The main legal point established is the importance of framing issues based on the record of the case and the principles of territorial jurisdiction in contractual matters.

Valmiki J. Mehta, J (Oral)

1. Issues are framed under Order 14 CPC. Issues are framed on material propositions of fact or law urged by one party and denied by the other. Framing of issues is considering the pleadings which are filed by the respective parties and also the other material on record. Consideration of the record at the time of framing issues prevents unnecessary issues from being framed and unnecessary evidence being led by both the parties, and, it also thus prevents unnecessary elongation of the case and prevents the record from becoming bulky. At the stage of framing of issues, Courts have to ensure that only those issues are framed which arise from the record of the case. If it is found that really the issue urged to be framed does not arise or the law bars the framing of the issue sought to be framed, then, such an issue need not be framed.

2. With this preface, let me set down the respective cases of the parties which are today being urged before me. The case of the plaintiff is simple. The plaintiff says that it deals with dental equipment and dental products. Plaintiff says that defendants were appointed by it as distributor of the goods of the plaintiff. The plaintiff, however, says that this relationship was a principal to principal basis i.e the plaintiff is the seller and the defendants are buyers of goods and consequently the defendants are liable to pay for the value of the goods which have not been paid.

3. Defendants have filed their written statement-cum-counter claim. A reading of the written statement shows that besides the complete denial of the claim of the plaintiff, defendants have taken up, what the defendants contend are ‘alternative’ stands. The defendants firstly, as per the stand taken before me today, contend that the relationship between the plaintiff and defendants was not on principal to principal basis, and the defendants were acting only as an agent who never purchased the goods from the plaintiff and the defendants simply transferred goods which were taken from the plaintiff ahead to other dealers/purchasers of the plaintiff. For providing of such services, the defendants received commission from the plaintiff. The defendants therefore, claim that since they have not purchased the goods from the plaintiff, they are not liable to pay value of the goods to the plaintiff, and if the plaintiff has to recover money, it has to recover moneys from and to whom the goods have been transferred by defendants. It is pleaded that defendants are entitled to various adjustments totaling to Rs. 46,57,815.84. This figure of Rs. 46,57,815.84 comprises of three claims. The first figure is the claim of commission of Rs. 27,85,663.54 for goods delivered to the dealers of plaintiff. The second figure of Rs. 9,50,874.55 is the value of the goods taken back by the plaintiff and for which adjustment is claimed. The third figure is an amount for Rs. 9,21,277.75 being the amount which the defendants say has been admitted by the plaintiff to be payable to defendants. Defendants have also pleaded what it says is an ‘alternative’ defence. Counsel for the defendants urges before me that this ‘alternative’ defence is that defendants should be taken as a buyer of the goods, however, the defendants are stated to be not liable on account of adjustments claimed in the written statement. Defendants seek to get issues framed on the basis of its defence which it calls ‘alternative’ defence. For the reasons given hereinafter, in my opinion, the ‘alternative’ stand that the defendants for being taken as the buyer of the goods from the plaintiff is not an ‘alternative’ stand but a mutually destructive stand when taken with the stand that defendants are only agents as stated above. Hence, I would not frame issues on this aspect. I say ‘mutually destructive’ because if the stand of the defendants being buyers is accepted, and which they will have to admit in their evidence, the same will lead to a most anomalous posi