Delhi District Court
Narender Khurana vs M/S Rana Polycot Limited on 21 April, 2026
CNR No. DLCT010086982022
IN THE COURT OF SHRI DEVENDRA KUMAR SHARMA:
DISTRICT JUDGE (COMMERCIAL COURT)- 03: CENTRAL
TIS HAZARI COURT (EXTENSION BLOCK) : DELHI.
CS (COMM) No. 1390/2022
In the matter of :-
Narender Khurana (Since deceased)
Through LRs
1. Mrs. Meena Khurana
2. Mrs. Rohini Khurana
3. Mrs. Shikha Khurana
4. Mr. Karan Khurana
All at 113, Dilkhush Building
Chowk Tilak Bazar,
Delhi-110006 ......Plaintiffs
Versus
M/s Rana Polycot Limited
Through its director/A.R.
Having its Registered Office at:
SCO No.49-50, Sector 8-C
Madhya Marg,
Chandigarh-160009
Email: [email protected],
[email protected],
[email protected]
Mobile No.9815900907
Also at:
Village Alamgir,
Chandigarh-Ambala Highway
Tehsil Lalru, District Mohali,
Punjab. ......Defendant
CS (COMM) No.1390/2022 Pg. 1 / 51
Digitally signed
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
15:47:37 +0530
Date of Institution : 31.05.2022
Date on which Judgment reserved : 09.04.2026
Date on which judgment pronounced : 21.04.2026
SUIT FOR RECOVERY
JUDGMENT
1. Before this Court set to adjudicate on myriad issues
flagged on behalf of both the parties, let the Court to spell out
laconically the landscape of the pleadings.
(A) Pleading of the Parties:-
2. This is a suit for recovery of Rs.25,38,223/- filed by
plaintiff against the defendants.
3. Succinctly stated facts of the case as set out in the
plaint are that the plaintiff is proprietor of the firm M/s J.D. Sales
Corp. having its registered office at 113, Dilkhush Building,
Chowk Tilak Bazar, Delhi-110006. The plaintiff is engaged in the
business of textile chemicals and dyes since the year 1943 having
its customers/clients/vendors/suppliers across the country. The
plaintiff’s firm product range includes VAT Dyestuffs, Reactive
and Disperse Dyes, Sulphur and Solvent Soluble Dyes, OBA’s,
Direct and Metal Complex Acid Dyes, Vat Pasters, Napthols and
Pigment Emulsion etc.
4. It has been further averred in the plaint that the
defendant No.1 is a Limited Company duly registered and
incorporated under the Companies Act having its registered
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Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:03:17 +0530
office at SCO No.49-50, Sector-8C, Chandigarh-160009 and the
Defendant No.2 is Managing Director/AR of the defendant no.1
company and is in-charge of and is responsible for the conduct of
the business and managing day-to-day affairs of the defendant
no.1. The defendants are in the business of manufacturing of
yarn, dyed yarn and garments etc. and the plaintiff and the
defendants are in business relationship since the last more than
15 years.
5. It has been further averred in the plaint that the
defendants used to place order for purchase of dyes material
through email/purchase orders at the registered office of the
plaintiff i.e. 113, Dilkhush Building, Chowk Tilak Bazar,
Delhi-110006 and the plaintiff used to supply the same from its
said office to the defendants agent i.e. The Bharat Motor
Transport Co. Pvt. Ltd. who used to book the same and transport
the same at the defendant’s place after issuing the requisite Lorry
Receipt (LR) to the plaintiff. The details of the invoices,
purchase order as well as lorry receipt are given in para 10 of the
plaint.
6. It has been further averred that as per the books of
account being maintained by the plaintiff in the normal and
ordinary course of its business, a sum of Rs.15,29,050/- remained
due and outstanding against the defendant. It is further averred
that the defendant no.2 had also taken his personal obligation and
responsibility to make payment due and payable by the defendant
no.1 to the plaintiff. The relevant terms and conditions as
mentioned in the invoice issued by the plaintiff have been
referred to in para 14 and 15 of the plaint and it has been stated
Digitally signed
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Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:03:34
+0530
that the plaintiff clearly called upon their customers/defendants to
accept the goods with full responsibility and the plaintiff will not
be held responsible for the quality of the goods supplied in any
manner whatsoever. It has been further averred that as per the
contract/agreement between the parties, it was agreed that
interest will be charged @ 22.5% per annum on overdue account
if bill is not paid within due date and that any dispute arose
between the parties shall be subject to Delhi Jurisdiction.
7. It has been further averred that the plaintiff had been
corresponding with the defendants from time to time as regards
to release of the balance payment and also for issuance of C-
Forms qua the goods sold by the plaintiff to the defendants. The
plaintiff had sent emails dated 23.02.2017, 24.02.2017,
01.03.2017, 06.03.2017, 08.05.2017, 11.05.2017, 16.05.2017,
21.03.2018, 22.03.2018, 27.03.2018 and 12.04.2018 and the
defendants, vide its email dated 04.02.2017 and 20.03.2018,
acknowledged its liability to pay and sought time to furnish the
C-Forms. Thereafter, the plaintiff on the same day provided its
address for sending the C-Forms.
8. It has been further averred in the plaint that the
defendants had issued few C-Forms thereby acknowledging the
bills pending for clearance and their legal liability due towards
the plaintiff which they failed to discharge intentionally and
deliberately. The details of the C-Forms received by the plaintiff
are given in para 22 of the plaint.
9. It has been further averred that despite repeated
requests/reminders, the defendants failed to clear the outstanding
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Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:03:39 +0530
amount. Thus, left with no other option, plaintiff had sent a legal
notice dated 28.09.2020 to the defendants calling upon them to
make the payment of Rs.20,42,289/- which was due till
September 2020 alongwith interest. It has been further averred
that though in terms of agreement/invoices, the interest was
agreed @ 22.5% p.a., however, the plaintiff is claiming the
interest @ 12% p.a. from the defendants w.e.f. December 2016
till date of filing of suit which comes to Rs.10,09,173/-. It has
been further averred that the legal notice was served upon both
the defendants and the defendants had sent a reply dated
17.11.2020 thereby acknowledging the business done with the
plaintiff as regards the invoice payments as stipulated in the
plaint in dispute, however, denied their liability to pay on false
and frivolous grounds and also tried to set up a case that a sub-
standard goods were supplied. Despite receipt of said reply, the
plaintiff had been regularly following up with the defendants and
the defendant no.2 assured the plaintiff to discharge their legal
liability by stating that they were facing some financial crisis and
required some more time to resolve all the issues with the
plaintiff.
10. It has been further averred that the plaintiff had
approached the office of Central District Legal Services
Authority at Tis Hazari Courts for initiating pre-institution
mediation proceedings. The defendants did not participate in the
mediation proceeding despite service of notices and thus, a non-
starter report dated 23.10.2021 was issued. Thus aggrieved by
the act of the defendants, the plaintiff has filed the instant suit
praying for a decree in sum of Rs.25,38,223/- (Rs.15,29,050/-
Digitally signed
CS (COMM) No.1390/2022 Devendra by Devendra
Kumar Sharma
Pg. 5 / 51
Kumar Date:
Sharma 2026.04.21
16:03:44 +0530
towards Principal amount and Rs.10,09,173/- towards interest @
12% p.a.) alongwith pendente lite and future interest @12% p.a.
from the date of filing of this suit till its realization.
11. During the pendency of the suit, the plaintiff has
expired on 14.01.2023 and vide order dated 19.04.2023, the
application filed on behalf of plaintiff U/o 22 Rule 3 r/w Section
151 CPC was allowed and the LRs of the plaintiff were permitted
to be substituted in place of deceased plaintiff.
12. Pursuant to issuance of summons of suit, defendants
had filed their written statement.
13. Subsequently, an application U/o VI Rule 17 r/w
Section 151 of CPC for amendment of plaint was filed by
plaintiff to incorporate averments with respect to documents
which plaintiff was permitted to place on record pursuant to
application U/o XI Rule 1(4) of CPC filed by the plaintiff. The
said documents include audited balance sheets of defendant no.1
for the Financial Years 2016-17 to 2020-21 taken from the
Ministry of Corporate Affairs (MCA) portal to prove that
plaintiff’s suit is well within limitation and that defendant no.1
has acknowledged its liability qua plaintiff in the said balance
sheets. The said application was allowed vide order dated
25.02.2025 and plaintiff was permitted to amend the plaint.
14. In the amended plaint, besides the facts mentioned
in original plaint, as detailed in foregoing paras, plaintiff has
averred that the copies of the Audited Balance Sheets of the
defendant no.1 from Financial Years 2016-17 to 2020-21 as taken
from the Ministry of Corporate Affairs portal has also been filed
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Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:03:50 +0530
wherein the total current liabilities of the defendant no.1 towards
its creditors as on 31.03.2017 was Rs.374.32 crores, as on
31.03.2018 was Rs.411.01 crores, as on 31.03.2019 was
Rs.397.66 crores, as on 31.03.2020 was Rs.376.02 crores and as
on 31.03.2021 was Rs.374.26 crores. Further, the amount
payable by the defendants no.1 to the plaintiff firm was also
reflected in the said balance sheets of the defendants. Hence,
there is a clear-cut admission by the defendants about the said
due payment to be made to the plaintiff firm and this itself is an
acknowledgment of the debt which is also evident from C-Forms.
It is averred that the belated issuance of the C-Forms by the
defendants is also a reflection and admission about the receipt of
the goods from the plaintiff and about the due payment and also
an acknowledgment of the fact that defendant had taken tax
benefit by delayed issuance of C-Forms. It is thus prayed that the
suit of the plaintiff be decreed as prayed for.
