(Prayer:- This Civil Suit is filed under Order VII Rules 1 & 2 of the Civil Procedure Code read with Order IV Rule 1 of the O.S. Rules, for a Judgment and Decree against the defendants for the following reliefs:
(a) directing the defendants to pay a sum of Rs.1,10,00,000/- (Rupees One Crores Ten Lakhs only) of the plaintiff;
(b) directing the defendants to pay interest @ 18% per annum on the above said amount of Rs.1,10,00,000/- from the date of the suit till reaslisation.)
1. This suit had been filed by the plaintiff M/s. Just Water (TZ) Ltd., a Company incorporated under the Corporate Laws of Tanzania, seeking a Judgment and Decree against the defendants, Canadian Crystaline Water India Ltd., and Shivsu Canadian Clear Waters Limited, both Companies incorporated under the Companies Act, 1956, to pay a sum of Rs.1,10,00,000/- together with interest at 18% p.a., from the date of the suit till the date of payment and also for costs of the suit.
2. In the plaint, it had been stated that the plaintiff, is a Limited Liability Company incorporated under the Corporate Laws of Tanzania having its administrative office at Tanzania had been approached by the defendants, who are in the business of manufacturing Mineral Water Processing Machines, Bottling Machines and PET Stretching Blow Moulding Machines, etc., claiming that they are capable of manufacturing Mineral Water Processing and Packaging Plant and requesting the plaintiff to purchase the Mineral Water Processing and Packaging Plant. It had been stated that the defendants are sister companies and claimed to have a global presence with offices in about 42 countries including an office at Kenya. The plaintiff placed an order for purchase of a Mineral Water Processing and Packaging Plant including Rotary Filling Machine, Automatic PET Blowing Machine etc., for a total sum of US$ 90,000. It had been stated that the understanding was that the machineries would be dispatched by the second week of December 2009. A quotation and a Proforma invoice both dated 28.10.2009 were taken out in the name of the first defendant and issued to the plaintiff. The plaintiff made the entire payment towards the invoice in four installments by 11.01.2010. In the Proforma Invoice, the price of each of the machine parts had been specified. The defendants had not supplied the Fully Automatic PET Blowing machine SSB20@2000 BPH with moulds and other accessories. The defendants had charged a sum of US$ 47,500 plus applicable packaging, forwarding and freight charges, which had also been paid by the plaintiff with respect to the said PET Blowing machine. However, the defendants did not deliver the machinery even by April 2010. On 29.04.2010, the plaintiff issued two electronic mails to the defendants requesting the details of the dispatch. It had been stated that when the plaintiff visited the defendants manufacturing factory in Chennai in March 2010, it was informed that the machines had already been manufactured and would be delivered soon. The plaintiff issued another electronic mail on 18.05.2010. The defendants forwarded a copy of a packaging slip and relevant freight invoice dated 05.05.2010. It included the undelivered equipments. However, the plaintiff claims that the packaging slip and freight invoice are not true documents. The plaintiff then deferred taking delivery of the undelivered equipments in September 2010 for a short period of time even though the entire price and the packaging, forwarding and freight charges had already been made. The plaintiff was affected by peak season rush and had to wait till the peak season to pass to take delivery of the undelivered machines.
3. It is the claim of the plaintiff that the defendants also agreed to keep the undelivered equipments and hold on to the same in trust for the benefit of the plaintiff. On 28.03.2011, the plaintiff instructed the defendants to shift the undelivered equipments to the plaintiff. Further reminders were given on 31.05.2011 and 01.06.2011. The defendants informed the plaintiff on 07.06.2011 that the machinery is in production and would take another five weeks for dispatch. On 23.05.2012 the plaintiff again wrote an email to the defendant's representative Mr. Sanjay that some potential investors will be coming to Chennai to look at the PET Blowing Machine which is in Chennai and ready to be dispatched. The representative expressed doubts as to whether the machine was still in Chennai as it had already been supplied to another company. It was later informed to the plaintiff's visitors by the defendants' representative in Chennai that the machine is only in production. The plaintiff states that the act of the defendants in selling the entrusted machines to another company was with the sole objective to make wrongful gain and to cause wrongful loss to the plaintiff.
4. It is claimed that the defendants continuously promised that a similar equipment would be delivered to the plaintiff and the last such promise was through electronic mails dated 27.06.2014 and 02.12.2014. However, such promises were not kept by the defendants. The plaintiff claimed that they had suffered a financial loss of US$ 50,000 every month from 2010 and this was also intimated to the defendants by electronic mail dated 29.04.2010. The plaintiff claimed that it was customary on the part of the defendants to entice several persons like the plaintiff to part with sums of money under the pretext of supplying of machines and thereafter prolonging the dispatch.
