M/S. S.J. TRADING CO. v. HINDUSTAN GAS and INDS.LTD.

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defendant-company. THE FACTUAL MATRIX:-

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2. It is the case of the plaintiff that pursuant to the discussions held with the defendant an agreement was entered into on 26.8.1987 as born out by letter dated 26.8.1987 in which it was agreed by and between the parties that the rate of service charge would be @ 12% of C.I.F. value of the licence endorsed by Joint Chief Controller of Imports and Exports (J.C.C.I.E.) in favour of the defendant-company.

3. According to the plaintiff, the said agreement was illegally cancelled/terminated by the defendant vide telex message dated

22.9.1987.

4. According to the plaintiff, agreement dated 26.8.1987 was acted upon by them much prior to it's cancellation. It was substantially performed.

5. Plaintiff claims to have requested the defendant to pay compensation @ 5% on the

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C.I.F. value of import licence by its letter dated 7.10.1987 followed by further letters dated 17.10.87, 29.10.87 and 10.12.87 to which there has been no reply or response from the defendant-company.

6. The plaintiff further stated in the plaint that since no reply was received to all these letters, it had no alternative but to issue notice dated 31.3.1988 through it's Advocate calling upon the defendant to pay the damages for breach of contract, which were tentatively assessed at Rs. 5 lac. Since no amount was paid as demanded by notice dated 31.3.1988 the present suit is filed by the plaintiff for the recovery of the service charges @ 12% calculated on the C.I.F.value of import licence worth Rs. 100 lac. The claim is valued in the sum of Rs. 12 lac with future interest thereon @ 18% per annum.

7. The writ of suit summons was served on the defendant but it has chosen not to appear. No written statement was filed.

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EVIDENCE:-

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8. The plaintiff in support of suit claim filed two affidavits; one duly sworn by Mr Jitendra Mehta, stating therein that he is a partner in the plaintiff-firm. That he is conversant with the facts of the case. That he is able to depose in support of their claim on the basis of the personal knowledge. In para 2 of the affidavit he has stated that the plaintiff has misplaced the original documents; particularly, debit notes raised upon the plaintiff by various brokers/agents and Export Houses.

9. The affiant, in para 3 of the affidavit has stated that he tried to procure original and/or duplicate copies of the said bills/debit notes from the brokers/Agent and/or Export Houses but he could not succeed in his efforts; since two agents who had raised debit notes are not traceable. There is reference to a personal discussions between the affiant Mr R.L. Bathwal and Mr R. K. Goenka representing the defendant-company. That pursuant to the discussion it was agreed between the parties that the plaintiff, on behalf of the defendant, would approach

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certain export houses, entitled to import non-OGL capital goods for actual use and shall get their licenses transferred in the name of defendant and shall do the job of getting the applications processed by approaching the office of the Directorate General of Technical Development (D.G.T.D.) to seek its recommendations. That it shall get the licenses endorsed in the name of defendant, by approaching the Chief Controller of Imports and Exports. According to the plaintiff, all these talks were seconded in the letter dated 26.8.1987 addressed by the plaintiff to the defendant. That the terms and conditions incorporated therein were accepted by the defendant.

10. The affiant has further stated that on 27.8.1987 meeting took place between the plaintiff and the defendant; wherein, the defendant was informed that the plaintiff would endeavour to get the endorsement of the J.C.C.I.E within 30 days of the receipt of necessary information from the defendant.

11. The affiant has further stated that on

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receipt of the list of the machineries required by the defendant, the plaintiff approached five Export Houses, through Brokers/Agents and applied to the D.G.T.D for the necessary endorsement and saw to it that their recommendations were forwarded to the J.C.C.I.E According to the affiant, apart from approaching the various Export Houses, the plaintiff was also required to engage the services of various Brokers and Agents to complete the contracted job. That various brokers have also raised their bills on the plaintiff for the work done by them. According to the affiant, by their letter dated 16th September, 1987, the plaintiff informed to the defendant that they had done the needful so as to complete the contracted job undertaken by them.