15. It is pertinent to mention here that the defendant
no.2 had also filed an application U/o I Rule 10 r/w Section 151
of CPC seeking his deletion from the array of parties. Vide order
dated 25.02.2025, the said application was allowed and the name
of defendant no.2 was permitted to be deleted from the array of
parties and the defendant no.1 was given liberty to file written
statement to the amended plaint.
16. Thereafter, the defendant no.1 had filed the written
statement to the amended plaint, through Sh. Sanjiv Sharma,
Manager-Legal of the Defendant No.1 Company, who has been
duly authorized to sign, verify the written statement and to
proceed with the matter on behalf of defendant by virtue of
Digitally signed
CS (COMM) No.1390/2022 by Devendra Pg. 7 / 51
Devendra Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:03:56
+0530
Board Resolution.
17. By way of preliminary objection, it has been stated
that the Defendant No.2 is the Managing Director of the
Defendant No.1 Company and he has never carried out any
transactions with the plaintiff in his personal capacity and all the
transactions alleged by the plaintiff were carried out between the
plaintiff and the defendant no.1; that the defendant no.2 cannot
be made personally liable for the alleged contractual obligations
of defendant no.1 and hence, the defendant no.2 is neither a
proper party nor a necessary party in the present suit. It has been
further stated that the defendant no.2 has also filed an application
U/o I Rule 10 r/w Section 151 CPC seeking deletion of his name
from the array of the parties.
18. Another objection regarding suit of plaintiff being
barred by limitation has also been taken. It has been stated that
the last invoice allegedly issued by the plaintiff was on
30.11.2016 and the suit was filed after the prescribed period of
limitation was over i.e. after 01.12.2019. Hence, the suit is liable
to be rejected being barred by law of limitation. However, it is
stated that the said invoices were never acknowledged by the
defendants.
19. It has been submitted that the defendant no.1 had
suffered huge losses due to bad and inferior quality of products
supplied by the plaintiff and due to this reason the defendant no.1
had terminated the relationship with the plaintiff as is evident
from the fact that the last invoice was issued by the plaintiff on
30.11.2016 after which the defendant no.1 never placed any order
Digitally signed
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Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:04:01 +0530
with the plaintiff. It is further submitted that when the plaintiff’s
officer approached the defendant no.1 for the alleged remaining
payment, the defendant no.1 apprised them of the fact that they
had suffered huge losses because of the inferior and sub-standard
quality of products supplied by the plaintiff. It is submitted that
the plaintiff had admitted the said wrong doing and thereafter an
oral understanding was reached between the parties.
20. It has been further submitted that it was amicably
agreed between the defendant no.1 and the plaintiff that to put a
quietus to all disputes, the defendant no.1 shall pay a full and
final payment of Rs.3,02,290/- to the plaintiff which was
admittedly made on 24.11.2016. The said payment was amicably
agreed to be the full and final settlement against any dues of the
plaintiff and it was also agreed that no action will be brought by
either of the parties in the Court of law. It has been further
submitted that as per the oral settlement, the plaintiff was to
provide certain products to the defendant no.1 which were
provided by the plaintiff in three installments subsequent to the
full and final payment made by defendant no.1; that after the
payment of Rs.3,02,290/-, the defendant no.1 was not liable to
pay any amount to the plaintiff. It has been further submitted that
despite there being an oral settlement between the parties, the
plaintiff has instituted the present suit to harass the defendants
and to extort money from the defendants.
21. It is further submitted that plaintiff has placed
reliance on certain financial documents purportedly pertaining to
the defendant in an attempt to demonstrate an alleged continuing
liability of the defendant. However, such reliance is whollyCS (COMM) No.1390/2022 Digitally signed Pg. 9 / 51
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:04:06 +0530
misplaced and untenable both in law and on facts. It has been
further stated that the balance sheets relied upon by the plaintiff
do not, in any manner, establish that the defendant have any
subsisting liability or outstanding dues payable to the plaintiff.
Further, it has been specifically denied that the said financial
documents contain any admission or acknowledgment by the
defendant of any debt in favour of the plaintiff; that there is
neither any reference to the plaintiff in the said documents nor is
there any reference to the alleged debt of the plaintiff and the
burden lies entirely upon the plaintiff to establish how the said
documents, even if assumed to be authentic and admissible,
evidence any liability owed by the defendant to the plaintiff . It
has been further submitted that the plaintiff has merely extracted
a generalized reference to the overall debt of the defendant
company from its balance sheets and is attempting to assert that
its alleged debt forms a part thereof. Such a claim, devoid of any
specific acknowledgment or supporting documentation, is not
only baseless but also legally unsustainable. The documents filed
by the plaintiff do not disclose any conclusive or corroborative
evidence indicating that the defendant owe any debt or liability to
the plaintiff. Hence, plaintiff’s reliance on defendant’s financial
documents is wholly misplaced, legally untenable and deserve to
be rejected in limine.
22. It has been denied that there was any
acknowledgment of the alleged debt of plaintiff by the
defendants in any manner and thus, no cause of action arose in
favour of the plaintiff against the defendants. It has been further
submitted that nowhere in the alleged emails dated 04.02.2017CS (COMM) No.1390/2022 Digitally signed Pg. 10 / 51
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:04:11 +0530
and 20.03.2018, the defendants have acknowledged their liability
towards the plaintiff and the defendants had merely sought the
address to which the C-Forms related to previous transactions
were to be delivered. It has been further submitted that mere
delivery of C-Forms in no way can be construed as
acknowledgment of the liability to pay to the plaintiff and that it
is well-settled principle of law that the issuance of C-Form does
not extend the limitation for filing the suit.
23. The maintainability of the suit has also been
challenged on the ground that this Court has no territorial
jurisdiction to try the present suit. It has been stated that the
defendant no.1 used to place the order in Chandigarh only and
the plaintiff also used to supply the goods outside the territorial
jurisdiction of this Court and the payments were also made by the
defendants outside the jurisdiction of this Court. Thus, this Court
has no territorial jurisdiction to adjudicate upon the present suit
as neither the defendants reside nor works for gain nor the cause
of action has arisen within the territorial jurisdiction of this
Court.
24. On merits, it is denied that defendant no.2 was
personally and solely in-charge of and was responsible for day-
to-day affairs of the defendant no.1. It is stated that the business
relationship between the plaintiff and defendants no.1 lasted for
many years due to the reason that defendant no.1 was making the
timely payments, however, the quality of goods supplied by
plaintiff kept on decreasing which ultimately forced the
defendant no.1 to terminate the business relations after settling
all the disputes. It has been reiterated that that parties have not
Digitally
signed by
CS (COMM) No.1390/2022 Devendra Devendra Pg. 11 / 51
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:04:16
+0530
done any transaction after 2016 and the last payment was made
by defendant no.1 on 24.11.2016 which was the full and final
settlement between the parties. It has been denied that the
defendants had placed the purchase orders at the registered office
of the plaintiff and that the plaintiff used to supply the goods
from its registered office to the defendant’s agent. It has also
been denied that M/s Bharat Motor Transport Co. Pvt. Ltd. used
to book and transport the goods on behalf of the defendant no.1.
It has been denied that the invoices issued by the plaintiff were
duly accepted by the defendant. It has been denied that the
defendants had agreed that interest @ 22.5% per annum is to be
levied on the overdue amount if the payment was not made. It
has been further stated that no such terms and conditions were
agreed between the parties and it has been reiterated that issuance
of C-Forms does not imply acceptance of quality of goods or
acknowledgment of debt in any manner. Rest of the averments
made in the plaint have also been controverted on merits and it is
prayed that suit of plaintiff be dismissed.
25. The plaintiff had filed the replication. However,
since the replication had not been filed within 45 days from the
date of supply of copy of the W.S., the same was directed to be
stuck off the record vide order dated 16.07.2025.
26. The plaintiff as well as defendant have filed their
respective affidavits of admission/denial of the documents and
the admission/denial of documents was also carried out.
(B) Issues :-
27. From the pleadings of the parties, following issues
Digitally signed
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Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:04:21
+0530
were framed :-
1) Whether the plaintiff is entitled to a decree of
recovery for a sum of Rs.25,38,223/- against the
defendants (jointly and/or severally) as prayed for?
(OPP)
2) Whether the plaintiff is entitled for any interest, if so,
at what rate and for which period? (OPP)
3) Whether the suit of the plaintiff is not maintainable
against defendant no.2 as the defendant no.2 has
never carried out any transaction with the plaintiff in
his personal capacity, as claimed? (OPD)
4) Whether the suit of the plaintiff is barred by limitation
as the period of limitation was already expired on
01.12.2019, as claimed? (OPD)
5) Whether the goods supplied by the plaintiff was of
sub-standard quality, if so, its effect upon the claim of
the plaintiff? (OPD)
6) Whether there was an oral settlement between the
plaintiff and defendant no.1 for a full and final
payment of Rs.3,02,290/- and whether the said
amount was paid on 24.11.2016 towards all the
liabilities of the defendants? (OPD)
7) Whether there was no acknowledgment of any kind of
outstanding by the defendants in any manner after
30.11.2016? (OPD)
8) Whether this Court has no territorial jurisdiction to
adjudicate upon the present suit? (OPD)
9) Relief.
Digitally signed
CS (COMM) No.1390/2022 Pg. 13 / 51
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:04:27
+0530
28. It is pertinent to mention here that vide order dated
18.10.2025, the application on behalf of the defendant U/o XIV
Rule 5(1) r/w Section 151 of CPC was allowed and issue no.3
was ordered to be deleted/struck off.
(C) Evidence :-
29. In order to prove its case, Sh. Karan Khurana,
Son/LR No.(iv) of deceased plaintiff has examined himself as
PW-1. He reiterated the averments made in plaint in his affidavit
Ex.PW-1/A and relied upon following documents:-
S.No. Details of documents Exhibit No.
1. The copies of the said bilty/LR & all invoices Ex.P1 (Colly)
are no. 130004 dated 08.02.2016, no. 13005
dated 08.02.2016, 13301 dated 18.07.2016,
no. 13323 dated 28.07.2016, no. 13511 dated
29.09.2016, 13197 dated 31.05.2016, no.
13335 dated 03.08.2016, no. 13342 dated
04.08.2016, no. 13363 dated 06.08.2016, no.
13433 dated 30.08.2016, no. 13435 dated
30.08.2016, 13487 dated 16.09.2016, no.
13508 dated 27.09.2016, no. 13568 dated
26.10.2016, no. 13571 dated 27.10.2016, no.
13578 dated 05.11.2016, no. 13606 dated
16.11.2016, no. 13607 dated 16.11.2016, no.
13608 dated 16.11.2016, no. 13631 dated
22.11.2016, no. 13642 dated 24.11.2016, no.
13658 dated 30.11.2016, no. 13600 dated
12.11.2016, no. 13619 dated 18.11.2016 and
invoice no. 13644 dated 24.11.2016
2. E-mail dated 02.12.2016, 04.02.2017 and Ex.P2 (Colly)
20.03.2018
3. Copy of C-Forms having serial no. Ex.P3 (Colly)
PB-AB/C1023666 dated 23.04.2018, PB-
AB/C1023667 dated 23.04.2018,
PB170577265 dated 28.12.2017,
PB170577333 dated 28.12.2017,
PB170577458 dated 28.12.2017 and PB-
AB/C-1023668 dated 23.04.2018
Digitally signed
CS (COMM) No.1390/2022 Devendra by Devendra
Kumar Sharma Pg. 14 / 51
Kumar Date:
Sharma 2026.04.21
16:04:33
+0530
4. Legal Notice dated 28.09.2020 Ex.P4
5. Copy of reply dated 17.11.2020 Ex.P5
6. Copies of ledger account and statement Ex.PW-1/1
accounts (Colly)
7. Copy of postal receipt Ex.PW-1/2
8. Balance sheet of financial year 2016 to 2021 Ex.PW-1/3
taken from MCA portal
9. Affidavit under Section 65B of Evidence Act, Ex.PW-1/4
dated 03.11.2022
10. Non-starter Report dated 23.10.2021 Ex.PW-1/5
30. The PW-1 was cross examined at length in respect
to his association/involvement with his father’s firm J.D. Sales
Corporation; genuineness of ledger account/statement of
accounts Ex.PW1/1 (Colly); personal knowledge of business
transactions between the plaintiff and the defendant company;
dispute with respect to the quality of the products; balance sheet
of the defendant company from financial years 2016-2021;
admission of outstanding liability of the defendant; emails lying
on record; terms and conditions mentioned in the invoices;
alleged oral settlement/agreement between the parties in the year
2016; meeting with employees/director of the defendant
company.
31. No other witness was examined on behalf of
plaintiff. Therefore, PE was closed.
32. In order to prove his defence, the defendant has
examined Sh. Sanjeev Sharma, its AR, as DW1. He reiterated the
facts averred in the written statement in his affidavit Ex.DW-1/A
and relied upon the original authorization letter as Ex.DW-1/1.
Digitally
signed by
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Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:04:39
+0530
33. The DW-1 was cross examined at length inter-alia in
respect to the genuineness of Board Resolution Ex.DW1/1/ his
authorization; terms and conditions mentioned in the invoices;
maintaining of business correspondence register, books of
accounts, balance sheet, filing ITRs, acknowledgment of the
liability by the defendant through emails; one time settlement or
full and final settlement between the plaintiff and defendant; C-
forms; profit/loss account; attestation of the affidavit Ex.DW1/A;
placing on record documents/communication pertaining to
substandard quality of product supplied by the plaintiff/loss
suffered by defendant; liability of the defendant towards the
plaintiff.
34. No other witness was examined on behalf of
defendant . Therefore, DE was closed.
35. Arguments were addressed by Sh.P.K. Rawal and
Sh.Vasu Purohit, counsels for the plaintiff and Sh. Aditya P.
Arora and Sh. Yash Aggarwal, counsels for defendant No.1.
Written submissions have also been filed on behalf of parties.
36. Counsel for plaintiff has submitted on the lines of
the pleadings that the present suit is based on the purchase orders
sent by the defendant through emails and invoices which are
already admitted by the defendant in the admission denial as well
as in the cross examination. It has been further submitted that the
plaintiff had supplied goods/chemical dyes to defendant and
raised invoices; that the payments were to be made as per the
terms and conditions mentioned in the purchase order and
invoices, however, the defendant failed to make payment of the
Digitally signed
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Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:04:46
+0530
principal amount of Rs.15,29,050/-. It has been further submitted
that the limitation period shall run from the date credit expires as
per Article 15 of the Limitation Act and the purchase orders dated
17.12.2015 and 19.11.2015 itself mentions in column 6 that
payment terms are within 75 to 90 days and Purchase order dated
24.11.2016 also mentions that payment terms are within 45 to 60
days, however, the plaintiff on various occasions had written to
the defendant company and as well as went personally and met
for the repayment of due amount but defendant only gave false
assurances and finally issued C-form and acknowledged the
liability. It has been further submitted that copy of Emails dated
02.12.2016, 04.12.2017 and 20.03.2018 have been admitted by
the defendant and vide copy of the email dated 02.12.2016, the
defendant had asked for the account statement pertains to
plaintiff which itself demolishes the false case and moon shine
defence set up by the defendant that full and final settlement took
place in November, 2016. It has been further submitted that it is
settled law that plea one time payment/settlement is itself an
acknowledgment of liability and once the C-forms have been
admitted by the defendants along with the admitted invoices and
balance sheets it is clear case of acknowledgment of liability. It
has been further submitted that as per para 12 of the plaint it has
been categorically mentioned that account whereby the
transactions were made were open running and since as the
goods were ordered by the defendant and never denied the
delivery of goods there was always element of mutuality in the
transaction. Hence, the present case comes under Article 85 of
Indian Limitations Act 1963 which provides that since debt
shown earlier was shown as merged in subsequent transactionDigitally signed
CS (COMM) No.1390/2022 by Devendra Pg. 17 / 51
Devendra Kumar Sharma
Kumar Date:
2026.04.21
Sharma 16:05:08
+0530
and was uninterrupted, continuous in nature then the limitation
period shall start at the end of financial year. Hence, in that case
also the suit filed by the plaintiff is well within limitation as
Hon’ble Supreme Court had also extended the period of
limitation suo moto in the year 2020. It has been further
submitted that there is no denial of the open and running account
on the part of defendant as also no cross examination or
suggestions have been put to that effect.
37. It has been further submitted that belated C-Form
were issued in the year 2017 and 2018 respectively and the
defendant has taken taxation benefits and the defendant cannot
take dual stand in respect of taxation period vis-Ã -vis to plaintiff.
It has been further submitted that Delhi High Court in case titled
as Chemical Fertilizer Ltd. has held that defendant cannot take
the contradictory stand against the succession authority vis-Ã -vis
the plaintiff and it was also held that C-Form is implied
admission of the liability and decreed the suit under order 12 rule
6 of C.P.C. It was further held by the Delhi High Court that C-
Form alongwith other circumstances can be considered while
deciding that there is an acknowledgment of the liability or
implied acknowledge of the liability. It has been further
submitted that the defendant’s witness admission that C-Form
were prepared after verifying the same through books of account
itself is sufficient to acknowledge the liability. It has been further
submitted that once it is stand of the defendant on oath that C-
Form prepared after verifying of the books of account of the
defendant company, non-filing of the relevant books of account is
an acknowledgment of the liability. It has been further submitted
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Kumar Sharma
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that all the documents which have been filed alongwith the plaint
are admitted by the defendant and in defence of those documents
not a single document has been filed by the defendant which
creates suspicious in the mind of the plaintiff and therefore, an
adverse inference may be drawn against the defendant.
