DUNLOP INDIA LIMITED Vs. KISHORE AND CO

JUDGEMENT

(1.) M/s Dunlop India Ltd has filed this suit for recovery of Rs. 1,09,054.13 against the defendants under Order 37 Rule 2 CPC, 1908, as amended, on the allegations that the defendants entered into an agreement with the plaintiff company and on the basis of that agreement the defendants were appointed as stockist/dealer of the plaintiffs adhesive products and thereafter at all material times the defendants placed various orders in the office of the plaintiff at Delhi for supply of products on the terms and conditions that the defendant No.1 from time to time would pay various amounts of the agreed purchase price of the said products of the plaintiff. During the period 26.11.1986 to 23.1.1987 the defendants purchased the goods worth Rs. 20629.24 from the plaintiff as per the details given in Annexure-B. The defendants issued cheques of various dates towards payment of the price of the goods so purchased but these cheques remained dishonourerd. The detail of the cheques issued which were dishonoured has been given in Annexure-C attached with the plaint and the total value of the dishonoured cheques comes to Rs. 90384.57. Out of this amount the plaintiff gaye credit of Rs 279.99 against the credit note issued in favour of the plaintiff and made demand of the balance amount of Rs. 90107.58 by sending legal notice but defendant did not pay any amount. Interest at the rate of 18% p.a. on this amount has also been claimed by the plaintiff in this suit totaling Rs.1 ,09,054.13.

(2.) Summons under form IV of Appendix B under the provisions of Order 37 CPC were issued against the defendants and they made appearance through their counsel and filed an application under Order 37 Rule 5 Civil Procedure Code seeking leave to defend the suit within the statutory period. One of the pleas taken by the defendant is that the suit is for recovery of Rs 90384.57 and is below the pecuniary jurisdiction of this court. The suit should have been filed before the District Judge. The other plea taken by the defendant is that the suit under Order 37 Civil Procedure Code does not lie because it is a matter for rendition of account between the parties and unless the accounts are settled and definite amount is arrived at, this suit under Order 37 Civil Procedure Code is not maintainable. In the affidavit filed by defendant No.2 as partner of defendant No,l, various preliminary objections have been taken regarding the maintainability of the suit under Order 37 CPC. However, it is admitted that the defendant firm being the stockist/dealer of the plaintiff placed orders for the supply of various goods on the plaintiff firm and also made payment on the assurance of the plaintiff that credit which is due to the defendant would be given and the accounts would be settled later on and on the assurance so given these cheques as mentioned in Annexure B were issued. Neither any credit was given nor accounts were settled and the cheques issued were not presented in time. These cheques, as mentioned in Annexure-C, were dishonoured in or about January, 1987 and no responsibility can be cast on the defendant for delayed presentation and bouncing of the cheques. It is further alleged that the bank guarantee for Rs. 1 lakh was valid and enforceable till 27.2.87 and if any amount was due from the defendants to the plaintiff, the plaintiff should have invoked the bank guarantee but it was not done. As per the terms and conditions of appointment of defendant No.1 as stockists, they were to get, besides commission on the sales made by them, overriding commission on the orders placed through defendant No.1. They were to be given Rs.80,000.00 on various items as overriding commission. The defendant has paid Rs.53,000.00 in cash to Mr. Vimal Kampani an official of the plaintiff when he visited in February, 1987 but no credit has been given for the amount paid to Kampani. This fact was brought to the notice of the Salqs Director of the plaintiff claiming credit of this amount but to no effect.

(3.) In the counter affidavit filed by K.S. Krishnan constituted attorney and principal officer of the plaintiff company, the averments made by the defendant in the affidavit have been denied and the averments made in the plaint have been reiterated. The affidavit of Mr Kampani has also been filed denying the averments made by the defendants against him.