Full Judgment Text
2011:BHC-OS:10658
1 sj-112-10.sxw
dgm
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
SUMMONS FOR JUDGMENT NO.112 OF 2010
IN
SUMMARY SUIT NO. 3068 OF 2008
IAL Logistics India (a Division of IAL
Container Line (India) Ltd. .... Plaintiff s
vs
1 Quantum International
2 Mr. Jayant A. Gidwani
3 East West Freight Carriers Pvt.Ltd. ... Defendants
Mrs. Bharati Narichania with Ms. Vijaya Bane i/by M/s.Vibha
Jurisconsult Co. for the Plaintiffs.
Mr. U. J. Makhija with Mr. Amin Kherada for Defendants 1 and 2.
CORAM: ANOOP V. MOHTA, J.
RESERVED ON : July 15, 2011
PRONOUNCED ON: July 28, 2011
JUDGMENT:
The present Summons for Judgment is taken out by the Plaintiffs
in a Summary Suit for recovery of unpaid freight and other incidental
charges by the Defendants in a sum of ` 8,33,656/ with interest at
the rate of 18% per annum from 1 January 2006 upto 25 September
2008.
2 The Plaintiffs carry on a business as Consolidators and Freight
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Forwarders. Defendant no.1 is the sole proprietary concern and doing
a business as exporters of garments. Defendant no.2 is also carrying
on business of the same nature. Defendant no.3 is an internationally
approved Freight Forwarding Agents for carriage of goods by Air and
stated to be the authorised agent of the carriers of the consignments in
question. Defendants 1 and 2 were the owner of the consignments
consisting of cotton woven garments which were entrusted to the
Plaintiffs for effecting shipment to New York. No relief is claimed
against Defendant no.3.
3 The Plaintiffs effected the carriage by Air of the four
consignments to New York. The Airway bills (The bills) reflect, apart
from number and date, Defendant no.1 M/s. Quantum International
as the consignees. The bills were signed by the Plaintiffs for and on
behalf of Defendant no.3 as Agents. As per the Plaintiffs, it was
mutually agreed that the bills would be marked as “Freight prepaid”;
and Defendants 1 and 2 would be allowed thirty days credit to pay the
Plaintiffs dues. The Plaintiffs, therefore, based upon an oral
assurance, as alleged, delivered the goods and expected the payment
from the Defendants to them or to their counter part in Dubai.
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4 The Plaintiffs’ case is that Defendant no.3 had issued Master
Airway bills on behalf of the Airline i.e. Swiss World Cargo
corresponding to the Airway bills which were also endorsed “Freight
prepaid” and the Plaintiffs were named as “shippers”. As alleged, the
Plaintiffs had already paid freight payable in respect of the said
consignment in advance to Defendant no.3 as Agents for the carriers
of Airline, therefore, has filed the present recovery Suit for the due
freight charges from Defendants 1 and 2. The Plaintiffs had also
issued four invoices aggregating to ` 5,58,404/ in respect of the said
freight and other charges payable on the four consignments which
were delivered at the destination to the consignee, M/Quantum
International Trade, a sister concern of Defendants 1 and 2.
Defendants 1 and 2, inspite of repeated reminders, oral, as well as, in
writing, failed to make the payment. The Plaintiffs had filed similar
Suits against Defendants 1 and 2 for the other consignments. A legal
notice dated 19 June 2006 was also remained unreplied. Therefore,
this Suit, based upon the four invoices and the bills. Defendant no.2
has filed the reply and resisted the claim on various grounds.
5 Admittedly the Defendants had entrusted the six consignments
for shipment to USA and Dubai along with the relevant documents.
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Five consignments of USA were delivered to the consignee at USA.
One consignment of Quantum International LLC, Dubai was not
delivered. It was accordingly recorded by email dated 25 December
2005. The withholding of goods is a basic objection, as it causes loss
of business, profit and reputation. There is an email on record to
show that the Plaintiffs communicated their inability to release the
consignment for want of nonpayment of overdue invoices.
