JUDGMENT SUMMARY:
Jay Ambe Industries Proprietor Shri Dineshkumar Bajranglal Somani vs Garnet Specialty Paper Ltd.
DATE OF JUDGMENT:
7th January 2022
JUDGES:
J.B. Pardiwala, J.
N.R. Mehta, J.
PARTIES:
Jay Ambe Industries Proprietor Shri Dineshkumar Bajranglal Somani (Plaintiff)
Garnet Specialty Paper Ltd. (Respondent)
SUBJECT
The High Court of Gujarat has held that the ledger in itself does not have evidentiary value under Section 34 of the Indian Evidence Act (EA)unless corroborated. Corroboration can be supplied by proving the transaction or by proving the entries in the Daily cash book or Roznama. The ledger which is an account book requires independent evidence to prove them.
AN OVERVIEW
1. The plaintiff had alleged that the respondent had purchased Rs.42,31,167/- worth papers and had only paid Rs.12,64,950/-.
2. The plaintiff had instituted a special civil suit through the Power of Attorney Holder to recover the rest Rs.29,36,211/- amount along with 15% interest. The suit had to proceed ex-parte due to the non-appearance of the respondent.
3. The issues that were raised before the Trial Court were:
A. Whether the plaintiff had proved that the defendant had purchased from the plaintiff?
B. Whether the plaintiff could prove that the remaining sum was legal and recoverable debt from the defendant?
C. Whether the plaintiff was entitled to get interest and how much?
D. Whether the plaintiff was entitled to get reliefs as prayed?
E. What were the order and decree?
4. The aforesaid issues were answered in negation. The suit was dismissed on the following grounds:
a. The plaintiff had failed to prove service of a valid demand notice to the defendant before the institution of the suit. The cover which contained the demand notice had returned unserved with an endorsement 'Door Locked’.
b. There was no proof in regards to the contents and genuineness of the invoices and the delivery challan.
c. The plaintiff had not specified who the amount was paid to him by the defendants. Further, there was an absence of any cogent evidence to prove that the remaining sum was legally recoverable.
d. The suit being instituted through the Power of Attorney Holder had required for the Power of Attorney Holder to state how he had derived knowledge of the various transactions.
5. The plaintiff had then appealed to the High Court of Gujarat under Section 96 of CPC.
IMPORTANT PROVISIONS
The Code of Civil Procedure 1908
- Section 96- Provides for the appeal from the original decree.
Indian Evidence Act 1872
- Section 34- Book entries even in an electronic form which are maintained regularly in the course of business shall be relevant in matters inquired by the Court. However, they shall not be alone sufficient evidence to charge a person with liability.
- Section 59- All the facts except those recorded in documentation or electronics are required to be proved by oral evidence.
- Section 61- The contents in documents can be proved by primary or secondary evidences.
- Section 62- Defines primary evidence.
ISSUES
The issue that was before the High Court was that:
- Whether the trial court was justified in dismissing the suit instituted by the plaintiff, despite there being no denial and/or no rebuttal evidence led by the respondent-original defendant?
- Whether or not it is mandatory for a plaintiff to first issue a demand notice and only thereafter file a suit for recovery of money?
ANALYSIS OF THE JUDGMENT
- The defendant had not appeared before the Trial Court and High Court that the adduced plaint and evidence had remained uncontroverted. The Court had stated that the suit was based on documentary evidence such as invoices, chalan and ledger.
- The High Court of Assam in Chandi Ram v Jamind Kanta Deka, 1952 had held that a ledger which was not supported by any Day-book or Roznama would not fulfill the requirement of Section 34 of EA and could not be regarded relevant under the provision. It had further opined that there was no daily opening or closing balance in the leader accounts that was maintained in some books and they could be prepared at any time. Thus, the ledgers were regarded as irrelevant.
- The High Court of Orissa in Hira Meher vs. Birbal Prasad Agarwal, 1958 had held that the entries of credit ledger, which had been scribed out by the plaintiff himself, could not assert that the transaction on credit actually took place due to the absence of corroboration of the entries made, therefore, could not be relied on. The High Court of Rajasthan in Sohan Lal vs. Gulab Chand, 1966 had held that an account book- Bahi Khata that was maintained in regular course of business and entries was not admissible if not supported by corresponding entries on Rokam or Nagal Behi.
- The High Court of Bombay in Zehna Sorabji vs. Mirabella Hoter Col. (Pvt.) Ltd 1981 had held that a ledger by itself could not be a book of account of the character as per Section 34 of EA unless it was corroborated by entries in the cashbook. The High Court of Nagpur in Beni vs. Bisan Dayal, 1952 had held that the entries in account books were not sufficient to charge any person with liability unless there was independent evidence to prove the entries.
- The plaintiff had presented oral evidence on oath by way of affidavit through his Power of Attorney which was neither rebutted nor cross-examined by the defendant. The oral evidence had constituted sufficient corroboration within the meaning of law about the entries made in the ledger. The High Court of Rajasthan in Balmukand vs. Jagan Nath, 1963 had held that Section 34 of EA did not require any particular form of corroborative evidence. The witness supporting entries made in the account books would be sufficient compliance with Section 34 of the EA.
- It was noticed that the Trial Court had taken the view that the demand notice issued by the plaintiff had not been proved in accordance with law. No law in India had obliged the plaintiff to first issue a demand notice and only thereafter institute a suit for recovery of money. Usually, notice was issued only for the purpose of limitation. If there was apprehension about the issue of limitation which might be raised, the plaintiff could issue a notice and then institute the suit.
CONCLUSION
The appeal succeeded in the High Court of Gujarat and was thus allowed. The judgement of the Trial Court was quashed and set aside. The defendant was directed to pay the remaining sum along with an interest of 6% per annum from the day of the institution of the suit.
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