{"id":3583,"date":"2010-01-20T00:00:00","date_gmt":"2010-01-19T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/zachariah-james-vs-t-h-bhaderuddin-on-20-january-2010"},"modified":"2017-01-29T14:04:50","modified_gmt":"2017-01-29T08:34:50","slug":"zachariah-james-vs-t-h-bhaderuddin-on-20-january-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/zachariah-james-vs-t-h-bhaderuddin-on-20-january-2010","title":{"rendered":"Zachariah James vs T.H.Bhaderuddin on 20 January, 2010"},"content":{"rendered":"
Kerala High Court<\/div>\n
Zachariah James vs T.H.Bhaderuddin on 20 January, 2010<\/div>\n
       \n\n  \n\n  \n\n \n \n  IN THE HIGH COURT OF KERALA AT ERNAKULAM\n\nAS.No. 543 of 1995()\n\n\n\n1. ZACHARIAH JAMES\n                      ...  Petitioner\n\n                        Vs\n\n1. T.H.BHADERUDDIN\n                       ...       Respondent\n\n                For Petitioner  :SRI.P.R.VENKETESH\n\n                For Respondent  :T.K.VENUGOPALAN,DINESH R.SHENOY\n\nThe Hon'ble MR. Justice A.K.BASHEER\nThe Hon'ble MR. Justice M.L.JOSEPH FRANCIS\n\n Dated :20\/01\/2010\n\n O R D E R\n                   A.K.BASHEER & M.L.JOSEPH FRANCIS, JJ.\n                      - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -\n                                    A.S.No.543 OF 1995\n                      - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -\n                       Dated this the 20th day of January 2010\n\n                                         JUDGMENT\n<\/pre>\n
Basheer, J.\n<\/p>\n<\/p>\n
      Plaintiff in a “suit on accounts” is the appellant.<\/p>\n
      2. The court below dismissed the suit, holding not only that the court<\/p>\n
had no territorial jurisdiction to try the suit, but also that the failure of the<\/p>\n
plaintiff to produce the books of accounts along with the plaint was fatal to<\/p>\n
his case.     The court below also referred to some other so called<\/p>\n
“discrepancies” in the accounts, which according to it were suggestive of the<\/p>\n
fact that the accounts were not true or correct.\n<\/p>\n
      3. The averments in the plaint may be briefly noticed:<\/p>\n
      4. The plaintiff, the proprietor of an industrial unit engaged in the<\/p>\n
manufacture of polythene films and other allied products, used to supply his<\/p>\n
product to the defendant who was engaged in manufacture of polythene<\/p>\n
bags, sheet, etc.      Plaintiff alleged that there were reciprocal dealings<\/p>\n
between him and the defendant and all such transactions were entered in<\/p>\n
the account books being maintained by him.                             The account between the<\/p>\n
parties was open, mutual and current. At the end of the accounting year of<\/p>\n
1989, viz. on December 31, 1989 an amount of Rs.66,308.55 was found due<\/p>\n
from the defendant to the plaintiff.                    In spite of several demands, the<\/p>\n
defendant failed to discharge the liability. A lawyer notice issued to the<\/p>\n
A.S.No.543 OF 1995
\n                                    :: 2 ::\n<\/p>\n
defendant on January 21, 1992 was returned unserved, since the defendant<\/p>\n
refused to accept the same.       The plaintiff specifically alleged that the<\/p>\n
transactions took place at Kavalam, where his industrial unit was situated<\/p>\n
and within the jurisdiction of the Court at Alappuzha.<\/p>\n
      5. The suit was resisted by the defendant contending that there were<\/p>\n
no reciprocal dealings between him and the plaintiff. But the plaintiff used<\/p>\n
to bring plastic granules to his factory at Ernakulam for “converting” them<\/p>\n
to polythene bags or sheets according to plaintiff’s requirement.         The<\/p>\n
defendant used to collect conversion charges from the plaintiff at the rate of<\/p>\n
Rs.5 per Kg. The defendant        asserted that no transaction took place at<\/p>\n
Kavalam.    However he admitted that certain quantity of raw material<\/p>\n
(granules) brought by the plaintiff was “entangled” in his factory from<\/p>\n
September 1988.      The price of this material was paid by him to the<\/p>\n
defendant through cash and cheque payments. Seven such payments, last of<\/p>\n
which being on January 17, 1991 were referred to in the written statement.<\/p>\n
He further contended that the accounts between him and the plaintiff had<\/p>\n
never been mutual, open or current. He referred to certain ‘conversion jobs’<\/p>\n
undertaken by him in July 1988 for which charges were collected by him<\/p>\n
from the plaintiff. According to the defendant, no transaction between him<\/p>\n
and the plaintiff took place on January 12, 1989 as alleged in the plaint,<\/p>\n
since the employees of his factory were on strike.       He was not able to<\/p>\n
receive any goods in the factory since August 1988 because of “labour<\/p>\n
A.S.No.543 OF 1995
\n                                     :: 3 ::\n<\/p>\n