6 The Plaintiffs by notice dated 10 May 2006 called upon the
Defendants to pay the freight charges in respect of all six
consignments though the last consignment valued about US $
9788.60 was not delivered.
7 The Plaintiffs have filed the present Suit for four
consignments/invoices, and Suit No.3069/08 for remaining one.
Suit No.3426/2008 is for the freight and other charges of Dubai
consignment.
8 It is clear that the Plaintiffs by a composite notice demanded
freight charges of six consignments, though they withhold last
consignment of Dubai of US $ 9788.60. The Plaintiffs’ action of non
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delivery caused loss of business, profit and reputation as Defendants
customers cancelled the orders also. The Plaintiffs’ Agent/Dubai
Office, even otherwise being bailee ought not to have retained the
consignment on the ground of nonpayment of freight charges as done
in the present case. The said retention/withholding of the goods by
the Plaintiffs Agent at Dubai, in the present facts and circumstances of
the case, just cannot be overlooked. The right of defence to set off
their loss against the plaintiffs’ claim is also relevant factor.
9 The bills show that the amounts/freight were prepaid. The case
of the Plaintiffs that it was mutually agreed that the Airway bills
would be marked as freight prepaid; and Defendants 1 and 2 would
be allowed thirty days credit to pay the Plaintiff’s dues; and the
assurance that they would make the payment after effecting the
carriage and upon the receipt of the Plaintiffs invoices, in Dubai, for
want of written documents, just cannot be accepted at this stage.
Such oral contract, even if any, unless substantiated by the Plaintiffs,
in my view, it is not the case to grant Summons for judgment as
prayed.
10 11 The scheme and purpose of Order XXXVII of th Code of
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Civil Procedure (CPC) can be summarised as under :
The purpose & the basic of summary suit:
(a) A Plaintiff, if chooses to invoke the provisions of Order XXXVII
for recovery of amount, the basic obligations and elements as required
need to be fulfilled. The summary suit so filed must fall within the
four corner of Order XXXVII for getting judgment/decree summarily.
(b) As per Rule 227 of the Bombay High Court (Original Side)
Rules, 1980, the Plaintiff must take out an appropriate proceeding
within six months once such Suit is instituted, though it is subject to
condonation of delay, if case is made out.
(c) The object of Order XXXVII is to recover the crystalised dues,
liquidated, admitted, acknowledged debt/monetary claim by a
summary procedure, without long trial, principally based upon a
written document executed in the course of business, in accordance
with law. It is a supportive measure for recovery of unpaid
debt/amount covering all the negotiable instruments as contemplated
under the Negotiable Instrument Act, apart from a valid, written
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contract/receipt/acknowledgment. It may be an express term or an
implied term, based upon facts and circumstances of the case,
considering the practice, trade and usage of the commerce and the
trade. This also covers apart from principal amount, express or
implied terms of the interest.
The Plaintiff’s and Defendant’s respective obligations:
(d) A Plaintiff having once instituted a summary suit is under
obligation firstly, to serve the Defendant, a summons for appearance
by providing copy of plaint and annexures. The Defendant, upon such
service, needs to appear within 10 days from the date of the service
either in person or through an Advocate. If the appearance is made,
either in person or through the Advocate, the Plaintiff is required to
serve the summons for judgment on the given address.
(e) The Defendant is entitled to file a reply and/or an application
for grant of leave to defend the Suit, within 10 days of service of
summons with the averments and the supporting documents entitling
him leave to defend the Suit. Such application or affidavit reply shall
be supported by an affidavit.
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(f) If the Defendant fail to enter appearance inspite of the service,
the Plaintiff’s averments/allegation, if supported by due
documents/material, shall be deemed to be admitted and entitled for
a judgment/decree for the amount so prayed. The Defendant though
filed appearance but failed to file reply or defence or remained absent
inspite of filing of service, the Court may pass judgment/decree as
prayed in accordance with law.