38. It has been further submitted that it is one of the
ground of the defendant that one time settlement took place in the
year 2016, however, during the cross examination it was stated
by the defendant on oath that there is no such document of one
time settlement. It has been further submitted that one time
settlement is an acknowledgment of liability. It has been further
submitted that it is the case of the plaintiff as mentioned in
paragraph 22-A and 22-B of amended plaint that the name of the
plaintiff has been shown in the list of sundry creditors and
amount so due is also mentioned and included in the total debt
shown in the respective years of balance sheet placed on record
from the year 2016 till 2021. It has been further submitted that in
response to the settled plea in the plaint the defendant fails to
specifically denied the said claim of the plaintiff. Hence, the
evasive denial is no denial. Secondly there are no specific
question put to the plaintiff witness and on the other hand when
the defendant witness was asked that defendant company
manages books of account as well as balance sheet, the answer of
the witness was in affirmative, however, when the defendant
witness was called upon to produce or asked whether such
document was filed before this Court, the defendant witness
replied in negative which further shows the malafide and
deliberate attempt on the part of the defendant company to runCS (COMM) No.1390/2022 Digitally signed Pg. 19 / 51
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away from the liability. It has been further submitted that there is
no question or suggestion put with regard to open running
account alongwith C-Form alongwith invoices and ledger related
to the plaintiff and no suggestion has been given by the defendant
and defence were put to the plaintiff witness. It has been further
submitted that it was held by the Hon’ble Delhi High Court in
case titled Bal Kishan Vs. State in 1976, in case titled Qausir
Jahan Begum Vs. Ramzan Karim and Rajinder Pal Vs. Darshana
Devi where the Hon’ble Delhi High Court and Hon’ble Supreme
Court of India held that once the witness in the witness box was
given no suggestion as a defence or no cross examination is put
to the witness leaving the substance unexplained is an admission
on the part of the defendant and the cross examination in chief
deemed to be admitted by the defendant. It has been further held
by the Hon’ble Delhi High Court in case titled as A.R.C. Arora
Project Pvt. Ltd Vs. Karan Pal Singh as well in IL & FS Financial
Service Ltd. Vs. Adhunik Megalaya Steel Pvt. Ltd. that there is
no requirement on the part of debtor to address creditor by name
to show the amount due and it is not required to mention by name
or in words specifically or acknowledgment of the liability and
the acknowledgment of liability can be inferred after considering
the surrounding circumstances. In the present case C-Form have
corroborated with the invoice as invoice alongwith amount due is
mentioned in the C-Form signed by the defendant and admitted
by the defendant keeping away the vital document and scrutiny
shows the malafide on the part of the defendant hence the
defence of the defendant is moon shine defence and the suit of
the plaintiff is liable to be decreed. It has been further submitted
that sole ground taken by the defendant is that the suit is barred
Digitally signed
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Pg. 20 / 51
Kumar Date:
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by limitation, however, none of the judgment relied upon by the
defendant applies to the facts of the present case. It has been
further submitted that it is settled law that balance sheet forms an
acknowledgment of liability and in the balance sheets of the
defendant company the debt is acknowledged and included in the
list of sundry creditors. It has been further submitted that neither
at the time of filing the written statement nor at the time of cross
examination any evidence is led by the defendant whether the
amount is included or not. It has been further submitted that the
documents have only been denied being illegible and not
specifically nor any counter documents have been filed by the
defendant. It has been further submitted that it is settled law that
evasive denial is no denial in the eyes of law. It has been further
submitted that even the defendant has admitted that “it is correct
that Ex. DW1/1 which is filed today is not the copy of the board
resolution filed by the defendant company alongwith WS as
mark-A.” and further stated that “it is correct that defendant
company has not passed any resolution before filing the written
statement dated 17.02.2022 and therefore, no resolution was
annexed with the Written Statement”. It has been further
submitted that since no counter document has been filed by the
defendant and even board resolution was not proved as per law,
an adverse inference is liable to be drawn against the defendant.
Lastly, it has been submitted that terms and conditions of the
invoices have been admitted by defendant in the cross-
examination and hence, plaintiff is entitled to a decree as prayed
with interest.
In support of the contentions, counsel for the
plaintiff has relied upon following judgments:-
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Kumar Sharma
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a) Chemicals Systems Technologies (India) Pvt. Ltd. vs.
Simbhaoli Sugar Mills Ltd., CS (OS) 1480/2009 & CS
No.27/2010 decided on 01.02.2023.
b) Rattan India Power Ltd. vs. Bharat Heavy Electricals Ltd.
OMP (ENF) (COMM) 149/2017 DOD 06.03.2025.
c) Shyam Dri Power Ltd. vs. Bhav Shakti Steel Mines Co.PET
475/2009
d) Vidyasagar Prasad vs. UCO Bank & Anr. Civil Appeal
No.1031/2022 DOD: 22.10.2024
e) ARC Arora Projects Pvt. Ltd. vs. Karan Pal Singh, FAO (OS)
87/2023, DOD: 04.12.2023
f) IL&FS Financial Services Ltd. vs. Adhunik Meghalaya
Steels Pvt. Ltd. C.A. No. 5787 of 2025
g) R.S. Shekawat Vs. Delhi Race Club (1940) Ltd. RFA
No.592/2017 DOD 11.10.2017
h) Suo Moto Petition No.3/2020
1968 3 SCR 862
j) Hira Lal & Ors. vs. Badkulal & Ors 1953 1 SCC 400
k) Bal Kishan vs. State & Anr. 1976 RLR 112 N
l) Rajinder Pershad vs. Darshana Devi 2001 5 SCALE 203
m) Qaiser Jahan Begum vs. Ramzan Karim 1998 46 DRJ 7
Ltd. RFA (OS) 13/2002 DOD 21.12.2011
39. Per contra, counsel for defendant has submitted on
the lines of the pleadings that suit is barred by limitation as the
last invoice was raised by the plaintiff on 30.11.2016 and last
payment was made by the defendant company on 24.11.2016;
that the parties amicably settled their disputes in November 2016
and the defendant had paid a sum of Rs.3,02,290/- on 24.11.2016
which was accepted as full and final discharge of all dues. It has
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been further submitted that once such full and final settlement
was accepted, no further liability survived and the oral settlement
closed the accounts and therefore, no fresh cause of action could
accrue to the plaintiff after November 2016. It has been further
submitted that the reliance of plaintiff on issuance of C-Forms
and balance sheets of the defendant company (2016-2021) is
wholly misconceived as the DW1 during his cross-examination
dated 19.08.2025 has categorically denied acknowledgment of
liability through various communications through emails whereas
the PW1, when confronted with the balance sheets during his
cross-examination dated 12.08.2025, has admitted that in the
documents filed on record there is no such list of sundry creditors
showing the plaintiff’s name. It has been further submitted that
that C-Forms are issued only for compliance under the Central
Sales Tax Act, 1956 and cannot be construed as acknowledgment
of liability under Section 18 of the Limitation Act. It has been
further submitted that the plaintiff had placed on record copies of
its audited balance sheets for the year 2016-2021 only after the
defendant had raised the issue of limitation. It has been further
submitted that the balance sheet can extend limitation only where
it contains a specific and unequivocal acknowledgment of
liability which is clearly absent in the present case. It has been
further submitted that the plaintiff’s sister concern, M/s L.D.
Rangwala, had filed a suit bearing CS (COMM) 686/2022
against the defendants on similar facts and the same was
dismissed on 30.01.2025 on limitation alone and it was held that
the handing over of the C-Forms and emails would not extend the
limitation period, since the issuance of C-Forms only
acknowledges a past transaction and not the present liabilities to
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pay. It has been further submitted that the defendant’s dealings
were exclusively with late Narender Khurana and not with PW1;
that entire testimony of PW1 is hearsay and that he has no
personal knowledge of the business transaction between the
plaintiff firm and the defendant company. It has been further
submitted that the defendant no.1 had verbally informed the
plaintiff regarding the substandard and inferior quality of goods
supplied, which caused the defendant substantial losses and
ultimately led to termination of the business relationship. Lastly,
it has been submitted that no part of the cause of the action has
arisen within the territorial jurisdiction of this Court as the
purchase orders were placed at Chandigarh, supplies were made
outside Delhi and payments were effected outside Delhi.
40. It has been further submitted that the Plaintiff’s
reliance on the e-mail dated 02.12.2016 is misconceived and
misplaced; that the said communication pertains exclusively to
invoices for the financial year 2013-2014 and bears no nexus
whatsoever with the invoices forming the subject matter of the
present suit. It has been further submitted the said e-mail,
therefore, cannot constitute any acknowledgment of liability in
respect of the present claim and is legally irrelevant. It has been
further submitted the Plaintiff’s attempt to invoke Article 1 of the
Limitation Act, 1963, is wholly misconceived. It has been further
submitted that the present transactions do not constitute a
“mutual, open and current account” with reciprocal demands, but
are in the nature of a one-sided commercial arrangement, where
goods were supplied by the Plaintiff, and payments were made
by the Defendants. There were no cross-liabilities or mutual
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Kumar Sharma
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dealings so as to attract Article 1. It has been further submitted
that the benefit of computing limitation from the close of the
financial year, as contemplated under Article 1 is available only
in cases of such mutual and reciprocal accounts and that in the
absence of the essential ingredients of mutuality, the Plaintiff
cannot seek to avail this extender period of limitation.
Consequently, limitation in the present case must necessarily be
computed from the date of the issuance of the last invoice, and
not from the end of the financial year. On such computation, the
claims sought to be raised are clearly barred by limitation. It has
been further submitted that the Plaintiff has failed to place on
record any document whatsoever which constitutes a valid
acknowledgment of liability in writing within the meaning of
Section 18 of the Limitation Act, 1963. It has been further
submitted that there is no communication, correspondence,
account confirmation, or any signed document emanating from
the Defendant acknowledging the alleged debt and the entire case
of the Plaintiff is sought to be built on vague and generic entries,
which neither identify the Plaintiff nor reflect any conscious
acknowledgment of liability. It has been further submitted that in
the absence of a clear, specific, and written acknowledgment
attributable to the Plaintiff, the essential precondition for
extension of limitation remains unfulfilled. Consequently, the
present suit, being ex facie barred by limitation, is liable to be
dismissed on this ground alone.
41. It has been further submitted that the Plaintiff’s
contention that issuance of C-Forms constitutes an
acknowledgment of debt is wholly untenable in law. It is a settled
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position that C-Forms, being statutory documents issued for the
limited purpose of availing concessional tax benefits, do not by
themselves amount to an acknowledgment of liability within the
meaning of Section 18 of the Limitation Act, 1963. Thus, it is
prayed that the suit filed by plaintiff is liable to be dismissed.
In support of the contentions, counsel for the
defendant has relied upon following judgments:-
a) Taipack Ltd. vs. Ram Kishore Nagar Mal, 2007 SCC OnLine
Del 804
b) Alliance Paints and Varnish Works (P) Ltd. vs. Hari Kishan
Gupta, 2010 SCC OnLine Del 571
c) Zion Steel vs. Subtleweight Electric (India) P. Ltd. (2014) 71
VST 312
d) Lamicoat Int. P. Ltd. vs. Galore Prints Industries Ltd. , 2012
SCC OnLine Del 4336
e) Rajiv Khanna vs. M/s Sunrise Freight Forwarders PVt. Ltd.
