M/S XACT STUDIO INTERNATIONAL vs M/S LIWONA SP. Z. O. O

PURCHASE ORDER NO.

Â",DETAILS,INVOICE RAISED,

30.06.2010

LIW001- item 1&2","I thank God For…- 6

titlesâ€​;Â

55ways- 7 titles.

Delivery to Greece","Invoice No.3/08/2010

30.08.2010

Amt â€" EUR 14611.75",

30.06.2010

LIW001- item 3","Niezwykle Biografie-6

titles.

Delivery to

“Bellonaâ€​, Poland.","invoice No. 3527/10 dated

11.10.2010 Amt- PLN 44

80",

30.06.2010

LIW001- item 3",,,"invoice No. 3578/10 dated

15.10.2010 Amt- PLN 19

380.60

E-mail dated 05.07.2010 from

Liwona Zajac with

Subject: Items to print for

Turkey","Titles: Puff & Bunn &

Lemm& Sloo

“Uzayâ€​; Puff & Bunn

& Lemm& Sloo

“Haberlesmeâ€​; &

Bunn & Lemm& Sloo

“Hava

Ve

Mevsimlerâ€​; & Bunn

& Lemm & Sloo

“Tasitlarâ€​","invoices No.

1/08/2010/EUR

Dated 25.08.2010

Amt- EUR 10 320.00",

E-mail dated 05.07.2010 from

Iwona Zajac with

Subject: Items to print for

Turkey","Titles:

 Bakalim Taniyalim

“Hayvanlarâ€​;

Kalim Taniyalim

“DenizCanlilariâ€​;

Bakalim Taniyalim

“YavruHayvanlarâ€​.","invoice No.

2/08/2010/ EUR

Dated 25.08.2010

Amt- EUR 8 791.20",

v) That the books were actually delivered to the third parties, who have not been impleaded in the suit.",,,

vi) That there is no privity of contract between the Plaintiff and Defendant as the supply was made to parties located in different countries.,,,

vii) That the interest has been granted on the decreed amount without any agreed terms.,,,

viii) That there are admitted defects in the goods as is evident from email dated 25th February, 2011 ix) That the Court lacks territorial jurisdiction.",,,

x)Â That the plaint is not properly verified & the date of the plaint does not tally with the verification.,,,

Each of the above grounds is dealt with hereinbelow.,,,

Territorial jurisdiction.,,,

According to the Defendant, as per the table contained in the plaint, the delivery of the goods took place abroad, hence, the Trial Court did not have",,,

the territorial jurisdiction. This plea is without any basis, inasmuch as the documents on record clearly show that the invoices have been raised from",,,

Xact Studio International based in Delhi. In the leave to defend application, the Defendant admits that he had made arrangements for the customers to",,,

meet the Plaintiff. He also admits that he introduced his customers to the Plaintiff. He also admits that the material for the books was prepared by him,,,

on various subjects. Thus, he admits that the contents of the book belong to him, the clients and the customers belong to him. Without him having",,,

passed the content to the Plaintiff, the book could not have been published. It is, therefore, clear that the Defendant had a major role and since the",,,

Defendant carries on business in Delhi, the Trial Court had jurisdiction. The question of jurisdiction being a threshold question, the role of the",,,

Defendant, as admitted in the leave to defend application, is sufficient to hold that the suit as maintainable against him and for the Trial Court to hold",,,

that it has jurisdiction.Â,,,

Verification in the plaint and date of the plaint,,,

The Defendant has raised an issue that the verification of the plaint is of 19th July, 2013 whereas above the verification, the date of plaint is stated",,,

as 9th October, 2013. Admittedly, the suit was filed on 9th October, 2013 and was first listed on 11th October, 2013. The date of verification has",,,

been filled (and correctly so) when the plaint was executed and notarized in Poland i.e. on 19th July, 2013. The filing date is subsequent to the",,,

verification. The date above the verification is filled when the counsels sign the Plaint for institution. It is very much possible that after the plaint was,,,

verified, documents were collected and the same was sent to the counsels in India. There could be a time lag between the verification of the plaint and",,,

filing of the suit. This does not create a defect in the plaint as the plaint is duly and properly verified.Â,,,

