J U D G M E N T

The instant suit has been filed seeking for a judgement and decree directing the defendant to pay a sum of Rs. 6,66,10,734/- to the plaintiff and directing the defendant to pay interest at the rate of 18% per annum from the date of the plaint till the date of recovery of all the amounts. The plaintiff further seeks for a direction to the defendant to pay the costs of the suit.

CASE OF THE PLAINTIFF:

2.The plaintiff is a company engaged in power sector. The plaintiff states that between 2013 and 2016 their Company was constructing a power plant to generate electricity ona commercial scale in the state of Chhattisgarh. For the purposes of civil construction the plaintiff required iron rods of particular diameters and length. The defendant is a Company manufacturing and selling such Iron rods.

3.The further case of the plaintiff is that the plaintiff placed a purchase order for a total requirement of 4900 Mts of iron rods for various dimensions vide Purchase order dated 25-3-2013. The plaintiff's claim that the total price for the entire supply of 4900 Mts of rods was fixed at rupees 29,94,50,000. The purchase order provided for 50 percent of the quantity to be delivered within April 2013 and the balance 50 percent by May 2013. The plaintiff claims that as per the agreed terms, the materials were progressively lifted till June, 2013 and subsequently, on account of monsoon and labour strikes, the supplies were kept in abeyance. The supplies resumed in September 2013 and continued till January 2014. The plaintiff claims that the defendant had totally supplied only 1490 Mts and that the said quantity is valued at Rs.6.39 crores as per the invoice of the defendant.

4.The plaintiff specifically relies upon certain clauses in the purchase order. Clause B of the purchase order enabled the plaintiff to reserve theirright to amend the purchase order in respect of quantity/delivery schedule. Clause 8 of the purchase order provides that, “invoice shall be quadruplicate along with the delivery challan, lorry receipt, test certificate, inspection report and other necessary documents”. Clause 2 of the purchase order states that ‘payment terms

100 percent advance payment against submission of proforma invoice’.

5.The plaintiff states that the plaintiff had given an advance of Rs.9.61 crores. The further claim of the plaintiff is that for the quantity of iron rods supplied, the price for the same was deducted out of the above said advance. On such adjustments, the defendant has to supply 753 Mts to adjust Rs.3.22 crores advance still lying with the defendant.

6. The grievance of the plaintiff is that the defendants demanded the payment of the entire 20.94 crores i.e., total consideration of the contract, even before the supply of the goods, failing which, the defendants will not dispatch the goods to the plaintiff. The plaintiff states that the defendant stopped all supplies from January 2014 onwards. According to the plaintiff, the purchase order along with the Clauses in the annexure clearly shows that as and when the defendant supplies the goods and sends the invoice, the plaintiff has to pay the amount in advance to the extent of the supply. The plaintiff therefore claims that the contract cannot be read as requiring the payment of the entire 20.94 crores even before any supply. The further grievance of the plaintiff is that the defendant received Rs.9.61 crores in advance and after deducting the quantity of iron rods supplied, the defendant still has the money of the plaintiff to the tune of Rs.3.22 crores. The plaintiff claims that all the invoices raised by the defendant are in conformation with Clause 8 and contain different quantities of iron rods dispatched by the defendant to the plaintiff. The plaintiff after adjusting the supply has sought for recovery of money and liquidated damages from the defendant.

CASE OF THE DEFENDANT:

7.The defendant is a manufacturing Company involved in the manufacture of iron and steel rods. The de