12. The affiant in para 8th of the affidavit, has referred to the telex message received from the defendant on 22.9.1987 requesting plaintiff not to take any further action for procurement of the licence in view of certain Governmental difficulties faced by them. According to the affiant, said telex message was received by the plaintiff after

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the contracted job was substantially performed by them.

13. The affiant went on to say that the plaintiff vide it's letter dated 7th October, 1987 informed the defendant that inspite of getting all the requisite recommendation from D.G.T.D, New Delhi for indigenous clearances of licenses worth Rs.85 lac, the defendant has suddenly cancelled the contract. That the defendant was informed that the plaintiff had already paid all service charges to the Export Houses and have devoted time and incurred expenses in getting the clearance from the D.G.T.D, as such, they are entitled to be compensated. Compensation was sought to be calculated @ 5% of the C.I.F. value of the licences to be endorsed. The plaintiff in para 13 of the affidavit has referred to the Invoices raised on it by various Brokers and Agents and the payments made by it. In the Legal notice dated 31.3.1998 Rs. 5,00,000/- were claimed by way of damages. However, instead of filing suit for damages, plaintiff chose to file the suit for recovery of the service charges calculated in the sum of Rs. 12 lac.

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14. The plaintiff has filed one more affidavit of Mr Shirish Kamdar, to prove the debit notes raised on them by M/s Abhijit Dipak Holdings Pvt. Ltd.

THE ISSUE:

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15. With the aforesaid evidence and material on record, the issue which needs consideration is: Whether the plaintiff is entitled to succeed in the suit on the basis of the aforesaid material inspite of the fact that the defendant chose not to appear?

CONSIDERATION:

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16. Having gone through the above two affidavits and documents produced on record, I am constrained to record finding that none of the affidavits filed on record were verified by the plaintiff by producing affiants in the Court for examination on oath as required by law laid down by this Court in the case of F.D.C. Ltd v. Federation of Medical

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Representatives Association India (FMRAI) and others, A.I.R. 2003 Bombay 371. The relevant extracts of the said judgment are reproduced hereinbelow for immediate reference.

(A) Civil P.C. (5 of 1908), O.18,Rr.45, examination-in-chief in each and every case is permitted in form of affidavit- taking affidavit on record- procedure to be followed in appealable cases is prescribed in R. 5- in Non-appealable cases procedure under R. 13 is to be followed.

" In other words, in the appealable cases though the examination-in-chief of a witness is permissible to be produced in the form of affidavit, such affidavit cannot be ordered to form part of the evidence unless the deponent thereof enters the witness box and confirms that the contents of the affidavit are as per his say and the affidavit is under his signature and this statement being made on oath to be recorded by following the procedure prescribed under R.5".

(Emphasis supplied)

17. The above judgment is approved by the Apex Court in the case of Ameer Trading Corporation vs. Shapoorji Data Processing Ltd.1 (2004) 1 S.C.C. 702.

18. Since none of these affidavits filed on record are proved by the plaintiff by producing and examining affiants in the Court as required by law, these affidavits cannot be read in evidence.

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19. Having said so, assuming that the affidavits can be read in evidence, dispite non-examination of the affiants; even then, if one runs through the affidavits one has to come to the conclusion that none of the documents filed on record are proved by the plaintiff in accordance with the provisions of Evidence Act. Nowhere in the affidavits any of the plaintiff/affiant has stated that leave to lead secondary evidence was prayed or granted or obtained by the plaintiff. As a fact no leave in this behalf was obtained from this Court.

20. Assuming that the secondary evidence, even without leave of the Court could be brought on record; even then, the secondary evidence is also required to be proved as the primary evidence. Nobody has testified with regard to the proof of the documents or the contents thereof. Mr Jintendra Mehta, deponent, nowhere in his affidavit, has either proved his own signature on the letter dated 26.8.1987 or that of his Partner Mr R.K. Goenka. Receipt of the telex message has also not been proved.