The Court needs to exercise the discretion judicially:
(g) Though basic burden lies upon the Plaintiff to prove and satisfy
the Court that the claim so raised and prayed for decree falls within
the ambit and scope of the summary procedure in question. Once
the Court comes to a conclusion that Plaintiff has made out a case for
summons for judgment or the Defendant has made out a case for
unconditional or conditional leave, after considering the facts and
circumstances of the case, need to exercise discretion in either way
based upon the settled position of law.
(h) The Defendant is able to demonstrate through the affidavit in
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defence and/or averments made in application/affidavit for leave to
defend that the Plaintiff has not made out a bonafide and clear case
and on the contrary the defence so raised is bonafide reasonable and
good defence and raises the plausible /triable issues the Defendant is
entitled to unconditional leave to defend.
(i) But, after the defence so raised by the Defendant and the Court
is satisfied that the Defendant may at the trial able to establish a
defence and/or there is material placed on record, though not fully
supportive, the Court may grant conditional leave, directing the
Defendant to deposit the amount in the Court in full and/or in part
and/or to furnish the security by possible permitted modes pending
the trial.
The grant of Decree or Summons for Judgment with agreed
interest:
(j) The Court, if, comes to a conclusion that there is no defence
and/or it is sham, bogus, illusory and moonshine, the Court may
refuse to grant leave to defend and pass/grant summons for judgment
or decree as prayed by the Plaintiff.
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The Interest:
(k) The Court needs to consider the aspect of agreed rate of interest
on the principal amount so claimed and the future interest also.
The condition should be reasonable, practicable and not be
onerous or burdensome:
(l) It is also necessary for the Court while exercising a jurisdiction
to see that while granting leave to defend, contention should not be
unduly onerous that results into depriving and/or unable to defend
the defence so raised. The Court, therefore, needs to exercise
discretion cautiously and carefully while passing the conditional or
any such order in summary suits.
11 In the present case though there are invoices/Airway bills are
the foundation for the summary suit, yet, in view of the fact that the
case is also based upon the oral agreement or promise, unless decided
by the evidence cannot be the foundation to grant the decree at this
stage. The Plaintiffs Agent has admittedly retained/withhold the
Dubai consignment worth of US $ 9788.60, which is definitely more
than the amount claimed in the Suit and as demanded through the
composite notice, as referred above.
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12 There was no question of claim of interest at 18% per annum on
the freight charges so raised as there was no such agreement. On the
contrary, the case of the Defendants is that the payment to be made, if
any, after 90 days and not 30 days as claimed. The claim of interest
at the rate of 18% per annum from 1 January 2006 to 25 September
2008 on the aggregate sum of ` 8,33,656/ based upon four invoices
and further 18% from the date of filing of the Suit till realisation is
also a matter of debate.
13 The Plaintiffs have filed different Suits as recorded above and
thereby separated the claims of freight charges even of nondelivery of
goods/consignment at Dubai. The composite notice/demand so raised
and considering the invoice and the averments made in the present
plaint, in my view, the facts and documents of the Suits are
interlinked and interconnected. All in all triable issues for detail
consideration are raised.
14 The Airway bills were signed by the Plaintiffs for and on behalf
of Defendant no.3 as Agents. Defendant no.3 had issued last Airway
bill on behalf of the Airlines. The same was marked “freight prepaid”.
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The Plaintiffs were named as shippers. The Suit, at the instance of
Plaintiffs as Agents itself raises issues about the maintainability of the
Suit itself.
15 The4refore, the Plaintiffs claim, even if any, cannot be stated to
be without any security. In my view, apart from other grounds, the
amount is already secured by the Plaintiffs. The defence so raised by
the Defendants therefore cannot be stated to be sham, bogus or false
and/or with an intent to delay the payment or avoid the payment.
The Defendants therefore have made out a case for unconditional
leave to defend.
16 Resultantly, the Defendants are entitled to unconditional leave to
defend the Suit. The Defendants to file written statement within
thirty days from the date of receipt of copy of this order. The
Summons for judgment is disposed of accordingly. There shall be no
order as to costs.
(ANOOP V. MOHTA, J.)
