Calcutta High Court
Pulinat Ettan Thomas vs Finorchem Limited on 16 July, 2026
Author: Debangsu Basak
Bench: Debangsu Basak
IN THE HIGH COURT AT CALCUTTA
CIVIL APPELLATE JURISDICTION
(COMMERCIAL DIVISION)
ORIGINAL SIDE
Present:
The Hon'ble Justice Debangsu Basak
And
The Hon'ble Justice Md. Shabbar Rashidi
AD-COM 02 of 2026
Pulinat Ettan Thomas
Vs.
Finorchem Limited
For the appellant : Mr. Aniruddha Mitra, Sr. Adv.
Mr. Sayan Banerjee, Adv.
For the respondent : Mr. P. P. Bishwal, Adv.
Ms. Swastikaa Ray, Adv.
Hearing concluded on : 30.06.2026
Judgment on : 16.07.2026
Md. Shabbar Rashidi, J.:-
1. The appeal at the behest of defendant in the suit is directed
against the judgment dated August 1, 2025 and consequential
decree dated November 17, 2025 passed in CS-COM No. 175 of
2024.
SK SOHEL Digitally signed by
SK SOHEL UDDIN
UDDIN 14:43:35 +05’30’
Date: 2026.07.16
2
2. By the impugned judgment and decree, the learned Trial
Judge decreed the suit and directed the defendant to pay a sum of
₹55,47,422/- along with interest calculated at the rate of 8% per
annum payable from the date of institution of the suit. At the same
time, the counter claim preferred by the defendant was dismissed
by the impugned judgment and decree. The learned Single Judge
disposed of the suit being CS-COM No. 175 of 2024 in the following
terms:
“It is ordered, therefore, that the Defendant shall pay
the principal sum adjudged of Rs.55, 47,422/- to the
Plaintiff with interest at a rate of 8% per annum from the
date of institution of the suit. The decretal amount shall be
paid within three months from the date of decree in case of
failure of which the Defendant shall be liable to pay
additional interest of 2% per annum from the expiry of the
three months on the principal sum adjudged till repayment.
After expiry of the said period of three months, the Plaintiff
shall be at liberty to draw up execution proceeding to
enforce the decree in case of non-payment.
The counter-claim stands dismissed.
The suit is disposed of.
Let the decree be drawn up.”
3. Learned senior advocate for the appellant submitted that
the learned Trial Judge committed error in holding that the
agreement dated August 2, 2019 constituted a contingent contract
in terms of the provision of Sections 31 and 32 of the Indian
3
Contract Act, 1872 (for short, ‘the Act of 1872’) insofar as the
contract did not stipulate any uncertain future event. It was further
submitted that the learned Single Judge failed to appreciate that
the final agreement executed between the parties did not specify the
number or the names of the experts and, therefore, no enforceable
contingency could have been read in the contract. The learned
Single Judge also failed to take into account that the list of experts
as provided in the agreement dated August 2, 2019 was provided by
the appellant to the respondent.
4. Learned senior advocate for the appellant also contended
that the learned Single Judge erred in taking into consideration the
terms and conditions of a draft agreement as the final agreement
which was contrary to Clause 12 of the agreement entered into
between the parties. Such clause was in supersession of all
previous drafts, negotiations and understandings between the
parties.
5. Learned senior advocate for the appellant also submitted
that the learned Single Judge was not justified in holding that
‘seven’ experts were contemplated under the agreement which is not
supported by any document whatsoever. The learned Trial Judge
also erred in construing the provisions of Sections 31 and 32 of the
Act of 1872 inasmuch as the joining of experts was neither an
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uncertain event nor collateral to the contract between the parties.
The learned Trial Judge was not justified in holding that the
contract became unenforceable due to failure of the event of
contingency in absence of the proof of impossibility.
6. Learned senior advocate for the appellant also submitted
that the learned Single Judge did not appreciate that the evidence
adduced at the trial as PW 1 was not reliable. PW 1 admittedly had
no knowledge of the post-agreement events, discussions and
services rendered by the appellant. At the same time, learned senior
advocate for the appellant submitted that the learned Single Judge
ought to have drawn adverse inference against the
plaintiff/respondent for not examining its Managing Director which
amounted to withholding the vital evidence. Moreover, the testimony
of PW 1 was self-contradictory.
7. Learned senior advocate for the appellant also submitted
that the learned Trial Judge failed to appreciate the testimony of PW
1 which established rendering of services and visits to
manufacturing units as well as the business development efforts
taken by the appellant. The documentary evidence in the form of
WhatsApp communications, emails and tax invoices, which
supported the testimony of DW 1, was not considered by the
learned Trial Court. In support of such contention, learned senior
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advocate relied upon (2016) 12 Supreme Court Cases 288
(Muddasani Venkata Narsaiah Vs. Muddasani Sarojana).