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21. Even the letters dated 7.10.87, 17.10.87 and 29.10.87, signatures followed letter by dated 10.12.1987 have also not been proved. The notice dated 31.3.1988 has also not been proved in accordance with the provisions of the Evidence Act. The secondary evidence, in the form of debit notes produced on record, has also not been proved. No evidence is on record as to who had taken out the photostat copies, who had seen the existence of the original documents and/or original debit notes/documents. Huls Bury (4th Edition, Vol

(1) page 138, page 102) observes "Secondary evidence of the contents of private document is inadmissible, if primary evidence is available. Before secondary evidence is tendered, it is therefore, necessary to account for the absence of the original document and for this purpose proof that primary evidence is not available mayt be required. Thus, non-production of original document is required to be accounted for. Nobody has accounted for non-production of original document. Nobody has accounted for non-production of original document. Nobody has proved the signature on the debit notes

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alleged to have been put for "M/s Jamnadas and Madhavji and Company". Even the contents thereof have not been proved. Consequently, none of these documents could be said to have been proved in accordance with the provisions of the Evidence Act. None of them can be read in evidence.

22. Having said so, let me turn to the debit notes raised by M/s Abhijit Dipak Holdings Pvt. Ltd. In order to prove these debit notes, the affidavit of one Shrinivas Kamdar has been filed on record who was not examined in Court to prove his affidavit. As already stated herein, he has produced a Board resolution authorizing him to depose in respect of the suit claim. Original resolution has been produced. Certified copy is said to have been produced carrying signature of one Director. Who, that Director is, has not been stated in the affidavit. His signature has also not been proved. His signature has also not been identified by the affiant, Mr Shirish Kamdar. Consequently, the said resolution can not be read in evidence.

23. In para 3 of his affidavit, a general

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statement is made with regard to the transaction of purchase and sale of licence between plaintiff and the said company. However, in whose favour these licences were sold has not been mentioned. No relationship of licensee, vis-a-vis defendant has been established. If the licences were sold or endorsed in favour of any person, then surely those details cannot be kept away from the Court. Had those details been disclosed the connectivity of the defendant with the said alleged licenses could have been established. No such evidence is on record. To establish any relationship of the licenses sold to the defendant, no specific reference to the specific debit note is made by the affiant in his affidavit except a general statement made in para 3.

24. In para 4 of his affidavit, he has stated about receipt of the amount somewhere in the year 1988. He has neither stated anything about existence of the original debit notes nor with regard to the comparison thereof made with the originals by him personally. Though before leading the secondary evidence one has to establish the

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existence of primary evidence i.e. original document at some point of time in the past. Now, the transactions are of the year 1988, the affidavit is being filed in the year 2008, practically, after 20 years. Affidavit is based on personal knowledge. One fails to understand how one can depose from personal knowledge, who had worked in the group Company; namely, "M/s Tanna Builders Pvt.Ltd." consisting of three group companies, that too, almost 20 years before. At the relevant time the affiant was working with

"Tanna Exports Private Limited" and not with

"M/s Abhijit Dipak Holdings". As such he had no occasion to work with M/s Abhijit Dipak Holdings at the material point of time. At any rate, there is no statement made in the affidavit to make out a case of personal knowledge. This part of evidence or such cannot be believed.

25. In the above circumstances, the affidavit on its own face value cannot be accepted or relied upon. It does not inspire judicial confidence. In the affidavit, itself, the affiant has stated that he went through the compilation of documents filed by

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the plaintiff and perused copies of the plaint. This statement by itself speaks volume to come to the conclusion that the witness is not an independent witness, He is only obliging the plaintiff by filing his affidavit.

26. It is, thus, clear that none of the documents produced on record are proved in accordance with the provisions of Evidence Act so as to enable this Court to read the same in evidence.

27. A statement is made in para 7 of the affidavit of Mr Jitendra Mehta that various brokers raised their bills on the plaintiff for the work done by them. That by letter dated 16.9.1987 plaintiff informed to the defendant that it had done the needful. This letter dated 16.9.1987 is not to be found on record. The said letter is neither produced alongwith plaint nor with the affidavit of Mr Jitendra Mehta, though reliance was placed on the said document in the plaint.