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dgm
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
SUMMONS FOR JUDGMENT NO.112 OF 2010
IN
SUMMARY SUIT NO. 3068 OF 2008
IAL Logistics India (a Division of IAL
Container Line (India) Ltd. .... Plaintiff s
vs
1 Quantum International
2 Mr. Jayant A. Gidwani
3 East West Freight Carriers Pvt.Ltd. ... Defendants
Mrs. Bharati Narichania with Ms. Vijaya Bane i/by M/s.Vibha
Jurisconsult Co. for the Plaintiffs.
Mr. U. J. Makhija with Mr. Amin Kherada for Defendants 1 and 2.
CORAM: ANOOP V. MOHTA, J.
RESERVED ON : July 15, 2011
PRONOUNCED ON: July 28, 2011
JUDGMENT:
The present Summons for Judgment is taken out by the Plaintiffs
in a Summary Suit for recovery of unpaid freight and other incidental
charges by the Defendants in a sum of ` 8,33,656/ with interest at
the rate of 18% per annum from 1 January 2006 upto 25 September
2008.
2 The Plaintiffs carry on a business as Consolidators and Freight
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Forwarders. Defendant no.1 is the sole proprietary concern and doing
a business as exporters of garments. Defendant no.2 is also carrying
on business of the same nature. Defendant no.3 is an internationally
approved Freight Forwarding Agents for carriage of goods by Air and
stated to be the authorised agent of the carriers of the consignments in
question. Defendants 1 and 2 were the owner of the consignments
consisting of cotton woven garments which were entrusted to the
Plaintiffs for effecting shipment to New York. No relief is claimed
against Defendant no.3.
3 The Plaintiffs effected the carriage by Air of the four
consignments to New York. The Airway bills (The bills) reflect, apart
from number and date, Defendant no.1 M/s. Quantum International
as the consignees. The bills were signed by the Plaintiffs for and on
behalf of Defendant no.3 as Agents. As per the Plaintiffs, it was
mutually agreed that the bills would be marked as “Freight prepaid”;
and Defendants 1 and 2 would be allowed thirty days credit to pay the
Plaintiffs dues. The Plaintiffs, therefore, based upon an oral
assurance, as alleged, delivered the goods and expected the payment
from the Defendants to them or to their counter part in Dubai.
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4 The Plaintiffs’ case is that Defendant no.3 had issued Master
Airway bills on behalf of the Airline i.e. Swiss World Cargo
corresponding to the Airway bills which were also endorsed “Freight
prepaid” and the Plaintiffs were named as “shippers”. As alleged, the
Plaintiffs had already paid freight payable in respect of the said
consignment in advance to Defendant no.3 as Agents for the carriers
of Airline, therefore, has filed the present recovery Suit for the due
freight charges from Defendants 1 and 2. The Plaintiffs had also
issued four invoices aggregating to ` 5,58,404/ in respect of the said
freight and other charges payable on the four consignments which
were delivered at the destination to the consignee, M/Quantum
International Trade, a sister concern of Defendants 1 and 2.
Defendants 1 and 2, inspite of repeated reminders, oral, as well as, in
writing, failed to make the payment. The Plaintiffs had filed similar
Suits against Defendants 1 and 2 for the other consignments. A legal
notice dated 19 June 2006 was also remained unreplied. Therefore,
this Suit, based upon the four invoices and the bills. Defendant no.2
has filed the reply and resisted the claim on various grounds.
5 Admittedly the Defendants had entrusted the six consignments
for shipment to USA and Dubai along with the relevant documents.
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Five consignments of USA were delivered to the consignee at USA.
One consignment of Quantum International LLC, Dubai was not
delivered. It was accordingly recorded by email dated 25 December
2005. The withholding of goods is a basic objection, as it causes loss
of business, profit and reputation. There is an email on record to
show that the Plaintiffs communicated their inability to release the
consignment for want of nonpayment of overdue invoices.