8. It was further contended by the learned senior advocate for
the appellant that the learned Trial Judge was not justified in
holding that the appellant’s appointment had never commenced.
The learned Single Judge overlooked the admitted payment,
deduction of TDS and issuance of tax invoices which established the
continuous engagement of the appellant by the respondent. The
learned Trial Judge also was not justified in holding that there was
no binding contract between the appellant and the respondent
inspite of the fact that the conduct of the parties established that
the parties were ad idem in respect of the existence of a contractual
relationship.
9. It was further contended by learned senior advocate for the
appellant that there was clear evidence that the appellant rendered
services and benefits which were availed by the respondent. Such
fact was not considered by learned Trial Judge. The learned Trial
Judge negated the claim of the appellant by misapplying the
provision of Section 72 of the Act of 1872.
10. Learned senior advocate for the appellant also submitted
that the learned Trial Judge wrongly dismissed the counter claim
put forth by the appellant, though, the respondent/plaintiff chose
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not to submit any additional written statement. It was also
submitted by learned senior advocate for the appellant that the
appellant was entitled for severance, fees and remuneration in
terms of the provisions of Clause 14 and Clause 17 of the
agreement which were overlooked by the learned Trial Judge.
11. Learned senior advocate for the appellant also submitted
that the learned Trial Judge committed error in considering the
clause relating to ‘simultaneous joining’ as a condition precedent
and on such basis, the appointment of the appellant was held to be
void and inoperative for non-joining of the other experts. It was
submitted that the learned Trial Judge erred in not considering that
the respondent, having availed professional services of the appellant
for several months was estopped from contending that the contract
never commenced or was not enforced. The respondent accepted the
services of the appellant nevertheless denied the existence of any
contractual relationship with the appellant. Moreover, the learned
Single Judge did not consider that in a contingent agreement,
performance commenced with the consent of the parties which
amounted to waiver of the contingency.
12. Learned senior advocate for the appellant also submitted
that there was no agreement between the appellant and the
respondent to recommend a fix number of experts. Whereas the
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learned Single Judge erroneously held the contract unenforceable
on the ground that all the ‘seven’ experts were not recommend by
the appellant. In fact, the learned Single Judge did not appreciate
that the appellant recommend more than ‘seven’ experts to the
respondent. By limiting the number of the recommendations to be
made by the appellant, the learned Single Judge erred in
considering the true purport of the agreement which amounted to
re-writing of the agreement. It was also submitted that admittedly
‘four’ experts had already joined to the plaintiff concerned. The
learned Single Judge failed to consider the joining of the ‘four’
experts as part performance of the agreement. Learned senior
advocate for the appellant submits that such part performance
coupled with rendering services by the appellant gave rise to a claim
on the basis of ‘quantum meruit’, which was not considered by the
learned Single Judge. The learned Single Judge did not consider the
provisions contained under Section 70 of the Act of 1872. In
support of such proposition, learned senior advocate for the
appellant relied upon the authority of (2007) 13 Supreme Court
Cases 544 (Food Corporation of India and Others Vs. Vikas
Majdoor Kamdar Sahkari Mandli Limited).
13. Learned senior advocate for the appellant also submitted
that the learned Single Judge failed to appreciate that the services
8
and expertise rendered by the appellant were accepted by the
respondent, nevertheless, the learned Single Judge directed the
appellant to refund all the monies paid in advance to the appellant.
The learned senior advocate for the appellant also submitted that
the claim of interest on such money was not supported by any
contractual or statutory provision and also without proof of the
actual damages suffered by the respondent rather; the same was
awarded in the form of penalty.
14. On the other hand, learned advocate for the respondent
submitted that the respondent had hired the services of the
appellant as part of a team of experts of business consultant in the
Rubber Chemical field. It was agreed between them that the seven
experts would be joined in the assignment simultaneously and that
the contract of engagement of each member of the team of expert
would kick start with the joining of all the seven experts. Since all
the seven experts did not join, the contract of employment of the
appellant with the respondent company never commenced.
15. According to learned advocate for the respondent, the
agreement between the appellant and respondent was in the form of
a contingent contract dependent upon happening of a future event
which did not happen. Therefore, the alleged agreement between the
9
parties cannot be enforced in view of the provisions of Section 31
and 32 of Indian Contract Act, 1872.
16. Learned advocate for the respondent further submitted that
at the time of agreement, the respondent/plaintiff, at the request of
the appellant, had made an advance payment of a sum of ₹
50,47,422/- to the appellant. Since, the contract of engagement of
the appellant with the respondent company did not commence for
non-joining of the remaining members of the team of experts, the
appellant is liable to refund the advance. At the same time, learned
advocate for the respondent also submitted that for the self-same
reasons, the appellant is not entitled to the monthly remuneration
fixed in the agreement dated August 2, 2019.
17. Learned advocate for the respondent also submitted that
since the agreement between the appellant and the respondent was
yet to be commenced, the appellant has not rendered any service to
the respondent company. The respondent has not utilized any
services from the appellant. As such, the appellant is not entitled to
any remuneration in terms of the alleged agreement. He stood by
the impugned judgment and decree and submitted that the same is
liable to be affirmed.
18. The plaintiff company negotiated with the defendant to join
its concern as business consultant. An agreement in this regard
10
was executed between the two parties on August 2, 2019. According
to the case made out in the plaint, the defendant represented
himself to be an expert in rubber chemical field. He further
represented that he was in a team of such experts in rubber
chemical field. Plaintiff/respondent required a team of experts from
rubber chemical field. It was agreed between the defendant and the
plaintiff company that the defendant and his seven associates
namely, Dr. Jaybalan Lakhmanan, Mr. Thomas Valera, Mr.
Yashwant VA, Mr. Praveen Patil, Mr. Manoj Choudhury, Mr.
Mukesh Singh and Mr. Mathew would join simultaneously. The
plaintiff company was not interested in appointing the
appellant/defendant alone. The plaintiff had specifically given out
that in case all the seven experts or any of them does not join, the
respondent would search for another team. Accordingly, the
respondent issued a letter to the defendant on August 2, 2019. At
the request of the appellant/defendant, the respondent/plaintiff
also made an advance payment of ₹ 50,47,422/-. According to the
case of the respondent/plaintiff, the appointment letter issued in
favour of appellant, clearly stipulated that the appointment of the
appellant would commence when the defendant and other experts
join simultaneously.
11
19. However, the plaintiff company could appoint only four of
the named experts namely Mr. Praveen Patil, Mr. Manoj Choudhury,
Mr. Mukesh Singh and Mr. Mathew. According to the case of the
respondent made out in the plaint, the agreement did not come into
effect as the other three experts Dr. Jaybalan Lakhmanan, Mr.
Thomas Valera, Mr. Yashwant VA did not join.
20. On such pretext, the respondent/plaintiff came up with the
suit being CS-COM No. 175 of 2024 seeking a declaration that the
appointment of the appellant in the respondent company had not
commenced. The respondent also sought refund of the advance sum
of ₹50,47,422/- together with interest, since the contract between
the parties had failed.
21. The suit was contested by the defendant/appellant by filing
written statement coupled with a counter claim. The defendant
denied all the material allegations made in the plaint. It was the
positive case of the defendant that the defendant was approached
by the plaintiff company with a proposal to work as a business
consultant in the capacity of ‘Chairman Emeritus’. The defendant
agreed to such proposal. Consequently, a letter of appointment was
issued in his favour on August 2, 2019 which contained the terms
and conditions of the appointment.
12
22. It was further case of the appellant the parties also agreed
that the respondent would appoint some experts in the field of
Rubber Chemical and requested the appellant to recommend such
experts who would be finally appointed by the respondent after due
negotiations. The appellant actually, recommended some experts.
Out of his recommendation, four experts were appointed by the
respondent/plaintiff in August 2019. The appellant submitted that
other persons recommended by him were not under his authority
that they could be forced to join the plaintiff company. It was
further case of the appellant, in his written statement that his
appointment with the plaintiff was completely independent and had
no nexus with the joining of other experts recommended by him.
Since his joining in the plaintiff company, the appellant/defendant
discharged his job responsibilities in strict compliance of the terms
of job profile enumerated in his letter of appointment.
23. According to the case made out by the
appellant/defendant, it was agreed that the appellant would be paid
a sum of ₹1,50,00,000/- upfront on his joining in the respondent
company. Out of such agreed amount, the respondent paid a sum of
₹50,00,000/- at the time of his joining. The respondent did not pay
the remaining amount of ₹1,00,00,000/- inspite of repeated
demands. However, the appellant came out with a case that the
13
respondent company never denied its liability to pay the balance
amount. Besides the upfront payment, it was also agreed that the
appellant would be paid a sum of ₹15,00,000 a month as
consultancy fee together with travelling, food and lodging expenses
on actuals. However, despite raising such bills, the respondent did
not reimburse a sum of ₹58,770.47/- towards such expenses. The
respondent company also did not pay the agreed consultancy fees
for the months of August, September, October and November, 2019
although, the appellant rendered extensive services. The respondent
company utilized the services so rendered.
24. It was the further case of the appellant/defendant that by
an email message dated September 7, 2019, the respondent was
informed that in terms of the discussions the experts namely Dr.
Balan, Mr. Thomas Valera and Mr. Yashavant were to join the
Plaintiff/Company with the Defendant but they did not join.
Following such email, the respondent also served a letter dated
November 23, 2019 upon the appellant intimating him that
Defendant’s appointment in the plaintiff company had not
commenced as it was agreed to commence upon the joining of other
experts. By the said letter, the plaintiff also sought refund of
₹55,00,000/-.
14
25. By filing the written statement, the appellant/defendant
denied all the allegations made in the plaint. The defendant also
took out a counter claim which was noted by learned Trial Judge. It
would be apposite to reproduce the heads of counter claim made by
the appellant in his written statement that is to say:
“i) Balance payment payable on appointment ₹1,00,00,000/-
ii) Fees for the month of August, 2019 ₹17,70,000/-
iii) Fees for the month of September, 2019 ₹17,70,000/-
iv) Fees for the month of October, 2019 ₹17,70,000/-
v) Fees for the month of November, 2019 ₹17,70,000/-
vi) Reimbursement of expenses ₹58,770/-
for travel, food and lodging
vii) Severance fee as per Clause ₹50,00,000/-
14 of the agreement dated 02/08/2019
viii) Interest at a rate of 18% p.a. ₹59,77468/-
Total ₹2,81,16,238/-"
26. On the basis of rival pleadings put in by the parties, the
learned Trial Judge, framed as many as 12 issues for proper
adjudication of the disputes which are,
1. “Is the suit maintainable in its present form?
2. Are the claims and the counter-claim barred by the laws of
limitation?
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3. Is the Plaintiff right in alleging that the Defendant’s
appointment did not take effect as all the seven experts did
not join the Plaintiff along with the Defendant?
4. Whether the appointment of the Defendant was dependent
upon all the seven other experts joining the Plaintiff Company?
5. Whether the Plaintiff is entitled to its claim for refund of
Rs.55,47,422/- or any part thereof?
6. Whether the Defendant is entitled to fees and expenses as
agreed upon as per the Terms of Engagement dated 2nd
August, 2019?
7. Whether the Defendant is entitled to the sum of Rs.2,81, 16,
238/- as claimed?
8. Whether the Defendant is entitled to any compensation for the
valuable knowledge imparted to the Plaintiff?
9. What other reliefs the parties are entitled to?
10. Whether the appointment of the Defendant as a business
consultant in the Plaintiff did not fructify in view of the fact
that the experts did not join the Plaintiff?
11. Whether the Defendant is entitled to the reliefs claimed in the
written statement and the counter-claim?
12. Whether the reliefs claimed in the written statement and the
counter-claim are barred by limitation?”
27. It was noted in the impugned judgment and decree that the
parties did not press and argue issue nos. 1, 2 and 12 at the time of
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hearing of the suit. The learned Trial Judge also held that the suit
as well as the counter claim was presented within the time of
limitation. Consequently, the learned Trial Court decided the issues
in favour of the plaintiff/respondent. The aforesaid issued were not
raised during the hearing of instant appeal as well. In such view of
the facts, we find no reason to interfere with the findings of the
learned Trial Judge in respect of these issues.
28. Issue nos. 3, 4 and 10 namely, were taken up together by
the learned Trial Judge. Evidence on record goes to demonstrate
that the plaintiff company and the defendant were in a negotiation
regarding appointment of the defendant. According to the case
made out in the plaint, the defendant had agreed to join the plaintiff
company as a business consultant along with seven other experts
on certain terms and conditions. One of the conditions was that the
appointment of the defendant was agreed to commence with the
joining of defendant and other seven experts simultaneously. Per
contra, the defendant came up with a case that he agreed to
recommend certain other experts in the Rubber Chemical field who
were to be appointed by the plaintiff company after due
negotiations. According to defendant’s case, he actually
recommended some names of such experts, out of which, four
persons joined the plaintiff company.
17
29. A case was made out by the defendant that under the
agreement, he was obliged to recommend the names of some
experts in the field of Rubber Chemical and that there was no
stipulation in the agreement to recommend specific persons or
specified number of such experts. Therefore, the appointment of the
defendant was independent of such recommendation and
commenced when appointment letter was served upon him.
30. The learned Trial Judge decided issue nos. 3, 4 and 10 in
favour of the plaintiffs to the following terms, that is to say:
“Clause 1 of the agreement is very clear and
conspicuous. This Clause stated that appointment of the
Defendant would commence on simultaneous joining of
other experts from rubber chemicals field. From forgoing
discussions, it is clear and established that seven experts
were to be appointed based on recommendation of the
Defendant and approval of the Plaintiff. The Defendant
accepted this term as pre-condition for his appointment.
Subsequently, a plea was taken that their appointment
dependent on their own will and approval of the Plaintiff
but the Defendant agreed to the terms and bound himself
with its terms and conditions as stipulated in Clause 1.
Once it is accepted and agreed upon that the Defendant’s
appointment was dependent of simultaneous joining of
other experts, he is bound by such term; there was no exit
rout from that. It is admitted that seven experts were not
appointed or did join. The case of the Defendant was that
four of them joined. It is not established that the Defendant
recommended the names of all the seven experts. Therefore,
18
obviously and very clearly, in the absence of joining all the
seven other experts the Defendant’s appointment did not
take place. It is not a case that their appointment became
subsequently impossible. No such plea is there. Therefore, it
is safe conclusion, in view of discussions made above, that
there was a contingent contract between the parties dated
02/08/2019. Since the contingency failed, no formation of
contract took place and the contract became unenforceable
under Section 32 of the Contract Act, 1872.
It is inevitable conclusion, therefore, that there was no
binding and enforceable agreement or contract between the
parties.
Issue No.3, 4 and 10 are decided in favour of the
Plaintiff.”
29. While deciding these issues, the learned Trial Court held
that the agreement between the plaintiff company and the defendant
was a contingent contract depending upon the joining of the other
seven experts. The learned Trial Judge, although held in reference to
Exhibit D, that the agreement was not explicit in relation to the
number or specific names of experts but referring to Exhibit B, it
observed that the draft agreement, which ultimately culminated into
final agreement (Exhibit D) had a reference of specific names of
experts who were to join the plaintiff company concurrently with
defendant to kick start the appointment of defendant. Besides that,
in answer to question No. 16, the defendant (DW1) stated that
basically he had suggested seven names to the plaintiff company
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but it was his request not to include his suggestions in the
agreement.
30. Clause 1 of Exhibit D i.e. agreement dated August 2, 2019
stipulated that the appointment of the Defendant in the
Plaintiff/Company as the business consultant would commence on
joining simultaneously with joining of other experts from rubber
chemicals field. It also provided that the experts would be selected
and recruited based on recommendation of the Defendant and
approval of the Plaintiff. However, referring to the evidence of DW1,
the learned Trial Court observed that DW1, in his deposition, when
his attention was drawn to Exhibit B, admitted that he had
recommended the name of seven experts. He had further stated in
his deposition that basically he had suggested seven people to be
inducted but told Mr. Holani not make it a part of the agreement.
Learned Trial Court also noted that DW 1 reiterated in his cross-
examination at question no. 122 that in the draft document Mr.
Holani and himself had mentioned seven experts but on suggestion
of the Defendant those names were not incorporated in the final
agreement because their joining was subject to the personal
decisions and subject to the approval of the Plaintiff. Such evidence
by the defendant himself together with various Clauses of the
agreement dated August 2, 2019 (Exhibit D) clearly indicates the
20
intention of the parties that the parties had agreed on simultaneous
appointment of defendant and seven experts named in Exhibit B
and that the appointment of defendant was to commence upon
joining of all such experts. In view of the evidence so discussed
hereinabove, we find no reason to fault the findings of learned Trial
Judge.
31. Issue nos. 5, 6, 7, 8, 9 & 11 with regard to refund of the
advance money paid by the plaintiff to the defendant as well as
counter claim raised by the defendant were decided by learned Trial
Judge together. The plaintiff claimed that a sum of ₹55,47,422/-
was paid to the defendant in pursuance of an agreement dated
August 2, 2019 (Exhibit D). Such money was paid as advance, in
anticipation of an enforceable contract. However, the contract
became unenforceable on account of non-happening of contingency
contemplated in the agreement. Since the agreement failed, the
defendant is liable to refund such advance payment.
32. On the contrary, it was the case of the defendant that his
appointment in the plaintiff company was not dependent upon the
simultaneous joining of other seven experts. He received the amount
under the agreement and had been discharging his obligations as
business consultant from the very time when he received his
appointment letter. The agreement entered into between the
21
defendant and the plaintiff company was in force after its execution.
Therefore, he is not liable to refund the money received under the
contract. Besides that, the defendant also made out a case that
since after his appointment in terms of appointment letter dated
August 2, 2019, the defendant has been diligently rendering
services to the plaintiff company as a business consultant. The
plaintiff company has also utilized his services in such capacity
without any demur. Therefore, the plaintiff is obliged to pay the
defendant the monthly consultation fee as agreed in the agreement.
The plaintiff also did not pay the agreed travelling expenses as well
as lodging and boarding expenditure incurred by the defendant in
discharge of his obligations under the contract. The defendant, on
such heads, made a counter claim to the tune of ₹2,81,16,238/- as
against the plaintiff company.
33. The learned Trial Court decided Issue nos. 5, 6, 7, 8, 9 & 11
to the following terms:
“It is the case of the Defendant that the agreement
came into being and he took money on the strength of the
agreement. The case of the Plaintiff, on the other hand, is
that the money was nothing but advance payment. As
decided above, the executory contract could not be
performed and stood unenforceable in view of failure of the
contingency on which the agreement dependent. The
Defendant cannot be allowed to retain the money so
received from the Plaintiff for his unjust enrichment. Money
22was paid on expectation of fulfillment of the contingency.
The contingency did not happen. Therefore, the Defendant
is liable to refund money taken under an unenforceable
contract. This is based on the principal “Nul ne doit
senrichir aux depens des autres”–No one ought to enrich
himself at the expense of others. This doctrine at this stage
of English common law was remedied by indebitatus
assumpsit which action lay for money had and received to
the use of the Plaintiff. In Mahabir Kishore & Ors. Vs. State
of Madhya Pradesh [(1989) 4 SCC 1], the Supreme Court
India observed that it lay to recover money paid under a
mistake, or extorted from the Plaintiff by duress of his
goods, or paid to the Defendant on a consideration which
totally failed. In Mafatlal Industries Ltd. Vs. Union of India
[(1997) 5 SCC 536], the principal so laid down was
considered by the Nine Judges Bench of the Supreme Court
of India with reference to this case. The principal laid down
in Mahabir Kishore‘s case was reiterated that the principal
of unjust enrichment requires – first that the Defendant has
been enriched by the received of a benefit; that this
enrichment is an expense of the Plaintiff and thirdly that
retention of the enrichment is unjust. This justifies
restitution. Money can be refunded under provision of
section 72 of the Indian Contract Act, 1872, which itself
embodies the principle of equity (see Mafatlal Industries
Ltd. Vs. Union of India [(1997) 5 SCC 536]). Similarly, the
Defendant cannot rely upon an unenforceable contract to
vindicate his right to demand any money as claimed here.
In absence of any executed and enforceable contract, the
Defendant cannot claim money as prayed for in the counter-
claim.”
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For reasons stated above, this Court is of opinion that
Plaintiff’s case succeeds and the Plaintiff is entitled to
recover the money from the Defendant and the Defendant is
liable to pay the amount to the Plaintiff with interest. This is
also conclusion of this Court that the Defendant has not
right to claim any money as prayed for.
In nutshell, the plaint case succeeds and the counter-
claim fails.
These issues are decided in favour of the Plaintiff.”
34. On the basis of evidence led at the trial, we have held
hereinbefore, that since the defendant did not join simultaneously
with the other seven experts, agreed in the negotiations between the
parties, the contract of employment of the defendant did not
commence. Although, the defendant has made out a case that the
appointment of the other experts was not within his control and
contractual obligation, but, materials on record establishes that the
defendant/appellant expressively accepted such condition. He
cannot now turn around to say that the other experts were not
under his control. Apparently, the money was advanced to the
defendant in relation to engagement of the defendant and other
experts in the plaintiff company. Since, such engagement was not
started; the defendant has had no right to retain such money
advanced to him which was dependent upon the terms of his
engagement. He is liable to refund the same to the plaintiff.
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35. So far as the counter claim of the defendant is concerned,
the defendant has claimed a sum of ₹2,81,16,238/- as counter
claim. This amount includes ₹1,00,00,000/- towards the balance of
upfront amount of ₹1,50,00,000/- which was agreed to be paid
upon joining of the defendant in the plaintiff company in terms of
Para I of the letter dated August 2, 2019 (Exhibit D) which reads,
thus:
“Your appointment with ML as a business consultant will
commence on your joining ML simultaneously with joining of
other experts from the rubber chemicals field. The aforesaid
experts will be selected and recruited based on your
recommendation and our approval thereof. These experts
will be absorbed in ML for the smooth running of the
business and those experts will be absorbed as consultants
or on permanent employment in the payroll of ML at not less
than their current emoluments. Your appointment as above
shall be valid from the date of joining of all aforesaid
experts and shall be in force for a period of 5 (Five) years
unless terminated/separated earlier by either side subject
to the terms and conditions mentioned herein below.”
36. At the same time, as per the letter dated August 2, 2019
(Exhibit D), the defendant was entitled to various remuneration and
incentives detailed in Para 17 of such letter. It would be appropriate
to set out paragraph 17, which is as follows:
“17. (A) Against compliances/provision of services
mentioned in Para 16 above, you will be entitled to receive
25i. Fixed amount of ₹.1.80 crores (₹. 1 crore 80 lakhs only)
per annum, which will be payable to you on monthly
basis at the end of every month in equal instalments
of ₹ 15 lakhs (₹ Fifteen lakhs only) per month,
ii. ₹. 150 lakhs (rupees one crore Fifty lakhs only) after
your appointment as referred to in paragraph 1
hereinabove.
iii. Loyalty Bonus of ₹ 1 50 lakhs (Rupees One Crore Fifty
Lakh only) on completion of rendering of your services
person to the sacrament for and an interrupted period
of 2 years (Two Years) from the date of your
appointment as referred to in para 1 hereinabove.
iv. Special Loyalty Bonus of ₹ 200 lakhs (Rupees Two
Crore only) on completion of rendering of your
services person to the sacrament for and an
interrupted period of 4 years (Four Years) from the
date of your appointment as referred to in Para one
hereinabove.
v. While on official tour, he will be entitled for travelling,
food & lodging as per actual incurred in terms of
policy of ML in this regard.
(B) In case ML gets opportunity to use and utilise
manufacturing facilities at Marchem India Private
Limited by virtue of outright purchase on mutually
amicable terms and condition, you will be entitled to
receive such additional sum as may be decided to
mutually between you and ML after ML gets the said
opportunity.”
37. As noted above, the appointment of appellant/defendant
did not start in terms of the condition envisaged at Para 1 of the
agreement, the defendant was not entitled to retain the sum of
26
₹55,47,422/-paid in advance towards the payment contemplated in
Para 17 (A)(ii) of the agreement dated August 2, 2019. The
defendant is liable to refund such amount. We therefore, affirm the
findings of learned Trial Court, in so far as refund of advance money
is concerned. Applying the same analogy of non-starter of the
employment, the claim of defendant towards severance fee in terms
of clause 14 of the agreement dated August 2, 2019 cannot be
allowed.
38. So far as payment under the condition envisaged at Para 17
(A)(i)of the agreement is concerned, the defendant was to receive a
remuneration of ₹15,00,000 a month on account of consultation fee.
According to the case of the plaintiff company, since the
appointment of the defendant did not kick start, the defendant was
not entitled for such payment. On the other hand, the defendant
claims that upon his engagement in the plaintiff company in terms
of an appointment letter issued in his favour, the defendant has
been rendering diligent services to the plaintiff. He travelled
extensively under directions of the plaintiff company and provided
his expertise for smooth functioning of the plaintiff company in
accordance with the terms and conditions of his engagement. The
plaintiff company never raised any objection rather, utilized such
services without any demur and therefore, the defendant is entitled
27
to the monthly consultation fees for the months of August,
September, October and November 2019. The defendant also
claimed travelling, food and lodging expenses incurred by him
amounting to ₹58,770/-.
39. At the time of his cross examination, the answer to question
numbers 27 and 28 by the defendant (DW1) shows that the
defendant was neither aware of the location of the office of Plaintiff
Company nor he visited such office. As regards the claim of the
plaintiff that he rendered services to the Plaintiff Company, answer
to question no. 32, DW1 stated that he had been interacting with
Mr. Holani, the Managing Director of the company on almost daily
basis and that too, at the direction of Mr. Holani. He used to be in
discussions with unit heads at Panoli, Gujrat and Cochin, Kerala
and suggested various measures to be undertaken for
commissioning the plants in Panoli and Cochin. He also personally
visited Panoli Plant and called joint meeting in presence of Mr.
Holani. All other team members including the General Manager and
unit head participated in the discussions, exchanged information
and several documents required for commissioning the unit.
40. DW1 further stated in such deposition that in Cochin Plant
also he held several meetings. The General Manager and Mr. Holani
visited his office in Cochin a couple of times to obtain appropriate
28
directions to proceed with the commissioning of the plant. DW1 also
travelled to Mumbai to assist Mr. Holani in taking interview of
certain other persons who were discussed by the defendant and the
plaintiff Company. DW1 also stated in his deposition that he used to
send his bills through electronic mail and WhatsApp messages.
41. However, we find from the materials on record, specially the
deposition of DW1 that the plaintiff has not cross examined DW1 as
to his claim regarding holding of meetings and providing expert
support for commissioning of the Panoli and Cochin plants of the
plaintiff company in presence of Mr. Holani and others. There is
absolutely no cross examination of DW1 that as to his statement
that he undertook travel to Mumbai to assist Mr. Holani in the
recruitment interview. Moreover, the witness examined on behalf of
the plaintiff company (PW1) was not conversant with and had no
personal knowledge about the facts of the case.
42. In Muddasani Venkata Narsaiah (supra), it was observed
by the Hon’ble Supreme Court that,
“15. Moreover, there was no effective cross-examination
made on the plaintiff’s witnesses with respect to factum of
execution of sale deed, PW 1 and PW 2 have not been cross-
examined as to factum of execution of sale deed. The cross-
examination is a matter of substance not of procedure one
is required to put one’s own version in cross-examination of
opponent. The effect of non-cross-examination is that the
29
statement of witness has not been disputed. The effect of
not cross-examining the witnesses has been considered by
this Court in Bhoju Mandal v. Debnath Bhagat. This Court
repelled a submission on the ground that the same was not
put either to the witnesses or suggested before the courts
below. Party is required to put his version to the witness. If
no such questions are put the Court would presume that the
witness account has been accepted as held in Chuni Lal
Dwarka Nath v. Hartford Fire Insurance Co. Ltd.
