CMI Vs. PANDIT AND CO

JUDGEMENT

(1.) THIS is an application filed by the contesting defendant nos.1 to 3 seeking leave to defend. Plaintiff has filed present suit under the provisions of Order XXXVII of the Code of Civil Procedure, based on four dishonored cheques and an invoice by which goods were dispatched by the plaintiff to the defendant no.1. The supply of goods is not disputed by defendant no.1.

(2.) THE necessary facts which are required to be noticed for disposal of this application are that the defendant no.1 is a partnership firm of which defendant nos.2 and 3 are the partners. Defendant no.1 to 3 had placed an order on the plaintiff for supply of four quad telecommunication cable for 52000 meters (52 kms) vide purchase order No.PCO/SR-04/763/97-98 dated 19.12.1997. THE defendant no.4 is the banker of defendant no.1 who had issued a letter dated 09.03.1998 confirming the plaintiffs lien on account No.112 of defendant no.1 with the bank, for the supplies made by the plaintiff against the defendant no.1s purchase order dated 19.12.1997. As per the plaint, defendant no.5, Chief Signal and Telecommunication Engineer, Southern Railway, Chennai had placed a contract dated 08.09.1997 on the defendant no.1. THE scope of the work under the said contract awarded to defendant no.1 included providing all telecommunication cables for Tokenless Block working between Olakur and Villapuram stations in connection with proposed Parallel Broad Gange on the Chengalpattu ? Villapuram Section of Southern Railway. In order to execute the work under the contract dated 08.09.1997 defendant no.1 was to procure and supply 52000 mtr. of four quad 0.9 mm telecommunication cable. THE defendant no.1 had indicated to the railway that the said material would be procured from the plaintiff and accordingly the plaintiff was approved as the supplier by defendant no.5 for placing orders for supply of the material. THE initial order of 19.12.1997 was modified to the extent that the quantity of cables was reduced to 50.05 kms. As per the plaint out of the total order of supply of 50.05 kms. cables, the plaintiff dispatched only 20.6 kms. to defendant no.1, consignee, Southern Railway on 17.02.1998, as per the invoice no.CMI/J/2500/02926 dated 17.02.1998 for Rs.24,01,631/- for which the defendant no.1 made payment to the plaintiff against the aforesaid invoice dated 17.02.1998. As per the plaint the payment was received on 31.03.1998 after several request and reminders, whereas as per the terms of the payment, the plaintiff was to receive Rs.5.0 lakhs in advance and the balance payment was to be received within 20 days of dispatch of the consignment of cable. THE defendant No.1, however, delayed in making the payment. On account of the delay in making the payment and having regard to the dilatory tactics of defendant No.1, the plaintiff insisted that the balance quantity of cables would be dispatched only after receiving advance payment against the performa invoice and before dispatch of the material. THE defendant no.1 requested the plaintiff to raise its performa invoice on capital Cable Limited account, Pandit & Company, however, the defendant no.1 could not arrange for the advance payment as promised and requested the plaintiff to dispatch the balance order on urgent basis, assuring the plaintiff that the payment in respect thereof would be made at the earliest.

(3.) COUNSEL for the plaintiff submits that the entire material was supplied well within the delivery schedule. The said material has been used by the consignee, Southern Railway. There was no protest from defendants no.1 to 3 or any complaint with regard to the delay in supplying the material or the quality of the cable supplied by the plaintiff. After several requests and reminders, defendant no.1 issued four cheques in the total sum of Rs.19.0 lakhs in discharge of their liability. The details of four cheques are as under: