The High Court allowed an appeal setting aside a decree for recovery of money. It held that a settlement letter proved a 50% payment was made in full and final settlement, invalidating the claim for the full amount.
The appeal was allowed and the judgment and decree dated 28.07.2017 in O.S.No.6486 of 2014 were set aside.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
A.S.No.296 of 2018
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 22.02.2023
CORAM
THE HONOURABLE MR. JUSTICE S.M.SUBRAMANIAM
A.S.No.296 of 2018 and
C.M.P.No.7061 of 2018
D.Vijayakumar Proprietor, M/s.VGP & Co., No:10/18, Venkatasamy Lane, Mylapore, Chennai – 600 004.
..Appellant
Vs.
M/s.C.Thirupugal Nadar and Sons, Rep.by its General Manager, Mr.C.T.Chithranjan, No:129, G.A.Road, Old Washermenpet, Chennai – 600 021.
..Respondent
Appeal filed under Order XLI Rule 1 read with Section 96 of C.P.C., praying to set aside the Judgment and Decree dated 28.07.2017 made in O.S.No.6486 of 2014 by the Learned XIX Additional City Civil Court, Chennai.
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For Appellant : Mr.V.Anil Kumar For Respondent : Mr.R.C.Manaoharan
A.S.No.296 of 2018
JUDGMENT
The Appeal Suit has been filed to set aside the Judgment and Decree dated 28.07.2017 made in O.S.No.6486 of 2014 passed by the XIX Additional City Civil Court, Chennai.
trade manufacturing and dealers in Dal in wholesale and retails. The defendant purchased Dal on credit by bill No.4782 dated 24.10.2011 for Rs.9,03,310/- and in bill No.4912 dated 12.11.2011 for Rs.9,44,648/-. After the purchase of the Dal vide bill Nos.4782 dated 24.10.2011 for Rs.9,03,310/- and bill No.4912 for Rs.9,44,648/-, the defendant made a part payment of Rs.9,25,000/- on 13.02.2012. The said payment was available on records and audited and submitted to the Sales Tax Authority and
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Income Tax Department. The balance amount was not paid by the defendant. The plaintiff issued a notice dated 13.09.2014 to repay the amount due to the plaintiff to the tune of Rs.9,04,633/-. The plaintiff claimed interest at the rate of 24% from the date of default committed by the defendant.
the same and had a mill at Tandiarpet, which was owned by Mr.C.T.Chidambaram. The defendant had transactions with the plaintiff. 3/14
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The defendant had been doing the business for a very long time and had a very cordial relationship with Mr.C.T.Chidambaram. In the year 2012, the defendant had purchased certain goods from the plaintiff, when the same was managed by Mr.C.T.Chidambaram. Since the defendant had to receive a lot of money for the goods supplied to various customers and since the defendant did not receive the same, their business ended in huge loss and consequently, he was not able to settle the money to the plaintiff. The defendant sold his only house to repay all the creditors. The defendant arrived at a settlement with all the creditors including the plaintiff. The defendant closed his mill, which was being operated from a rented place. On 12.02.2012, a compromise was arrived with the plaintiff, wherein the plaintiff agreed to receive 50% of the amount outstanding, amounting to Rs.9,25,000/- as full and final settlement, in respect of all the claims against the defendant. The defendant sold his house on 10.02.2012 and settled all the creditors including the plaintiff. At that time, Mr.C.T.Chidambaram was alive and he had deputed one Mr.Saravanapandian to accompany his employee to receive the amount along with the letter acknowledging receipt of Rs.9,25,000/- as full and final settlement. The letter was handed over to the defendant on 12.02.2012 simultaneously when a sum of Rs.9,25,000/-
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was paid to the plaintiff. The amount of Rs.9,25,000/- was paid in full and final settlement. Due to serious loss suffered by the defendant in his business, the mill was closed down and he sold his only house and thereafter, settled all the creditors.
are audited and submitted to the Sales Tax Authority and Income Tax Department. The plaintiff had stated that they have not signed the letter as 5/14
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alleged and the letter is a forged one. They have pleaded that there was no reply to the legal notice and therefore, an adverse inference has been drawn
against the defendant regarding the alleged settlement letter.
(1) Whether the plaintiff is entitled for a decree, directing the defendant to pay a sum of Rs.11,94,116/- with further interest of 12% per annum till the date of realisation of the amount?
(2) Whether the defendant is not liable to pay any
amount to the plaintiff?