6 The Plaintiffs by notice dated 10 May 2006 called upon the
Defendants to pay the freight charges in respect of all six
consignments though the last consignment valued about US $
9788.60 was not delivered.
7 The Plaintiffs have filed the present Suit for four
consignments/invoices, and Suit No.3069/08 for remaining one.
Suit No.3426/2008 is for the freight and other charges of Dubai
consignment.
8 It is clear that the Plaintiffs by a composite notice demanded
freight charges of six consignments, though they withhold last
consignment of Dubai of US $ 9788.60. The Plaintiffs’ action of non
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delivery caused loss of business, profit and reputation as Defendants
customers cancelled the orders also. The Plaintiffs’ Agent/Dubai
Office, even otherwise being bailee ought not to have retained the
consignment on the ground of nonpayment of freight charges as done
in the present case. The said retention/withholding of the goods by
the Plaintiffs Agent at Dubai, in the present facts and circumstances of
the case, just cannot be overlooked. The right of defence to set off
their loss against the plaintiffs’ claim is also relevant factor.
9 The bills show that the amounts/freight were prepaid. The case
of the Plaintiffs that it was mutually agreed that the Airway bills
would be marked as freight prepaid; and Defendants 1 and 2 would
be allowed thirty days credit to pay the Plaintiff’s dues; and the
assurance that they would make the payment after effecting the
carriage and upon the receipt of the Plaintiffs invoices, in Dubai, for
want of written documents, just cannot be accepted at this stage.
Such oral contract, even if any, unless substantiated by the Plaintiffs,
in my view, it is not the case to grant Summons for judgment as
prayed.
10 11 The scheme and purpose of Order XXXVII of th Code of
::: Downloaded on - 26/06/2024 07:31:48 :::
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Civil Procedure (CPC) can be summarised as under :
The purpose & the basic of summary suit:
(a) A Plaintiff, if chooses to invoke the provisions of Order XXXVII
for recovery of amount, the basic obligations and elements as required
need to be fulfilled. The summary suit so filed must fall within the
four corner of Order XXXVII for getting judgment/decree summarily.
(b) As per Rule 227 of the Bombay High Court (Original Side)
Rules, 1980, the Plaintiff must take out an appropriate proceeding
within six months once such Suit is instituted, though it is subject to
condonation of delay, if case is made out.
(c) The object of Order XXXVII is to recover the crystalised dues,
liquidated, admitted, acknowledged debt/monetary claim by a
summary procedure, without long trial, principally based upon a
written document executed in the course of business, in accordance
with law. It is a supportive measure for recovery of unpaid
debt/amount covering all the negotiable instruments as contemplated
under the Negotiable Instrument Act, apart from a valid, written
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contract/receipt/acknowledgment. It may be an express term or an
implied term, based upon facts and circumstances of the case,
considering the practice, trade and usage of the commerce and the
trade. This also covers apart from principal amount, express or
implied terms of the interest.
The Plaintiff’s and Defendant’s respective obligations:
(d) A Plaintiff having once instituted a summary suit is under
obligation firstly, to serve the Defendant, a summons for appearance
by providing copy of plaint and annexures. The Defendant, upon such
service, needs to appear within 10 days from the date of the service
either in person or through an Advocate. If the appearance is made,
either in person or through the Advocate, the Plaintiff is required to
serve the summons for judgment on the given address.
(e) The Defendant is entitled to file a reply and/or an application
for grant of leave to defend the Suit, within 10 days of service of
summons with the averments and the supporting documents entitling
him leave to defend the Suit. Such application or affidavit reply shall
be supported by an affidavit.
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(f) If the Defendant fail to enter appearance inspite of the service,
the Plaintiff’s averments/allegation, if supported by due
documents/material, shall be deemed to be admitted and entitled for
a judgment/decree for the amount so prayed. The Defendant though
filed appearance but failed to file reply or defence or remained absent
inspite of filing of service, the Court may pass judgment/decree as
prayed in accordance with law.
