Allowed

Rubyorganics Pvt. Ltd. v. Sai Mirra Innopharm Pvt. Ltd.

Bombay HC21 Sept 2013SJ/495/2009

Case brief

AI extract

What is this about?

The High Court disposed of a summons for judgment in a suit filed by M/s.Ruby Organics against M/s.Sai Mirra Innopharm. The court rejected all defenses, held the buyer deemed to have accepted goods given lack of timely objection, and decreed the suit for the claimed amount. Further interest was awarded.

What did the court decide?

Suit decreed for Rs.1,99,08,154/- plus interest; entitlement to 12% p.a. interest from decree date.

Rubyorganics Pvt. Ltd. Vs Sai Mirra Innopharm Pvt. Ltd. — Specific Performance | Bombay HC (2013)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION SUMMONS FOR JUDGMENT NO. 495 OF 2009 IN

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SUMMARY SUIT NO. 2602 OF 2009

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M/s.Ruby Organics Pvt. Ltd. VERSUS

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M/s.Sai Mirra Innopharm Pvt. Ltd.

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..... Plaintiffs

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..... Defendants

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Mr.Sanjay Jain, i/b. A.V.Jain & Associates for the Plaintiffs.

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Mr.Vinod Tayade, i/b. Mr.Anil Desai for the Defendants.

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CORAM : R.D. DHANUKA, J. DATED : 21^st SEPTEMBER, 2013

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P.C.

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By this Summons for Judgment, plaintiffs seek that judgment be entered for by the plaintiffs in its suit for a sum of Rs.1,99,08,154/- as per the particulars of claim with further interest on Rs.1,21,34,753/- at the rate of 24% per annum from the date of the filing of the suit till payment. This suit is based on various invoices issued by the plaintiffs from time to time which are annexed to the plaint. On 26^th May, 2006, an agreement was entered into between the plaintiffs and the defendants by which plaintiffs agreed to supply the product described in schedule to the said agreement. It is the case of the plaintiffs that plaintiffs pursuant to the order placed by the defendants from time to time sold and delivered diverse quantities of goods annexed to the Exs.A-1 to A-72. Reliance is placed on delivery challans and transport receipts also. Defendants have admittedly issued C Form in respect of each of such transaction to the plaintiffs which are also annexed to the plaint.

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Since defendants did not make payment, vide letter dated 10^th July, 2008 addressed by the plaintiffs to the defendants, plaintiffs enclosed the detailed statement of outstanding payments and called upon the defendants to make payment. In response to the said letter, defendants vide letter sent by e-mail dated 18^th July, 2008 stated that in view of the recent changes that had taken place in its company with regard to the spinning off of their marketing division into a new joint venture company, it may be not of much interest to the plaintiffs to participate with equity in its manufacturing cum export company. It was stated that defendants on clearing of the outstanding payment of the plaintiffs, the defendants which are under obligation to clear outstanding payment of the plaintiffs which defendants planned to do progressively at about Rs.10 lacs every month from their operation. It was further stated that the defendants were actively exploring the possibility of locating a joint venture partner for their manufacturing company and if they were successful, then they should be able to clear the outstanding of the plaintiffs in one shot. The defendants assured that the plaintiffs would be kept informed of the progress of that matter. Defendants also thanked the plaintiffs for all its support provided to the defendants. Since no payment was forthcoming, the plaintiffs issued another letter raising demand on 23^rd July,2008. There was no response to the said letter. Plaintiffs issued notice of demand through its advocate on 24^th March, 2009 calling upon the defendants to pay Rs.1,24,34,753/- with further interest thereon. In response to the said notice, defendants replied through its advocate. In the said reply, it is stated by the defendants that the plaintiffs had not insisted for any payment from the defendants from the day on which supplies have been made by the plaintiffs to the defendants. Defendants denied that the defendants had not raised any dispute regarding the quality and quantity supplied by the plaintiffs. It is stated that the defendants were even now prepared to allot equity share as desired by the plaintiffs initially. Since no payment was made by

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the defendants, the plaintiffs filed this suit for recovery of Rs.1,99,08,154/- with interest at the principal amount. Defendants have filed affidavit in reply.

