M/S Vibromech Engineers vs. Sri B C Nanjundashetty

Held

The High Court held that the case was fit for remand to the Commercial Court under Order XLIII Rule 23A of the Code of Civil Procedure. The Court noted that the defendant had filed a detailed written statement. However, the evidence commenced and was closed on the same date, December 15, 2020. This fact was not disputed by the respondent. Considering the prevailing COVID-19 situation and the defendant's residence in Tamil Nadu, the Court found that the trial court ought to have provided a reasonable opportunity for the defendant to cross-examine the plaintiff's witness and lead defence evidence. Failure to provide such an opportunity would lead to a miscarriage of justice. Therefore, without delving into the merits of the case, the appeal was allowed, the judgment and decree were set aside, and the matter was remitted to the Commercial Court. The Commercial Court was directed to re-admit the suit and grant the defendant an opportunity to cross-examine the plaintiff's witness and lead defence evidence within a specified timeframe. All contentions of both parties were left open.

Facts

The appellant, M/s. Vibromech Engineers & Services Ltd. (defendant), is challenging a judgment and decree dated March 1, 2021, passed by the Principal District and Sessions Judge, Shivamogga, in Company O.S.No.19/2020. The respondent, Sree SGK Industries (plaintiff), had filed a suit for recovery of Rs. 5,42,360/- with interest. The plaintiff claimed that the defendant purchased VME HUB 545 and VME 955 PULLEY, and as of July 22, 2017, owed Rs. 4,04,342.20, including taxes and charges. The defendant filed a written statement, denying the allegations and raising a contention regarding territorial jurisdiction. The defendant also claimed the suit amount was for defective goods. The trial court decreed the suit. The defendant's business is located in Kanchipuram, Tamil Nadu, while the plaintiff's business is in Shivamogga, Karnataka.

Key Issues

1. Whether the trial court had territorial jurisdiction to entertain the suit, considering no part of the cause of action arose within its jurisdiction, as argued by the defendant? 2. Whether the trial court erred in awarding interest when there was no agreement for interest as per the purchase order, as contended by the defendant? 3. Whether the trial court erred in decreeing the suit when the goods supplied were defective and the suit claim was in respect of these defective goods, as argued by the defendant? 4. Whether the defendant was denied a reasonable opportunity to cross-examine the plaintiff's witness and lead defence evidence, as submitted by the defendant? The respondent (plaintiff) argued that the appellant (defendant) did not dispute the transaction and failed to participate in the proceedings after filing the written statement, thus not being denied a reasonable opportunity. The respondent also contended that the plaintiff's evidence remained uncontroverted and the trial court rightly decreed the suit based on oral and documentary evidence.