5. The plaintiff issued a legal notice on 21.05.2015 to the defendants. The plaintiff claims a sum of US$ 47,500 towards the cost of undelivered equipments and US$ 8020 towards packaging, forwarding, training, erection and installation charges. The plaintiff also claimed interest @ 18% p.a. The plaintiff also claimed US$ 1,000,000 to partly compensate the plaintiff for the losses and damages suffered by it. The defendants issued a reply notice on 17.06.2015 wherein they claimed that the machineries had already been delivered to the plaintiff. The plaintiff issued a rejoinder on 31.08.2015 denying the averments made in the reply notice. The defendants issued a further reply on 05.09.2015. The plaintiff issued another letter on 30.03.2016 calling upon the defendants to furnish a copy of the proof of delivery of the outstanding undelivered equipments. This was not given till the institution of the suit.
6. The plaintiff claimed that the suit is not barred by the law of limitation since there were confirmations from the defendants for the delivery of the undelivered equipments including electronic mails dated 27.09.2014 and 02.12.2014. It had been further stated that the claim is with respect to entrustment of valuable property and therefore the law of limitation shall not be applicable. It is under these circumstances that the suit had been filed seeking the reliefs as stated above.
7. The defendants filed a written statement wherein they have denied the averments made in the plaint. It had been stated that the agreement to deliver the machine was only between the plaintiff and the first defendant. It had been stated that the second defendant was not a necessary party to the suit and that the suit should be dismissed on the ground of misjoinder of necessary parties. The defendants further denied any liability to the plaintiff and claimed there was no default on their part. The defendants also stated that the suit is not maintainable since it was clearly barred by limitation under Section 3 read with Article 55 of the Limitation Act 1963. It had been stated that the machines should have been dispatched by December 2009 and delivered around January 2010. It had been stated that the suit should have been filed by January 2013. The suit was actually filed in June 2016. It had also been stated that there had been no communications with respect to the transaction between the plaintiff and the first defendant after 2012. The electronic mail dated 26.09.2014 was only between the plaintiff and Sanjay Mandavia, a former employee who had left the services of the defendants and had communicated with the plaintiff in his individual capacity. It had been stated that the said electronic mail cannot be stated to be an admission of liability. It had been very specifically denied that the packaging slip given by the defendants on 05.05.2010 was fabricated and and included undelivered equipments. It had been stated that the packaging slip clearly showed that the Blowing Machine was dispatched to Dar Es Salaam, the agreed port. The plaintiff had failed to collect the machinery. The plaintiff's contention that Port Mombasa was the agreed port was denied. The averments that the plaintiff had called upon the defendants to hold the machines in trust was also specifically denied. The further averments that the machine was still in production in 2011 was also denied. It was also denied that the defendants had sold the plaintiff's machine in breach of trust. It had been further stated that the electronic mail communications from the year 2014 are all fabricated only to over come the bar by limitation. The defendants again very specifically denied that there had been entrustment of property. It had been stated that the second defendant was not a necessary party to the suit. It had been stated that the suit is barred by law of limitation. It had therefore been stated that the suit should be dismissed.
8. On the basis of the above pleadings, the following issues were framed for trial on 04.07.2019:
“1. Whether the defendants delayed in dispatching all the equipments to the plaintiff?
2. Whether the defendant had a right to sell the undelivered equipments to other third parties when the same were held by them in trust for plaintiff?
3. Whether the period of limitation is applicable when the matter is covered under Section 10 of the Limitation Act, 1963?
4. Whether the plaintiff has proved that the PET Blowing Machine was manufactured and kept ready without being dispatched by the second defendant?
5. Whether the 2nd defendant is a proper and necessary party to the suit?
6. Whether the plaintiff is entitled to the reliefs as claimed in the suit.”
9. The parties were then invited to adduce evidence. Accordingly, the plaintiff examined G. Pratik, the Power of Attorney of the plaintiff as PW-1. He marked Exs. P-1 to P-33. The plaintiff also filed an affidavit under Section 65-B of the Indian Evidence Act, 1872, with respect to the electronic documents particularly the electronic mails exchanged between the parties. The defendants examined C. Sathish Kumar, the President of the first defendant company on behalf of the first and second defendants. He did marked Exs. D-1 and D-2.
10. Heard arguments advanced by Mr. G. Kalyan Jhabak, learned counsel for M/s. Surana and Surana, learned counsel for the plaintiff and Mr. P.R. Raman, learned Senior Counsel for Mr. C. Seethapathy, learned counsel for the defendants.
