A HEFLIN ROBERT Vs. REVATHI RAMACHANDRAN

JUDGEMENT

(1.) This suit has been filed for recovery of a sum of Rs.19,35,000/- equivalent to U.S.Dollars 75,000 or at such exchange rate as applicable on the date of decree together with interest at 24% per annum from the date of plaint till realisation and for costs.

(2.) The plaint averments are as follows: The plaintiff knew the defendants since 1980 when they became indenting agent for India through their Company BOART & CO, for the plaintiff's former employer Valdiamont International, Ann Arbor, Michigan, United States of America. The defendants regularly purchased synthetic industrial diamond from the West German Office of Valdiamont International in Frankfurt/Main, West Germany, by making cash payment in order to take the synthetic industrial diamond purchased by them to India for sale in the Bombay Market and or also for the use of and benefit of their Companies in India viz. Boart & Co; Kanco Precision Tools Ltd.,; Schneidtechnic (India) Pvt. Ltd., and Tokai Kanco Exports Ltd. Since the West German Office of Valdiamont International was closed in 1986, the defendants continued to purchase diamond from Valdiamont's Head Office in Ann Arbor, Michigan, U.S.A. After Valdiamont International was closed in 1987, the defendants contacted the plaintiff to help them to get in touch with the suppliers of synthetic industrial diamond. The plaintiff agreed to the supply to the defendants Industrial Diamond. The agreement between the plaintiff and the defendants was that the plaintiff would supply synthetic industrial diamond, and the price for the same would be settled by the defendants from time to time in a mutual open account between the parties. From 13.3.87 till 4.5.89, a total quantity of 105,000 carats were supplied to the defendants in a total value of 210,000 U.S.Dollars, and the defendants paid a sum of 165,000 U.S.Dollars, leaving a balance of 45,000 U.S.Dollars. The delivery of the Synthetic Industrial Diamonds was made either to the defendants or one of their messengers in U.S.A. or West Germany on the basis of the instructions of the defendants. The statement of accounts between the parties would show the last credit of U.S.Dollars 12,500. From May 1989, the defendants stopped the purchase of synthetic industrial diamond from the plaintiff. The plaintiff came to know that the modus-operandi of the defendants is to keep switching from one supplier to another, after making the supplier's account sticky. There are instances of suppliers having sued the defendants and their organisations for recovery of the outstanding amount. Since the transaction between the parties is commercial and the plaintiff had already settled to his suppliers, the defendants have become liable to pay interest at 24% on the amounts due. The plaintiff caused a legal notice on the defendants on 19.3.91. Instead of settling the amounts, the defendants sent an untenable reply on 28.3.91. The defendants used to represent to the plaintiff that they are representing various business interests in India, and they were purchasing the Industrial Diamond for their use in India as well as for re-sale and held out to the plaintiff that the plaintiff can look to both the defendants jointly and severally for settlement of the accounts of the plaintiff. It was agreed between the parties that in the event of the account becoming sticky, the defendants would settle the principal amount together with interest at 24% per annum. Even after availing the maximum credit period, the defendants have not settled the amounts. Hence, this suit has been filed for the above said relief.

(3.) In the written statement filed by the defendants it is averred as follows: The defendants do no owe the plaintiff the sum of Rs.19,35,000/- or any other sum. The synthetic industrial diamond could be imported on ordinary general licence issued by the Government of India. M/s.Valdiamont International USA had a synthetic industrial diamond division in which the plaintiff was employed as Production Manager. M/s.Valdiamont International opened a unit in West Germany. In the course of the trade, it contacted the second defendant and wanted to know whether he could act as its Indian representative, and the second defendant agreed to do so. In 1984, it had conducted a Seminar at Frankfurt, Germany, for which the second defendant was invited to attend. He accepted the invitation and proceeded to Frankfurt and attended the Seminar. One Mr.Klaus Lappe was the Regional Director of the said M/s.Valdiamont International West Germany. In the said seminar, the second defendant had occasion to meet both Klaus Lappe and the plaintiff. They became friends of the second defendant, and in due course, the first defendant also came to know the said persons. The diamond for which the orders were procured by the second defendant would be supplied directly by the said Company, and the second defendant would be paid the commission through banks only. The defendants did not contact the plaintiff to help them to get in touch with the suppliers of synthetic diamonds. There was no occasion for the plaintiff to agree to supply any diamonds. There was no dealing of purchase of diamond from the plaintiff by the defendants nor was any mutual open account existed between the parties. The alleged supply of 105000 carats of diamonds and the payment of U.S.Dollars 210000 are false. No synthetic industrial diamond was delivered either to the defendants or to any alleged messenger. The plaintiff has manufactured self serving documents and filed them along with the plaint. None of the documents, except the exchange of notices are true nor are they binding on the defendants. It is highly unbelievable that valuable synthetic industrial diamonds were delivered to the defendants or to the alleged messenger without even taking an acknowledgement for the receipt of the same. The Diamond Division of M/s.Valdiamont International Germany was closed down in 1987. Mr.Klaus Lappe was without employment. He offered to come down to India and make Polycrystaline Synthetic Cutting Tools for the benefit of the concerns of the defendants. Believing the said representation, the defendants agreed for the same. In view of the said offer of Klaus Lappe, the name of the company was changed to Schneidtechnik (India) Pvt. Ltd. He was not able to make the Polycrystaline Synthetic Cutting Tools. He offered to make diamond cutting tools for industrial purposes. On the suggestion of Klaus Lappe, the defendants invited the plaintiff to come down to India so as to provide technology for manufacturing synthetic diamond tools. He came to India at the cost of the defendants and stayed in India for a week, but could not provide the technology. Thereafter, there was no connection with him. Klause Lappe and the defendants had disputes. Klaus Lappe filed C.P.No.20/90 on the file of this Court for various reliefs. A settlement was entered into between Klaus Lappe and the defendants, by which the defendants took over the share holding of the said Klaus Lappe. Klaus Lappe, even though stayed in India, did not have any employment worth its name. He has a grouse against the defendants. In order to seek revenge on the defendants, Klaus Lappe must have set up the plaintiff to file the above suit on imaginary and false allegations. The plaintiff on account of his close relationship must be a willing tool in the hands of Klaus Lappe. There were no frantic telephone calls. The defendants had not switched on from supplier to supplier. Though the plaintiff may say that some suppliers have sued the defendants, no particulars have been given. The defendants are not liable to pay any amount, and thus, the question of paying interest at 24% per annum does not arise. No amount is due by the defendants to the plaintiff. The tone and tenor of the notices issued by the plaintiff show that the same were not issued in pursuance of any genuine claim, but with ulterior objects. The cause of action is non-existent and false. Hence, the suit may be dismissed with costs.