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Bansibhar Ganga Pershad Agency Vs. Chanan Lal and anr. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtDelhi High Court
Decided On
Case NumberRegular Second Appeal No. 1 of 1967
Judge
Reported inILR1975Delhi445; 1975RLR289
ActsCode of Civil Procedure (CPC), 1908 - Sections 100; Evidence Act, 1872 - Sections 114
AppellantBansibhar Ganga Pershad Agency
RespondentChanan Lal and anr.
Advocates: Sultan Singh and; Chaman Lal, Advs
Cases Referred(See T. S. Murugesam Pillai v. M. D. Gnana Sambandha Pandara Sannadhi and
Excerpt:
.....him in respect of these payments which would have clearly shown that the payments were made to the sister concern and not to the agency. the best evidence in the case consisted of the receipts which, every witness of the respondent said, were issued by the agency as well as the sister concern whenever any payment was made by the respondent. this case of the respondent is clearly is belied by the evidence of his own witnesses. dw 1. dw 2, dw 3, dw 4, dw 5 and dw 6. all of them arc unanimous in saying that puce receipts were issued both by the agency as well as by the sister concern in respect of all payments made irrespective of the fact that kacha receipts had been given by the persons to whom the payments were made. it was not disputed that account books of the dealings with both the..........these payments were made by the respondent they were made not to the appcllant agency but to their sister concern. the appellant carries on business under the name and style of 'bansi dhar ganga pershad agency' i will call it 'agency' for convenience. the other sister concern of the appellant is known as firm bansi dhar ganga pershad. i will call it 'the sister firm' for convenience. the dispute between the parties is this. the appellant says that the payment was never made to the agency, but to the sister firm. the respondent claims that the payments were made to the agency. these payments arc all entered in a small note book exhibited in this case. at the top of this note-book at page i, it is written :'paymentmade to m/s. bansi dhar ganga pershad agency delhi' (marked k).underneathare.....
Judgment:

Avadh Behari, J.

(1) On 20th August, 1963, M/s. Bansi Dhar Ganga. Pershad Agency, plaintiff-appellant instituted a suit against Chanan Lal, proprietor of Jawahar Wool Store for the recovery of Rs. 6692.96 p. on account of balance price of goods sold and delivered. The appellant's case was that during the period 13th September, 1962 to 1st April, 1963, Bansi Dhar Ganga Pershad Agency (the Agency) had supplied goods to the defendant-respondent of the valueof Rs. 14,771.27 p. The appellants arc dealers in wool. So is the respondent. The respondent purchased wool of that value. The appellant further alleged that the respondent had paid Rs. 8671.60 p. towards the price of the goods. A balance of Rs. 6099.67 p. was claimed to be due. Interest was also claimed at the rate of 12 per cent. This amounted to Rs. 593.29 p. In all a decree for Rs. 6692.96 p. was claimed.

(2) The respondent in his defense stated that he had purchased goods worth Rs. 14,209.67 p. and not Rs. 14,771.27 p. as alleged by the appellant. The next important defense which he raised was that he had made payment of Rs. 13,146.60 p. to the appellant and only a balance of Rs. 1063.07 p. remained due from him which, however, he was prepared to pay. The respondent denied that he had merely paid Rs. 8671.60 p. as was alleged by the appellant. A further payment of Rs. 4475.00 was alleged by the respondent which the appellant disputed. This was, in fact. the main controversy between the parties.

(3) The trial court framed the following issues :

(1)Is the plaintiff firm registered under the Indian Partnership Act and Ajay Kumar is its registered partner (2) Did the defendants purchase goods worth Rs. 15,771.27 from 1-10-1992 to 27-3-1963? (3) Whether the defendants have made any payments over and above the admitted ones (4) To what interest if any, is the plaintiff entitled (5) Whether the plaint has been properly presented? (6) Is the plaint properly stamped? (7) Relief.

(4) N this appeal only two issues, namely, issues No. 2 and 3 have been canvassed.

(5) On issue No. 2 the trial court came to the conclusion that the appellant had supplied goods worth only Rs. 14,209.67 p. as was the case of the resopndent. On issue No. 3, it returned the finding that the respondent had made the payment of Rs. 13,146.60 p. In a word the defense of the respondent was accepted and the trial court by order dated 31st May 1965 passed a decree for Rs. 1063.07 p. and interest amounting to Rs. 112.50 p. at the rate of 9 per cent. Proportinate costs were also awarded.

(6) Dissatisfied with the decree of the trial Court the appellant Agent went in appeal to the Additional District Judge. The Additional District Judge confirmed the decree of the trial Court, and dismissed the appellant's appeal on 29th of August, 1966. The appellant appeals to this court under Section 100 of the Code of Civil Procedure.

(7) On issue No. 2, the appellant's case is that the goods of the value of Rs. 14,771.27 p. were sold and delivered to the respondent. The respondent denied that he received the goods of the bill of Rs. 561.61 p. (P. 21). As regards this issue this was the only question in dispute between the parties. The bill of Rs. 561.61 p. was alleged to have been signed by one Sant Lal, brother-in-law of the respondent. The respondent denied that Sant Lal was his brother-in-law or that he ever purchased the goods of this bill. The courts below on an examination of the evidence of this issue found that there was no cogent proof that Sant Lal had purchased the goods on behalf of the respond.ent. They also held that it had not been proved that Sant Lal was the brother-in-law of the respondent. Both the courts, thereforee,held that the appellant had failed to prove that goods of this bill (P. 21) were supplied to the respondent. The result was that this issue was decided against the appellant. This is a concurrent finding of fact. I cannot interfere in second appeal. I thereforee, affirm the finding of the courts below on this issue and hold that goods worth only Rs. 14,209.67 p. were supplied by the appellant to the respondent.

(8) I now turn to issue No. 3. This issue has been strenuously argued by counsel on both the sides and the decision of this appeal mainly turns on this issue. As I have said the case of the appellant was that the respondent paid only 8671 .60 p. The respondent on the other hand alleged that he had made payment of Rs. 13,146.60 p. The controversy between the parties centres round the difference between the two amounts, namely, Rs. 4475.00 . This is the amount for which the appellant claims a decree in this appeal.

(9) The amount of Rs. 4475.00 consists of 13 items. Both the courts below have held that the payment of Rs. 4475.00 was made by the respondent to the appellant. The counsel for the appellant has taken me throught these 13 items of dispute and has contended that the courts below were wrong in holding that the payment of Rs. 4475.00 was made by the respondent to the appellant.

(10) The 13 items of dispute can conveniently be divided into two categories. The first category consists of the following 8 items:

____________________________________________________________________________ S.No. Date of paymnent. Amount paid. Exhibit. ____________________________________________________________________________ 1. 16.10.1963 Rs. 200.00 D 7. 2. 18.10.1962 Rs. 250.00 D- 8. 3. 26.10.1962 Rs. 250.00 D-12. 4. 01.11.1952 Rs. 300.00 D-13. 5. 15.09.1962 Rs.1000.00 D 15. 6. 17.10.1962 Rs. 200.00 D-16. 7. 24.10.1962 Rs. 200.00 D-17. 8. 20.10.1962 Rs. 400.00 D-19. ____________________________________________________________________________ Total Rs. 2800.00 ____________________________________________________________________________

WITHregard to these eight items the respondent's case is that these payments were made to the appellant Agency while the appellant's case is that though these payments were made by the respondent they were made not to the appcllant Agency but to their sister concern. The appellant carries on business under the name and style of 'Bansi Dhar Ganga Pershad Agency' I will call it 'agency' for convenience. The other sister concern of the appellant is known as Firm Bansi Dhar Ganga Pershad. I will call it 'the sister firm' for convenience. The dispute between the parties is this. The appellant says that the payment was never made to the agency, but to the sister firm. The respondent claims that the payments were made to the agency. These payments arc all entered in a small note book exhibited in this case. At the top of this note-book at page I, it is written :

'PAYMENTmade to M/s. Bansi Dhar Ganga Pershad Agency Delhi' (marked K).