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The first defence raised in the affidavit in reply is that the transport receipts were not annexed by the plaintiffs alongwith the plaint and thus defendants could not deal with the same. It is not in dispute that the plaintiffs have given inspection of the transport receipts to the defendants and the same is recorded by the letter addressed by the plaintiffs' advocate. Defendants did not file any additional affidavit denying the receipt of the material supplied by the plaintiffs or the contents of the transport receipts. In my view, there is no substance in that defence.

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The next defence submitted in the affidavit in reply is that there is no agreement for payment of interest at the rate of 24% per annum on the commercial tax invoice which are subject matter of this suit. On the tax invoices which are annexed to the plaint, the terms and conditions of the supply are incorporated. It is categorically provided that interest would be recovered at the rate of 24% per annum on overdue unpaid bills. Defendants have not denied the receipt of any of these invoices or the goods supplied by the plaintiffs referred to in such tax invoices. The terms and conditions incorporated on the contents invoices are acted upon by both the parties. In my view, thus there is no substance in the defence that there is no provision for payment of interest @ 24% per annum or otherwise.

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The next defence of the defendants in the affidavit in reply is that the plaintiffs had agreed to convert Rs.1,00,00,000/- of the outstanding bills into equity with the defendants and it was belief of the defendants that the plaintiffs had accepted the proposal of the defendants. There is no such agreement produced by

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the defendants on record. On the contrary, letter addressed by the defendants to the plaintiffs would indicate that it was the defendants' own case that the plaintiffs would not be interested in participating in any equity share of the defendants. There is no merit in this defence raised by the defendants.

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The next defence of the defendants in affidavit in reply is that certain goods supplied by the plaintiffs were of inferior quality and as a result of which, the defendants were required to issue credit notes. It is alleged that in view of inferior quality of goods of the plaintiffs, the defendants have suffered loss. On perusal of the record produced by parties, it is clear that there are no such letters produced on record by the defendants alleging that inferior quality of goods were supplied by the plaintiffs. No debit notes are issued to the plaintiffs by the defendants. Defendants have used the goods supplied by the plaintiffs. Section 42 of the Sale of Goods Act, 1930 provides that the buyer is deemed to have accepted the goods when he intimates to the seller that he has accepted them, or when the goods have been delivered to him and he does any act in relation to them which is inconsistent with the ownership of the seller, or when, after the lapse of a reasonable time, he retains the goods without intimating to the seller that he has rejected them. On perusal of the tax invoices issued by the plaintiffs and in particular terms and conditions recorded therein which categorically records that claim of any nature whatsoever will lapse unless raised in writing within three days from the date of invoice. It is clear that there is nothing on record placed by the defendants that any complaint was lodged by the defendants about alleged inferior quality of goods within three days from the date invoice or at any point of time in future. On the basis of the perusal of the terms and conditions printed on the tax invoices which are acted upon by the parties and on perusal of section 42 of the Sale of Goods Act, 1930, in my view defendants are deemed to have accepted the goods since no

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objection about the quality of goods has been raised by the defendants within three days from the date of invoices or in any event after the lapse of reasonable time. There is thus no merit in this defence raised by the defendants in affidavit in reply.

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There is no dispute that the defendants have issued 'C' Forms to the plaintiffs admitting the supply of goods effected by the plaintiffs. Learned counsel appearing for the defendants submit that it is also the case of the defendants that the plaintiffs have not complied with the terms and conditions of the agreement entered into between the parties. On perusal of the invoices issued by the plaintiffs which are subject matter of this suit, it is clear that the said invoices are issued independently of the agreement entered into between the parties. There is thus no merit in this defence also.

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I am of the view that each and every defence raised by the defendants is totally frivolous and is moonshine and deserves to be rejected. Plaintiffs have thus made out a case for grant of relief as claimed in the Summons for Judgment. Summons for Judgment is accordingly made absolute. It is however made clear that the plaintiffs would be entitled to claim further interest at the principal amount at the rate of 12% per annum from the date of decree till payment. Suit is decreed in aforesaid terms.

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Refund of court fees as per rules.

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[R.D. DHANUKA, J.]

Rubyorganics Pvt. Ltd. v. Sai Mirra Innopharm Pvt. Ltd.

Case brief

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Rubyorganics Pvt. Ltd. v. Sai Mirra Innopharm Pvt. Ltd.

Case brief

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