Defendant's Leave to Defend Denied, Plaintiff Awarded Claimed Amounts with Interest. Costs Awarded.

The court dismissed the defendant's leave to defend application, decreed the suit in favor of the plaintiff for the claimed amounts of Rs. 65 lacs plus Rs. 38,45,961/- with 18% per annum simple interest till payment. The court awarded costs to the plaintiff, citing the defendant's liability under the agreement and the frivolous nature of the defenses raised.

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Issues Involved:
1. Delay in filing the application.
2. Claim for money decree under Order XXXVII CPC.
3. Non-supply of C-Forms and differential tax/VAT claim.
4. Termination of business relationship and settlement agreement.
5. Defenses raised by the defendant for leave to defend.
6. Applicability of Sections 91 and 92 of the Indian Evidence Act.
7. Limitation period for filing the suit.
8. Grant of leave to defend based on Supreme Court precedents.
9. Costs and interest awarded to the plaintiff.

Detailed Analysis:

1. Delay in Filing the Application:
The court noted that there was no opposition to the application for delay, and thus, it was allowed and disposed of.

2. Claim for Money Decree under Order XXXVII CPC:
The plaintiff sought a money decree for Rs. 1,13,10,000/- as the balance amount payable under a written contract dated 6.5.2013, and an additional Rs. 38,45,961/- for differential tax/VAT due to the defendant's failure to supply C-Forms.

3. Non-Supply of C-Forms and Differential Tax/VAT Claim:
The plaintiff argued that the defendant was obligated to provide C-Forms under the Central Sales Tax Act, 1956, as per the agreement dated 6.5.2013. The defendant failed to provide these forms, leading the plaintiff to pay Rs. 38,45,961/- to the sales tax authorities. Clause 8 of the agreement explicitly stated that the defendant would be liable for differential sales tax if C-Forms were not supplied.

4. Termination of Business Relationship and Settlement Agreement:
The business relationship between the parties was terminated on 30.11.2012. Subsequently, a full and final settlement agreement was entered into on 6.5.2013, where the defendant agreed to pay Rs. 1,30,00,000/- to the plaintiff. The defendant paid only Rs. 65,00,000/-, leaving a balance of Rs. 65,00,000/-, which was claimed in the suit along with the differential tax amount.

5. Defenses Raised by the Defendant for Leave to Defend:
The defendant sought unconditional leave to defend, raising several defenses:
- The plaintiff had to collect goods worth Rs. 4 crores from the defendant's warehouse and promised discounts.
- The plaintiff could not claim Rs. 38,45,961/- as it was not a liquidated liability in the agreement.
- Payment was contingent on the defendant selling the stocks.
- The plaintiff's fault in obtaining C-Forms.
- The suit was barred by time.
- Lack of territorial jurisdiction, which was later given up by the defendant.

6. Applicability of Sections 91 and 92 of the Indian Evidence Act:
The court held that the terms of the agreement dated 6.5.2013 could not be contradicted by oral evidence as per Sections 91 and 92 of the Indian Evidence Act. The defendant's claims of additional agreements or terms were legally barred and rejected.

7. Limitation Period for Filing the Suit:
The court rejected the defendant's argument that the suit was barred by limitation. The suit was filed within three years from the date when the amounts became payable under the agreement (31.5.2013), thus within the limitation period.

8. Grant of Leave to Defend Based on Supreme Court Precedents:
The court referred to the Supreme Court judgment in IDBI Trusteeship Services Ltd. Vs. Hubtown Ltd., which outlined principles for granting leave to defend. The court found the defendant's defenses to be frivolous, vexatious, and not raising any genuine triable issues, thus dismissing the leave to defend application.

9. Costs and Interest Awarded to the Plaintiff:
The court mandated the imposition of actual costs on the defendant for frivolously defending the suit. The plaintiff was awarded a decree for Rs. 65 lacs plus Rs. 38,45,961/- with 18% per annum simple interest till payment, considering the commercial nature of the transaction and the defendant's failure to pay the dues.

Conclusion:
The court dismissed the defendant's leave to defend application, decreed the suit in favor of the plaintiff for the claimed amounts, and awarded costs and interest, emphasizing the defendant's liability under the agreement and the frivolous nature of the defenses raised.

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