disturbance”.    The factory was closed down during March 1989.           The<\/p>\n
defendant further alleged that the plaintiff had received some excess amount<\/p>\n
from him and when a demand for returning the excess money was made, the<\/p>\n
plaintiff did not return it and the suit was instituted as a counterblast.<\/p>\n
Finally, it was further contended that the accounts were fabricated by the<\/p>\n
plaintiff and the plaint claim was barred by limitation.<\/p>\n
      6. The court below framed the following issues:\n<\/p>\n
      1) Whether this court has territorial jurisdiction to try the suit?<\/p>\n
      2) Whether the account between the plaintiff and the defendant
\n      was mutual, open and current?\n<\/p>\n
      3) Whether the accounts produced by the plaintiff is genuine?<\/p>\n
      4) Was there any transaction on 12-1-1989?\n<\/p>\n
      5) Whether the suit is barred by the Law of Limitation?<\/p>\n
      6) What is the amount, if any, to which the plaintiff is entitled?<\/p>\n
      7) What is the rate of interest, if any, to which the plaintiff is
\n      entitled?\n<\/p>\n
      8) What is the order as to costs?\n<\/p>\n<\/p>\n
      7. The plaintiff was examined as PW1. His accountant was examined<\/p>\n
as PW2 and Exts.A1 to A12 were marked on his side. The defendant was<\/p>\n
examined as DW1 and Exts.D1 to D5 were marked on his side.<\/p>\n
      8. As mentioned earlier, the court below held that the plaintiff was not<\/p>\n
entitled to get a decree as claimed by him, since the court had no territorial<\/p>\n
A.S.No.543 OF 1995
\n                                      :: 4 ::\n<\/p>\n
jurisdiction to try the suit. Not only that, the court further held that the<\/p>\n
account books produced by the plaintiff were not dependable not only for<\/p>\n
the reason that there were some discrepancies in them but also since the<\/p>\n
account books were not produced by the plaintiff at the time of institution of<\/p>\n
the suit itself as mandated under Order 7 of Rule 17 of the Code of Civil<\/p>\n
Procedure.\n<\/p>\n
      9. It may at once be noticed that the court below did not consider the<\/p>\n
question of territorial jurisdiction at the threshold itself. The learned Judge<\/p>\n
proceeded to consider issue No.1 relating to territorial jurisdiction along<\/p>\n
with issue numbers 2 to 5.\n<\/p>\n
      10.   Paragraph 21 of the impugned judgment deals with the issue<\/p>\n
relating to territorial jurisdiction. In the course of the discussion of the<\/p>\n
above issue, the learned Judge noticed that the plaintiff, while being cross<\/p>\n
examined in court as PW1, had admitted that he had handed over an<\/p>\n
invoice to the defendant in Ernakulam where the industrial unit of the<\/p>\n
defendant was situated. It was further noticed by the learned Judge that<\/p>\n
Ext.B1 letter, written by the plaintiff in 1986, proved that he took delivery of<\/p>\n
the goods from the unit of the defendant at Ernakulam.<\/p>\n
      11. In this context, it may be noticed that the specific case of the<\/p>\n
plaintiff was that the defendant used to purchase plastic granules from him<\/p>\n
at Kavalam for the purpose of his industrial unit which was of course<\/p>\n
situated at Ernakulam. The defendant had tacitly admitted that the plaintiff<\/p>\n
A.S.No.543 OF 1995
\n                                      :: 5 ::\n<\/p>\n
used to supply granules to him for conversion as plastic bags and sheets for<\/p>\n
which conversion charges used to be collected by him from the plaintiff.<\/p>\n
      12.   Significantly, the defendant never alleged or proved that no<\/p>\n
transaction took place between him and the plaintiff at Kavalam at all. Even<\/p>\n
assuming that on certain occasions the plaintiff used to take granules to the<\/p>\n
industrial unit of the defendant for conversion as plastic bags and sheets, it<\/p>\n
did not mean that the defendant never used to purchase plastic granules<\/p>\n
from the plaintiff for the purpose of his industrial unit. The evidence clearly<\/p>\n
indicated otherwise. Significantly, the defendant himself admitted in no<\/p>\n
uncertain terms that there were several transactions between him and the<\/p>\n
plaintiff spread over a long period of time. In fact the case of the defendant<\/p>\n
himself was that he had paid amounts in excess to the plaintiff and that huge<\/p>\n
amount was due from the plaintiff to him. But strangely in the course of his<\/p>\n
examination he stated that he did not choose to take any steps for recovery<\/p>\n
of the amount due from the plaintiff.\n<\/p>\n
      13. We have carefully perused Ext.B1 letter sent by the plaintiff to the<\/p>\n
defendant. By the said communication, plaintiff had placed an order for<\/p>\n
HM\/HD tube rolls weighing 125 kg. The plaintiff requested the defendant to<\/p>\n
deliver the same on the 12th of June 1986.          One sentence in the said<\/p>\n
