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M/s. Portman Overseas Traders, Represented by its Proprietor, K. Ganesh, Namakkal v/s M/s. P.M.S. Traders, Represented by their Power Agent S. Chellaiah Balakrishnan, Kovilpatti

    A.S. No. 343 of 2015
    Decided On, 02 September 2022
    At, High Court of Judicature at Madras
    By, THE HONOURABLE MS. JUSTICE V.M. VELUMANI & THE HONOURABLE MR. JUSTICE S. SOUNTHAR
    For the Appellant: S. Senthil, C. Jagadish, Advocates. For the Respondent: M. Santhanaraman, Kasirajan, Advocates.


Judgment Text
(Prayer: First Appeal filed under Section 96 of Civil Procedure Code, R/w Order 41 Rule 1 of CPC, praying to set aside the judgement and decree dated 06.11.2014 passed in O.S.No.109 of 2011 on the file of the Principal District Court, Namakkal.)

S. Sounthar, J.

1. The unsuccessful defendant in a suit for recovery of money is the appellant.

Plaint Averment:

2. The respondent/plaintiff filed a suit for recovery of Rs.20,14,155/- equivalent to 44,758.70 UD dollars together with interest at the rate of 24% from 28.12.2010 till the date of realisation. According to the respondent/plaintiff, it is engaged in import and export business for more than 15 years at Srilanka and India. The appellant/defendant is doing a rice bran business in India and the appellant/defendant used to purchase rice bran from the respondent/plaintiff for his business transaction. During the course of business transaction in the month of December 2010, the appellant/defendant ordered 208.18 metric tons of rice bran from the respondent/plaintiff at the rate of 215 U.S. Dollars per metric ton. As per the telephonic order, the respondent/plaintiff dispatched 208.18 metric tons of rice bran in 5751 bags from Srilanka to the appellant on 21.12.2010, under Invoice No. PORT/EXP/06/2010-2011. On 28.12.2010, the appellant executed all the customs formalities for taking delivery of the said consignment through his clearing agent G.Sreenivasan. The said consignment was taken delivery by the appellant at Thoothukudi Port. The respondent/plaintiff specifically pleaded that at the time of placing order, the appellant/defendant promised to pay the cost of the consignment at the time of taking delivery of the goods. Believing the words of the appellant/defendant, the respondent/plaintiff had dispatched all the original invoices and other shipment related documents directly to the appellant/defendant to enable him to take delivery of the goods from Thoothukudi Port. According to the respondent/plaintiff, by using the above documents the appellant/defendant had taken delivery of the consignment. But he failed to pay the invoice amount of Rs.44,758.70 US dollars. It was further averred in the plaint that the inspite of several demands, the appellant/defendant failed to pay the price of consignment and hence, a complaint was made to the High Commissioner of India at Colombo and he also sent a letter dated 09.02.2011 requesting appellant to make payment without any delay. Thereafter, the respondent/plaintiff sent a legal notice to the appellant/defendant on 27.01.2011 and inspite of the same, the appellant/defendant failed to make any payment and hence, the respondent/plaintiff was constrained to file the above suit for recovery of money.

Averment found in the written statement:

3. The appellant/defendant in his written statement mainly contended that the respondent/plaintiff dispatched the consignment only after receiving the cost of the consignment and hence, in the invoice dated 21.12.2010 in the delivery and payment column, it was clearly mentioned as “Advance Payments”. Therefore, the respondent/plaintiff is estopped from claiming that the appellant/defendant failed to pay the cost of the consignment. It was further averred by the appellant/defendant in his written statement that when the plaintiff came down to India earlier on 21.04.2010 a sum of Rs.21,00,000/- was paid to him at his request as the appellant/defendant enjoy a close business relationship with the respondent/plaintiff. The said payment was made to the respondent/plaintiff in the presence of Chellaiah Balakrishnan and Hariharan and only due to receipt of the said amount by the respondent/plaintiff, he prepared invoice stating that “Advance Payments” in the delivery and payment column of invoice. The appellant/defendant also raised a plea that framing of the suit was bad because the capacity of the respondent/plaintiff was not clearly mentioned whether it is a proprietary concern or firm or company. The appellant/defendant also raised a plea that the Power of Attorney produced by the Power Agent of the respondent/plaintiff, which was executed in Srilanka, was not adjudicated in India and therefore, it could not be taken into consideration.

