HERBICIDES INDIA LTD Vs. SHASHANK PESTICIDES P LTD

JUDGEMENT

(1.) This is a suit for recovery of Rs 24,90,665/-. Defendant No. 1 is a company alleged to be owned and controlled by defendant No. 4 and his family members. Defendant No. 3 is the wife of defendant No. 4 and is running business in the name and style of defendant No. 2 from the same premises, where defendant No. 1 is functioning. Defendant No. 1-company entered into an agreement to purchase one lakh litres of weedicide, namely 2, 4-D Ethyl Ester 38% EC in 200 litres packaging, at the price of Rs 96.80 per litre plus local tax in staggered lots commencing from October, 1995 and ending in December, 1995. In the event of non-supply or non-lifting of goods, the party, in default, was to pay pre-determined compensation at the rate of Rs 20/- per litre. The plaintiff claims to have supplied 7000 litres of the aforesaid goods to defendant No. 1 in October, 1995. On the request of the defendant, invoice in respect of these 7000 litre of goods were raised on one M/s Paramount Pesticides Pvt. Ltd., nominee of the defendant.

(2.) The defendants have contested the suit and have taken a preliminary objection that the suit is bad for misjoinder of parties since there is no privity of contract between the plaintiff and defendant Nos. 2 and 3 and there was no personal contract between the plaintiff and defendant No. 4. They have also taken a preliminary objection that suit against defendant No. 2, which is not a legal entity, is not maintainable. On merits, it has been alleged that the plaintiff was to deliver 10,000 litre of goods by the eve of Diwali 1995 and the balance quantity was to be delivered in regular intervals commencing from 1st November, 1995 and was to be completed by 15th December, 1995, but, the plaintiff failed to effect the delivery of any part of the goods, despite receiving Rs 4 lakhs from them. It is further alleged that after expiry of season, the plaintiff tried to foist goods on defendant No. 1, but, at that time the goods were of no use to them. The defendants have denied having received 7000 litre of goods from the plaintiff and having asked the plaintiff to raise invoice in the name of Paramount Pesticides Pvt. Ltd. The defendant Nos. 1 and 4 have filed a counter-claim of Rs 5,45,000/- against the plaintiff on the ground that it had not refunded the amount of Rs 4 lakhs, received from them and, therefore was liable to refund that amount along with interest amounting to Rs 1,44,000/- and Rs 1,100/- towards Advocate fee for service of notice. In its replication, the plaintiff-company has admitted receipt of total payment of Rs 4 lakhs from defendant No. 1

(3.) The following issues were framed on the pleadings of the parties: