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Manju Rai Vs. The Uttar Pradesh State Mineral Development Corporation Ltd. - Court Judgment

LegalCrystal Citation
CourtKolkata High Court
Decided On
Judge
AppellantManju Rai
RespondentThe Uttar Pradesh State Mineral Development Corporation Ltd.
Excerpt:
.....to try and entertain the suit in the written statement. the defendant claims that, the agency agreement between the parties was terminated by the defendant. the defendant also claims that, the accounts between the parties stood settled as on march 31, 1986 and that no amount is due and payable by the defendant to the plaintiff. the defendant contends that, a portion of the claims of the suit is barred by the laws of limitation. the defendant also denies the material allegations made against it in the plaint. by the order dated march 17, 2011 seven issues were framed for trial. such seven issues are as follows:(i) has the court territorial jurisdiction to entertain and try the suit?. (ii) was the termination of agency agreement dated 20th september, 1983 illegal as alleged by.....
Judgment:

C.S.No.349 of 1988 IN THE HIGH COURT AT CALCUTTA Ordinary Original Civil Jurisdiction Manju Rai versus The Uttar Pradesh State Mineral Development Corporation LTD.For the Plaintiff : Mr.Dhrubo Ghosh, Advocate For the Defendant : Mr.P.K.Dutt, Sr.Advocate Mr.C.K.Dutt, Advocate Mr.Rajarshi Dutt, Advocate Smt.

Krishna Mullick, Advocate Hearing concluded on : January 21, 2015 Judgment on : January 28, 2015 DEBANGSU BASAK, J.

The suit is for declaration that the letter of the defendant refusing to renew the contract between the parties is illegal, wrongful, void and liable to be set aside and for a decree for damages and in the alternative an inquiry into the damages suffered by the plaintiff and a decree in respect thereof.

The plaintiff claims to carry on business as the sole proprietor of M/S.Shivisidh Enterprises.

She claims that she was appointed by the defendant as its commission agent on the various terms and conditions as would appear from the letter dated September 20, 1983.

The plaintiff had performed her obligations under such contract.

The plaintiff had generated business for the defendant in the eastern region of India which such region remained unexplored by the defendant.

The plaintiff claims that, between the period 1983 to 1986 she had procured various orders for the defendant.

The plaintiff had also contacted various potential customers on behalf of the defendant.

The plaintiff had incurred diveRs.expenses on account of the promotion of the defendant and had also undertaken business work for the defendant in terms of the contract.

She claims that, the defendant had illegally and wrongfully reduced the commission rate on April 1, 1985.

She had applied for renewal of the contract which was rejected by the defendant by a letter dated December 1, 1986 illegally and wrongfully.

She claims that, the refusal of the defendant to renew the contract should be declared as null and void.

She claims compensation for the loss and damages suffered by her and in the alternative an inquiry with regard thereto and a decree for damages as may be found upon such inquiry.

The defendant has filed a written statement.

The defendant has pleaded that this Hon’ble Court lacks jurisdiction to try and entertain the suit in the written statement.

The defendant claims that, the agency agreement between the parties was terminated by the defendant.

The defendant also claims that, the accounts between the parties stood settled as on March 31, 1986 and that no amount is due and payable by the defendant to the plaintiff.

The defendant contends that, a portion of the claims of the suit is barred by the laws of limitation.

The defendant also denies the material allegations made against it in the plaint.

By the Order dated March 17, 2011 seven issues were framed for trial.

Such seven issues are as follows:(i) Has the Court territorial jurisdiction to entertain and try the suit?.

(ii) Was the termination of agency agreement dated 20th September, 1983 illegal as alleged by the plaintiff?.

(iii) Whether the agency agreement was renewable as stated in the plaint?.

(iv) Did the parties enter into any agreement for Rock Phosphate as claimed by the plaintiff and denied by the defendant?.

(v) Is the plaintiff’s claim as mentioned in paragraph 10(a) of the plaint barred by limitation?.

(vi) Are the plaintiff and the defendant entitled to the respective relief as claimed in the plaint and in the counterclaim contained in the written statement?.

(vii) To what relief, if any, the parties are entitled?.

The parties disclosed various documents.

The husband of the plaintiff came as the witness on behalf of the plaintiff.