The Court needs to exercise the discretion judicially:
(g) Though basic burden lies upon the Plaintiff to prove and satisfy
the Court that the claim so raised and prayed for decree falls within
the ambit and scope of the summary procedure in question. Once
the Court comes to a conclusion that Plaintiff has made out a case for
summons for judgment or the Defendant has made out a case for
unconditional or conditional leave, after considering the facts and
circumstances of the case, need to exercise discretion in either way
based upon the settled position of law.
(h) The Defendant is able to demonstrate through the affidavit in
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defence and/or averments made in application/affidavit for leave to
defend that the Plaintiff has not made out a bonafide and clear case
and on the contrary the defence so raised is bonafide reasonable and
good defence and raises the plausible /triable issues the Defendant is
entitled to unconditional leave to defend.
(i) But, after the defence so raised by the Defendant and the Court
is satisfied that the Defendant may at the trial able to establish a
defence and/or there is material placed on record, though not fully
supportive, the Court may grant conditional leave, directing the
Defendant to deposit the amount in the Court in full and/or in part
and/or to furnish the security by possible permitted modes pending
the trial.
The grant of Decree or Summons for Judgment with agreed
interest:
(j) The Court, if, comes to a conclusion that there is no defence
and/or it is sham, bogus, illusory and moonshine, the Court may
refuse to grant leave to defend and pass/grant summons for judgment
or decree as prayed by the Plaintiff.
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The Interest:
(k) The Court needs to consider the aspect of agreed rate of interest
on the principal amount so claimed and the future interest also.
The condition should be reasonable, practicable and not be
onerous or burdensome:
(l) It is also necessary for the Court while exercising a jurisdiction
to see that while granting leave to defend, contention should not be
unduly onerous that results into depriving and/or unable to defend
the defence so raised. The Court, therefore, needs to exercise
discretion cautiously and carefully while passing the conditional or
any such order in summary suits.
11 In the present case though there are invoices/Airway bills are
the foundation for the summary suit, yet, in view of the fact that the
case is also based upon the oral agreement or promise, unless decided
by the evidence cannot be the foundation to grant the decree at this
stage. The Plaintiffs Agent has admittedly retained/withhold the
Dubai consignment worth of US $ 9788.60, which is definitely more
than the amount claimed in the Suit and as demanded through the
composite notice, as referred above.
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12 There was no question of claim of interest at 18% per annum on
the freight charges so raised as there was no such agreement. On the
contrary, the case of the Defendants is that the payment to be made, if
any, after 90 days and not 30 days as claimed. The claim of interest
at the rate of 18% per annum from 1 January 2006 to 25 September
2008 on the aggregate sum of ` 8,33,656/ based upon four invoices
and further 18% from the date of filing of the Suit till realisation is
also a matter of debate.
13 The Plaintiffs have filed different Suits as recorded above and
thereby separated the claims of freight charges even of nondelivery of
goods/consignment at Dubai. The composite notice/demand so raised
and considering the invoice and the averments made in the present
plaint, in my view, the facts and documents of the Suits are
interlinked and interconnected. All in all triable issues for detail
consideration are raised.
14 The Airway bills were signed by the Plaintiffs for and on behalf
of Defendant no.3 as Agents. Defendant no.3 had issued last Airway
bill on behalf of the Airlines. The same was marked “freight prepaid”.
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The Plaintiffs were named as shippers. The Suit, at the instance of
Plaintiffs as Agents itself raises issues about the maintainability of the
Suit itself.
15 The4refore, the Plaintiffs claim, even if any, cannot be stated to
be without any security. In my view, apart from other grounds, the
amount is already secured by the Plaintiffs. The defence so raised by
the Defendants therefore cannot be stated to be sham, bogus or false
and/or with an intent to delay the payment or avoid the payment.
The Defendants therefore have made out a case for unconditional
leave to defend.
16 Resultantly, the Defendants are entitled to unconditional leave to
defend the Suit. The Defendants to file written statement within
thirty days from the date of receipt of copy of this order. The
Summons for judgment is disposed of accordingly. There shall be no
order as to costs.
(ANOOP V. MOHTA, J.)
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