UNDERNEATHare entered all the above eight items. The appellant says that these words at the top were added later on. These words were not in existence when the payments were made. It is not disputed by the appellant that all these payments were made by the respondent. They were received in the account books of the sister firm. The appellant has produced the account books of both the agency as well as the sister firm. They are all entered in the account books of the sister firm. But the respondent says that he is entitled to the credit of these payments in the account of the agency as the payments were made by him to the appellant agency. The onus of this issue clearly lay on the respondent. The proof that the payment were made in addition to what was admitted by the appellant was plainly on the respondent and he had to discharge that onus. In proof of payment the respondent mainly relied upon this note-book and on his own account-books.

(11) In order to prove these eight entries the respondent summoned a number of witnesses. These witnesses were the employees and the partners of the sister concern. Dw 1, Lallu Mal is a broker. He proved entry D-8. Dw 2 is Madan Lal, an employee of the sister concern. He proved D-7. Nathu Ram Dw 3 another employee of the sister concern proved D-9, D-1O and D-ll. Rajinder Kumar Dw 4 is a partner of the sister concern, and he proved D-12, D-13 and D-14. Another partner of the sister concern is Devinder Kumar Dw 5. He proved D-15. Jagdish Pershad another partner of the sister concern appeared as Dw 6 to prove D-16, D-17 and D-18. These persons were summoned by the respondent though they were the employees or the partners of the sister concern. In the main all these witnesses deposed against the respondent. Nearly all of them admitted that they received the above eight payments totalling Rs. 2800.00 . All of them uniformly said that these payments were made not to the agency but to the sister concern. Devinder Kumar, Dw 5 and Jagdish Pershad Dw 6, both of them categorically stated that the writing at the top of the note-book was not there when they received the payment. This, they said, is a later interpolation. What was further said by these witnesses was that whenever any payment was made by the respondent a puce receipt was issued to him. The appellant also produced the copies of the account books of the sister concern to show that these payments were all entered in the account books of the sister concern. It was further said that receipts of payment were issued in respect of all these eight items to the respondent and those receipts were in the respondent's possession. This being the evidence of the respondent's own witnesses I cannot disbelieve them, though counsel for the respondent urges that I should not place reliance on every word that they have uttered. I don't agree. This is the respondent's own evidence. When he examined the employees and the partners of the sister concern, he has no doubt taking a great risk. Now that the evidence has gone against him, he cannot be heard to say that the testimony of these-witnesses is not worthy of credence.

(12) There are two flaws in the respondent's defense and his evidence. The onus of proof, as I have said, clearly lay on him. In my opinion, he has failed to discharge this onus. The respondent has neither produced the puce receipts issued to him in respect of these payments which would have clearly shown that the payments were made to the sister concern and not to the agency. This would also have shown whether the writing at the top of the note-book was a later interpolation or was in existence at the time of payment. These receipts would have gone a long way in proving the payment of Rs. 2800.00 which is alleged by the respondent. The non-production of these receipts raises an adverse inference against the respondent. He would have me believe that payments were made by him to the agency as there are entries in his account books to that effect. Entries in own's account books without receipts are not sufficient proof to prove payment against the opposite party. Something in the nature of corroboration is required. The best evidence in the case consisted of the receipts which, every witness of the respondent said, were issued by the agency as well as the sister concern whenever any payment was made by the respondent. The respondent however, in his statement stated that he never obtained receipts in respect of the payments which he made and which were entered in the note-book as in the note-book itself he obtained signatures of the persons to whom he made payments. He never got puce receipts in respect of these eight items. This case of the respondent is clearly is belied by the evidence of his own witnesses. Dw 1. Dw 2, Dw 3, Dw 4, Dw 5 and Dw 6. All of them arc unanimous in saying that puce receipts were issued both by the agency as well as by the sister concern in respect of all payments made irrespective of the fact that kacha receipts had been given by the persons to whom the payments were made.