Suit being based on photocopies,,,

This is a suit under Order XXXVII CPC. On the directions of the Court, the Plaintiff has placed on record the various invoices that have been",,,

raised along with the documents and the purchase orders. The invoices are duly matched with the purchase orders, which have been placed. The",,,

purchase orders have been placed by the Defendant on the Plaintiff and the Plaintiff has raised invoices after dispatching the books to the various,,,

customers of the Defendant. The invoices in original would at best be with the Defendant and not with the Plaintiff and the dispatch documents would,,,

be with the customers. The documents are duly self-attested and there is no reason to disbelieve them. In these days of commercial transactions,",,,

which are carried on across borders, unless and until a doubt is raised as to the genuinity of the documents, upholding a mere technical objection that",,,

the original documents are not filed especially when there are other documents, which prove the existence of the transactions and the genuinity",,,

thereof, would be a very pedantic approach. It is also a fact of which judicial notice needs to be taken of, that business is no longer conducted with",,,

original invoices and carbon copies. Most invoices are transmitted through electronic means. On most occasions, there are no original invoices. In the",,,

present case, on the direction of the Court the self-attested documents were filed and apart from raising an omnibus objection that the original",,,

documents have not been filed, there is nothing specific that has been raised by the Defendant to challenge the existence, genuinity or validity of the",,,

documents. In fact, as will be evident from the emails, which have been placed on record, the Defendant admits to the existence of the liability and",,,

hence the insistence of original documents is merely an eye wash objection raised to delay the proceedings. Moreover, there could be an impossibility",,,

for production of original documents as the commercial invoices would be in the custody of the Defendant. The documents, showing transport of the",,,

goods, could be with the various carriers or the customers. Under these circumstances, this Court is of the opinion that insistence on production of",,,

original documents lacks any basis.Â,,,

Emails not sufficiently proved under Section 65B of the Indian Evidence Act,,,

The Plaintiff has filed on record a certificate under Section 65-B of the Indian Evidence Act, which reads as under:-",,,

“It is certified that documents/photograph placed on record i.e. CC No.77487116 is a computer print out and the same has been provided to me by,,,

the client. The same has been obtained/developed from my printer installed at his office at Poland in routine manner for the purpose of printing.Â,,,

The said computer was under his lawful control. It is further certified to the best of my knowledge that no addition or alteration has been made with,,,

the copy of documents provided from the extract of electronic record.â€​,,,

The same is not signed, however, each of the emails attached with the certificate duly bear the sign and seal of the Plaintiff Company. The",,,

Defendant does not challenge the fact that his email address is rahul.xact@gmail.com. It was also not contended that he did not write these emails.,,,

His argument is that it is not adequately supported by a Section 65-B certificate. A perusal of the emails on record shows that the original printouts,,,

have been taken by the Plaintiff from their computers in Poland and each page of the emails has been duly attested by the authorized signatory. As,,,

held in Shafhi Mohammad v. The State of Himachal Pradesh (2018) 2 SCC 801 (hereinafter „Shafhi‟), the requirement under Section 65-B is",,,

relaxable. The Supreme Court held as under:-,,,

“......................,,,

Accordingly, we clarify the legal position on the subject on the admissibility of the electronic evidence, especially by a party who is not in possession of",,,

device from which the document is produced. Such party cannot be required to produce certificate under Section 65B(4) of the Evidence Act.Â,,,

The applicability of requirement of certificate being procedural can be relaxed by Court wherever interest of justice so justifies.,,,

.................â€​,,,

Recently, in ICICI Bank Ltd. v. Kamini Sharma & Anr. RFA 297/2016 dated on 31st January, 2018, this Court has held, following Shafhi",,,

(supra) and Anvar P.V. v. P.K. Basheer & Ors. (2014) 10 SCC 473 as under:,,,

“16. There is however some serious re-thinking required on the manner in which electronic documents are to be proved. In each case where,,,

electronic documents are involved, it would be impractical to expect the parties to produce the primary evidence which would be the medium on which",,,

the document is stored, considering that electronic documents could be stored on hard drives, hard disks, CPUs, micro-processors, cameras,",,,

telephones, etc. Certificates under Section 65B accompanying the printouts have simply become standard formats.Cross examination on these",,,

certificates can involve debates on model of computer, printer, questions as to who took printouts etc. Courts, therefore, need to take a pragmatic",,,

attitude in these cases. Unless there is a serious challenge to the electronic documents i.e., tampering, forgery, hacking, misuse of an email address,",,,

change in contents etc., usually printouts of electronic documents ought to be allowed to be read in evidence. The complex procedure laid down for",,,

proving of electronic documents can prove to be extremely cumbersome and can have enormous impact especially in commercial transactions, as it",,,

has had in the present case.Â,,,

The Code of Civil Procedure, 1908 and the Evidence Act though have undergone several amendments over the years, in the area of production of",,,

documents, they continue to insist on primary evidence being the admissible evidence. This can result in enormous injustice, due to delay, in",,,

commercial cases. It is for this reason that in several jurisdictions the production of original documents is dispensed with unless there is challenge,,,

raised to the authenticity and existence or contents of a document. One such example is the Civil Evidence Act, 1995 in the United Kingdom which",,,

reads as under:,,,

“1995 Chapter 38,,,

Proof of statements contained in documents,,,

(1) where a statement contained in a document is admissible as evidence in a civil proceedings, it may be proved â€" (a) by the production of that",,,

document, or (b) whether or not that document is still in existence, by production of a copy authenticated in such manner as the court may approve.",,,

(2) It is immaterial for this purpose how many removes there are between a copy and the original.Â,,,

Proof of records of business or public authority.,,,

(1) A document is shown to form part of the records of a business of public authority may be received in evidence in civil proceedings without further,,,

proof.Â,,,

(2) A document shall be taken to form part of the records of a business or public authority if there is produced to the court a certificate to that effect,,,

signed by an officer of the business or authority to which the records belong.Â,,,

For this purpose â€"Â,,,

(a) a document purporting to be a certificate signed by an officer of a business or public authority shall be deemed to have been duly given by such an,,,

officer and signed by him; and,,,

(b) a certificate shall be treated as signed by a person if it purports to bear a facsimile of his signature.Â,,,

…………………..â€​,,,

A perusal of the above provisions shows that copies of documents are acceptable in Courts and are to be authenticated in the manner which the,,,

Court may approve. Courts in U.K. can prescribe the manner in which a document is to be proved, if the copy which is filed is challenged or",,,

questioned. If the records relied upon are part of the records of a business or part of the records of a public authority, the same can be filed along with",,,

the certificate signed by a responsible officer belonging to the business or the public authority. Thus, discretion has been vested with the court to",,,

entertain copies of documents and whether originals need to be insisted upon in each case.â€​,,,

In view of the above legal position, the emails, which have been placed on record along with the certificate as filed, are held to be sufficient to",,,

prove the genuinity of the emails. The Defendant has not filed any other version of the emails to show that the emails either have been distorted,,,

manipulated or tempered with. Thus, there is no reason to doubt the contents of the emails.Â",,,

The suit is against a sole proprietary concern but the sole proprietor has not been made a party.      Â,,,

The Defendant has raised an objection on the framing of the suit i.e. that it has been filed against the sole proprietary concern without naming the,,,

proprietor. A perusal of the documents on record shows that in none of the documents, the Defendant is described as a sole proprietary concern.Â",,,