& Anr. 2016 SCC OnLine Del 3359
f) Dahiben vs. Arvindbhai Kalyanji Bhanushali (2020) 4 SCC
(Civ) 128
g) T. Arivandandam v. T.V. Satyapal & Anr. 1978 SCR (1) 742
(E) Analysis of Evidence and Findings:-
42. I have heard the learned Counsels for the parties and
have also perused the record as well as the written submissions
and case laws filed on behalf of the parties. My issue-wise
findings are as under:-
ISSUE No.4 :-
Whether the suit of the plaintiff is barred by limitation as the
period of limitation was already expired on 01.12.2019, as
claimed? (OPD)
Digitally signed
Devendra by Devendra
Kumar Sharma
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Date:
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AND
ISSUE No.7:-
Whether there was no acknowledgment of any kind of
outstanding by the defendants in any manner after 30.11.2016?
(OPD)
43. Both these issues are being taken up together as they
are inter connected.
The onus of proving these issues were upon
defendant.
In the written statement, the defendant has raised an
objection that the alleged books of accounts, as maintained by the
plaintiff, reflects that the date of last invoice was 30.11.2016 and
there have been no transactions i.e. delivery of goods or payment
thereof since 30.11.2016. It has been further alleged that the
plaintiff has wrongly and unjustly stated that Defendant had
acknowledged the debt through e-mails dated 04.02.2017 and
20.03.2018 and it is submitted that the defendant no.1 had merely
sought the address on which C-Forms were to be delivered to the
plaintiff vide the said emails and the issuance of C-Forms does
not extend the period of limitation for filing of suit and more so,
since C-Forms are merely admission of transaction(s) that took
place in past, but are not acknowledgment of any present liability
to pay U/s 18 of the Limitation Act. It has been further averred
that reliance on balance sheets for the Financial Years 2016-17 to
2020-21 has been misplaced as there is no specific page or
document therein in which defendant expressly acknowledges
alleged debt owned to the plaintiff. Further, the name of plaintiff
does not figure anywhere and hence, the suit of plaintiff is
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hopelessly barred by limitation. He has relied upon judgments in
case of Taipack Limited & Ors. vs. Ram Kishore Nagal Mal,
2007 SCC OnLine Del 804 and Alliance Paints and Varnish
Works Pvt. Ltd. vs. Hari Kishan Gupta (Deceased) Through LRs
2010 SCC OnLine Del 571 in support of his contentions.
44. The plaintiff, on the other hand, had filed audited
balance sheets of defendant no.1 for the Financial Years 2016-17,
2017-18, 2018-19, 2019-20 and 2020-21 to contend that by virtue
of incorporation of liability towards plaintiff in the list of
creditors and debtors, in the said balance sheets, the defendant
no.1 has acknowledged that it owes payment to plaintiff and the
same would amount to an acknowledgment for the purposes of
Section 19 of the Limitation Act. He has relied upon judgment
passed by Hon’ble Delhi High Court in case of ARC Arora
Projects Pvt. Ltd. vs. Karan Pal Singh, FAO (OS) 87/2023 dated
01.12.2023 wherein reliance upon list of creditors and debtors in
the balance sheet of company was permitted as acknowledgment
of liability by holding that debt shown in balance sheet of a
company amounts to an acknowledgment for the purposes of
Section 19 of the Limitation Act.
45. It is pertinent to mention here that alongwith the
W.S., defendants had also filed an application U/o VII Rule 11
r/w Section 151 seeking rejection of the plaint on the ground that
plaint is barred by limitation and concealment of material facts
regarding the full and final settlement between the parties. Vide
order dated 25.02.2025, it was held by the Ld. Predecessor Court
that though C-Forms by themselves may not be sufficient for
plaintiff to establish that the suit has been filed within period of
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limitation but conjoint reading with record summoned to prove
relevant balance sheets of defendant no.1 may lead to a different
conclusion. Thus while disposing the application, the issue of
limitation was left to be decided after final trial.
46. Thereafter, the witness PW1 on behalf of the
plaintiff and DW1, on behalf of the defendant, were examined.
47. In the present case, at the time of admission/denial
of the documents, existence of all the invoices raised on behalf of
the plaintiff were admitted and the invoices were exhibited as
Ex.P1 (Colly).
48. Admitted fact in the present case is that the alleged
last supply of the goods to the defendant on behalf of the plaintiff
has been made on 30.11.2016 and as per ledger account,
Ex.PW1/1 (Colly), the last date of payment is on 24.11.2016.
Thus, ordinarily the limitation period would have expired on
01.12.2019 is same is treated to be open and running account and
if it is treated to be mutual account then as per Article I of
Limitation Act, it would have expired on 31.03.2020.
49. Law regarding the date when the cause of action for
instituting a suit arises, is well settled. It has been held by the
Hon’ble Supreme Court in case titled as Gannon Dunkerley and
Co. Ltd. v. Union of India (1969)3 SCC 607 as under:-
“…… there is no right to sue until there is an
accrual of the right asserted in the suit, and its
infringement, or at least a clear and unequivocal
threat to infringe that right by the Defendant
against whom the suit is instituted…”
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50. Further, in the case titled as Khatri Hotels vs. U.O.I.
& Anr. (2011 (10) Scale 190), the Hon’ble Supreme Court while
examining a situation where a right to sue accrues on multiple
causes of action and to decide as to when will the period of
limitation begin to run for instituting a suit has held as under:-
“….21. The Limitation Act, 1963 (for short “the
1963 Act”) prescribes time limit for all
conceivable suits, appeals, etc. Section 2(j) of that
Act defines the expression “period of limitation”
to mean the period of limitation prescribed in the
Schedule for suit, appeal or application. Section
13 lays down that every suit instituted, appeal
preferred or application made after the prescribed
period shall, subject to the provisions of Section 4
to 24, be dismissed even though limitation may
not have been set up as defence. If a suit is not
covered by any specific article, then it would fall
within the residuary article. In other words, the
residuary article is applicable to every kind of suit
not otherwise provided for in the schedule.”
51. In case titled as Rajendra Bajoria and others v.
Hemant Kumar Jalan and others, AIR 2021 SUPREME COURT
4594, the Hon’ble Supreme Court has held that the duty is cast
upon the Court to determine whether the Plaint discloses a cause
of action or whether the suit is barred by any law.
52. In the present case, as per averments made in para
29 of the amended plaint, the cause of action has been shown to
have arisen on the basis of invoices and orders placed which
from the last invoice appears to be on 30.11.2016 and there are
other averments regarding the cause of action which have arisen
on the basis of C-form and emails etc. However, in the entire
para, there is no mention of any acknowledgment of liability in
the balancesheet of the defendant company giving rise to the
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cause of action. The claim of the plaintiff that his case is covered
under Article 1 of the Limitation Act is being taken up first.
53. In the entire pleading, there is no averment
regarding the limitation and as to when the limitation to file the
present suit has arisen. During the course of arguments, two fold
arguments have been advanced, first that the present dealing with
the parties is dealing in the form of open, running and mutual
account and the second limb of the argument is that there was
acknowledgment in the form of issuance of C-form alongwith the
mention of name of plaintiff in the balance sheet being filed by
the defendant company showing the name of the plaintiff.
54. In case titled as Dilboo Vs. Dhanraji, (2000) 7 SCC
702, it was observed by the Hon’ble Apex Court that where there
is a dispute that the suit is filed beyond period of limitation, it is
for the plaintiff to aver and to prove that the suit is within the
period of limitation as prescribed. In the absence of any
averment or proof to show that the suit is within time, it is the
Plaintiff who would fail.
55. The first argument that the account between the
parties was an open, mutual and running account though argued
but there is no mention of the account being running, mutual and
open account in the entire averment. However, now it is to be
seen with reference to the Schedule attached to the Limitation
Act, 1963 wherein under Part-I and II, as to how the limitation
period in the present case would be governed.
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56. Part-I of The Act, 1963 relates to the suit pertaining
to accounts and Part-II deals with the suit relating to Contracts.
In the absence of any averment in the plaint that there was
mutual dealing in the sense that both the parties come under
liability under each other. In the present case, the account can be
treated to be an open account between the parties on account of
transaction mentioned in the plaint and this account can be
treated to be running, unsettled or unclosed account but the
account in question maintained by Plaintiff cannot be treated to
be a mutual account, since neither there are shifting balances nor
independent obligations arising because of any other relationship
except that of a buyer and a seller. Reliance may be placed in
this regard upon the judgment in case titled as Manish Garg Vs.
East India Udhog Limited, (2001) Latest Case Law 2022 DEL
and in case titled as Bharath Skins Corporation v. Taneja Skins
Company Pvt. Ltd., 186 (2012) DLT 290 (DB).
57. In respect of what is an open and running account,
the legal position was summarized in view of the two judgments
of the Hon’ble Supreme Court in the cases of Hindustan Forest
Company Vs. Lal Chand & Anr. AIR 1959 SCC 1345 and
Kesharichand Jaisukhal Vs. Shillong Banking Corporation AIR
1965 SC 1711. The ratio of these judgments was followed by the
Hon’ble High Court of Delhi in decision in RFA No. 666/2017
titled as Harjit Singh Vs. M/s Bharat Hotels Ltd. & Anr (DOD as
31.07.2017). The Para 10 in the case of Harjit Singh (supra) reads
as under:-
“10. The law with respect to the meaning of the
expression “open mutual and current account” of
Article I of the Limitation Act is now well settled.