The General Manager of the defendant gave evidence on behalf of the defendant.

The fiRs.issue relates to the territorial jurisdiction of the Hon’ble Court to entertain and try the suit.

In the couRs.of submissions at the hearing of the suit the defendant gave up the issue accepting that a part of the cause of action of the suit has arisen within the jurisdiction of this Hon’ble Court.

In such circumstances, the fiRs.issue is answered in the affirmative and against the defendant.

Both the parties agree that the second and the third issues could be taken up together for the sake of convenience.

The second and the third issues are taken up for consideration for the sake of convenience.

Mr.P.K.Dutt, learned Senior Advocate for the defendant contends that, the plaintiff admitted in her pleadings that the agency agreement dated September 20, 1983 being Exhibit ‘A’ by which the plaintiff was appointed as the commission agent stood terminated.

He refers to the various paragraphs of the written statement and submits that, the agency agreement of the plaintiff was terminated by the defendant on or about March 16, 1986.

He refers to the various questions and answers given by the witness of the plaintiff in cross-examination as well as the evidence of the witness of the defendant and submits that, the agency agreement dated September 20, 1983 being Exhibit ‘A’ stood terminated.

According to him, this is an accepted position of the parties.

He contends that, without a valid termination the question of applying for renewal of the agency agreement would not arise if such agency agreement was still subsisting.

He points out that, the application for renewal of the agency agreement had been turned down by the letter dated December 1, 1986.

Therefore, according to him, the plaintiff has accepted that the agency agreement being Exhibit ‘A’ stood terminated.

He submits that, such termination happened on March 31, 1986 with a notice in respect thereof being given on March 16, 1986.

Although such notice of termination is not on record, he contends that, the conduct of the parties establishes that there was a termination of the agency agreement in terms of Exhibit ‘A’.

He points out that Exhibit ‘A’ is terminable at the option of the parties with 15 days notice in respect of such termination being given.

He contends that, the conduct of the parties establishes that the defendant had terminated the agency agreement being Exhibit ‘A’ by giving 15 days notice and such termination happened on March 31, 1986.

Mr.Dutt refers to the conduct of the parties prior to the alleged termination.

He refers to a letter dated April 26, 1985 and submits that, Exhibit ‘A’ was understood between the parties to be of yearly basis as would appear from the letter dated April 26, 1985 being Exhibit ‘2’.

In support of the contention that, the termination of the agency agreement happened on March 31, 1986, Mr.Dutt refers to Exhibit ‘1’ being a letter dated October 24, 1986.

He points out that, by such letter the plaintiff referred to a negotiation meeting between the parties six months prior to the issuance of such letter with regard to renewal of the agency agreement.

He submits that, the contents of Exhibit ‘1’ would demonstrate that the agency agreement had expired on March 31, 1986.

Mr.Dutt refers to the various correspondences exchanged between the parties contemporaneously and submits that, the parties accepted the position that the agency agreement stood terminated if not expired as at March 31, 1986.

He next points out that, the brother-inlaw of the husband of the plaintiff was a high official of the defendant.

Such high official of the defendant was found not to have a good reputation for integrity and to have indulged with the present transactions with the plaintiff without informing the management of the defendant.

Such high official was compulsorily retired by the defendant.

Such action of the defendant was upheld by the Supreme Court.

He refers to 1996 Volume 5 Supreme Court Cases page 111 (U.P.State Mineral Development Corporation & Anr.v.K.C.P.Sinha) in this regard.

He submits that, the nexus of the plaintiff with that of the Chief Marketing Manager of the defendant being the high official who was compulsorily retired stand established.

He submits that, the second and the third issues ought to be answered against the plaintiff.

Mr.Dhruba Ghosh learned Counsel for the plaintiff contends that, the claim of termination of Exhibit ‘A’ has not been established by the defendant.

There is no evidence on record to establish such fact.

At least there is no documentary evidence to such effect.

He submits that, the conduct of the parties post March 31, 1986 being the date of the alleged termination of the agency agreement would demonstrate that such termination was not made.

He refers to the various documents marked as exhibits to demonstrate that the conduct of the parties post March 31, 1986 establishes that there was no termination of the agency agreement as claimed by the defendant.

Mr.Ghosh contends that the letter dated December 1, 1986 being Exhibit ‘E’ is under challenge in the suit.

He contends that, the defendant has not established in evidence any notice of 15 days termination as required by Exhibit ‘A’.

He contends that, the written statement is vague on this aspect.

He contends that the alleged termination whether on March 31, 1986 or December 1, 1986 is invalid and not binding upon the parties, without a valid notice of 15 days being given in terms of Exhibit ‘A’.

He contends that, even post the alleged termination, the parties had conducted their affairs in a manner to establish that Exhibit ‘A’ had not been terminated on the date claimed by the defendant.

Mr.Ghosh for the plaintiff contends that, the agency agreement was not terminated on March 31, 1984.

He refers to Exhibits ‘N1’, ‘P7’, ‘R2’, R4’, ‘R7’, ‘R8’, ‘P11’, ‘P12’ and ‘R10’ amongst other documents in support of his contention that the parties had dealt with each other in accordance with Exhibit ‘A’ subsequent to March 31, 1986.

The defendant had appointed the plaintiff as its commission agent for the procurement of ordeRs.arranging prompt sales realization, coordination for acceptance of supplies of the defendant and liaison with the customers for achieving high degree customer services.

The defendant had allowed the plaintiff to deal with silica sand, rock phosphate, limestone, dolomite and bauxite in Eastern India other than steel plants and for bauxite at HINDALCo.Renukot.

The defendant had agreed to pay 10 per cent commission on the selling price on a monthly basis and obtained sales proceeds, collections during the preceding months.

These letters would appear from Exhibit ‘A’ being the letter dated September 20/21, 1983 issued by the defendant.

Exhibit ‘A’ also allows the defendant to terminate the appointment of the plaintiff as its commission agent on 15 days notice.

Indisputably, the parties had acted on the basis of Exhibit ‘A’.

The plaintiff acted as the commission agent of the defendant and became entitled to commission as agreed by Exhibit ‘A’.

Exhibit ‘A’ is not period specific that is to say, Exhibit ‘A’ does not speak of the agency agreement coming to an end on a particular date or expiring after a specified period of time.

Exhibit ‘A’ allows the defendant to terminate the agency agreement upon giving 15 days notice.

The parties refer to Exhibit ‘2’ which is a letter dated April 26, 1985 written by the defendant to the plaintiff.

Exhibit ‘2’ speaks of the Pricing Committee and the Board of Directors of the defendant to have agreed to continue the selling arrangement of various minerals with the defendant upto March 31, 1986.

The defendant was informed that the selling commission would be 10 per cent on ex-pit selling prices for all sales of minerals with effect from April 1, 1985.

By Exhibit ‘2’ the defendant introduced two things into the subsisting agency agreement.

The fiRs.being a terminus of the agency agreement, specified to be on March 31, 1986 and the second being the alteration in the rate of the selling commission with effect from April 1, 1985.

The conduct of the parties would demonstrate that the parties accepted Exhibit ‘2’ and its terms and conditions.

There is no evidence on record to suggest that the plaintiff had protested to any of the terms and conditions of Exhibit ‘2’ contemporaneously.

In any event, in my view, the evidence on record establishes that, the contract of agency given by the defendant to the plaintiff by Exhibit ‘A’ stood modified by Exhibit ‘2’.

Reading Exhibit ‘A’ as modified by Exhibit ‘2’, so far as the period of the agency agreement is concerned, I find that, the parties had agreed that the agency agreement would come to an end on March 31, 1986.

The subsequent conduct of the parties throws a better light on this aspect.

Exhibit ‘1’ is a letter dated October 24, 1986 written by the defendant to the plaintiff.

It speaks of a letter from the plaintiff requesting renewal of the selling agency.

It notes that the plaintiff did not receive any official response to such request for renewal.

It refers to a negotiation meeting claimed to be held in April 1986 between the plaintiff and the various officials of the defendant.

It claims that, the plaintiff had arranged for orders of silica sand.

It requests the defendant to arrange for issuance of the requisite letter of intent.

The defendant had rejected the request for renewal of the selling agency by a letter dated December 1/3, 1986 being Exhibit ‘E’.

By a letter dated December 13, 1986 being Exhibit ‘4’ the plaintiff refers to the discussions and negotiations held on April 16, 1986 for renewal of agency for a further period of 3 years from April 1986.

The plaintiff appeals to the defendant to reconsider the decision of rejection and requests the defendant to renew the agency for the next 3 yeaRs.Reading Exhibits ‘A’, ‘2’, ‘3’, ‘1’, ‘E’ and ‘4’ in the order of time as they happened I find that, by Exhibit ‘2’ the parties had agreed that the selling agency would come to an end on March 31, 1986.

The plaintiff had entered into negotiations with the defendant for renewal of the agency and had held a meeting on April 16, 1986 for such purpose.

By holding such negotiations and discussions with the defendant in April 1986, the plaintiff had accepted that the agency agreement stood terminated on March 31, 1986.

The plaintiff, thereafter, had made a request for renewal which was rejected.

The plaintiff had made a further request for reconsideration of the renewal.

The defendant did not renew the agency agreement.

I have considered the documents which Mr.Ghosh relies upon in support of the contention that the agency agreement was not terminated on March 31, 1986.

I find that such documents of alleged transactions subsequent to March 31, 1986 between the plaintiff and the defendant are not signed by any person other than the high official of the defendant who is also the brother-in-law of the husband of the plaintiff.

This relationship between the high official of the defendant Mr.K.C.P.Sinha and the plaintiff is established in evidence.

The plaintiff objects to the introduction of the evidence of relationship between Mr.K.C.P.Sinha and the husband of the plaintiff on the ground that such relationship has not been pleaded in the written statement and, therefore, no evidence to this extent can be led.

It is contended on behalf of the plaintiff that, in absence of pleadings in the written statement on an issue no evidence can be looked into in relation thereto.

In support of such contention reliance is placed on 2003 Volume 4 Supreme Court Cases page 161 (Bondar Singh & Ors.v.Nihal Singh & Ors.) as well as 2003 Volume 10 Supreme Court Cases page 653 (Rajgopal v.

Kishangopal & Ors.).Evidence without pleadings cannot be looked into has been laid down in Bondar Singh & ORS.(supra) and Rajgopal (supra).The defendant in the instant case by introducing the relationship between Mr.K.C.P.Sinha and the husband of the plaintiff is seeking to assail the quality of the evidence given by the plaintiff in support of the claims made by the plaintiff.

A defendant is entitled to question the quality of the evidence introduced by the witness of the plaintiff at trial.

By introducing the indisputable relationship between the husband of the plaintiff and Mr.K.C.P.Sinha, and the reasons for Mr.K.C.P.Sinha to take compulsory retirement the defendant is challenging the quality of the evidence of the plaintiff in support of its claim.

Mr.K.C.P.Sinha was found by the defendant not to have a good reputation for integrity.

He was found to have appointed his own brother-in-law, the husband of the plaintiff in this case, as Sales Agent without disclosing this fact to the management and to have continued to deal with him throughout without disclosing this relationship.

The defendant had compulsorily retired Mr.K.C.P.Sinha.

This action of compulsory retirement of Mr.K.C.P.Sinha by the defendant has been upheld by the Hon’ble Supreme Court in K.C.P.Sinha (supra).The Hon’ble Supreme Court in K.C.P.Sinha (supra) notes that there was a confidential report in respect of Mr.K.C.P.Sinha for the year 1993-1994.

A portion of the remarks made by the Reviewing Officer has been quoted in K.C.P.Sinha (supra).The relevant portion of such remarks of the Reviewing Officer for the instant case is as follows:“.........................................He got his own brother-in-law appointed as Sales Agent for Silika Sand and other products without disclosing this fact to the management and continued to deal with him throughout disclosing this relationship....................................” In K.C.P.Sinha (supra) the Supreme Court has noted that the remarks of the Reviewing Officer contain a reflexion on the integrity of Mr.K.C.P.Sinha in the matter of discharging his duty.

It has also been held that having regard to such remarks made in the confidential report of Mr.K.C.P.Sinha it is not possible to hold that the compulsory retirement of Mr.K.C.P.Sinha by the appointing authority is not in public interest.

It also holds that, the order of compulsory retirement of Mr.K.C.P.Sinha does not suffer from any infirmity.

This finding is at paragraph 16 of such report.

In view of Mr.K.C.P.Sinha being asked to take compulsory retirement on the ground of integrity it would not be prudent to rely upon documents issued by Mr.K.C.P.Sinha on behalf of the defendant to fasten a liability of the defendant more particularly when the confidential report with regard to Mr.K.C.P.Sinha contains an observation that Mr.K.C.P.Sinha got his own brother-in-law appointed as a Sales Agent for silica sand and other products without disclosing the facts to the management and continued to deal with him throughout without disclosing his relationship.

There is no independent document from the end of the defendant acknowledging subsistence of the agency agreement subsequent to March 31, 1986.

The documents relied by the plaintiff are either issued by the high official of the defendant Mr.K.C.P.Sinha or are third party documents in which the defendant is not concerned.

On the strength of such documents, it cannot be said that the selling agency agreement did not stand terminated on March 31, 1986.

In such circumstances, the selling agency having come to an end on March 31, 1986 there was no obligation on the part of the defendant to renew the selling agency.

In such circumstances, the second and the third issues are answered in the negative and against the plaintiff.

On the fourth issue Mr.Dutt learned Senior Advocate for the defendant submits that, the accounts between the parties were settled as on March 31, 1986 as would appear from Exhibit ‘3’.

The selling agency came to an end on March 31, 1986.

There is no other or separate agreement between the parties with regard to rock phosphate.

The claims of the plaintiff emanate out of Exhibit ‘A’.

In such circumstances, the plaintiff cannot receive any claim on this account.

Mr.Dhruba Ghosh, learned Counsel for the plaintiff submits that, Exhibit ‘A’ allows commission on rock phosphate.

The defendant had tried to make a distinction between the high grade and low grade of rock phosphate.

He refers to Exhibit ‘M’ being a letter dated September 12/13, 1985 in this regard.

He contends that, the agency agreement between the parties allows the plaintiff to deal with rock phosphate without making any distinction as to quality.

Exhibit ‘A’ read with Exhibit ‘2’ speaks about rock phosphate.

As rightly pointed out by the learned Counsel for the plaintiff, the parties did not distinguish between high grade and low grade rock phosphate.

By Exhibit ‘M’ being a letter dated September 12/13, 1985 the plaintiff terminated the agency agreement with regard to high grade rock phosphate.

Such termination presupposes the existence of a contract of agency for rock phosphate without making a distinction between the qualities.

In such circumstances, the fourth issue is answered in the affirmative and in favour of the plaintiff.

The fifth and the sixth issues are taken up together for the sake of convenience.

These two issues relate to claims made by the plaintiff and the counterclaim made by the defendant.

The defendant did not adduce any evidence with regard to its counterclaim.

The point of counterclaim was not pressed at the hearing also.

In such circumstances, so far as the counterclaim portion of the sixth issue is concerned the same is answered in the negative and against the defendant.

With regard to the claim made by the plaintiff, Mr.Dutt learned Senior Advocate for the defendant submits that, the plaintiff has claimed loss and damages owing to the alleged wrongful reduction in the rate of commission.

This reduction in the rate of commission was known to the plaintiff since April 1985.

The suit was filed in May 1988.

Such claim is barred by the laws of limitation.

Without prejudice to his submission with regard to limitation, he contends that, the claim is not adequately proved by necessary documents.

He points out that, Exhibit ‘2’ permits the plaintiff to act as the selling agency on the basis of the commission prescribed therein.

The plaintiff had accepted Exhibit ‘2’ and had acted thereon without any protest.

The plaintiff, therefore, cannot be allowed to turn around and make a claim with regard to the alleged loss and damages allegedly suffered consequent to the reduction in the rate.

He contends that, Exhibit ‘L’ is a chart whose contents have not been established by adequate evidence.

Therefore, according to him, the claim of the plaintiff on this account is wrong and baseless.

With regard to the other claims made by the plaintiff in the plaint, Mr.Dutt submits that, the claim made in paragraphs 28(c) and (d) relate to claims for transactions alleged to have taken place prior to March 31, 1986.

He submits that, since the accounts between the parties stood settled as on March 31, 1986 and that since the plaintiff had accepted such settlement of accounts, the plaintiff cannot be allowed to reopen such issue in the suit.

