GAUTAM KATARIA Vs. LA EXOTICA

JUDGEMENT

(1.) Plaintiff Gautam Kataria has filed the present suit for recovery of Rs.7,80,452.80 paise invoking Order XXXVII of the Code of Civil Procedure. The sum and substance of the facts alleged are that the plaintiff has been supplying to the defendant (M/s.La Exotica) goods as per the specifications and orders. The plaintiff is maintaining an open and running account in the defendant's name for the transaction the plaintiff had with the defendant. On 1/4/1997, a I.A.8853/2000 in S.No.2601/99 sum of Rs.7,80,452.80 was due and payable by the defendant. The defendant issues three cheques on 10/5/1997, 'drawn on Overseas Bank, all dated 10/5/1997. The amount of each cheque was Rs.2,50,000.00, Rs.2,50,000.00 and Rs.2,05,875.40 paise. Defendant had assured the plaintiff that all the cheques would be honoured on. presentation. The cheques "were dishonoured. The plaintiff had been approaching the defendant and the defendant paid Rs.1,50,000.00 lakhs by three cheque leaving balance to be due. The case of the plaintiff is that after adding the interest, the amount claimed is due.

(2.) The defendant preferred an application under Order XXXVII Rule 3(5) of the Civil Procedure Code, seeking grant of unconditional leave to defend. It has been asserted that the defendant is a reputed exporter of various designs of garments, handicrafts and other related items. It is a sole proprietorship firm of Sanjeev Khokha. Over the years, since 1992, the defendant ordered goods from the plaintiff on various occasions. In January 1997, the defendant provided a loan of Rs.5,50,000.00 lakhs to plaintiff, who was in desperate need of cash, to enable him to perform a vital export contract. The relations between the parties were friendly. It was agreed that the amount would be adjusted during the later transactions. The post-dated cheques that were given were not to be encashed. The transactions between the parties were always based on the mutual understanding that in case of any quality complaints the same would have to be provided by the supplier. A meeting took place in July 1997 between the parties and it was agreed between the parties i) That the goods allegedly to the tune of Rs.7,08,452.80 had been supplied by the plaintiff to the defendant towards its export commitments; ii) that of the abovesaid amount, Rs.5,50,000.00 lacs were to be adjusted towards the amount already loaned by the defendant;. iii) that the balance amount, would however, be paid by the defendant; iv) that compensation towards defective quality of goods would be paid by the plaintiff, based on the 'compensation demanded ,upon the defendant by the overseas buyer; v) that the aforesaid compensation, would subsequently be adjusted in the subsequent orders placed by the defendant; vi ) that post dated cheques earlier provided, to the tune of Rs.7,05,875.40 would not be presented for their encashment. - Immediately, a sum of Rs.1,50,000.00 lakhs was provided by the defendant. The same was received and the remaining amount was agreed to be adjusted towards the loan. In, these circumstances, it is claimed that permission to contest may be granted.

(3.) In the reply filed, the assertions of defendant have been controverted. It is denied that there was any such agreement or that the loan, as such, had been taken.