(13) The second flaw in the respondent's defense is that he has withheld from the court the account books he maintained in respect of his dealings with the sister concern. It was not disputed that account books of the dealings with both the agency as well as the sister concern were maintained. It is also not disputed that the respondent had dealings with the sister firm also and made certain payments to that firm. Why has the respondent not produced the account books of the dealings he had with the sister concern This also raises an adverse inference against the respondent.

(14) Both the courts below overlooked these shortcomings in the evidence of the respondent. The whole question was approached from a wrong angle. The courts below thought that the account books of the agency were not reliable, and, thereforee, they held that the respondent has succeeded in proving that he has made the payment of Rs. 2800.00 to the appellant. This in my opinion is an entirely erroneous approach. The onus was on the respondent and he had to discharge the onus by showing that the payments were made by him to the agency and not to the sister concern. This, in my opinion, he failed in proving because he did not produce before the court the best evidence in his possession, namely, the receipts issued in respect of the payments made as well as his own account books of his dealings with the sister concern. The respondent can succeed on the strength of his own case and not on the weakness of the appellant. The burden of proof of issue No. 3 was laid on the respondent. How can he succeed if he has not discharged the onus ?

(15) Another fact of some importance is that on 6-11-1962, the respondent had squared the dealings with the sister concern. He had paid an excess amount of Rs. 862.00 to the sister concern. This being an excess payment it was agreed that credit should be given to the respondent for Rs. 862.00 in the account of his dealings with the agency. Both in the account books of the appellant agency as well as of the respondent there is an admitted entry of Rs. 862.00 dated 6th November 1962. All the above eight payments arc admittedly before this date of 6-11-1962. If the payments had not been made to the sister concern and had been made to the agency, the clearest proof of this would have been the accounts maintained by the respondent himself in respect of the sister concern. The account of the sister concern would have revealed that the dealings were squared as the respondent had paid the disputed 8 items in the account of the sister firm and that is why an excess payment of Rs. 862.00 stood in favor of the respondent. This entry of Rs. 862.00 shows that the respondent's claim is false and the writing at the top of the note-book is clearly a interpolation. His own witnesses have said so. Why must not I read respondent's own witnesses' evidence against him? The second class of entries consists of the following five items :

___________________________________________________________________________ S. No. Date of Payment Amount Paid. Exhibit. ___________________________________________________________________________ 1. 25-11-1962 Rs.500.00 D-9. 2. 06-11-1962 Rs.300.;- D-10. 3. 09-11-1962 Rs.325.00 D-11. 4. 21-12-1962 Rs.250.00 D-14. 5. 02-11-1962 RS.400.00 D-18. ____________________________________________________________________________ Total Rs.1675.00 ____________________________________________________________________________