Findings of the Trial Court:

4.1. On these pleadings, the parties went to trial and one S.Chellaiah Balakrishnan, Power Agent of the respondent/plaintiff was examined as PW.1 on behalf of the respondent/plaintiff. The proprietor of the appellant/defendant concern namely Ganesh was examined as DW.1 and an independent witness who allegedly witnessed the payment of Rs.21,00,000/- by the appellant to respondent was examined as DW.2. On behalf of the respondent/plaintiff Ex.A1 to Ex.A17 were marked. On behalf of the appellant/defendant Ex.B1 to Ex.B3 were marked.

4.2. The Trail Court framed the following issues:

“(i) Whether the plaintiff is entitled to recover sum of Rs.20,14,155/- equivalent to 44,758.70 US dollars with interest at the rate of 24% from 28.12.2010 till date of realization with cost?

(ii) Whether the defendant discharged the amount sum of Rs.21,00,000/-?

(iii) To what relief is entitled?”

4.3. The Trial Court on consideration of oral and documentary evidences came to a conclusion that the appellant/defendant failed to prove that he had paid the amount of Rs.21,00,000/- to the respondent/plaintiff and hence, decreed the suit. Aggrieved by the same, the unsuccessful defendant has come up with this appeal.

Arguments of the learned counsel for the appellant/defendant:

5. The learned counsel for the appellant/defendant contended that the respondent/plaintiff came up with a specific case that though he prepared an invoice Ex.A2 as if, he received advance payment of the cost of the consignment, as per the regular business practice between the appellant as well as the respondent, he dispatched the consignment without receiving the cost of the same and the appellant/defendant has to pay the cost after delivery of the consignment. The alleged business practice pleaded by the respondent is against his own documentary evidence namely Ex.A2 invoice. It is not open to lead any oral evidence so as to contradict the documentary evidence available on record. He further contended that the alleged business practice pleaded by the respondent is well within the exclusive knowledge of the proprietor of the respondent concern. In order to prove the alleged business practice, the proprietor of the respondent namely Parameshwaran should have entered box and deposed. In the case on hand, the said Parameshwaran never entered box. He only examined his Power Agent, as PW.1. He admitted that he had no knowledge about the business transaction between the respondent and appellant. Therefore, the evidence of sole witness of respondent/plaintiff, who is not competent to depose about the business transaction, is not sufficient to support the case of the respondent/plaintiff. The learned counsel relied on the judgement of the Hon'ble Apex Court in S.Kesari Hanuman Goud vs. Anjum Jehan reported in (2013) 12 Supreme Court Cases 64 for the proposition that a power of attorney cannot depose for the principal in respect of the matter over which, the principal has got personal knowledge. He also relied on the decision of the Hon'ble Apex Court in Mohinder Kaur vs. Sant Paul Singh reported in (2019) 9 Supreme Court Cases 358 for the proposition that the power of attorney holder is not competent to depose on behalf of principal in respect of acts or matters which pertains to period prior to conferment of power of attorney. He also relied on the decision of the Hon'ble Apex Court in Mangala Waman Karandikar vs. Prakash Damodar Ranade reported in (2021) 6 Supreme Court cases 139 for the proposition that oral evidence cannot exclude the documentary evidence. Assailing the findings of the Trial Court, he submitted that in Ex.B2 and Ex.B3 which came into existence before 21.04.2010, in the payment column, it was mentioned as “Documents Against Payment (D/A 15 Days)”. But however, in the invoices Ex.A7, Ex.A8 and Ex.A9 which were raised subsequent to the alleged date of payment by the appellant, it was mentioned in the payment column as “Advance Payments”. Therefore, he submitted that only because of payment made by the appellant/defendant to the respondent/plaintiff on 21.04.2010 subsequent invoices were prepared as if advance payment was already received. He also submitted that payment of Rs.21,00,000/- was proved by examining independent witness namely DW.2. The learned counsel for the appellant also submitted that the Power Deed produced by the Power Agent of the plaintiff, which was executed out of India i.e. in Srilanka, was not adjudicated within the prescribed time on receipt of document in India, therefore, the same is inadmissible in evidence. He also submitted that the very framing of the suit is not proper, as the respondent/plaintiff failed to give correct description of the plaintiff whether it is a proprietary concern or firm or company.