(3) To what relief, the plaintiff is entitled for?
was mainly relied upon by the defendant to establish that the plaintiff agreed for such a settlement and 50% of the amount outstanding was settled as full and final settlement. The plaintiff disputed the said letter of settlement by stating that it was not signed by the authorized person on behalf of the plaintiff-M/s.C.Thirupugal Nadar and Sons.
P.W.1 and Mr.R.Kandasamy, D.W.2.
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as P.W.1 and Exs.A2 & A3 are the plaint alleged original bills to establish the purchase of Dal by the defendants on 24.10.2011 and 12.11.2011 for the two sums of Rs.9,03,310/- and Rs.9,44,648/-. The defendant has filed documents to establish that similar settlements are made in respect of other traders with whom they had business transactions. In the written statement, the defendant has stated that their company have sustained serious financial loss in their business and accordingly, the mill was closed down. The defendant sold his only house in the year 2012 and settled all his creditors by paying 50% of the amount outstanding at that point of time. Thus, the defendant marked all those documents to establish that they have settled 50% of the dues outstanding to other creditors and similarly, 50% of the amount has been paid to the plaintiff as full and final settlement. Ex.B1 document is the Settlement Letter. Ex.B3, series of documents are relating to the other settlements made by the defendant with the creditors. The said documents were considered by the trial Court and the trial Court further considered the deposition of D.W.2, Mr.Kandasamy, who was the Scribe in respect of Ex.B1 and Ex.B3 series of documents. All those documents were written by the said Mr.Kandasamy, D.W.2 in his office.
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that the Ex.B1 document was prepared in his office in the presence of the representative of the respondent-M/s.C.Thirupugal Nadar and Sons and there is no reason to make a finding that the appellant/defendant is liable to pay the balance dues. It is further contended that the deposition of D.W.2 is clear that the said Mr.R.Kandasamy had written the Ex.B1 document in his office. The Letterhead of M/s.C.Thirupugal Nadar and Sons was handed over to the D.W.2 by one Mr.Ganesan, Grandson of C.T.Chidambaram, who was the Proprietor of M/s.C.Thirupugal Nadar and Sons company. Further, D.W.2 deposed that the letter, Ex.B1 document was prepared in order to settle the dispute between the plaintiff and the defendant and to settle the dues. Thus, the purpose, for which, the Ex.B1 document was prepared was deposed by D.W.2 in clear terms. More so, the Letterhead of the respondentM/s.C.Thirupugal Nadar and Sons was handed over by Mr.Ganesan to the Scribe, D.W.2. Therefore, this Court is unable to arrive at a conclusion that Ex.B1 document is a forged document.
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company would have initiated all appropriate action including criminal action against all such persons, who have committed such forgery or misrepresented the company for the purpose of entering into a settlement with the appellant/defendant. Admittedly, no such action was initiated. The suit itself was filed after a lapse of about two and a half (2 ½) years from the date of purchase of Dal by the defendant from the plaintiff. Therefore, the overall facts and circumstances would reveal that the Ex.B1 document was intended by both the plaintiff and the defendant. Accordingly, it is a settlement entered into between the parties and 50% of settlement was agreed. Thus, there is no reason to believe Ex.B1 document marked by the defendant in the suit is a forged document and in this regard, the trial Court has committed an error in not considering the vital document, Ex.B1 for the purpose of considering the issues. Thus, as far as Issue No.1 is concerned, the plaintiff though able to prove that the defendant purchased the Dal in two bills and settled only 50% of the amount and remaining 50% due outstanding has not been paid, the subsequent settlement letter, Ex.B1 would establish that the parties had settled the issues between them by receiving 50% of the amount and thus, the Issue No.1 is answered in favour of the defendant and the Settlement Letter in Ex.B1 document is a valid
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document and therefore, institution of the suit subsequently by the grandson of Mr.C.T.Chidambaram with an intention to recover the entire amount would not serve any purpose as in the present case, the settlement was entered into between the plaintiff and the defendant with the knowledge of Mr.C.T.Chidambaram, who was the owner of M/s.C.Thirupugal Nadar and Sons.
22.02.2023 Index : Yes Speaking order:Yes Neutral Citation:Yes kak
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To
The XIX Additional City Civil Court,
Chennai.
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S.M.SUBRAMANIAM, J.
kak
A.S.No.296 of 2018
22.02.2023
2 issues framed by the court
Whether the trial court correctly held the appellant liable for the outstanding balance after a 50% settlement agreement was reached?
Whether the settlement letter (Ex.B1) is forged or unauthorized and valid as a full and final discharge of dues?
2 provisions across 1 enactments
D.Vijayakumar
M/s.C.Thirupugal Nadar and Sons
S.M.Subramaniam
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
