2020 (2) TMI 58 - HC - Insolvency and Bankruptcy

Suit for recovery of price of goods sold and delivered - issue of forgery - HELD THAT - In a suit for recovery of price of goods sold and delivered and in an application for judgment and decree on admission therein, a defendant can set up a defence of forgery. Such defence is required to be evaluated so as to arrive at a finding whether such defence is one of moonshine or of substance. In the facts of the present case, the defendant claims that one Mr. Pankaj Sharma issued certain letters to the defendant. Such Mr. Pankaj Sharma by way of an affidavit denies having issued such letters. These letters apparently relate to the alleged loss that the defendants suffered by way of the inferior supplies effected by the plaintiff. The pendency of the proceedings under the Insolvency and Bankruptcy Code, 2016 is no bar to the present suit being heard and decided. The jurisdiction of the two fora are different - The confirmation of account dated August 11, 2018 shows an outstanding amount of ₹ 5,79,58,608/-due and payable by the defendant to the plaintiff. Application disposed off.

Summary

Issues:
Suit for recovery of price of goods sold and delivered, defense of inferior quality supplies, defense of forgery, judgment on admission, trialable issues, consideration of confirmation of accounts, pending proceedings under Insolvency and Bankruptcy Code, quantum of decree, interest.

Analysis:
In a suit for recovery of the price of goods sold and delivered, the plaintiff seeks a judgment and decree for a substantial amount due from the defendant. The plaintiff claims that the defendant acknowledged a significant sum to be due and payable through various transactions and confirmed accounts. The defendant made part payments but did not dispute the transactions reflected in the accounts, leading to a substantial outstanding amount due as of a specified date. The plaintiff contends that the defense of inferior quality supplies raised by the defendant was not raised contemporaneously and lacks specificity, hence should not be considered valid.

The defendant, on the other hand, argues that the plaintiff initiated insolvency proceedings based on the same transactions, which are yet to be finally adjudicated. The defendant raises issues of inferior quality supplies and potential forgery, pointing to letters and responses exchanged between the parties regarding the quality of goods supplied. The defendant asserts that trialable issues exist, emphasizing the need for a detailed evaluation before passing a judgment and decree on admission.

The Court considers the application for judgment on admission and refers to a previous case to establish the parameters for such judgments. It is noted that clear admissions must be evident from documents issued by the defendant, which can be explained or disputed. In the present case, the defendant disputes the quality of supplies, claiming losses due to inferior goods. However, the defendant's contentions lack specificity and fail to quantify or pinpoint the alleged inferior supplies, weakening the defense raised.

Despite the pendency of insolvency proceedings, the Court proceeds to evaluate the confirmation of accounts signed by the parties, which are not disputed. The confirmation of accounts reflects a substantial outstanding amount due from the defendant to the plaintiff, leading to a judgment and decree for the specified sum. The Court leaves the decision regarding interest open for future consideration and allows the defendant to file a written statement within a specified timeframe.

The judgment concludes by disposing of the relevant applications without costs, maintaining the focus on the substantial outstanding amount due and the validity of the plaintiff's claims in the suit for recovery of goods sold and delivered.