Court’s Decision
The Delhi High Court dismissed the appeal filed under Section 96 of the Code of Civil Procedure, challenging the judgment of the trial court that dismissed a suit for recovery of Rs. 3,08,343/-. The court found that the appellant failed to establish any business transaction between the parties and could not prove that Delhi courts had territorial jurisdiction to adjudicate the matter.
Facts of the Case
The appellant, a private limited company, filed a suit for recovery of Rs. 3,08,343/- against the respondent, alleging that the respondent had been purchasing goods (fancy lights) from the appellant since 2012-13 through oral orders and that the amount claimed was outstanding against various invoices. The appellant further claimed that the goods were delivered directly to the respondent or through transporters, and a running account was maintained for these transactions. The appellant issued a demand notice to the respondent after several attempts to recover the amount, but the respondent did not make the payment. The appellant contended that since the business and transactions occurred in Delhi, the courts in Delhi had territorial jurisdiction.
The respondent denied the appellant’s claims, stating that he was operating his business from Ernakulam, Kerala, and had no dealings with the appellant company. The respondent argued that the bills and invoices produced by the appellant were fabricated and fraudulent. He claimed that he only had business transactions with a sister concern of the appellant, which operated in Kochi, Kerala.
Issues
- Whether the Delhi courts had territorial jurisdiction to entertain the suit.
- Whether the suit was filed and verified by a duly authorized and competent person.
- Whether the suit was barred by Section 69(2) of the Partnership Act.
- Whether the suit was devoid of cause of action and based on false facts.
- Whether the plaintiff was entitled to recover Rs. 3,08,343/- as claimed.
- Whether the plaintiff was entitled to any pendent lite and future interest, and if so, at what rate.
- Relief.
Petitioner’s Arguments
The appellant argued that the trial court ignored vital evidence, including the ledger account and invoices, which clearly established the respondent’s liability. The appellant relied on courier receipts and various judgments to assert that since the sale consideration was to be paid in Delhi, the courts in Delhi had territorial jurisdiction. The appellant further contended that non-payment of the amount due entitled them to recover the outstanding amount along with interest.
Respondent’s Arguments
The respondent argued that the appellant’s claims were baseless as the appellant failed to produce any evidence showing that business transactions occurred between the parties. He contended that the alleged bills and ledger accounts were unendorsed, and there was no proof of delivery of goods. He maintained that the judicial precedents cited by the appellant were not applicable to the facts of the case. Therefore, he argued that there was no merit in the appeal, and it should be dismissed.
Analysis of the Law
The court observed that the burden of proof lies on the party asserting a fact, as defined under Section 101 of the Evidence Act, 1872. The appellant needed to establish that the parties engaged in business transactions where goods were supplied from Delhi, and payments were to be made in Delhi. The court emphasized that merely producing invoices and ledger accounts that were not endorsed by the respondent does not satisfy this burden.
Precedent Analysis
The appellant relied on various judgments such as J.C. Enterprises vs Ranganatha Enterprises, Harit Polytech Pvt. Ltd. vs Colt Cables Pvt. Ltd., Shradha Wassan vs Anil Goel, and Vidyadhar vs Manik Rao. The court found that these judgments were distinguishable as they pertained to situations where valid business transactions were established. In contrast, in the present case, there was no evidence to prove the transactions between the appellant and the respondent.
Court’s Reasoning
The court reasoned that despite repeated opportunities, the appellant failed to produce any documentary evidence proving that the respondent placed any orders or received any goods in Delhi. Furthermore, the appellant admitted in cross-examination that none of the invoices bore the respondent’s signature and that he could not produce any contract between the parties. The court also noted that the appellant failed to take legal recourse to compel the production of the original bills allegedly in the possession of the respondent.
Conclusion
The High Court upheld the findings of the trial court, holding that the appellant did not discharge its burden of proving the existence of any business transaction with the respondent or the jurisdiction of Delhi courts. Consequently, the appeal was dismissed.
Implications
The judgment reiterates the importance of maintaining clear documentary evidence to substantiate business transactions in commercial disputes. It also emphasizes that territorial jurisdiction cannot be claimed without concrete evidence of transactions occurring within the claimed jurisdiction.
