Back
2018 Supreme(Guj) 869
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
AKIL KURESHI, B.N. KARIA, JJ.
Gujarat Alkalies and Chemicals Ltd. - Petitioners
Versus
M/S. Pragati Progressive Pvt. Ltd. - Respondents
R/First Appeal No. 4034 of 2017
Decided On : 04-10-2018
For the Petitioners:Ms. Priyal Parikh, Advocate.
For the Respondents:Mr. Anshin Desai, Senior Advocate With Mr. Parth, Advocate, With Mr. Pranjal Buch, Advocate.
Headnote:
Gujarat Alkalis and Chemicals Ltd - Companies Act - Indian Evidence Act - Section 65B - Suit Decree - Present appellant, had filed a Special Civil Suit before the Court of Civil Judge against the present respondents - Plaintiff is a company registered under the Companies Act and is engaged in the business of manufacture, sale and trading of Alkalis, chemicals and allied products - Defendant no.1 Pragati Progressive Pvt. Ltd. is a private limited company engaged in the business of trading in various chemicals - Held, Situation was that if the plaintiff had supplied the goods to the defendant no.1, who in turn had sold part of it to S.P. Marketing and was unable to make payment to the plaintiff because S.P. Marketing defaulted in its obligation, the above noted arrangement was perfectly natural. Even in such a scenario, the three parties involved in the process could have duly agreed to a formula, under which, for the supply of goods by S.P. Marketing to GACL, no payment would be made but the payment would be adjusted against the dues of the S.P. Marketing to Pragati Progressive and in turn, the accounts of Pragati Progressive with the plaintiff would be credited by matching amount - Taking note of the span of supply of goods and the fact that the suit was filed nearly six months after the last supply, Court grant interest for a period of one year at 9% on the said sum of - This comes to the total thereof will come to - Plaintiff shall recover such sum with further interest at the rate of 9% from the date of the suit till actual recovery with proportionate costs - A decree may be drawn accordingly - Appeal dismissed. (Paras 38, 39)
AKIL KURESHI, J.
1. This appeal is filed by the original plaintiff challenging the judgment and decree of the Commercial Court, Vadodara, dated 05.08.2017 passed in Commercial Suit No.65 of 2016. By such judgment, the Trial Court was pleased to dismiss the suit of the present appellant.
2. Gujarat Alkalies and Chemicals Ltd., (hereinafter to be referred to as 'the GACL' for short)the present appellant, had filed a Special Civil Suit No.290 of 2004 before the Court of Civil Judge (Senior Division), Vadodara, against the present respondents. Plaintiff is a company registered under the Companies Act and is engaged in the business of manufacture, sale and trading of Alkalies, chemicals and allied products. Defendant no.1 Pragati Progressive Pvt. Ltd. is a private limited company engaged in the business of trading in various chemicals. Defendant nos.2 and 3 were the directors of the defendant no.1 company at the relevant time. The plaintiff had filed the said suit for recovery of a sum of Rs.1,76,35,269/- with interest from the defendants. This prayer was based on following averments made in the suit. According to the plaintiff, the defendant nos.2 and 3 on behalf of defendant no.1 company had approached the plaintiff sometime in December, 2001, for appointing the defendant no.1 company as a dealer of the plaintiff's products. The defendants would execute necessary documents and agreements as per the requirements of the plaintiff company. The plaintiff agreed in principle to appoint defendant no.1 as dealer subject to execution of dealership agreement and providing necessary securities. The plaintiff thereafter started supplying to the defendants various products such as Hydrochloric Acid, Sodium Cyanide, Caustic Soda Lye, Caustic Potash Flakes, Carbon Tetrachloride, Dilute Sulphuric Acid etc. The plaintiff sold and delivered such goods to the defendants on exfactory basis. For sale of such goods, the plaintiff raised various invoices and bills during the period between 21.12.2001 and 01.12.2003. The invoices and bills were accepted by the defendants without any demur or dispute. Despite reminders from the plaintiff, dealership agreement was not executed. Bank guarantee was also not furnished by the defendants. The plaintiff had written several letters in this respect which were duly acknowledged by the defendants.
3. In the meantime, the plaintiff went on supplying the goods to the defendants on continuous basis raising regular invoices and bills. Yearly statement of accounts was also provided. The defendants were liable to pay the sale price of these goods. However, according to the plaintiff, the defendants collected payments for goods sold by them but did not pay over the sale price to the plaintiff.
4. According to the plaintiff, the defendant started defaulting in making the payments for the goods delivered to them. The defendant no.1 in the letters dated 16.06.2002, 11.08.2003, 13.08.2003 and 07.08.2003 written to the plaintiff, admitted that there were outstanding amounts due to the plaintiff for supply of such goods. Finally when the defendants did not clear the dues, the plaintiff issued a legal notice dated 22.09.2003 demanding an unpaid sum of Rs.1,87,75,163/which included the principal sum of Rs.1,48,36,271/with interest calculated till that date. The defendant no.1 vide a letter dated 07.10.2003 admitted that the goods supplied by the plaintiff were received and that amount of Rs.1,80,43,653/- due and payable by the defendants to the plaintiff. We may however record that such letter has not been exhibited.
5. According to the plaintiff, as on 04.06.2004, a sum of Rs.1,39,90,963/- remained outstanding payable by the defendants to the plaintiff for the period between 10.11.2001 to 04.06.2004. Since despite efforts by the plaintiff, the defendants did not pay such sum, the said suit came to be filed for recovery of a sum of Rs.1,76,35,269/which included the outstanding amount of Rs.1,39,90,963/- and accrued interest
