RELIANCE INDUSTRIES LIMITED Vs. IMPERIAL PIGMENTS PRIVATE LIMITED

JUDGEMENT

(1.) By these Orders, I shall dispose off the Defendants applications (under Order XXXVII Rule 3(5) read with Section 151 of the C.P.C. praying for Leave to Defend the Suit) being IAs No.968/99 [filed by Defendant No.2] and I.A. 1939/00 [filed by Defendant No.1].

(2.) The first question to be addressed is whether the parties had entered into a ' written contract ' on the breach of which this summary suit is founded. The Plaintiff argues that all the terms of the parties engagement have been reduced to writing and can be found on the reverse side of each of its Invoices. I had the occasion to consider this very contention in the case titled KLG Systems Ltd. vs. Fujitsu ICIM Ltd., 92(2001) Delhi Law Times 88. My conclusion was that " it is no longer res integra that invoices/bills are ' written contracts' within the contemplation of this Order. Reference is directed to Messrs. Punjab Pen House v. Samrat Bicycles Ltd., AIR 1992 Delhi 1; Corporate Voice (Pvt.) Ltd. v. Uniroll Leather India Ltd., 60(1995) DLT 321; and Beacon Electronics v. Sylvania and Laxman Ltd., 1998 (3) Apex Decisions (Delhi) 141." I may only add that if the transaction in question is covered by a single invoice or bill the party relying on it should be in a position to indubitably disclose that the adversary's attention was specifically drawn to the terms on the back of the bill, and that it consented to be bound to those terms by failing to lodge any demur. One must not lose sight of the reality that a person does not always read a bill or invoice from its start to its finish, especially the reverse side. Where the bill is preceded by a delivery challan which does not contain all the terms of the transaction, this presumption may be an exception. However, where there have been a series of transactions in respect of which identical terms are printed on the bill, especially where both parties are commercial entities, this presumption would become irresistible. In the case at hand, several supplies have been made and each one is covered by identical and replicated terms. I am in no manner of doubt that a written contract can be found in these invoices such as would sufficiently attract the rigours of Order XXXVII of the C.P.C.

(3.) The next point is obviously whether the Defendant's liability towards the sums claimed in the summary suit, or any lesser sums, is apparent on the face of the record. The Court must eschew a minute investigation into the rival cases, and if there is reasonable doubt in its mind, if there is only a preponderant possibility in the veracity of the Plaintiff's claim, leave should be granted. The approach advocated by the Hon'ble Supreme Court in Mechalec Engineers & Manufacturers v. Basic Equipment Corporation, AIR 1977 SC 577 should be adhered to since the spectrum of possibilities has been spelt out in that judgment. These have been adumbrated in this celebrated judgment to comprise- " (a) If the defendant satisfies the Court that he has a good defence to the claim on its merits the plaintiff is not entitled to leave to sign judgment and the defendant is entitled to unconditional leave to defend, (b) If the defendant raises a trivial issue indicating that he has a fair or bona fide or reasonable defence although not a positively good defence the plaintiff is not entitled to sign judgment and the defendant is entitled to unconditional leave to defend, (c) If the defendant discloses such facts as may be deemed sufficient to entitle him to defend, that is to say, although the affidavit does not positively and immediately make it clear that he has a defence, yet, shews such a state of facts as leads to the inference that at the trial of the action he may be able to establish a defence to the plaintiff's claim the plaintiff is not entitled to judgment and the defendant is entitled to leave to defend but in such a case the Court may in its discretion impose conditions as to the time or mode of trial but not as to payment into Court or furnishing security, (d) If the defendant has no defence or the defence set up is illusory or sham or practically moonshine then ordinarily the plaintiff is entitled to leave to sign judgment and the defendant is not entitled to leave to defend, (e) If the defendant has no defence or the defence is illusory or sham or practically moonshine then although ordinarily the plaintiff is entitled to leave to sign judgment, the Court may protect the plaintiff by only allowing the defence to proceed if the amount claimed is paid into Court or otherwise secured and give leave to the defendant on such condition, and thereby show mercy to the defendant by enabling him to try to prove a defence". On the basis of these pronouncements, I am of the view that if the Court is presented with an acknowledgement of debt by the Defendant, no penumbra for speculation remains and the Plaintiff is entitled to leave to sign judgment.