Arguments of the learned counsel for the respondent/plaintiff:

6. Per contra, the learned counsel for the respondent submitted that Ex.A7 to Ex.A9, invoices raised by the respondent/plaintiff in earlier occasions also in the delivery and payment column it was mentioned as “Advance Payment”. But the appellant/defendant paid the cost of respective consignment only subsequently as evidenced by Ex.A6 and also admitted by DW.1. Therefore, it was contended by the learned counsel for the respondent/plaintiff that the plaintiff has proved his plea that it was normal business practice between the respondent and the appellant that the respondent/plaintiff would raise invoice as if he received advance payment but actual payment would be made by the appellant/defendant only subsequent to the delivery of the consignment. As far as the contention of the learned counsel for the appellant that the Power of Attorney Deed Ex.A1 was not adjudicated in India and therefore, it was not admissible in evidence, the learned counsel for the respondent submitted that when the Power Deed Ex.A1 was marked through PW.1, there was no objection by the appellant/defendant with regard to adjudication for stamp duty and in view of Section 36 of the Indian Stamp Act, 1899, if the document is admitted in evidence without any objection by the opposite side with regard to the stamp duty, the said point cannot be raised at a later stage. Therefore, the appellant/defendant is not entitled to raise absence of adjudication for stamp duty at the stage of appeal. As far as the contention of the learned counsel for the appellant regarding the mis-description of the respondent/plaintiff, it was submitted by the learned counsel for the respondent that in Ex.A1 Power Deed the plaintiff concern was clearly described as a proprietary concern and the name of the proprietor is Parameshwaran. Therefore, non-mentioning of the same in the cause title of the plaint is not a serious defect and the respondent/plaintiff cannot be non-suited on that ground when the plaint was properly verified by a duly authorised power agent of said Parameshwaran.

The points arise for consideration:

7. On the basis of pleadings and contention of the learned counsel for either side, following points for consideration are arising in this appeal.

(i) Whether the respondent proved his case that he dispatched the consignment to the appellant without receiving the payment in advance?

(ii) Whether the respondent is entitled for recovery of suit amount?

(iii) Whether Ex.A1 special power deed is valid in law without adjudication in India?

(iv) Whether the suit as framed is maintainable in law?

Point No: 1. Whether the respondent proved his case that he dispatched the consignment to the appellant without receiving the payment in advance?

8 (i) It is the specific case of the respondent/plaintiff that even though he prepared an invoice as if he received the payment in advance from the appellant/defendant, actually, he dispatched the consignment without receiving any payment on the understanding it would be paid after receipt of consignment by the appellant/defendant. There is a specific plea in the plaint that at the time of placing the orders, the defendant promised to pay the cost of consignment after taking delivery of the goods. It was also specifically pleaded in the reply statement of the respondent/plaintiff that during earlier occasions number of times respondent/plaintiff prepared invoice by mentioning the payment column as “Advance Payment”. But however, in all the earlier occasions the appellant paid the cost of the consignment only after delivery and therefore, it has been a recognised normal business practice between the respondent and the appellant. When the core contention of the respondent is that inspite of his admission in Ex.A2 that cost of consignment was received in advance, as per the usual business practice, it was not received and the goods were sent on an understanding that the cost would be received after delivery, the burden on the respondent to prove the existence of such a business practice is very high. In other words, unless the respondent/plaintiff, proved the existence of special business practice, namely preparing the invoice as if advance payment was received but without actual payment and receiving payment only after the delivery of the goods, the onus on him will never shift to appellant/defendant. Unless the respondent displace that burden on him by leading cogent evidence, the onus will never shift to the appellant. In the case on hand, in order to prove the existence of special business practice pleaded by the respondent, the power agent of the respondent was examined as PW.1. During the cross examination, he categorically admitted that he did not know anything about the business relationship between the respondent and the appellant. Therefore, it is clear the special business practice pleaded by the respondent/plaintiff is very well within the knowledge of the respondent and he never entered the box. The Power Agent is not competent to depose in respect of the matters over which the principal alone has got exclusive knowledge. It would be useful to refer to the following observations of the Hon'ble Apex Court in S.Kesari Hanuman Goud vs. Anjum Jehan reported in (2013) 12 Supreme Court Cases 64,

“23. It is a settled legal proposition that the power-ofattorney holder cannot depose in place of the principal. The provisions of Order 3 Rules 1 and 2 CPC empower the holder of the power of attorney to “act” on behalf of the principal. The word “acts” employed therein is confined only to “acts” done by the power-of-attorney holder, in exercise of the power granted to him by virtue of the instrument. The term “acts”, would not include deposing in place and instead of the principal. In other words, if the power-of-attorney holder has preferred any “acts” in pursuance of the power of attorney, he may depose for the principal in respect of such acts, but he cannot depose for the principal for acts done by the principal, and not by him. Similarly, he cannot depose for the principal in respect of a matter, as regards which, only the principal can have personal knowledge and in respect of which, the principal is entitled (sic liable) to be cross-examined. (See: Vidhyadhar v. Manikrao, Janki Vashdeo Bhojwani v. Indusind Bank Ltd., Shankar Finance and Investments v. State of A.P and Man Kaur v. Hartar Singh Sangha).”