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For Article 1 of the Limitation Act to apply, the
account must be open i.e account must not be
closed, it must be for the current year and it should
be mutual ice there should be mutuality of
transactions in the sense of shifting balances or
counter obligations of each party against the
other….”
58. Thus, from the law laid down as discussed herein
above, it can be safely inferred that if there is only a ‘single’
contractual relationship, namely, that of buyer and seller between
parties, such case is not one of reciprocal demands and thus,
Article-85 of the Schedule to the Act, corresponding to Article-1
of the Act will not apply to such suits and in the present case, it is
a case of single contractual relationship and therefore, the
account between the plaintiff and defendant cannot be termed as
a mutual account and as a necessary corollary, Article-1 of the
Schedule to the Act, 1963 has no application.
59. The nature of transaction between the plaintiff and
defendant is of seller and buyer and it does not indicate the
account between the parties as mutual account i.e. there is no
credit balance shown some time in favour of the plaintiff firm
and some time in favour of the defendant and there is no
reciprocal demand between the parties. Therefore, in the present
case, Article I of the Limitation Act has no application. It is a
simplicitor case where the goods were supplied to the Defendant
by the Plaintiff. In such a situation, the limitation shall run at the
best from the last transaction between the parties as per account
maintained. In the present case, the last transaction between the
parties as per own averment in the plaint by the plaintiff is dated
30.11.2016 and therefore at the best, the limitation period would
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Devendra Kumar Sharma
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have expired in terms of the last entry made in the ledger account
and that would be on 01.12.2019. Thus, on this count, it can be
safely held that since the account between the parties was not
mutual and running account but it was an open and running
account, therefore, the present suit is barred by limitation.
60. Further, the second limb of the arguments of the
plaintiff is that by virtue of issuing C-forms and by virtue of
filing the balance sheets and showing the name of the plaintiff in
the name of Sundry Creditors, there is written acknowledgment
on behalf of the defendant company of its liability and
consequent extension of limitation period till the filing of the
balance sheets from 2016 to 2021.
61. So far as issue of C-forms is concerned, that was put
on rest in the detailed order dated 25.02.2025 as discussed
hereinabove, wherein it was held by the Ld. Predecessor Court in
para 24 that C-form may not itself be sufficient to extend the
limitation period but there may be other documents proved
during the trial like balance sheet of defendant no.1 which may
lead to a different conclusion. The relevant para no.23 and 24 are
reproduced for ready reference as under:-
“23. As far as plaintiff’s reliance on C-Forms is
concerned, defendant has challenged the same by placing
reliance on Taipack Limited & Ors. (supra) and Alliance
Paints and Varnish Works Pvt. Ltd. (supra). The plaintiff
has, however, relied upon judgment in case of ARC Arora
Projects Pvt. Ltd. (supra) wherein reliance upon list of
creditors and debtors in the balance sheet of company was
permitted as acknowledgment of liability by holding that
debt shown in balance sheet of a company amounts to an
acknowledgment for the purposes of Section 19 of the
Limitation Act. The plaintiff thus filed audited balance
sheets of defendant no.1 for the Financial Years 2016-17,
Digitally signed
CS (COMM) No.1390/2022 Pg. 34 / 51
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:06:49
+0530
2017-18, 2018-19, 2019-20 and 2020-21 to contend that by
virtue of incorporation of liability towards plaintiff in the
list of creditors and debtors, in the said balance sheets, the
defendant no.1 has acknowledged that it owes payment to
plaintiff and the same would amount to an
acknowledgment for the purposes of Section 19 of the
Limitation Act. Though per se name of defendant no.1 is
not reflected from the name of creditors from the said
balance sheets, it is contended that the plaintiff can always
lead necessary evidence by summoning the relevant record
to prove the same at an appropriate stage of trial.
24. Though C-Forms by themselves may not be
sufficient for plaintiff to establish that the suit has been
filed within period of limitation but conjoint reading with
record summoned to prove relevant balance sheets of
defendant no.1 may lead to a different conclusion. Per se
the documents placed on record vide its application U/o XI
Rule 1(4) CPC r/w Section 151 CPC coupled with
corresponding amendment in plaint by incorporating para
22(a) and 22(b), which has been allowed by the Court
today, make the question of limitation in the instant case a
mixed question of law and fact rather than pure question of
law alone. Thus prayer of defendants that plaint filed by
plaintiff ought to be rejected as being barred by limitation
cannot be allowed at this stage. Accordingly, application
U/o VII Rule 11 r/w Section 151 CPC filed on behalf of
defendant is dismissed.”
62. Thus, a limited scope was left regarding the issue of
limitation and it was for the plaintiff to prove that by virtue of
balance sheets of the defendant no.1 company, there was written
acknowledgment of liability.
63. The copy of the balance sheets of the defendant no.1
company for the year 2016-2021 has been exhibited as
Ex.PW1/3. These documents run on the paper book from page
no.213 to 369.
64. In the affidavit in examination-in-chief, Ex.PW1/A,
in para 28, the detail of total current liability of defendant no.1 in
the different financial year starting from the year 2017 till 2021
Digitally signed
CS (COMM) No.1390/2022 Devendra by Devendra Pg. 35 / 51
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:06:55 +0530
have been mentioned. It has also been claimed in the said para
by PW1 that the dues amount of the plaintiff is also duly
reflected in the said balance sheets of the defendant company and
this is a clear cut admission by the defendants which is also
evident from C-forms. Apart from that issuance of C-forms on
28.12.2017 and 23.04.2018 have also been claimed to be written
acknowledgment of liability alongwith the receipt of goods and
both the facts i.e. issuing of C-forms and filing balance sheets
with list of sundry creditors have been claimed to be conjointly
the written acknowledgment of liability.
65. In his cross-examination, when he was confronted
with his deposition in para 28 in his affidavit in examination-in-
chief, he has testified that name of the plaintiff firm is mentioned
in the list of sundry creditors but when he was asked to point out
the page number in which the name of plaintiff firm has been
mentioned, he replied that he cannot point out any such
document and further testified that in the documents filed on
record, there is no such list of sundry creditors. Thus, by his own
admission in his cross-examination, apparently it has come on
record that no such list of sundry creditors were ever filed. As a
matter of fact since beginning it was projected on behalf of the
plaintiff that mere filing of balance sheet with the mention of
outstanding liability should be presumed to include the liability
qua the plaintiff as well without placing on record any such
specific documents showing the name of the plaintiff and thereby
defendant has admitted the liability qua the plaintiff. Mere filing
of balance sheet by any company with details of outstanding
liability cannot be treated to be acknowledgment as such of
Digitally signed
CS (COMM) No.1390/2022 by Devendra Pg. 36 / 51
Devendra Kumar Sharma
Kumar Date:
2026.04.21
Sharma 16:07:00
+0530
specific liability qua the person/ entity supplied the goods or
services and at the best it can be treated to be a cumulative
liability of the defendant qua all the creditors. In such
circumstances, the plaintiff is bound to either bring on record by
summoning the documents or by cross-examining the witness on
behalf of the defendant, the sundry list of creditors so as to pin
point the liability and its admission qua specific creditor.
However, in the present case no such document has been placed
on record or summoned by the plaintiff in order to prove the
written admission/acknowledgment of liability by the defendant.
As a matter of fact even no notice U/o XI Rule 1(6) of CPC has
ever been given to the defendant either to produce their balance
sheet alongwith list of sundry creditors or their ledger account
nor has been proved on record.
66. In order to bring the facts akin to the case laws
relied upon by the plaintiff, the plaintiff was required to prove
that apart from issuing the C-forms, there was written
acknowledgment of liability in the form of balance sheets with
list of sundry creditors but in the present case in the testimony of
PW1 it has further come on record in the reply to the question as
to whether there is any document on record showing admission
of outstanding liability by the defendant company towards the
plaintiff firm that there is no such documents.
67. However, the case of PW1 did not rest on the big no
but by voluntary statement he has claimed that he has received a
balance confirmation email from the defendant company
admitting the liability of the suit amount and he himself stated
that the said email has not been filed on record. This cross-
Digitally signed
CS (COMM) No.1390/2022 by Devendra Pg. 37 / 51
Devendra Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:07:06
+0530
examination was there on 12.08.2025 before lunch. However,
after lunch the witness PW1 without asking of any question
regarding the said email has filed a screenshot of email dated
06.12.2019 stating itself to be the email sent acknowledging the
balance confirmation. This document was never placed on record
prior to the cross-examination on the issue of admission of
liability in writing which was marked as Mark-P1.
68. This screenshot of email Mark-P1 has been
produced in response to the question put to PW1 regarding
written admission of liability without any appropriate certificate
under Evidence Act and therefore, this document is not
admissible in evidence. More so, perusal of the Mark-P1 further
makes it clear that in his cross-examination, this witness has
introduced a new story of written admission of liability on behalf
of defendant company finding the time during the lunch hours
which otherwise though not relevant to the present case but is a
matter of concern as to how a smart witness can introduce a new
story which was never pleaded. Though it was a smart move and
story on behalf of PW1 but to his bad luck he placed on record a
screenshot regarding the balance confirmation and that too of the
year 2011-12 which is not even the subject matter of dispute in
the present case. This document in no way has any relevance or
relation with the present case and therefore, is of no help to the
case of the plaintiff as there is no admission of the liability in the
entire documents of the amount involved in the present suit.
