Disposed

Emu Lines Pvt. Ltd. v. Blue Ocean Lines Pvt. Ltd. and 2 Ors.

Bombay HC24 Aug 2012SJ/59/2011

Case brief

AI extract

What is this about?

In a suit for recovery of freight and storage charges arising from re-shifting of goods due to foreign buyer's refusal, the court dismissed the Plaintiff's claim against directors but granted them conditional leave to defend. The suit was transferred to the commercial causes list.

What did the court decide?

Unconditional leave to defend granted to second and third defendants. Conditional leave to defend granted to first defendant upon deposit of Rs. 4 lacs.

Emu Lines Pvt. Ltd. Vs Blue Ocean Lines Pvt… — Contract and Commercial Disputes | Bombay HC (2012)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

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SUMMONS FOR JUDGMENT NO. 59 OF 2011 IN SUMMARY SUIT NO. 845 OF 2010

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E.M.U.Lines Private Limited Company ) Registered with Register of Companies ) under Indian Company Act 1956 having ) Corporate Office at Delhi and Branch at ) Mumbai and Navi Mumbai – 411 413 ) Monarch Plaza, Plot No.56, Sector No.11 ) CBD Belapur, Navi Mumbai – 400 614. )

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..... Plaintiff

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VERSUS

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1. M/s.Blue Ocean Lines Pvt. Ltd. ) 401, Chandra House, 90, Perin Nariman ) Street, Fort, Mumbai 400 001 ) 2. Permanand Chand, Director, Adult, ) Occupation Business, 401, Chandra ) House, 90, Perin Nariman Street, Fort, ) Mumbai )

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3. Jankinandan Pandey, Director, Adult, ) Occupation Business, Doing business at ) 401, Chandra House, 90, Perin Nariman ) Street, Fort, Mumbai ) ..... Defendants

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Mr.J.B.Singh for the Plaintiff.

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Ms.Jyoti Chatpande, i/b. PRS Legal for Defendants.

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CORAM : R.D. DHANUKA, J.

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DATE : 24th AUGUST, 2012.

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ORAL JUDGMENT :

By this Summons for Judgment, the Plaintiff seeks to recover a sum of Rs. 4,29,204/- with further interest thereon and cost. The suit is filed on the basis of invoice dated 6^th October, 2008.

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According to the Plaintiff, Defendant No.1 is carrying on business of exports and imports of goods. Defendant Nos. 2 and 3 are Directors of the Defendant No. 1. For one of the transaction of the first defendant relating to export to Taiwan, the Plaintiff provided services to the first Defendant by shipment of the goods and issued Bills of Lading dated 6^th October, 2008 in the sum of Rs.4,29,204/-. It is a common ground that the said goods exported were not accepted by foreign buyer and were called back from Taiwan on 15^th September, 2008. It is the case of the Plaintiff that on instructions of the first Defendant, such goods were re-shifted from Taiwan to India.

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The Plaintiff filed this suit for recovery of demurrage and storage charges on the ground that the Defendants did not accept the delivery of the goods and the same was lying at JNPT, Mumbai. The Plaintiff issued an invoice on 6^th October, 2008 towards freight, endorsement charges, load port charges and storage charges in the sum of Rs.4,29,204/-. By letter dated 5^th February, 2008 the Plaintiff through its advocate issued a demand notice calling upon the

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Defendants to pay Rs.4,29,204/- with interest. By undated letter, the first Defendant replied to the legal notice and denied the claim on the ground that the Plaintiff had not followed the proper procedure. It is denied that any amount was due and payable by the Defendants to the Plaintiff. The Plaintiff by its letter dated 10^th July, 2009 reiterated its claim.

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The Defendants have filed affidavit in reply. The Learned Counsel appearing on behalf of the Plaintiff submits as under :-

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(a) It is not in dispute that the first defendant

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had availed of the service provided by the Plaintiff. The foreign customer of the defendant refused to take delivery of the consignment and as a result of which the goods were required to be re-shifted to

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India. This Court is informed that the first Defendant did not take delivery of the said goods and the same were stored with JNPT incurring liability of demurrage and storage charges. It is submitted that the decree should be passed against all the Defendants.

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On the other hand, the Learned Counsel appearing for the Defendants submit as under :-

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(a) The Defendant Nos. 2 and 3 are Directors of

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the 1^st Defendant and are not joined as

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guarantors, are wrongly impleaded and are not personally liable for the transaction between the

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Plaintiff and the 1^st Defendant. It is submitted

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that there is misrejoinder of parties. The goods which are re-shifted from Taiwan by the Plaintiff are finally auctioned by JNPT.

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(b) The 1^st Defendant could not take any steps

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in view of the fact that no document was provided by the Plaintiff.

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In rejoinder, the Learned Counsel appearing for the Plaintiff submit that though in reply to the notice of demand, the 1^st Defendant has admitted the receipt of Bill of Lading, it has been denied in the affidavit in reply.

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As far as Defendant Nos. 2 and 3 are concerned, it is common ground that both these Defendants are directors of the 1^st Defendant Company. There is no privity of contract between the Plaintiff and 2^nd and 3^rd Defendant. In my view, no summary suit is maintainable against the directors who are merely joined as office

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bearers of the 1^st Defendant. 2^nd and 3^rd Defendants therefore, in my opinion are entitled to unconditional leave to defend the suit on this ground.

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As far as 1^st Defendant is concerned, it is common ground that the foreign customer of the first Defendant did not take delivery of the shipment and such goods were thus required to be re-shifted at the instance of the 1^st Defendant by the Plaintiff. Receipt of Bill of lading is not disputed by the first defendant in reply to notice of demand.

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In my view, since the 1^st Defendant has not taken delivery of the goods, the Plaintiff has incurred freight endorsement charges, load port charges, storage charges which the 1^st Defendant is required to pay. The Learned Counsel appearing for the Plaintiff submits that all such amount claimed by the Plaintiff in this suit are actually incurred and paid by the Plaintiff to JNPT.

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In my opinion, the defence raised by the 1^st Defendant is not substantial and moon shine.

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I, therefore, pass the following order :-

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(a) The second and third defendants are

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granted unconditional leave to defend the suit

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and are directed to file Written Statement within

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eight weeks from today.

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(b) The 1^st Defendant is granted conditional

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leave to defend the suit on depositing a sum of Rs. four lacs in this Court within a period of

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eight weeks from the date of this Order.

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statement within a period of four weeks after such deposit is made by the first defendant.

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(d) If the 1^st Defendant deposits the said amount in this Court as directed, the Prothonotary & Senior Master is directed to invest the same in a Fixed Deposit of a nationalised bank initially for a period of two years and thereafter for a like period after obtaining further order from this Court.

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(e) In the event of 1^st Defendant committing

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default in making payment, the Plaintiff would be

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at liberty to apply for further reliefs from this

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Court.

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(f) Suit is transferred to the list of commercial

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causes.

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(g) Summons for Judgment is accordingly

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disposed of.

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(h) There shall be no order as to cost.

Emu Lines Pvt. Ltd. v. Blue Ocean Lines Pvt. Ltd. and 2 Ors.

Case brief

What is this about?

What did the court decide?

Emu Lines Pvt. Ltd. v. Blue Ocean Lines Pvt. Ltd. and 2 Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

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