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2012 Supreme(Del) 2213

DELHI HIGH COURT
Valmiki J.Mehta, J.
SCJ Plastics Ltd. - Appellant
Versus
Creative Wares Ltd. - Resopndent
CS(OS) No. 738 of 2002
Decided On : 24-07-2012

Advocates Appeared:
For the Plaintiff :Mr. Pankaj Chaudhary, Advocate.
For the Defendant:Mr. K. Datta , Mr. Manish Srivastava, Advocates.

The main legal point established in the judgment is the significance of judicial admissions and their binding nature, along with the impact of deemed acceptance of goods under the Sale of Goods Act, 1930, on the defendant's defense.

Headnote:

Admissions - Recovery Suit - Sick Industrial Companies (Special Provision) Act, 1985 - Section 22 of SICA - Sale of Goods Act, 1930 - [Order 12 Rule 6 CPC] - [SUIT FOR RECOVERY OF DEBTS] - [Sick Industrial Companies (Special Provision) Act, 1985, Section 22] - The court discussed the admissions made by the defendant in the BIFR proceedings, the legal provisions of Order 12 Rule 6 CPC, and the Sale of Goods Act, 1930. The court emphasized the significance of judicial admissions and their binding nature, citing relevant case law. The court also highlighted the deemed acceptance of goods under Section 42 of the Sale of Goods Act, 1930, and its impact on the defendant's defense. These legal provisions influenced the court's decision to decree the suit in favor of the plaintiff.

Fact of the Case:

The plaintiff filed a suit for the recovery of a principal amount and interest from the defendant, who had made admissions of the amount payable in the BIFR proceedings under Section 22 of SICA. The defendant disputed the admissions in the court.

Finding of the Court:

The court found that the defendant's categorical admission in the BIFR proceedings, based on the books of accounts, was significant. The court also noted the defendant's vague defense of rejecting the goods, which was deemed inadequate under the Sale of Goods Act, 1930.

Issues: The issues revolved around the defendant's admissions in the BIFR proceedings, the validity of the defense regarding the quality of goods, and the applicability of relevant legal provisions.

Ratio Decidendi: The court relied on the significance of judicial admissions, the binding nature of such admissions, and the deemed acceptance of goods under the Sale of Goods Act, 1930, to decree the suit in favor of the plaintiff.

Final Decision: The suit of the plaintiff was decreed for the principal amount along with interest, and the application was allowed and disposed of with the suit decreed as stated.

Valmiki J. Mehta, J (ORAL).—

IA No.20050/2011(u/O.12 R.6 CPC)

1. This is an application filed by the plaintiff for decreeing the suit under Order 12 Rule 6 CPC on account of admissions made by the defendant in judicial proceedings viz before the Board for Industrial and Financial Reconstruction (BIFR) categorically bringing out that the debts/amounts are payable to the plaintiff and which are the subject matter of the present suit.

2. The facts of the case are that the plaintiff filed the subject suit for recovery of Rs.36,06,238/- being the principal amount and interest payable thereon with effect from 1.4.2002. The amount is claimed to be due with respect to goods sold by the plaintiff to the defendant namely “Master Batches”, being raw material which is used for preparing packaging material.

3. The defendant-company became sick and therefore it was registered as a sick company under the relevant provisions of the Sick Industrial Companies (Special Provision) Act, 1985. It is in these proceedings that the defendant-company made categorical admissions of the amount which was payable to the plaintiff in the present suit, and therefore, the present application has been filed making the following averments in paras 2(e) to 2(g) as under:-

“2(e) That on receipt of summons of the present suit, the defendant moved an application under Section 22 of SICA, seeking stay of proceedings of the present suit, stating that the defendant company, vide reference no.47/2001, has approached the BIFR for declaration of the defendant company as a sick company;

(f) That on 25.3.2004 and vide diary no.5972, the defendant voluntarily filed in the present suit, the list of documents i.e. 1. Record of proceedings of the hearing held on 14.11.2003 before the BIFR in case no.47 of 2001 (pages 1 to 11); 2. List of sundry creditors of the defendant as on 30.9.2001 (pages 12 to 16), which is signed by the company secretary of the defendant; and 3. Audited balance sheet and profit and loss account of the defendant-company as on 30.9.2001 (pages 17-40).”

(g) That at page 15 of the said list of documents filed by the defendant in the present suit vide diary no.5972 on 25.3.2004, there is a clear, unequivocal, unconditional, unambiguous and positive admission by the defendant “that as on 30.9.2001, the defendant has to pay to the plaintiff a principal balance payment of Rs. 23,81,613.80 (`twenty three lacs eighty one thousand six hundred thirteen and paise eighty only).” Whereas as per plaintiff, even as on date and against the supply of goods by the plaintiff to the defendant vide said bills, as detailed in para 5 of the plaint, a balance payment of Rs. 23,85,077/- is still due from the defendant to the plaintiff. Thus, there is a nominal difference of Rs. 3,463.20 (` three thousand four hundred sixty three and paise twenty only) in the principal balance payment claimed by the plaintiff from the defendant and admitted by the defendant in their list of creditors as on 30.9.2001. Thus, plaintiff hereby waives the said nominal difference of Rs. 3,463.20 (` three thousand four hundred sixty three and paise twenty only) in order to settle the present case as per admission by the defendant.”

4. The defendant has today filed its reply in Court. A reading of the relevant paras of the reply shows that it could not be disputed that such a categorical admission was made in the BIFR proceedings and which itself was as per the records/books of accounts of the defendant. The relevant portions of the reply read as under:

“e) & f) That the contents of paragraphs no. e) & f) need no specific response.

g) That the contents of paragraph no. g) are denied in toto as false, frivolous and misconceived. It is denied that at page 15 of the said list of documents filed by the defendant in the present suit, there is clear, unequivocal, unconditional, unambiguous or positive admission by the defendant as alleged. It is categorically denied that the defendant has admitted that as on 30.9.2001 th






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