69. Admitted case of the parties are that last invoice was
issued on 30.11.2016 and last payment on behalf of the defendant
was made on 24.11.2016 and therefore, in any case the limitation
Digitally signed
CS (COMM) No.1390/2022 by Devendra Pg. 38 / 51
Devendra Kumar Sharma
Kumar Date:
2026.04.21
Sharma 16:07:13
+0530
period would have expired in the month of December 2016. In
order to prove the extension of limitation period, the plaintiff was
required to prove that there was written acknowledgment of
liability in terms of Section 18 of the Limitation Act on behalf of
the defendant within the limitation period.
70. Even PW1 in his cross-examination has admitted
that in any of the email confirmations Ex.P2 (colly), there is no
mention of any kind of due towards the defendant company
while asking for C-forms. These emails Ex.P2 (colly) are dated
02.12.2016 to 20.03.2018 and in view of the admission of PW1
that there was no mention of any dues in these emails, it clearly
demonstrates that these emails were only sent for the purposes of
asking C-forms and had there been any dues it would have been
found mention in these emails. The claim of PW1 that the
outstanding was informed verbally while sending the emails
appears to be an afterthought introduction of verbal demand.
71. Now coming to the admission and acknowledgment
of liability within the limitation period on behalf of the defendant
company, the testimony of DW1 becomes more important as this
witness has appeared on behalf of the defendant company and
there was occasion for the plaintiff to ask for production of
documents pertaining to claim of the plaintiff that there was
written acknowledgment of liability in the balance sheet/list of
creditors of the defendant company as well as in its ledger
account.
72. Witness DW1 was extensively cross-examined and
this witness has admitted that the books of account was
Digitally signed
CS (COMM) No.1390/2022 Devendra by Devendra
Kumar Sharma Pg. 39 / 51
Kumar Date:
Sharma 2026.04.21
16:07:18
+0530
maintained by the defendant company duly audited by the
Auditor and respective Income Tax Returns till date on each and
every year and there is also filing of Income Tax Returns before
the Registrar of the Company and this witness has not brought
any such document on the day of his cross-examination. After
this cross-examination of DW1, the suggestion has been given
that these documents have not been brought or filed on record as
same goes against the interest of the defendant company.
However, no prayer was made that since the line of custody of
these documents are with the defendant company and since it is
going against there interest, therefore, this witness should be
asked to produce these documents. It appears that the further
cross-examination was conducted with the presumption that mere
filing of the balance sheets showing the cumulative liabilities of
defendant company would be suffice to prove the claim of the
plaintiff against the specific liability. Perusal of those balance
sheets makes it clear that there is different dues amount shown in
different financial years but there is no specific due amount
shown in the entire balance sheet of any specific creditor and in
such circumstances it was an opportunity on behalf of the
plaintiff to ask the witness DW1 to produce the relevant
documents which were going in favour of the plaintiff and
against the interest of defendant company. Instead of that a
suggestion has been given that in the list of creditors name of the
plaintiff is also there since the year 2016 to 2025. This suggestion
appears to be again given on the presumption that the name of
the plaintiff must be there in the said list of creditor once the
balance sheet has been filed by the defendant company before the
Registrar of Companies. This witness DW1 himself has never
Digitally signed
CS (COMM) No.1390/2022 Pg. 40 / 51
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:07:24
+0530
seen any list of creditors personally and therefore, even if there
would have been admission on his behalf of mention of name of
the plaintiff in the list of creditors would have left the case of
plaintiff neither here nor there as the witness himself is not aware
about the actual and factual position of list of sundry creditors.
73. Further cross-examination of DW1 has been
conducted and he was asked that there is no document on behalf
of the defendant company that the name of the plaintiff was
written off from the profit and loss account. Non-production of
document on behalf of the defendant in absence of any written
notice to produce the document and in absence of proof of such
notice cannot be treated to be giving rise any adverse
presumption against the defendant.
74. This witness DW1 has admitted that C-forms were
sent by the defendant company in 2017 and 2018 and has also
admitted that C-forms are issued after verification through books
of account. However, mere issuance of C-forms in absence of
any cogent proof that there was any written admission of liability
on behalf of the defendant itself cannot be construed to be written
admission/ acknowledgment of liability so as to extend the
limitation period.
75. DW1 has specifically denied that the suit amount
was included in the current liabilities shown in the balance sheets
of the defendant company and in such circumstances it was
incumbent upon the plaintiff either to prove in the testimony led
on his behalf regarding the written acknowledgment of liability
Digitally signed
CS (COMM) No.1390/2022 by Devendra Pg. 41 / 51
Devendra Kumar Sharma
Kumar Date:
2026.04.21
Sharma 16:07:31
+0530
during the subsistence of limitation period or in the testimony led
on behalf of the defendant. However, as discussed hereinabove
the plaintiff has failed to bring on record any evidence in order to
prove his claim that the limitation period got extended by virtue
of issuing C-forms on behalf of the defendant coupled with the
fact that balance sheet was filed showing the total liability
towards the creditor.
76. In view of the above discussion, this Court is of the
opinion that plaintiff has failed to prove on preponderance of
probability that there was written acknowledgment of liability by
the defendant within the meaning of section 18 of Limitation Act.
Whereas defendant has succeeded in proving on the
preponderance of probability that the suit is barred by limitation
as the period of limitation was already expired on 01.12.2019 and
there was no acknowledgment of any kind of outstanding by the
defendant in any manner after 30.11.2016. Both the issues are
accordingly decided in favour of the defendant and against the
plaintiff.
ISSUE No.5:-
Whether the goods supplied by the plaintiff was of sub-standard
quality, if so, its effect upon the claim of the plaintiff? (OPD)
77. Onus of proving this issue was on defendant who
has alleged that plaintiff had supplied inferior and sub-standard
quality of products to defendant due to which defendant suffered
huge financial losses.
Digitally signed CS (COMM) No.1390/2022 Devendra by Devendra Kumar Sharma Pg. 42 / 51 Kumar Date: Sharma 2026.04.21 16:07:36 +0530
78. Admittedly, plaintiff and defendant had been in
business since a very long time and there was no complaint
regarding the quality of products (chemicals) supplied by
plaintiff to defendant during the entire period the parties had
business relations, save and except, since the year 2016 as
claimed by defendant. It is alleged that due to sub-standard
products supplied by plaintiff, the defendant suffered huge losses
which defendant informed the plaintiff’s officer who approached
them for the alleged payment but plaintiff did not take the
complaints made by defendant seriously. Ultimately defendant
had to terminate business dealings with the plaintiff.
79. The counsel for defendant has relied upon testimony
of DW1/Sh. Sanjeev Sharma, Manager-Legal of the Defendant
No.1 Company to contend that plaintiff had supplied poor and
sub-standard quality of products to defendant due to which
defendant company suffered considerable loss and was
compelled to close its business dealings with the plaintiff.
80. Per contra, counsel for plaintiff has contended that
as per the terms and conditions on the invoices, it was
specifically mentioned that “before using our products in full-
scale production, the customer should make his own tests to
determine the suitability of our products for his own purpose
under his operating conditions. As the circumstances under which
our products are stored, handled and used, are beyond our
control, we cannot assume any responsibility for their use by the
customer. In spite of the aforementioned specific instructions, if
the customer uses our products in full-scale production without
Digitally signed
CS (COMM) No.1390/2022 Pg. 43 / 51
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:07:42 +0530
prior tests, sustains and proves to us that he has sustained loss
due to deficiency in quality of the goods supplied, our liability is
limited to the value based on purchase price of the quality of our
goods actually used. Submission of claim does not absolve the
customer of the obligation to pay the amount due” and as such
the plaintiff clearly called upon the defendant to accept the goods
with full responsibility and the plaintiff will not be held
responsible for the quality of the goods supplied in any manner
whatsoever. Moreover, the defendant did not check the material
received from plaintiff at any point of time and hence cannot take
a plea of defective products. Further plaintiff was never informed
about the defective products. The plea of defective products has
been taken by defendant as an afterthought to put forth some
defence to the claim of plaintiff and ought to be rejected.
81. As per the mandate of Section 41 of the Sale of
Goods Act, the purchaser not having inspected the goods in
question prior to delivery, has a right to inspect the same on
delivery and report defects within a reasonable time of delivery.
If not rejected within reasonable time, mandate of Section 42
stipulates that the purchaser would be deemed to have accepted
the goods. Section 41 and Section 42 of the Sale of Goods Act
read as under:-
“41. Buyer’s right of examining the goods.-
(1) Where goods are delivered to the buyer which he has not
previously examined, he is not deemed to have accepted
them unless and until he has had a reasonable opportunity
of examining them for the purpose of ascertaining whether
they are in conformity with the contract.
(2) Unless otherwise agreed, when the seller tenders delivery
Digitally signed
CS (COMM) No.1390/2022 Pg. 44 / 51
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:07:48
+0530
of goods to the buyer, he is bound, on request, to afford the
buyer a reasonable opportunity of examining the goods for
the purpose of ascertaining whether they are in conformity
with the contract.
42. Acceptance.- The buyer is deemed to have accepted the
goods when he intimates to the seller that he has accepted
them, or when the goods have been delivered to him and he
does any act in relation to them which is inconsistent with
the ownership of the seller, or when, after the lapse of a
reasonable time, he retains the goods without intimating to
the seller that he has rejected them.”
82. In the instant case also defendant failed to prove that
he had communicated to plaintiff regarding the supply of
defective goods. Though defendant had taken this plea in his
reply, Ex.P5, to plaintiff’s legal notice, the same is also devoid of
any details of the defective material, date when defendant
discovered the alleged defect and if, prior to receipt of legal
notice, Ex.P4, from plaintiff, it (defendant) had communicated to
plaintiff in any manner about the alleged defective material. In
its written statement also, the defendant failed to clarify from
which lot of goods i.e. invoices Ex.P5 (Colly) the alleged
defective goods pertained and when, if at all, he had informed
plaintiff regarding the same. The steps taken by defendant to
precipitate the issue when plaintiff failed to take note of oral
requests made by defendant to take back defective goods is also
not specified. Even the date when the defective goods were
discovered and factum thereof was communicated by defendant
to plaintiff has not been specified. In these facts and
circumstances, defence of defective goods taken by defendant is
without any basis.