In most international jurisdictions, even a sole proprietary concern is a legal entity on its own and hence it would not be inapposite to state that the",,,

requirement of law in India that the sole proprietor ought to be made a party to the suit could be in that sense â€" unusual. Moreover, the trading",,,

name of the sole proprietary concern is Xact Studio International and the memo of parties says Xact Studio International through its director. Since,,,

the exact constitution of Xact Studio was not known, the term `director’ as used in the memo ought to be construed in wider terms. The",,,

Defendant has also placed on record an amended memo of parties to overcome this objection. This being a curable defect, the amended memo of",,,

parties having been filed, the defect stands cured. The amended memo of parties is taken on record.   Â",,,

The goods have been delivered to the third party and there is no privity of contract.,,,

A perusal of the pleadings and the documents as also the emails placed on record show that the Defendant’s conduct has been completely,,,

dishonest. The emails placed on record admitted to the liability. One such email dated 23rd December, 2010 from the Defendant reads as under:",,,

“We hv also v ery hard timesÂ,,,

Due to snowing no body is making d payment Nd wht ur company did with greek and turkish companys,,,

They r complaining too much nd they r not making d payment, I m helpless when they will make d payments than only I can do ur pay ments",,,

All books frm greek publshr r wet nd not straight they r shouting ev ry time they got return ev ry book from christmas sale nd same wid turkish,,,

publisher first u delay ed d shipment nd u put same pages in the book like 12 nd 13 page r same, they missed there season nd now they both r",,,

deducting 50 percent our bill nd they will pay next year, u people spoiled our company image",,,

I can‟t do any thing, I didn‟t know earliear tht u don‟t know how to make books SURPRISE!!!!!!!",,,

Rahulâ€​,,,

The Defendant actually claimed that his clients were not making payments to him and they had raised issues about the delayed shipment and same,,,

objections on the books not being the same. He also dishonestly claimed that they had held back 50% of the bills. The Plaintiff has placed on,,,

record the various communications sent by him to the Defendant calling upon the Defendant to pay the same, all of which remain unanswered. One",,,

of the envelopes which contain such notice was returned back to the Plaintiff with the information that the Defendant is travelling abroad and that,,,

there is no information as to when he would be returning. The Plaintiff, upon receiving such emails from the Defendants, confirmed from the",,,

Defendant’s customers that in fact there was no fault in the supplied books and the supply was made as per the specifications. Four emails,,,

received from the Defendant’s customers i.e. Bellona SA of Poland and another customer by the name Pyramid, read as under:",,,

“I hereby declare, that books of series “Biografieâ€, 12 titles were produced by company LIWONA Sp. z o.o. in the year 2010 for publisher",,,

Bellona SA according to the specification within contract with company XACT. No faults were observed on the supplied books. Settlement of,,,

receivables took place in October 2010 directly to the company XACT.â€​,,,

.......................,,,

“Dear Sylwia, good morning,",,,

Our publishing house doesn‟t own not even 1 euro to Xact. After the books you mention below we have published more titles and it‟s all with full,,,

payment.,,,

Of course we have confirmations because we pay through the bank system but we can‟t send you anything if the Xact will allow us. We have sent,,,

already an email to them And we are waiting their reply. If they can Yes we are in a goodwill to proceed with your request Kind Regards,",,,

Dimitris Tziampirisâ€​,,,

19. In fact, the Defendant, in his other emails repeatedly admitted to the payment and suggested a schedule for the payment in his email dated 17th",,,

March 2011. The said emails are set out below:,,,

..............................................,,,

“From:Rahul.xact@gmail.com Date: 2010-11-24 10:54 GMT+01:00 Subject: Re: Payment for Liwona.,,,

To: Marcin Zysk , Iwona ZAJAC ,Sahni saheb",,,

,Sahni sahebÂ",,,

,,,

Its nt like tht my dear tht wht papuga said is d final words he is nt d king ok,,,

He nd me decided payment terms before starting printing nd tht was 120 days, ask him its correct or nt",,,