(16) The dispute regarding these five entries is this. The respondent says that he made the payment of Rs. 1675.00 . This also is admilted by the appellant. What is further stated by the respondent is that apart from the payments entered in the account books of the appellant these further payments were also made by him and for which credit has not been given to him. I will take some of these items to illustrate the nature of the dispute. Take for instance. D-9. There is an entry of 24-11-1962 of Rs. 500.00 in the account books of the appellant. D-9 is a separate receipt of Rs. 500.00 dated 25-11-1962. The case of the respondent is that one payment he made on 24-11-1962 as correctly entered in the appellant's books. The second payment he made again on 25-11-1962 of the same amount, namely, of Rs. 500.00 He has been given credit on 24-11-1962. No credit, he says, has been given to him on 25-11-1962. Here again the question of puce receipts arises. The receipts are of pivotal importance. The appellant's case is that only one payment was made and this was on 24-11-1962 as is entered in the account books. If the respondent had produced the puce receipt issued for Rs. 500.00 , it would have clearly shown whether there was one payment by him or two as is alleged. The respondent's own witnesses, one after another, have deposed that puce receipts were always issued. The manager of the appellant agency (Public Witness 1) has also deposed that receipts were always issued. The respondent has obtained receipts, but, it appears he has chosen not to produce them in court. Let me take another instance, D-ll. It is in the note-book dated 9-11-1962. Credit has been given to the respondent for Rs. 225.00 on 9-11-1962. But the respondent claims that he is entitled to a second credit for this amount of Rs. 225.00 which he paid to Nathu Ram and which is not entered in the appellant's account books. D-4 is the puce receipt issued in respect of this item and on that basis credit has been given to the respondent for Rs. 225.00 . The respondent however, claims that he is entitled to another credit of Rs. 225.00 on account of the fact that this payment was made by him on 9-11-1962 to one Nathu Ram who signed the diary. It appears to me that the payment was made to Nathu Ram on 9-11- 1962. Nathu Ram handed over the amount to appellant. The appellant issued a puce receipt for this amount. The appellants are right in giving one credit for Rs. 225.00 . The respondent is clearly wrong in claiming two credits for this amount. Take the other item D-18. D-18 is entered in the note-book under the date 2-11-1962. On that date Rs. 400.00 were paid by the respondent to Jagdish Pershad and signatures were obtained in the note-book. This amount of Rs. 400.00 is entered in the appellant's books under the date 3-11-1962. Now the respondent says that he made one payment on 3-11-1962 in respect of which credit has been given to him of Rs. 400.00 but he also made another payment on 2-11-1962 to Jagdish Pershad as entered in the notebook and for which, he says, the appellant has not given credit to him. He claims a second credit of Rs. 400.00 . It appears that the payment of Rs. 400.00 was made to Jagdish Prashad on 2-11-1962 who handed it over to the appellant, probably the next day, and an entry accordingly, was made in the account books of the appellant on the day the money came into the hands of the appellant agency. If two payments were made, as in the case of the respondent this could easily have been proved by the production of the receipts issued by the appellant. In that case the respondent must be having in his possession two receipts for Rs. 400.00 For every payment made, it is his own witnesses' case receipt was issued. Where are the receipts? Not even one receipt of Rs. 400.00 has been produced. The respondent relies on the entry of Rs. 400.00 made in his favor in the account books of the appellant. Over and above, he claims that he is entitled to another credit of Rs. 400.00 on the basis of D-18. The appellant's case is that there was a payment of Rs. 400.00 . If that was not so and there were two payments, the onus clearly was on the respondent and he, in my opinion, has utterly' failed in discharging that onus. The same argument has been advanced in respect of remaining items. It is not insignificant that in all these items the amount is the same for which credit has been given and for which a further credit is claimed.

(17) Here in this second class of items as in the first, the courts below did not approach the issue before them by placing the onus of proof on the respondent. Both the courts have held that the appellant's account books were not reliable, and, thereforee, it was held that the respondent has succeeded in proving the payment on the basis of this note-book. It was held that double payments were made by the respondent in respect of the above five items. I entirely disagree with this finding which is the result of placing burden of proof on wrong shoulders.

(18) Counsel for the respondent submitted that in the second appeal I will not be justified in interfering with the concurrent findings of fact on issue No. 3, and in support of his submission he relied on V. Ramachandra Ayyar and another v. Ramalingam Chettiar and another, : [1963]3SCR604 ; Madamanchi Ramappa and another v. Muthaluru Bojjappa, : [1964]2SCR673 ; Abdul Waheed Khan v. Bhawani and others, : [1966]3SCR617 and Misri Lal Nayak v. Mt. Surji and others. 1950 PC 28, (4). The proposition that this court in second appeal will not interfere with the concurrent findings of fact is not in doubt. Since the end of the last century the proposition is well established that the High Court has no jurisdiction to entertain a second appeal 'on the ground of an erroneous finding of fact, however gross or inexcusable the error may be' (Mussummat Durga Choudhrain v. Jawahar Singh Choudhri (1890) 17 I A 122. But if the courts below do not approach the question form the right angle and place onus on wrong shoulders, it will be a clear case of 'a substantial defect or error in procedure' under section 100. Civil Procedure Code . The Supreme Court has ruled that if in dealing with a question of fact the courts below have placed the onus on a wrong party and its finding of fact is the result '.uhstantially of this wrong approach, that is a defect in procedure. (Sec V. Ramachandra Ayyar and another v. Ramalingam Chettiar and another, : [1963]3SCR604 and Ladii Parshad Jaiswal v. The Karnal Distillery Co. Ltd. Karnal and others, : [1964]1SCR270 ), Then it is also well established that legal inference from proved facts is a question of law. (See Nedunuri Kameswaramma v. Sampati Subba Rao, : [1963]2SCR208 ). If the courts below have misunderstood the real question in dispute between the parties, the High Court will be justified in interfering with the findings of fact resulting in an erroneous decision. (See Kakumanu Pedasubhayya and another v. Kakumanu Akkamma and another, : [1959]1SCR1249 ),. The Courts below overlooked the fact that the onus of proof of issue No. 3 was on the respondent. They forgot to ask themselves the question: Has he discharged that onus The result was miscarriage of justice.