16. In Maroti Bansi Teli v. Radhabai, it has been laid down
that the matters sworn to by one party in the pleadings not
challenged either in pleadings or cross-examination by
other party must be accepted as fully established. The High
Court of Calcutta in A.E.G. Carapiet v. A.Y. Derderian has
laid down that the party is obliged to put his case in cross-
examination of witnesses of opposite party. The rule of
putting one’s version in cross-examination is one of
essential justice and not merely technical one. A Division
Bench of the Nagpur High Court in Kuwarlal Amritlal v.
Rekhlal Koduram has laid down that when attestation is
not specifically challenged and witness is not cross-
examined regarding details of attestation, it is sufficient for
him to say that the document was attested. If the other side
wants to challenge that statement, it is their duty, quite
apart from raising it in the pleadings, to cross-examine the
witness along those lines. A Division Bench of the Patna
High Court in Karnidan Sarda v. Sailaja Kanta Mitra has
laid down that it cannot be too strongly emphasised that
the system of administration of justice allows of cross-
examination of opposite party’s witnesses for the purpose of
testing their evidence, and it must be assumed that when
the witnesses were not tested in that way, their evidence is
30
to be ordinarily accepted. In the aforesaid circumstances,
the High Court has gravely erred in law in reversing the
findings of the first appellate court as to the factum of
execution of the sale deed in favour of the plaintiff.”
43. In the facts of the case, if the claim of the
defendant/appellant with regard to rendering services and plaintiff
company accepting and utilizing such services, is not challenged by
the respondent/plaintiff by filing written statement or by cross
examination of the concerned witness, Section 70 of the Indian
Contract Act, 1872 is immediately pressed into service. The Hon’ble
Supreme Court, in the case of Food Corporation of India (supra)
laid down that,
“19. The principle of quantum meruit is often applied where
for some technical reason a contract is held to be invalid.
Under such circumstances an implied contract is assumed,
by which the person for whom the work is to be done
contracts to pay reasonably for the work done, to the
person who does the work. The provisions of this section
are based on the doctrine of quantum meruit, but the
provisions of the Contract Act admit of a more liberal
interpretation; the principle of the section being wider than
the principle of quantum meruit. The principle has no
application where there is a specific agreement in operation.
A person who does work or who supplies goods under a
contract, if no price is fixed, is entitled to be paid a
reasonable sum for his labour and the goods supplied. If
the work is outside the contract, the terms of the contract
31
can have no application; and the contractor is entitled to be
paid a reasonable price for such work as was done by him.
20. If a party to a contract has done additional construction
for another not intending to do it gratuitously and such
other has obtained benefit, the former is entitled to
compensation for the additional work not covered by the
contract. If an oral agreement is pleaded, which is not
proved, he will be entitled to compensation under Section
70. Payment under this section can also be claimed for
work done beyond the terms of the contract, when the
benefit of the work has been availed of by the defendant.”
44. Therefore, in view of the ratio laid down by the Hon’ble
Supreme Court in Food Corporation of India (supra), we are of the
opinion that although, the contract of employment of the defendant
did not commence but the defendant did render services to the
plaintiff company and such services were not gratuitous. Therefore,
the defendant is entitled to the remuneration for the services
rendered. As such we do hold that the defendant is entitled for the
remuneration at the agreed rate of ₹15,00,000/- a month, in terms
of Exhibit D, for the months from August, 2019 to November 2019
totaling to ₹60,00,000/-
45. The respondent paid a sum of ₹55,00,000/- to the appellant
as part payment including ₹5,00,000/- towards Tax Deducted at
Source (TDS), as evident from Exhibit E and Exhibit G. The
appellant would therefore be entitled to ₹5,00,000/- towards
32
remuneration after adjusting the sum of ₹55,00,000/- which he
already received towards the receivable ₹60,00,000/-. Therefore,
there will be a decree for ₹5,00,000/- in favour of the appellant and
as against the respondent. Appellant will be entitled to recover the
sum of ₹5,00,000/- from the respondent. There will be decree for
interest at the rate of 8% per annum from the sum of ₹5,00,000/-
from December 1, 2019 till realization.
46. Interest at the rate of 8% per annum is awarded in view of
the nature of transactions between the parties.
47. Moreover, the defendant has also claimed for the travelling,
food and lodging expenses incurred by him for his travel to and stay
at Mumbai. However, such expenses are not substantiated by any
documentary evidence led at the trial. Exhibit G is the document
which shows payment of ₹47,422/- towards reimbursement of
travelling, food and lodging expenses incurred by the defendant for
his visit to Calcutta. But the claim for visit at Mumbai has not been
substantiated by any such document. For such reason, we are not
in a position to allow such claim of the defendant as against the
plaintiff.
48. AD-COM 2 of 2026 is disposed of accordingly. Connected
application(s), if any, shall also stand disposed of.
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49. Urgent photostat certified copy of this judgment, if applied
for, be supplied to the parties on priority basis upon compliance of
all formalities.
[MD. SHABBAR RASHIDI, J.]
50. I agree.
[DEBANGSU BASAK, J.]