Nd its his willll he can write whatever he wants,,,

I can‟t stop him, I m just watching my wordsÂ",,,

So sorry Rahul,,,

………………………,,,

From: Marcin Zysk,,,

To: rahul singal,,,

Subject: Re: Payment for Liwona.,,,

Sent: Nov 24,2010 3:14 PM",,,

Dear Rahul, i wish you good trip and safe way home. I understand well your last e-mail, but I must write words that come frome mr.Papuga. Mr.",,,

Papuga said:,,,

“90 days ago I gave you invoices. You don‟t reported any comments and any corrections for payment terms. I demand immediate payment of,,,

overdue invoices. Zbigniewâ€​,,,

I am sorry for his word “demandâ€​.,,,

Best Regards Martin,,,

………………………. Â,,,

2010/11/24 :,,,

>Hi marcin,,,

>I m on traveling nd I chd d delvry dates of d goods nd we talked abt 120 days credit nd ur invoices started due by dec nd than we will start paying,,,

>Bye,,,

>Rahul,,,

.........................................,,,

From: ,,,

Date: 2011-03-17 12:33 GMT+01:00,,,

Subject: Re: Xact payment schedule,,,

To: Liwona ,,,

Cc: Iwona ZAJAC ,,,

Hi,,,

As discussed wid iwona,,,

We can send you,,,

1000 Euro-end of April 2011,,,

5000 Euro-end of May 2011,,,

5000 Euro-end of June 2011,,,

5000 Euro-end of July 2011,,,

Nd at present I m in abudhabi,,,

Nd more will discuss in may last how to proceed further Rahulâ€​,,,

The last email above shows that the Defendant agreed to make the payments in instalments on a monthly basis. The two certificates issued by the,,,

buyers also go to show beyond any pale of doubt that the Defendant was taking a false stand with the Plaintiff that he had not received the payments,,,

from his customers. Emails of the Defendant go beyond any doubt that he owed the payment to the Plaintiff and he was giving such reasons only to,,,

avoid making payment. In commercial transactions, of this nature, timely payment is the essence. The frustration of the Plaintiff is evident from the",,,

emails wherein the Plaintiff wrote to the Defendant that, if overdue payment is not made, he may go bankrupt. Â Conduct of the Defendant deserves",,,

to be seriously viewed.  The stand that there is no privity of contract between the Plaintiff and the Defendant is absolutely false as is borne out,,,

from the record. Thus, it is held that the Defendant has clear privity of contract with the Plaintiff and admitted that he owed money to the",,,

Plaintiff.Â,,,

Claims are barred by limitation,,,

All the invoices are of 2010. Within the period of limitation there is a clear acknowledgment in the email of the Defendant dated 23rd December,",,,

2010 and again on 17th March 2011. Repeated notices have been sent by the Plaintiff in 2011 i.e. 1st January, 2011 and 13th October, 2011. The",,,

suit has been filed on 9th October, 2013 which is within the three year period from the date of the email dated 17th March 2011. Thus, all the claims",,,

are within the limitation period.Â,,,

Defect in goods                 Â,,,

This is another dishonest defence raised by the Defendant. The customers of the Defendant have confirmed that the books have been received as,,,

per the specifications and hence there is not even a semblance of any defect in the books. Except for the bald statement, there is no evidence to claim",,,

that there was a defect in the books. Â,,,

Interest grantedÂ,,,

The Plaintiff, which is a Polish Company, has been unnecessarily made to litigate in India for its legitimate dues for more than almost five years.",,,

The decree passed by the Trial court is upheld with the modification of interest rate as 8% instead of 12% granted by the Trial Court. The Defendant,,,

is directed to make payment within 8 weeks. If the payment is not made within the said period, interest would be payable at 12% per annum. In",,,

addition, the Plaintiff is awarded Rs. 1 lakh as costs. The additional court fees, if any, be deposited by the Plaintiff within 10 weeks. The impugned",,,

judgement and decree is modified. Decree sheet be drawn accordingly.,,,

The appeal is, accordingly, dismissed.",,,