11. Among the issues which have been framed, it would be appropriate if the issue relating to limitation is taken up first for discussion and determination.
12. This issue is whether the suit is barred by the law of limitation.
13. The plaintiff, Limited Liability Company incorporated in Tanzania. The defendants, who claimed to be manufacturers of Mineral Water Processing Machines and Packaging Plants had approached and requested the plaintiff to purchase a Mineral Water Processing and Packaging Plant. Ex.P-4 dated 28.10.2009 is the offer made by the first defendant to the plaintiff giving the description of the various components /machineries required for setting up, the Mineral Water Processing and Packaging of Plant. The total cost as given in Ex.P-4 was US$ 90,000. The issue now to be resolved is only with respect to the third item mentioned, namely, Fully Automatic PET Blowing Machine SSB20@2000 BPH mould 300 ml, 500 ml, 1000 ml, 1500 ml, compressor drier and chiller. This was independently valued at US$ 47,500.
14. A Proforma Invoice was raised by the first defendant also dated 28.10.2009 which is also part of Ex.P-4. Partial shipment had been stated in the Proforma Invoice which would indicate that the materials may be supplied independently of each other. In the plaint, it had been stated that the defendants had undertaken to despatch the equipments by the second week of December 2009. The plaintiff had made the necessary payments by Exs. P-5 to P-8. Ex.P-5 is the mannual printout for transfer of US$ 18,000 on 20.11.2009. Ex.P-8 is the proof of payment of pound sterling 5000 which according to the plaintiff was equivalent to US$ 8000 on 15.12.2009. Ex.P-7 is the proof of payment for transfer of amount by the plaintiff on 04.01.2010 of Euro Dollars 19,579.32 which according to the plaintiff was equivalent to US$ 27,770. Ex.P-8 is proof of transfer of US$ 36000 on 11.01.2010. The plaintiff claims that by the said transfer on 11.01.2010, the entire amount payable to the defendants had been paid. The onus was on the defendants to supply the materials. They had agreed to supply the materials by December 2009. The first communication issued by the plaintiff is an electronic mail dated 29.04.2010. By this, the plaintiff had sought for the date when the four Blow Bottles would be given for label design. It was also sought that the PET blowing machine, should be despatched. But, it is the case of the defendants that the said machinery, namely, Automatic Blowing Machine had been delivered. Even in the plaint, the plaintiff had very categorically stated that the delivery of the machineries should be completed by December 2009. It is an admitted fact that the plaintiff had paid the entire consideration towards purchase of the machinery. Thereafter, according to the plaintiff, one specific equipment, namely, the Fully Automatic PET Blowing Machine had not been delivered by the defendants.
15. It is further claimed by the plaintiff that they had requested the defendants to retain the said machinery and forward the same when requested by the plaintiff. It is therefore stated that the defendants were in possession of the said machinery as a trustee and the plaintiff had proceeded to explain the delay in filing the suit by relying on Section 10 of the Limitation Act 1963. Even otherwise, it is the case of the plaintiff that there were correspondences between the parties and that these correspondences also extended the period of limitation.
16. With respect to the parties engaging themselves in correspondences and therefore seeking extension of the period of limitation, the Hon'ble Supreme Court had very clearly stated that the period of limitation would commence from the date on which the cause of action takes place and not on any further date. It had actually been stated that if it were to be accepted that the period of limitation would commence from the date on which the last representation was rejected, then it would be nothing but a travesty of the law of limitation.
17. In State of Tripura v. Arabinda Chakraborty and others reported in (2014) 6 SCC 460, the Hon'ble Supreme Court was examining a case where the first respondent before the Hon'ble Supreme Court, who had been appointed as a Librarian by the Director of Education, Government of Tripura, during service was sent to Banaras Hindu University, Varanasi, to undergo further education and to get qualification of Bachelor of Library Science during the academic year 1965-1966. Thereafter, he resumed his duties on 27.07.1966. He remained absent from 01.08.1966 to 20.09.1967. A notice was issued to him calling upon him to join duty within a period of 7 days failing which his service would be terminated. He had given a explanation regarding attaining a Degree of Master in Library Science. He was then issued with a fresh appointment by order dated 22.11.1967 purely on temporary basis as Librarian. He then made a representation seeking seniority in service from the date when he was intially appointed as Librarian in 1964. This was rejected on 31.08.1973. He finally filed a suit on 19.09.1979. He referred to the representations made by him and to a reply to his last representation which was on 15.01.1979. He claimed that the suit was filed within the period of limitation. While examining the above facts with particular reference whether the period of limitation was extended owing to the correspondences between the parties, the Hon'ble Supreme Court held as follows in paragraph No.15:
“15. In our opinion, the suit was hopelessly barred by law of limitation. Simply by making a representation when there is no statutory provision or there is no statutory appeal provided, the period of limitation would not get extended. The law does not permit extension of period of limitation by mere filing of a representation. A person may go on making representations for years and in such an event the period of limitation would not commence from the date on which the last representation is decided. In the instant case, it is a fact that the respondent was given a fresh appointment order on 22-11-1967, which is on record. The said appointment order gave a fresh appointment to the respondent and therefore, there could not have been any question with regard to continuity of service with effect from the first employment of the respondent.”
