Karnataka HC Sets Aside ₹7.4 Lakh Chunni Decree: Supplier Failed To Prove Delivery Or Examine Transporter

In brief

The question

Whether the plaintiff proved that it supplied and delivered the goods to Defendant No. 1.

The court held

The High Court answered the first issue in the negative and the second in the affirmative.

It also directed

It allowed the appeal, set aside the trial court’s judgment and decree, dismissed the plaintiff’s suit, and made no order as to costs.

01Facts

The plaintiff sued to recover ₹4,44,000, alleging that it had supplied 480 bags of chunni to Defendant No. 1 on 15 May 2019.

¶ 3–8

Defendant No. 1 denied both the contract and receipt of the goods.

¶ 3–8

The trial court decreed the suit, awarding ₹7,40,000 with future interest at 21% per annum, relying in part on Defendant No. 1’s failure to reply to the demand notice; the suit against Defendant No. 2, the transporter, was dismissed.

¶ 3–8

Defendant No. 1 appealed under Section 13(1A) of the Commercial Courts Act, 2015.

¶ 1, 8

02Issues

i.Whether the plaintiff proved that it supplied and delivered the goods to Defendant No. 1.

¶ 13(i)

ii.Whether the trial court’s judgment and decree were arbitrary or erroneous.

¶ 13(ii)

03Law Applied

Section 13(1A) of the Commercial Courts Act, 2015 provides the appellate route invoked in this case.

¶ 1

In a suit for recovery based on an alleged supply of goods, the plaintiff bears the burden of proving the delivery on which the claim depends.

¶ 20

An invoice or transport receipt that does not establish receipt by the defendant, and the defendant’s failure to respond to a legal notice, do not by themselves discharge that burden.

¶ 20, 23

The judgment does not identify a particular provision of the Evidence Act as the basis for these principles.

The appellant cited Union of India v. Vasavi Co-operative Housing Society Ltd., (2014) 2 SCC 269; the judgment records that submission but does not separately analyse or apply the precedent.

¶ 10

Provisions in the judgment · 1 · Linked ones open on LawLens

Commercial Courts Act, 2015 Section 13

04Reasoning

The plaintiff relied on the invoice, weighbridge receipt and transporter’s receipt.

¶ 19–20

The High Court found that the invoice and transporter’s receipt did not show that Defendant No. 1 had received the goods, and there was no acknowledgment of receipt by him.

¶ 19–20

The plaintiff also failed to examine the transporter or otherwise prove delivery, despite having made the transporter a party and later seeking proof of delivery from it.

¶ 21, 24

The defendant’s non-response to the legal notice could not replace proof of delivery; the trial court therefore erred in decreeing the claim on that basis.

¶ 23–24