28. The plaintiff in the affidavit has

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relied upon a letter dated 7.10.1987. By this letter the plaintiff has informed the defendants on 7.10.1987 that they have already paid all the services charges to the Export Houses. This assertion made in the letter dated 7.10.1987 unequivocally, goes to show that entire service charges were paid by 7.10.1987 to the Export Houses.

29. With the above evidence on record, if one turns to the three debit notes raised by

"M/s Jamnadas Madhavji & Co." dated 11.9.1987. If they are carefully examined, then it will be clear that all of them are subsequent to 7.10.1987 since they are dated 4.1.1988 and 10.11.1987. Secondly, three other debit notes one issued by M/s Jamndas Madhavji & Co dated 11.9.1987; Whereas, another issued by "M/s Abhijit Dipak Holdings Pvt.Ltd" is dated 27.8.1987. They are prior to 7.10.1987. None of them are proved. There is no evidence to show that the payments were made against these debit notes on or before 7.10.1987. Debit notes do not bear any serial number. If perused, all debit notes on the face thereof appear to have been typed on the same typewriter which is clear to a naked eye. The

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wording of all debit notes are identical. The mode of typing is also identical, though it carries different dates and different years. These debit notes, if prepared on different dates, in different years; by different export houses or agents, then one fails to understand, how could they bear same wording and same mode of typing and font. In my considered view, possibility of preparing these documents for the purposes of the suit cannot be ruled out. None of these documents were produced alongwith the plaint, though these documents were in existence at the time of filing of the suit. There is no answer on record for non-production of these documents alongwith the plaint. None of these debit notes bear the seal or rubber stamp of the respective issuing company. Normally, debit notes of the Companies are expected to be in the prescribed printed proforma carrying serial numbers.

30. With the above quality of evidence, it is difficult to accept the case sought to be made out by the plaintiff. The documents produced neither can be accepted, read or relied upon. The documents produced,

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especially debit notes do not inspire judicial confidence.

31. Apart from the above, assuming that the documents could be read in evidence, even then the plaintiff is not entitled to succeed in the suit. Firstly, the plaintiff in para 6 of the plaint, has stated that the agreement was substantially performed. Service charges are claimed in the sum of Rs. 1,00,00,000/- i.e. for entire contract. The entire amount claimed in the suit as if entire contract was performed. Secondly, in the affidavit of the affidavit Mr Jitendra Mehta has stated that after the negotiations and contract dated 26.8.1987, meeting took place on 27.8.1987 between plaintiff and the defendant and pursuant to that meeting the list of machineries required by the defendant was forwarded to the plaintiff. The said list though in possession of plaintiff has not been produced. The statement made in the affidavit that five Export Houses were approached by the plaintiff and the steps were taken to get the license endorsed or transferred in the name of the defendant, but not a single piece of evidence in this behalf is produced on record.

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32. The notice issued through Advocate claims damages only in the sum of Rs. 5,00,000/-; whereas, the suit claim is for Rs 12,00,000/- by way of service charges. In none of the letters any reference to the brokers from whom services were availed and who had raised debit notes are to be found. There is no material on record to show that how much expenses were incurred when amounts were paid to the export houses through various brokers. The plaintiff must be maintaining books of accounts being registered Company under Companies Act.

33. Plaintiff must have maintained books of account at the relevant time. Books of Account could have been the best evidence to show how much expenses were incurred. How much amount was paid against the various debit notes. The evidence in this behalf is absolutely absent.

34. At this juncture, it will not be out of place to mention that when this matter was heard, the Advocate appearing for the

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plaintiff was put on notice that none of these documents are proved and none of the formalities which are required to be followed to prove documents were complied with. The matter was adjourned for a day at the request of the Advocate for the plaintiff so as to enable him to take appropriate remedial steps. On the next day, when the matter was called out, nobody was present on behalf of the plaintiff. With the result, left with no other alternative, suit was required to be closed for judgment.

35. In the totality of the facts and circumstances of the case and in the light of the reasons given hereinabove the plaintiff cannot succeed.

36. In the result, the suit is dismissed. Parties to bear their own costs.

(V.C. DAGA,J)