, theclaim for interest at 18% per annum for the outstanding amount willnot also arise. Therefore, both these points are also decidedagainst the appellant.9.Point No.4:- In view of the finding in Points 1 to 3 that theplaintiff is not entitled for any relief sought for by him and thesuit is not maintainable in law, this Court is of the view that thejudgment and decree passed by the lower Court are not liable to beset aside.10.In the result, the appeal is dismissed, confirming thejudgment and decree passed by the lower Court with costs.ssvSd/-Asst.Registrar/True Copy/Sub.Asst.RegistrarTo,1. The Registrar, City Civil Court, Chennai. https://hcservices.ecourts.gov.in/hcservices/

2. The II Additional Judge, City Civil Court, Chennai.3. The Record Keeper, V.R.Section, High Court, Madras.+ 1 CC to Mr.K.Bijai Sundar,Advocate,SR.29051A.S.No.333 of 1999NG(CO)EM/24.9