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2026 Supreme(Online)(Del) 16907
IN THE HIGH COURT OF DELHI AT NEW DELHI
V. Kameswar Rao, Manmeet Pritam Singh Arora, JJ
Anup Kothiwal – Appellant
Versus
Singhasan Prasad – Respondent
RFA(COMM) 39/2025 | CM APPL. 46529/2025
For the Appellants/Petitioners: Niyati Pathak
For the Respondents: Rakesh Mittal, Yamini Mittal, Ajay Harshana
A claim for set-off for alleged defects in a commercial contract cannot be granted if it was not pleaded in the written statement, the expenditure was not actually incurred, and the evidence provided is from an interested witness.
Headnote:(A) Recovery of Money - Commercial Contract - Invoices and Measurement Sheets - Where invoices are based on admitted measurement sheets and the defendant fails to rebut them, the claim for outstanding dues is sustainable despite minor discrepancies in preliminary email demands. (Para 15, 16)
(B) Set-off - Defective Work - Claim for rectification costs - A claim for set-off based on an estimate cannot be granted if no formal counter-claim or set-off was pleaded in the written statement and the expenditure was never actually incurred. (Para 18, 19, 20)
(C) Evidence - Interested Witness - Testimony of an expert witness who is a close relative of the party may be discarded if found to be biased or unsupported by objective evidence. (Para 13, 18)
Issues: Whether the appellant is entitled to a set-off for alleged defective work and whether the respondent is entitled to the decreed amount with interest.
JUDGMENT
MANMEET PRITAM SINGH ARORA, J.
1. The present regular first appeal has been filed under Section 13 of the Commercial Courts Act, 2015, [„Act of 2015‟] assailing the judgment dated 26.10.2024 [„impugned judgment‟] passed by the District Judge (Commercial Courts)-05, South East District, Saket, in CS DJ NO. 144/2020 titled as Singhasan Prasad v. Anup Kothiwal [„Trial Court‟].
1.1. Vide impugned judgment the suit filed by the Respondent for the recovery of the amount of Rs. 9,02,686/- has been decreed in favour of the Respondent along with interest at 10% per annum from the date of filing of the suit till its realisation, along with the costs of Rs. 20,000/-.
FACTUAL MATRIX
The brief facts as set out in the appeal are as under: -
2. The Appellant engaged the Respondent in June 2017 to carry out interior renovation work in Appellant‟s flat at M-67 Third Floor, Greater Kailash-II, New Delhi („flat‟). The scope of work was settled vide e-mail dated 03.07.2017 which included carpentry, electrical, plumbing, plastering and painting. It is stated that payments were to be made progressively based on the work completed.
3. In July, 2017, Appellant shifted to a rented accommodation to enable the Respondent to carry out renovation work in the flat. The Respondent carried out renovation work thereafter until December, 2017. In November/December, 2017, Appellant shifted back to the flat.
4. According to the Appellant, the Respondent delayed the work considerably and ultimately handed over the flat in an incomplete and defective condition in November-December 2017, despite the agreed completion date being October 2017. The Respondent raised claims for its outstanding dues vide e-mail dated 12.12.2017.
5. It is stated that the Appellant raised the defects in the work through an e-mail dated 13.03.20181Refer to printed page no. 147 of the appeal. However, in its reply dated 29.10.20182Refer to printed page no. 149 of the appeal, the Respondent acknowledged that certain snags may arise after handover and offered to undertake repairs, while maintaining that the same could not justify withholding payment.
6. Thereafter, the Respondent instituted a suit seeking recovery of principal amount of Rs. 9,02,686/- plus interest, which has been decreed by the Trial Court in favour of the Respondent. Aggrieved by the said decree, the Appellant has filed the present appeal for seeking to set aside the impugned judgment dated 26.10.2024.
SUBMISSIONS OF THE PARTIES
7. Ms. Pathak, learned counsel for the Appellant, states that after taking possession of the flat, the Appellant noticed that the interior work carried out by the Respondent was incomplete and unprofessional.
7.1. She states that the existence of defects and snags, in the work executed by the Appellant, is evident from a conjoint reading of the e-mails dated 13.03.2018 and 29.10.2018 exchanged between the parties.
7.2. She states that the Appellant accordingly engaged an Architect on 12.02.2020 to inspect the flat. She states that the Architect has submitted an estimate of a sum of Rs. 4,13,000/- towards rectification and repair of the defects in the Appellant‟s work.
7.3. She states that the learned Trial Court ought to have granted set-off for this amount of Rs. 4,13,000/- from the principal amount of Rs. 9,02,686/- found due and payable.
7.4. Also, she submits that there are inconsistencies in the outstanding amount demanded by the Respondent. In the e-mail dated 13.03.20183Refer to printed page no. 146 of the appeal, the Respondent claimed an outstanding amount of approximately Rs. 9.8 lakhs along with taxes, whereas in the e-mail dated 29.10.2018, a demand of Rs. 8 lakhs were raised, and finally the suit was ultimately instituted for recovery of Rs. 9,02,686/-.
7.5. She contends that these inconsistent demands of the alleged outstanding support the Appellant‟s case that the bills were not prepared in accordance with the actual measu
