Implied acceptance of terms and conditions can establish a binding agreement; Failure to prove payment of dues despite withdrawal of Debit Note can lead to adverse inference against the defendant.

1. The challenge by means of this Appeal by the defendant filed under Section 96 of the Code of Civil Procedure, 1908, is to the impugned judgment dated 31.10.2007 passed by the IV Additional Judge, City Civil Court, Chennai, in O.S. No. 3713 of 2005 decreeing the suit for a sum of Rs. 2,97,264/- with interest at the rate of 12% per annum as against the claim of Rs.7,46,751.19 together with interest at 24% per annum.

2. The case of the plaintiff, as narrated in the plaint, runs as follows:-

(a) The plaintiff is a firm engaged in the business of rendering Security Service, Consultancy, Personal Management Services, etc. since 1967. While so, when the defendant, who is engaged in the business of sale of consumer goods, Groceries and Pharmaceuticals, approached the plaintiff firm for providing security services at its shops and godowns throughout the city of Chennai, they agreed to provide them on certain terms and conditions mutually agreed upon and accordingly, they sent a Letter Agreement dated 23.02.1999 to the defendant mentioning the notice period for termination of service besides stating about the contemplated payments to personnel, Consultancy Service Charges and further Credit Service Charges. Further, since the terms and conditions were also accepted by the defendant, they implemented the proposal by providing security services for the shops and godowns of the defendant.

(b) The defendant besides committing default in payment, by letter dated 02.02.2002, asked the plaintiff to restrict their security services to only certain shops without giving two months notice, which is one of the terms and conditions as per the agreement. Therefore, according to the plaintiff, the defendant had become liable to pay service charges for two months with regard to the units for which security services were unilaterally withdrawn by them. Further, since the defendant was irregular in making the payments, the plaintiff terminated the security services by letter dated 14.6.2002.

(c) The further averment of the plaintiff is that the last payment made by the defendant was of Rs.32,815.85 on 05.6.2002 while the outstanding balance was Rs.7,02,746.98 as on 17.02.2004. It is also averred that despite the letter dated 17.02.2004 asking for payment and though the same was received by the defendant on 25.02.2004, no payment was made. Since the defendant failed to pay the dues despite reminders, the plaintiff issued a legal notice on 24.09.2004, which was received by the defendant on 25.9.2004, but no reply was made by the defendant.

(d) Hence, the plaintiff filed the suit for recovery of Rs.7,46,751.19 with interest at 24% per annum from the date of plaint till the date of realisation and for costs.

3. Resisting the suit, the defendant filed written statement denying the allegations made in the plaint as under:-

(a) According to the defendant, the suit on a Statement of Account referring to specific bills cannot be maintained.

(b) As regards the agreement dated 23.02.1999, it is stated by the defendant that since it is only a letter unilateral in nature, the terms and conditions contained therein cannot be said to have been accepted by them. It is further averred by the defendant that the services rendered by the plaintiff were not of standard quality and only when the same were brought to their notice, the services came to be terminated. Besides denying the allegation of the financial constraints, it is stated by the defendant that since the services provided by the plaintiff were inadequate and unsatisfactory, they sought for restriction of the same only to certain shops and hence, according to the defendant, the question of payment of service charges for two months as claimed the plaintiff, does not arise. It is further stated that the Debit Notice raised for this purpose was withdrawn by the plaintiff by letter dated 05.3.2002.

(c) The defendant, while denying the allegation of irregularity in payment, averred in paragraph 11 that the suit