8 (ii) In the case on hand, the principal who had exclusive knowledge about the business transaction between himself and the appellant failed to enter the box and his Power Agent who entered the box clearly admitted that he had no knowledge about the business transaction between the respondent and the appellant. Therefore, the only witness examined by the respondent/plaintiff to prove the existence of the special business practice contrary to the entry in Ex.A2 invoice, is not only not competent to depose but also failed to support respondent's case. Further, in this case, the owner of the respondent concern namely Parameshwaran should have entered the box and deposed in support of respondent's case. He failed to enter the box and get himself cross examined by the appellant/defendant. Therefore, an adverse inference shall be drawn against the respondent for the failure of its proprietor to enter the box. In this regard, it would be useful to refer to the decision of the Hon'ble Apex Court in the case of Mohinder Kaur vs. Sant Paul Singh reported in (2019) 9 Supreme Court Cases 358, wherein it was held as follows:-

“7. In Janki Vashdeo, it was held that a power-ofattorney 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:(SCC p.233, para 15)

“15. Apart from what has been stated, this Court in Vidhyadhar v. Manikrao 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….”

Therefore we hold that when the proprietor of the plaintiff concern refused to enter box, the special business practice pleaded by the respondent/plaintiff, that inspite of entry in the invoice that advance payment was already received, the respondent used to send goods without receiving any money on an understanding that money would be paid after delivery of the goods, cannot be accepted.

8 (iii) It is also pertinent to mention that in Ex.B2 and Ex.B3 dated 01.10.2007 and 10.08.2009 invoices raised by the respondent prior to the payment alleged by the defendant, in the payment and delivery column it was mentioned as “Documents Against the Payment”. When PW.1 was cross examined he explained the expression “the payment against the document”. He explained that it means at the time of receiving the invoice the appellant/defendant shall pay the amount. As far as Ex.A2 is concerned, PW.1 admitted the entry in Ex.A1 is “Advance Payment”. He also gone to the extent of admitting that the entry in Ex.A2, was accepted by both the parties and it is binding on them. When there is a documentary evidence on record in the name of Ex.B2 and Ex.B3 that prior to the date of alleged payment by the appellant/defendant, the respondent/plaintiff used to prepare invoice with an endorsement in the payment column that “Documents Against the Payment”, the contention of the learned counsel for the respondent that there is a special business practice between the respondent and the appellant as if respondent would raise invoice with an endorsement 'Advance Payment' and inspite of the same, the appellant has to pay the cost after the delivery of the goods, cannot be accepted. The Trial Court committed serious error in decreeing the suit mainly on the ground that the appellant failed to prove the payment of Rs.21,00,000/- to the respondent as pleaded by him. Here, there is a documentary evidence available on record to show that the respondent received advance payment and dispatched the goods. Ex.A2 was admitted by PW.1, he has gone to the extent of saying that both the parties agreed to the terms and conditions mentioned in Ex.A2 and put their signature thereon. When there is a documentary evidence to show that the respondent received advance payment, the onus is on the respondent/plaintiff to show that he had not received any advance payment and inspite of the same, he prepared Ex.A2 invoice as if he received advance payment. However, the proprietor of the respondent concern namely Parameshwaran failed to appear before the Court. His Power of Attorney, who had no special knowledge about the business transaction of the respondent was the sole witness examined on his behalf. His evidence is not sufficient to displace the documentary evidence namely Ex.A2. Further, it is settled law that no amount of oral evidence is sufficient to exclude the documentary evidence. Therefore, we have no hesitation in holding that in the light of Ex.A2, the respondent/plaintiff dispatched the consignment only after receiving the advance payment from the appellant/defendant and consequently, Point No.1 is answered in favour of the appellant and against the respondent.

Point No.2. Whether the respondent/plaintiff is entitled to recovery of suit amount?

9. In view of our findings to the Point No.1 that the respondent received advance payment and dispatched the consignment to the appellant by mentioning the advance payment, we hold that the respondent is not entitled to recover any amount towards the price of the consignment covered by the invoice marked as Ex.A2 and Point No.2 is answered in favour of the appellant and against the respondent.