18. Again in paragraph No.18, the law was laid down dictum as follows:
“18. It is a settled legal position that the period of limitation would commence from the date on which the cause of action takes place. Had there been any statute giving right of appeal to the respondent and if the respondent had filed such a statutory appeal, the period of limitation would have commenced from the date when the statutory appeal was decided. In the instant case, there was no provision with regard to any statutory appeal. The respondent kept on making representations one after another and all the representations had been rejected. Submission of the respondent to the effect that the period of limitation would commence from the date on which his last representation was rejected cannot be accepted. If accepted, it would be nothing but travesty of the law of limitation. One can go on making representations for 25 years and in that event one cannot say that the period of limitation would commence when the last representation was decided. On this legal issue, we feel that the courts below committed an error by considering the date of rejection of the last representation as the date on which the cause of action had arisen. This could not have been done. ”
19. The Hon'ble Supreme Court had very clearly laid down that the period of limitation would commence only from the date on which the cause of action had taken place and that subsequent correspondences would not extend the period of limitation.
20. In the instant case, the plaintiff had relied on electronic mails exchanged between the parties which finally ended with a follow up notice dated 30.03.2016 in Ex.P-33. The correspondences commenced from 01.09.2010 in Ex.P-13 and went on through the years 2011, 2012, 2014, 2015 and finally to Ex.P-33 on 30.03.2016. These correspondences, as laid down by the Hon'ble Supreme Court can never extend the period of limitation. The cause of action for the plaintiff arose in December 2009 when the defendants should have despatched the materials. Even if it is to be stated that the cause of action had arisen on the date on which the last payment had been made, then the last payment had been made by the plaintiff on 11.01.2010 in Ex.P-8.
21. The suit having been filed on 21.06.2016 is hopelessly barred by limitation. It is acknowledged by both the learned counsel for the plaintiff and the learned Senior Counsel for the defendants that Article 55 of the Limitation Act will apply to the facts of the present case. Article 55 relates to compensation for breach of any contract, express or implied not herein specifically provided and the period of limitation is three years and the time from which the period would begin to run is when the contract is broken. Here, by alleged non delivery of the machineries by December 2009, the contract had been broken by the defendants.
22. The plaintiff further relied on Ex.P-13 which is an electronic mail from the plaintiff to the defendants dated 01.09.2010, by which the plaintiff had stated that they may hold the despatch of the PET Blowing Machine as they were in high season. It is stated that this had created a trust on the defendants and that Section 10 of the Limitation Act, 1963 would apply. Section 10 of the Limitation Act, 1963 is as follows:
“Section 10 in The Limitation Act, 1963
10. Suits against trustees and their representatives.—
Notwithstanding anything contained in the foregoing provisions of this Act, no suit against a person in whom property has become vested in trust for any specific purpose, or against his legal representatives or assigns (not being assigns for valuable consideration), for the purpose of following in his or their hands such property, or the proceeds thereof, or for an account of such property or proceeds, shall be barred by any length of time.
Explanation.— For the purposes of this section any property comprised in a Hindu, Muslim or Buddhist religious or charitable endowment shall be deemed to be property vested in trust for a specific purpose and the manager of the property shall be deemed to be the trustee thereof. ”
23. Even before examining this particular issue any further, it must be pointed out that the parties herein were proceeding on the basis of a commercial transaction. Trust and commercial transactions can never go hand in hand. There is no equity in any commercial transaction. It is payment of consideration for work to be done, in this case, for supply of machineries to be made by the defendants. The plaintiff pays consideration. The defendants supplies the machineries parts. The concept of Section 10 of the Limitation Act, 1963 cannot be therefore, even on the face of it, be stated to be applicable to the facts of the present case.
24. In AIR 1956 MAD 96 [K.R. Kumaraswmi Chetiar Vs. Krishnaswami Chetty], a learned Single Judge had stated that “to extend the provisions of Section 10 to the cases of ordinary bailments would revolutionise the entire law relating to limitation.” The facts in that case was with respect to entrustment of metal sheets to the defendants, who was a metal worker for fabricating vessels. There was a strong element of commerce involved. The learned Single Judge held that his was a case of bailment and there cannot be an entrustment in trust. As a matter of fact, the learned Single Judge also observed as follows:
“The whole scheme of the Indian Limitation Act proceeds upon a sharp distinction between bailment as such and an express trust for a specific purpose covered by Section 10.”
