Allowed

M/S.Ferdous Hotel Pvt. Ltd. v. M/S.Jayaram Electricals

Madras HC23 Nov 2023A/3489/2018

Case brief

AI extract

What is this about?

The single judge held that a suit filed as a summary suit is not maintainable where the claim involves disputed quantum of work, absence of necessary certification from the Project Management Consultant, and conflicting liability allegations.

What did the court decide?

An unconditional leave to defend the suit was granted, and the defendants were directed to file a written statement.

M/S.Ferdous Hotel Pvt. Ltd. Vs M/S.Jayaram… — Civil Procedure and Limitation | Madras HC (2023)

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A.No.3489 of 2018 in C.S. No.616 of 2017

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A.No.3489 of 2018 in C.S. No.616 of 2017 ABDUL QUDDHOSE,J.

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This application has been filed seeking leave to defend the suit.

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2.The suit has been filed as a summary suit as per the provisions of Order VII Rule 1 of the Original Side Rules by the respondent/plaintiff for the recovery of a sum of Rs.2,86,78,093/- from the applicants/defendants.

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3.As seen from the affidavit filed in support of this application, the applicants/defendants claim that they do not owe any money to the respondent/ plaintiff, but, instead it is only the respondent/plaintiff, who owes money to them for the un-satisfactory work. According to the applicants/defendants, unless and until the work done by the respondent/plaintiff is certified by the Project Management Consultant, the question of making payment to the respondent/ plaintiff for the invoices raised by them will not arise. According to them, as per the terms and conditions of the work orders, the work done by the respondent/plaintiff has to be certified by the Project Management Consultant and only thereafter, the invoices raised by the respondent/plaintiff can be paid by the applicants/defendants. According to them, without getting certification from the Project Management Consultant, the respondent/plaintiff has arbitrarily raised invoices on the applicants/defendants, for which, no payments need to be paid.

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https://www.mhc.tn.gov.in/judis

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A.No.3489 of 2018 in C.S. No.616 of 2017

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Therefore, according to the applicants/defendants, there are several triable issues involved in the suit and therefore, the suit cannot be filed as a summary suit.

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4.However, as seen from the counter affidavit filed by the respondent/ plaintiff, they would reiterate that they are entitled for the suit claim. According to them, the invoices raised by them are un-disputed invoices and the claim made by them in the suit is for a liquidated sum of money. According to them, they have satisfied the requirements of Order VII Rule 1 of Original Side Rules as the suit claim is based on the value of the invoices, which is a liquidated sum of money. It is their case that being an un-disputed sum, a summary suit will lie.

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5.Learned counsel for the applicants/defendants as well as the learned counsel for the respondent/plaintiff would reiterate the contentions of their respective clients.

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6.Admittedly, the work orders placed by the applicants/defendants with the respondent/plaintiff contains terms and conditions. As seen from the terms and conditions, invoices raised by the respondent/plaintiff will have to be certified by the Project Management Consultant and only thereafter, the same may be considered by the applicants/defendants for making payment to the respondent/

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https://www.mhc.tn.gov.in/judis 2/6

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A.No.3489 of 2018 in C.S. No.616 of 2017

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plaintiff. The respondent/plaintiff along with the plaint has filed 18 documents, which includes work orders, placed by the applicants/defendants and demand letters issued by the respondent/plaintiff calling upon the applicants/defendants to make payment towards the invoices. However, the certification, which will have to be obtained by the respondent/plaintiff from the Project Management Consultant before raising invoices, has not been filed as a document along with the plaint.

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7.The bone of contention of the applicants/defendants is that without obtaining certification from the Project Management Consultant, the respondent/plaintiff has arbitrarily raised invoices, for which, they are not liable to pay. They also claim that the work done by the respondent/plaintiff was unsatisfactory and infact, according to them, it is only the respondent/plaintiff, who owes the applicants/defendants money. The relevant clauses of the terms and conditions of the respective work orders are extracted hereunder:

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'3.Payment Terms:
1.Advance amount......................................................	....... 10%
2.Material supplied to site along with receipt...........	........ 50%
3.After Installation ....................................................	........ 15%
4.After Testing and Commissioning...........................	....... 20%
5.Retention amount to be released
after defects liability period which
is not more than 12 months.....................................	......... 5%

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https://www.mhc.tn.gov.in/judis

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A.No.3489 of 2018 in C.S. No.616 of 2017

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4.Billing Cycle:

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You shall raise bill as per Terms of payment (as above). The fully documented cumulative final bill shall be submitted with detailed measurement sheets, supplementary sketches, vouchers/delivery challans for material at site etc. The final bills will be assessed for quantum of work and certified for payment based on detailed verification by PMC along with Management's representatives for work executed. Certification of the bill by the PMC with the signature/endorsement of Management's Representative shall reach the client within 7 working days and the clients shall make the payment of the bill within 14 working days from the date of certification from th PMC.

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Extra items will be mutuallydiscussed and paid as per the marked rate.'

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8.As seen from the aforesaid clauses, certification of the bills by the Project Management Consultant is required to enable the respondent/plaintiff to raise invoices on the applicants/defendants in respect of the work done by them. The applicants/defendants also assert that without obtaining certification from the Project Management Consultant, the respondent/plaintiff has arbitrarily raised invoices. They also claim that they do not owe any money to the respondent/ plaintiff due to the unsatisfactory work of the respondent/plaintiff. Though the respondent/plaintiff disputes the contention of the applicants/defendants, this Court is of the considered view that there are several triable issues involved, which

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A.No.3489 of 2018 in C.S. No.616 of 2017

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cannot be decided in a summary nature, but, can be decided only after trial. Therefore, in view of the several triable issues involved, an unconditional leave to

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defend has to be granted in favour of the applicants/defendants as prayed for in this application.

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9.Unless and until a suit is filed to recover a liquidated debt, evidenced by a document or any money payable by the defendants with or without interest, arising on a negotiable instrument or on a bond or a contract for payment of a liquidated amount of money evidenced by a document or on a guarantee where the claim arises against the principal in the manner aforesaid, Order VII Rule 1 of the Original Side Rules shall not apply as it is not a summary suit. The respondent/ plaintiff has not satisfied the aforementioned requirements and hence, the summary suit filed by the respondent/plaintiff is not maintainable and the suit will have to be treated only as an ordinary Civil Suit.

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10.For the foregoing reasons, this application is allowed as prayed for and un-conditional leave to defend is granted in favour of the applicants/defendants.

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ABDUL QUDDHOSE,J.

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vga

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https://www.mhc.tn.gov.in/judis

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A.No.3489 of 2018 in C.S. No.616 of 2017

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The applicants/defendants are directed to file their written statement on or before the next hearing date. Post the matter on 11.12.2023.

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23.11.2023

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vga

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A.No.3489 of 2018 in C.S. No.616 of 2017

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M/S.Ferdous Hotel Pvt. Ltd. v. M/S.Jayaram Electricals

Case brief

What is this about?

What did the court decide?

M/S.Ferdous Hotel Pvt. Ltd. v. M/S.Jayaram Electricals

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

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