Point No.3 Whether Ex.A1 special power deed is valid in law without adjudication in India?

10. The Ex.A1 Special Power of Attorney executed by Parameshwaran, the proprietor of the respondent concern in favour of his agent, who was examined as a sole witness on behalf of plaintiff was executed in a plain paper. No Indian Non-Judicial Stamp was affixed. Therefore, when Ex.A1 which was executed in Srilanka is received in India it has to be adjudicated by affixing sufficient stamp papers by the Sub-Registrar Office. Ex.A1 is not adjudicated in India by affixing sufficient stamp duty. But however, though the non-adjudication was raised by the appellant/defendant in the written statement, at the time of marking of Power of Attorney through PW.1, there was no objection by the appellant/defendant, with regard to stamp duty and adjudication. Hence, there is a force in the contention of the learned counsel for the respondent that having failed to object at the time of marking of Power of Attorney as a document, the appellant is not entitled to raise the said point in the appeal. It would be pertinent to mention the observations of the Hon'ble Apex Court with regard to the scope of Section 36 of the Indian Stamp Act, 1899 in the case of Javer Chand and Others vs. Pukhraj Surana reported in AIR 1961 SC 1655, wherein it has held as follows:-

“4. ... Once a document has been marked as an exhibit in the case and the trial had proceeded all along on the footing that the document was an exhibit in the case and has been used by the parties in examination and cross-examination of their witnesses, Section 36 of Stamp Act comes into operation. Once a document has been admitted in evidence, as aforesaid, it is not open either to the trial court itself or to a court of appeal or revision to go behind that order. Such an order is not one of those judicial orders which are liable to be reviewed or revised by the same court or a court of superior jurisdiction.”

In view of the law settled in the above decision, we hold the appellant/defendant who failed to raise objection with regard to stamp duty and adjudication at the time of marking of Power of Attorney is not entitled to raise that point in a later point of time especially before the Appellate Court. The points numbers 1 and 2 are already answered in favour of appellant and against the respondent. Hence, we refrain from proceeding further in this issue by invoking our power under Section 61 of the Indian Stamp Act, 1899. The Point No.3 is answered against the appellant/defendant and in favour of the respondent/plaintiff.

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Point No.4 Whether the suit as framed is maintainable in law? 11. In the cause title of the plaint, the respondent/plaintiff described the name of the plaintiff as M/s. P.M.S. Traders represented by its Power Agent S.Challiah Balakrishnan. It is not mentioned whether P.M.S.Traders is a Proprietary Concern or Firm or Company. If the description found in the plaint is read along with Ex.A1 Power of Attorney Deed, it can be gathered P.M.S.Traders is a proprietary concern owned by its proprietor namely Parameshwaran and the said Parameshwaran executed a Power of Attorney in favour of S.Challiah Balakrishnan. The said Power of Attorney executed by the proprietor of the respondent was filed along with Plaint as Plaint Document No.1. Though the name of the respondent was not properly described in the plaint, the parties understood the case and there is no mistake in the identity of the parties. The plaint was verified by Power of Attorney of the proprietor of the respondent namely S.Challiah Balakrishnan and he was examined as PW.1. In the earlier part of written statement appellant/defendant raised mis-description of respondent as a ground of attack. But from the specific pleas raised by him regarding suit transaction in the latter part of written statement, it is clear that he understood, who the respondent was and there was no mistake as to identity. Hence, misdescription of respondent/plaintiff in plaint did not cause any prejudice to the appellant/defendant. In these circumstances, the mis-description found in the plaint, though serious in nature it will not result in any serious prejudice to the appellant/defendant. We do not think on this hyper technical ground the respondent/plaintiff need to be non-suited and hence, this point is answered against the appellant/defendant and in favour of the respondent/plaintiff. Conclusions: 12. In view of our findings in Point Nos.1 and 2 that the respondent/plaintiff failed to prove that he dispatched the goods without receiving the cost of the goods mentioned in the invoice raised by him, the judgement and decree of the Trial Court need to be set aside and accordingly, the above appeal is allowed by setting aside the judgement and decree dated 06.11.2014 made in O.S.No.109 of 2011 on the file of the Principal District Court, Namakkal. 13. In nutshell: (i) The appeal is allowed and the judgement and decree dated 06.11.2014 made in O.S.No.109 of 2011 on the file of the Principal District Court, Namakkal, is set aside. (ii) The original suit stands dismissed; (iii) In the facts and circumstances of the case, there will be no order as to costs.
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