With regard to the claim made in paragraph 28(e) of the plaint is concerned, Mr.Dutt for the defendant submits that, the plaintiff cannot be held to have suffered any loss and damages since the alleged expenses allegedly incurred by the plaintiff is subsequent to March 31, 1986 when the agency agreement stood terminated.

He contends that, in any event on merits also the plaintiff is not entitled to any claim made in paragraphs 28(c).(d) and (e) of the plaint.

He contends that the contents of the various exhibits in support of the claims made in paragraphs 28(c).(d) and (e) have not been duly established in evidence.

He relies upon 1975 Volume 1 Supreme Court Cases page 212 (Harihar Prasad Singh & Ors.v.Balmiki Prasad Singh & Ors.) and All India Reporter 1971 Supreme Court page 1865 (S.T.Khimchand v.Y.Satyam) in support of such contention.

Exhibit ‘2’ is a letter dated April 26, 1985 by which the defendant reworked the commission payable.

No contemporaneous document is placed before me to suggest that the plaintiff did not accept the contents of Exhibit ‘2’ or that the plaintiff did not act thereupon.

No evidence has been shown to demonstrate that the defendant did not pay in terms of Exhibit ‘2’.

The plaintiff, therefore, cannot be allowed to sustain a claim beyond Exhibit ‘2’.

On the question of limitation, I find that, the accounts between the parties stood settled as on March 31, 1986.

The suit has been filed in May 1998.

The claim of the plaintiff therefore is within the period of limitation.

However on merits, the plaintiff having failed to establish its claim made in paragraph 10(a) of the plaint the plaintiff is not entitled to any relief in such account.

By Exhibit ‘3’ the plaintiff acknowledges that there has been a settlement of account as on March 31, 1986.

It promises to pay any amount in excess over and above the settlement of accounts as at March 31, 1986 if it is found due from the plaintiff to the defendant.

It calls upon the defendant to reimbuRs.any commission receivable by the plaintiff from the defendant.

The witness of the defendant has categorically stated that the accounts between the parties stood settled as on March 31, 1986.

The witness of the defendant is one of its officials.

I find no reason to disbelieve the evidence of the defendant in this regard.

All claims of the plaintiff upto the period March 31, 1986, therefore, has no basis as the accounts between the parties stood settled as on March 31, 1986.

By Exhibit ‘3’ the plaintiff had called upon the defendant to revisit the settled accounts as on March 31, 1986.

There is no evidence on record to suggest that the parties agreed to revisit the accounts as at March 31, 1986 subsequent to Exhibit ‘3’ or at any point of time.

In absence of such evidence, it must be held that the accounts between the parties stood settled as at March 31, 1986.

The other claims of the plaintiff in the plaint relates to claims on account of expenses allegedly incurred by the plaintiff subsequent to March 31, 1986.

No agreement subsisted between the parties after March 31, 1986 to fasten any liability on the defendant either on account of the expenses allegedly incurred or on account of loss and damages otherwise for the period subsequent to March 31, 1986.

In such circumstances, the claim of the plaintiff on such account has to be disallowed.

Contents of various exhibits particularly the charts prepared and exhibited on behalf of the plaintiff is assailed by the defendant on the ground that such contents have not been adequately proved.

In Harihar Prasad Singh & ORS.(supra) and S.T.Khimchand (supra) the Supreme Court has held that mere marking of a document as an exhibit does not dispense with its proof.

I have considered the evidence of the plaintiff with regard to the charts that the witness of the plaintiff introduced in evidence.

The witness of the plaintiff stated that the charts were prepared by him the basis of the charts was the documents marked exhibits in the proceedings.

The contents of the charts were established by the witness of the plaintiff.

In my view, the plaintiff has adequately proved the contents of the documents which are marked as exhibits on her behalf.

In view of the discussions on the fifth and the sixth issues, the fifth issue is answered in the negative and in favour of the plaintiff.

The sixth issue is answered in the negative both against the plaintiff and the defendant so far as the claim of the plaintiff and the counterclaim of the defendant are concerned.

Having found that neither of the parties is entitled to any relief against each other, the seventh issue is answered in the negative and against the parties to the suit.

C.S.No.349 of 1988 is, therefore, dismissed.

No order as to costs.

The department is directed to draw up and complete the decree expeditiously.

[DEBANGSU BASAK, J.].


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