(19) Onus of proof plays a vital role in the adversary system of litigation. On it depends the right decision of a case. Onus, generally speaking, lies on a party who would fail if no evidence were given on either side. Applying this rule the onus lay on the respondent.

(20) The Supreme Court has said in V. Ramachandra Ayyar and another v. Ramalingam Chettiar another, : [1963]3SCR604 , that in a case where the evidence which is accepted by the lower appellate court is such as no reasonable person could have accepted that really amounts to saying there is no evidence at all. This is what has happened in this case. In my opinion the conclusions of fact recorded by the courts of fact are such conclusions as are not supported by any evidence. The courts below were not right in placing implicit reliance on the account books of the respondent. The respondent ought to have supported the entries by corroborative evidence either by producing the receipts which were obtained by him or by proving payments in respect of all the 13 entries which were in dispute by independent and reliable testimony. This the respondent did not do. All that he said was that he had made payments which are duly endered in his account books and are shown in the note-book. The best evidence in the case would have been the receipts themselves. These were not forthcoming.

(21) The respondent had in his possession the account books of both the agency as well as the sister firm. He did not produce the account books of his dealings with the sister firm. An adverse inference ought to have been raised against him that if the account books and the receipts had been produced they would have gone against him. Even if the burden of proof does not lie on a party the court may draw an adverse inference if he withholds important documents in his possession which can throw light on the facts in issue in controversy. It is not a sound practice for those desiring to rely upon a certain state of facts to withhold from the court the best evidence which is in their possession which could throw light upon the issues in controversy. The party failing to do so cannot be heard to say that he was never called upon by the opponent to produce the account books or documents. (See Gopal Krishnaji Ketkar v. Mohmed Haji Latif and others, : [1968]3SCR862 and Hiralal and others v. Badkulal and others, : [1953]4SCR758 ),. The courts below were also in error in not raising an adverse inference against the respondent when he had failed to produce the account books as well as the receipts. On this ground alone the courts below ought to have held that the respondent has failed in proving that he made the payment of Rs. 4,475 in addition to what was admitted between the parties.

(22) The counsel for the respondent lastly submitted that no adverse inference should be raised against the respondent unless the account books were summoned by the appellant. In support of his submission, he relied on Ramrati Kuer v. Dwarika Prasad Singh and others, : [1967]1SCR153 and Goswami Shri Mahalaxmi Vahuji v. Shah Ranchhoddas Kalidas (Dead) and others, : [1970]2SCR275 I do not agree. This has never been the law. The onus was on the respondent. He had to prove his case by production of the account books and the receipts. It was not for the appellant to summon the account books of his adversary to prove an issue the burden of which lay on the shoulders of the respondents. As long ago as 1917 the Privy Council depricated this practice. (See T. S. Murugesam Pillai v. M. D. Gnana Sambandha Pandara Sannadhi and others, A.I.R. 1917 PC 6.

(23) In the result, the appeal succeeds. I set aside the decrees of the courts below instead pass a decree for Rs. 5,983.07 p. including interest up to the date of the suit. The appellant shall also be entitled to interest at the rate of 6 per cent annum from the date of the suit till payment and costs throughout.


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