CS (COMM) No.1390/2022 Digitally signed
by Devendra
Pg. 45 / 51
Devendra Kumar Sharma
Kumar Date:
2026.04.21
Sharma 16:07:53
+0530
83. Admittedly, no communication has been placed on
record by defendant from which it can be concluded that
defendant had ever communicated to the plaintiff regarding
defective products, if any, supplied by plaintiff. The testimony of
the witness examined by defendant namely DW1/Sh. Sanjeev
Sharma is also not sufficient to bring out that the plaintiff had
supplied sub-standard products to the defendant due to which it
suffered huge financial losses.
84. Moreover, during his cross-examination, the DW1
admitted that no document has been placed on record by the
defendant company pertaining to substantial loss or poor or
substandard quality of products supplied by plaintiff as alleged
by defendant/DW1 in para 5 (Mark A to A1) of his affidavit.
Though he has stated that it was conveyed telephonically to the
plaintiff but admitted that no proof or evidence in support of the
same had been placed on record. Nothing had been produced on
record by defendant/DW1 from which it can be ascertained as to
on how many occasions defendant returned goods, alleged to be
of defective and inferior quality, to plaintiff and quantum thereof.
85. Further, the plea of defective goods taken by
defendant is even otherwise not maintainable in view of
judgment in case of ‘Lohmann Rausher Gmbh vs Medisphere
Marketing Pvt. Ltd.‘ 117 (2004) DLT 95 wherein it was held by
the Hon’ble High Court of Delhi:-
“……21. As per the mandate of Section 41 of the Sale of
Goods Act, the defendant not having inspected the goods
in question prior to delivery, had a right to inspect the case
on delivery and report defects within a reasonable time ofDigitally signed
CS (COMM) No.1390/2022 by Devendra Pg. 46 / 51
Devendra Kumar Sharma
Kumar Date:
2026.04.21
Sharma 16:07:59
+0530
delivery. If not rejected within reasonable time, mandate
of Section 42 stipulates that the defendant would be
deemed to have accepted the goods.”
86. In the instant case besides failing to specify the
quantity of the damaged goods, defendant has also failed to
clarify at what point of time after delivery of goods by plaintiff,
the alleged damage in the goods was detected. Hence
unsubstantiated plea of damaged goods raised by defendant is not
maintainable.
87. The nutshell of foregoing discussion is that
defendant has failed to prove that the goods supplied to
defendant by plaintiff were of sub-standard quality. This issue is,
therefore, decided in favour of plaintiff and against the
defendant.
ISSUE No.6:-
Whether there was an oral settlement between the plaintiff and
defendant no.1 for a full and final payment of Rs.3,02,290/- and
whether the said amount was paid on 24.11.2016 towards all the
liabilities of the defendant? (OPD)
88. The onus of proving this issue was on defendant.
Witness DW1 in his cross-examination has admitted that no
document has been placed on record. By way of voluntary
statement he has stated that it was oral. However, he himself has
admitted that the defendant company is a public limited
company. Thus, in the circumstances, it appears to be doubtful
Digitally signed
by Devendra
CS (COMM) No.1390/2022 Devendra Kumar Sharma Pg. 47 / 51
Kumar Date:
2026.04.21
Sharma 16:08:04
+0530
that the defendant company has entered into an oral settlement
and made payment against the oral settlement. Even for the sake
of arguments, if it is assumed that there was oral settlement, even
nothing has been placed on record in the form of ledger account
that the said settlement was executed and appropriate entry was
made in order to maintain the books of accounts of the defendant
company. In absence of any relevant books of account, the claim
of the defendant qua the oral settlement appears to be taking
benefit of occasion when there was no written acknowledgment
of liability within the limitation period. There is no evidence on
record at all that any such oral settlement was arrived at between
the parties, there is no details of any such oral settlement i.e.
date, time or the persons involved in the said oral settlement.
Thus, in absence of any clear and cogent evidence, it cannot be
said that there was any oral settlement between the parties qua
the amount of Rs.3,02,290/- and that too the delivery of goods
are there by plaintiff subsequent to said payment.
89. In view of the aforesaid discussion, this Court is of
the opinion that defendant has failed to prove that there was an
oral settlement between the plaintiff and defendant no.1 for a full
and final payment of Rs.3,02,290/- and that the said amount was
paid on 24.11.2016 towards all the liabilities of the defendant.
This issue is decided against the defendant and in favour of the
plaintiff.
ISSUE No.8:-
Whether this Court has no territorial jurisdiction to adjudicate
upon the present suit? (OPD)CS (COMM) No.1390/2022 Pg. 48 / 51
Devendra Digitally signed
by Devendra
Kumar Kumar Sharma
Date: 2026.04.21
Sharma 16:08:10 +0530
90. Onus of proving this issue was upon defendant. The
simple contention of the defendant is that since no part of cause
of action arose within jurisdiction of this Court, it is not entitled
to adjudicate upon the lis filed by the plaintiff. It is alleged by
the defendant that it used to place order in Chandigarh only and
the plaintiff also used to supply the goods outside the territorial
jurisdiction of this Court and the payments were made by the
defendant outside the jurisdiction of this Court. The defendant
neither resides nor works for gain within the territorial
jurisdiction of this Court. As such no cause of action, as alleged
by the plaintiff, ever arose within territorial jurisdiction of this
Court.
91. On the other hand, Counsel for the plaintiff has
contended that plaintiff had supplied goods to defendant, from
time to time, through various invoices and that it was specifically
mentioned on the said invoices “all disputes subject to Delhi
jurisdiction”. The defendant accepted the invoices without raising
any objection regarding the terms and conditions mentioned
thereupon and thus, accepted the jurisdiction of Delhi Courts.
92. In the instant case, it is not disputed that defendant
had purchased chemicals from the plaintiff. It is also not
disputed that plaintiff is carrying out its business from Delhi
while defendant is based at Chandigarh. Admittedly, there is no
separate agreement between the parties with regard to
jurisdiction of the Court which would adjudicate upon the
dispute. It is seen from the copies of purchase orders placed on
record by the plaintiff that the purchase orders were placed by
Digitally signed
CS (COMM) No.1390/2022 Pg. 49 / 51
Devendra by Devendra
Kumar Sharma
Kumar Date:
Sharma 2026.04.21
16:08:15
+0530
defendant at plaintiff’s address of 113, Dilkhush Building,
Chowk Tilak Bazar, Delhi-110006. The invoices, Ex.P5 (colly)
have specific term mentioned thereupon “Subject to Delhi
Jurisdiction”. Further, all the goods were supplied by plaintiff to
defendant from Delhi. The part payment for goods was made by
defendant in the bank account of the plaintiff at Delhi. The
defendant has, thus, failed to discharge the onus of proving that
the Court at Delhi does not have territorial jurisdiction to
entertain the suit of plaintiff. On the other hand, from the
testimony of its witnesses and documents placed on record by it,
plaintiff has succeeded in proving that this Court has jurisdiction
to entertain the suit filed by it. This issue is also decided in
favour of the plaintiff and against the defendant.
ISSUE No.1:-
Whether the plaintiff is entitled to a decree of recovery for a sum
of Rs.25,38,223/- against the defendants (jointly and/or
severally), as prayed for? (OPP)
&
ISSUE No.2:-
Whether the plaintiff is entitled for any interest, if so, at what rate
and for which period? (OPP)
93. The onus of proving both the issues was on plaintiff.
It is the case of the plaintiff that the firm had supplied the
different kinds of goods to the defendant against the orders
placed by defendant from time to time and raised various
invoices/bills. All the material supplied by plaintiff was accepted
by defendant without any complaint regarding defect and/or
Digitally signed
CS (COMM) No.1390/2022 Devendra by Devendra
Kumar Sharma
Pg. 50 / 51
Kumar Date:
Sharma 2026.04.21
16:08:20 +0530
damage in the quality and quantity of the material. Even
defendant has failed to prove that there was one time settlement
between the parties. Thus, from the admitted case of the parties,
the plaintiff has been able to prove the supply of goods and due
amount of Rs.15,29,050/- in the ledger account. However, since
it has been held while deciding the issue No.3 and 7 that the
present suit of the plaintiff is barred by the limitation, the
plaintiff cannot be held entitled for recovery of principal amount
or any interest thereon. Hence, issue No.1 and 2 are disposed off
accordingly.
R E L I E F :-
94. In view of foregoing discussion, after appreciation
of evidence led on record and in view of the law laid down
regarding the cause of action and limitation as discussed herein
above, this Court is of the opinion that the plaintiff has failed to
prove on preponderance of probability his entitlement for
recovery of Rs.25,38,223/- with interest as the suit is barred by
limitation. Therefore, the suit of the plaintiff is dismissed.
95. However, in the facts and circumstances as
discussed herein above, parties to bear their own costs.
Decree sheet be drawn up accordingly.
File be consigned to record room after due
compliance.
Announced in the open Court Devendra Digitally signed
by Devendra
on 21st Day of April, 2026 Kumar Kumar Sharma
Date: 2026.04.21
Sharma 16:08:26 +0530
(DEVENDRA KUMAR SHARMA)
District Judge (Commercial Court)-03
Central, Tis Hazari Courts, Delhi
CS (COMM) No.1390/2022 Pg. 51 / 51
