2017 (8) TMI 341

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....tation business and owned various trucks. It was further pleaded in the plaint that the appellant/defendant no.1 approached the respondent/plaintiff for supply of fuel on credit basis and with respect to which interest at the rate of 1.25% per month compounded quarterly was to be charged. Appellant/defendant no.1 was pleaded to be in default right from the very first bill and outstanding amount kept on inflating on each subsequent bill whereby the appellant/defendant no. 1 offered to liquidate the outstanding amount in installments by desiring to get a running account with the respondent/plaintiff. It is then pleaded in the plaint that the outstanding amount remained unpaid as in August 2004. It is further pleaded that when credit was obtained and the account to be maintained by the respondent/plaintiff the same was subject to a security deposit, which though was originally waived, but, when appellant/defendant no. 1 sought revival of his account with the respondent/plaintiff then the respondent/plaintiff was given by the appellant/defendant no. 1 cheque as security and which was to be used and encashed in case there were defaults in clearing of the outstanding amount. It is then p....

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....ed under Article 1 of the Limitation Act, 1963. 6.(i) With respect to issue nos. 3 and 4 trial court has held that there is no misutilization of the security cheque and this security cheque was rightly presented by the respondent/plaintiff to clear unpaid invoices Ex.PW1/2 to Ex.PW1/9. Trial court has further held that the respondent/plaintiff has proved that there were purchases by the appellant/defendant no. 1 of the fuel on credit basis and there is no proof for the court to hold that the invoices Ex.PW1/2 to Ex.PW1/9 are for inflated amounts. Trial court also referred to admission of DW-1/Sh. Virender Kumar/appellant that he used to take fuel from the respondent/plaintiff sometimes on credit basis also and that the transactions with the respondent/plaintiff continued in cash or by way of cheque or on credit in the year 2005-06. It was further held by the trial court that the appellant/defendant no.1 admitted that he never gave any notice or any letter to the respondent/plaintiff with respect to alleged discrepancies in the bills because of inflation of the bills on the ground that litres said to be filled in the trucks were less than actually what was filled in. The trial co....

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....e was given for clearing the outstanding amount. 21. The argument on behalf of defendant that such cheque has been misused only to make a time barred claim, appears to be not sustainable when DW1 in his cross examination has admitted that he has been issuing the cheque for payment of outstanding amount and has also admitted that he continued to have transaction with plaintiff firm in cash or by way of cheque as well as on credit, in year 200506 as well. DW1 further admits that when said cheque returned dishonoured, he had received legal notice from plaintiff which is Ex.PW1/14. However, DW1 denies giving any reply to such notice of plaintiff but DW1 was confronted with the complaint Ex.DW1/P1 of defendant Virender Kumar, in which he himself has stated in that complaint that he had sent the reply in response to the notice sent by plaintiff firm. These facts assume importance and are sufficient to establish that defendant has failed to establish that cheque was not meant for encashment or that it was given only as security. Defendant to my conclusion has failed to rebut the presumption under section 139/118 of NI Act and has failed to establish that cheque was misused by the....

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.... been regularly made and there was no credit running account. If we consider this aspect of the matter, nothing could come out in the cross-examination of PW1, PW2 or PW7 to show that there was never any credit sale of fuel for trucks of defendants. In the entire cross examination of PW1, it is nowhere suggested to the witness that invoices Ex.PW1/2 to Ex.PW1/9 are not correct or in any way inflated etc. In the absence of any such suggestion coming in the evidence of PW1, it impliedly means that defendants have disputed raising of such bills by plaintiff firm regarding supply of fuel to the trucks of defendants. 35. In this context, counsel for the defendant has argued that inflated bills were raised by plaintiff firm by charging amount for 400 ltrs, whereas the fuel tanks of the trucks had maximum capacity to store only 350 ltrs. at one time. It is argued that such facts clearly show that claim of the plaintiff was not only exaggerated but patently false. It was also argued that defendants never had any credit accounts in the books of plaintiff as cash amount has been paid on each occasion of drawing fuel from the outlet of the plaintiff firm. Taking such plea on the face....

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.... of fuel by plaintiff firm to defendant no. 1. So, it can be safely concluded that this aspect of the defence of defendant no. 1 have not be proved. Certain arguments has been raised regarding number of trucks or regarding name of the firm mentioned in the photographs. But, I find those aspects do not have much bearing in the fact and circumstances of the case because substantially this court is required to evaluate whether there is any legal liability existing against defendants regarding purchase of fuel from plaintiff firm or not. As I have already noted above, that in the absence of any written agreement/arrangement between the parties regarding purchase of the goods, in the absence of anything coming in the evidence of defendant that there was no liability at all for payment to be made, I find that defendants have failed to disprove the case / claim of plaintiff. Merely alleging that plaintiff firm had allured the defendant no. 1 for purchasing fuel from its petrol pump and that assurance was given for discount, does not by itself negate any legal liability of outstanding amount, for supply of fuel which has been duly proved by the plaintiff firm by preponderance of probabilit....