25. Thus I reject the contentions of the plaintiff that they can take refuge under Section 10 of the Limitation Act, 1963.
26. One further aspect, namely, competency of the witness for the plaintiff has also to be examined. He was a power of attorney agent and the said document had been marked as Ex.P-1. He however had not produced the Resolution authorising him to tender evidence before the Court. The plaintiff was his client. He was an Intellectual Property Consultant. The following question and answer is quire revealing to determine his competency:
“Q: How did you become the plaintiff's IPR Consultant?
A: The plaintiff is my client's client.”
27. I still wonder the nature of a relationship an Inspector Consultant can have with an undisclosed client's client.
28. He had been interacting with the plaintiff only from December 2016 after the institution of the suit. The following question and answer establishes that:
“Q: Can we assume that you have been interacting with the plaintiff from the year 2016/2017?
A: Yes. Since December 2016 I had contact with the plaintiff.”
29. The witness was also questioned as to why the author of the electronic mail on behalf of the plaintiff did not come to Court and depose. The following question and answer with relation to that is as follows:
“Q: Since all these correspondences are either by Mr. Hussain Bhanji or by Mr. Allym Bhanji why they have not come to depose before this Hon'ble Court?
A: Mr. Hussain Bhanji is a senior person and could not travel and I am not sure as to why Mr. Allym Bhanji is not present before this Hon'ble Court.”
30. With respect to the cause of action and the payments made, the following was the answer:
“Q: Is it correct to state that the claim in the present suit is in respect of payments made by the plaintiff in 2010?
A: Yes, In the year 2009 and 2010.”
The Court must place appreciation at the precise and pointed cross examination of PW-1 conducted by Mr. Gautam S.Raman, learned counsel on behalf of the defendants.
31. On the other hand, the witness for the defendant/DW-1 was a party to the electronic mails exchanged between the parties. The following is the question and answer given by him:
“Q: Are you a par
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ty to any other emails exchanged between the plaintiff and defendants? A: Yes.” 32. With respect to the competency of a Power of Attorney, the Hon'ble Supreme Court laid as follows in (2019) 9 SCC 358 [ Mohinder Kaur Vs. Sant Paul Singh] following (2005) 2 SCC 217 [Janki Vashdeo Bhojawani Vs. Indusind Bank]: “In Janki Vashdeo (2005) 15 SCC 217 (supra), it was held that a power of attorney holder, who has acted in pursuance of the said power, may depose on behalf of the principal in respect of such acts but cannot depose for the principal for the acts done by the principal and not by the power of attorney holder. Likewise, the power of attorney holder cannot depose for the principal in respect of matters of which the principal alone can have personal knowledge and in respect of which the principal is entitled to be cross examined. In our opinion, the failure of the respondent to appear in the witness box can well be considered to raise an adverse presumption against him as further observed therein as follows : “15. Apart from what has been stated, this Court in the case of Vidhyadhar v. Manikrao [1999) 3 SCC 573 observed at SCC pp. 583-84, para 17 that: “17. Where a party to the suit does not appear in the witness box and states his own case on oath and does not offer himself to be cross examined by the other side, a presumption would arise that the case set up by him is not correct….”” 33. It is thus seen that the plaintiff has produced an incompetent witness to prove that a non existent trust had been created between them and the defendants. Section 10 of the Limitation Act, 1963 will not come into play. As stated, if it is to be held that Section 10 of the Limitation Act, 1963 would apply, it would revolutionise the entire law relating to limitation. 34. The suit having been instituted in the year 2016 is barred by the Law of Limitation. 35. Even in the cause of action, the plaintiff had stated that the last payment was made on 11.01.2010 and thereafter, there had only been correspondences between the parties which can never extend the period of limitation. 36. Accordingly, with respect to this issue, I hold that the suit is barred by limitation. Section 10 of the Limitation Act does not apply. The issue is answered against the plaintiff. Issue Nos. 1, 2, 4 & 5: 37. Discussion on these issues become otiose since the suit filed by the plaintiff is barred by the law of Limitation. All the issues are therefore answered against the plaintiff. Issue No.6: 38. In the result, the Suit is dismissed with costs. Since the plaintiff had paid the entire consideration towards the machineries, I would quantify and limit the costs to Rs.1,00,000/- (Rupees one Lakh only).