communication which might have persuaded the learned Judge to decide the<\/p>\n
question of territorial jurisdiction read thus: “In this connection we will visit<\/p>\n
your office to take processed film on 12th afternoon”.       We are afraid the<\/p>\n
A.S.No.543 OF 1995
\n                                      :: 6 ::\n<\/p>\n
learned Judge has egregiously erred in        jumping to the conclusion that<\/p>\n
Ext.B1 letter would conclude the issue of territorial jurisdiction against the<\/p>\n
plaintiff.\n<\/p>\n
       14. On a careful evaluation of the oral and documentary evidence<\/p>\n
adduced by the parties, we have no hesitation to hold that the case of the<\/p>\n
plaintiff is more probable and believable. The evidence clearly shows that<\/p>\n
the defendant had been purchasing goods from the plaintiff at his unit at<\/p>\n
Kavalam within the territorial jurisdiction of the court at Alappuzha.<\/p>\n
       15. There is yet another vital flaw in the procedure adopted by the<\/p>\n
court below while deciding the question of territorial jurisdiction. It is trite<\/p>\n
that the question of territorial jurisdiction has to be decided at the earliest<\/p>\n
point of time.    It is true that the defendant had raised the question of<\/p>\n
territorial jurisdiction in the written statement itself. The court below had<\/p>\n
framed the relevant issue on the basis of the above contention.             But<\/p>\n
strangely the defendant had not taken any steps to see that the above issue<\/p>\n
was considered by the court below at the earliest point of time. The court<\/p>\n
also did not bother to decide that question as a preliminary issue. Stranger<\/p>\n
still, the court below has considered the above issue along with the four<\/p>\n
other issues as is discernible from the judgment. The learned Judge has<\/p>\n
devoted a small paragraph for the said issue towards the end of the<\/p>\n
judgment and that too after considering the other issues pertaining to the<\/p>\n
nature and genuineness of the accounts, about the credibility of the<\/p>\n
A.S.No.543 OF 1995
\n                                       :: 7 ::\n<\/p>\n
accounts, etc.    In view of the settled position on the point as laid down in<\/p>\n
Bahrein Petroleum Co. V. P.J.Pappu<\/a> [AIR 1966 SC 634],<\/p>\n
C.M.Muhammed Ismayil V. M\/S Malabar Engineering Co.<\/a> [AIR 2005<\/p>\n
Kerala 295] and Ayyappan Pillai V. State of Kerala<\/a> [2009 (2) KLT<\/p>\n
985] etc., we have no hesitation to hold that the court below has fallen in<\/p>\n
grave error in non suiting the plaintiff on the ground that the court had no<\/p>\n
territorial jurisdiction. Curiously the court below had not considered the<\/p>\n
option to be given to the appellant\/plaintiff to present the plaint before the<\/p>\n
proper court by returning the same to him even assuming there was no<\/p>\n
territorial jurisdiction for the court to try the suit.<\/p>\n
      16.    It is vehemently contended by Sri.T.K.Venugopalan, learned<\/p>\n
counsel for the appellant that even assuming this court holds that the court<\/p>\n
below had territorial jurisdiction to try the suit, two other legal impediments<\/p>\n
loom large.     According to the learned counsel, the claim made by the<\/p>\n
appellant\/plaintiff was clearly barred by limitation. The other contention is<\/p>\n
that the pleadings and evidence on record will not in any way show that the<\/p>\n
account was mutual, open and current. It is further pointed out by the<\/p>\n
learned counsel that the court below had not considered the question of bar<\/p>\n
of limitation at all. It was held that the account was not open, mutual and<\/p>\n
current.\n<\/p>\n
      17.    In the preceding paragraph, we have already noticed that<\/p>\n
admittedly, the plaintiff and defendant had had several transactions between<\/p>\n
A.S.No.543 OF 1995
\n                                     :: 8 ::\n<\/p>\n
them over a span of 8 to 10 years. According to the plaintiff, the last of the<\/p>\n
transaction between him and the defendant, going by the books of account<\/p>\n
was on March 31, 1989. This contention was vehemently challenged and<\/p>\n
denied by the defendant. But it can be seen from Ext.A9, invoice book<\/p>\n
(invoice No.1037) and Ext.A6, ledger that there was one transaction<\/p>\n
between the plaintiff and the appellant on that day.<\/p>\n
      18. In this context, it may further be noticed that the defendant had<\/p>\n
admitted that he had had several transactions with the plaintiff.           He<\/p>\n
conceded that he used to purchase granules from the plaintiff for the<\/p>\n
purpose of his industry. On certain other occasions, plaintiff used to bring<\/p>\n
granules for production of high density polythene bags.           A perusal of<\/p>\n
paragraphs 10 and 11 of the written statement will undoubtedly show that<\/p>\n
several transactions had taken place between the plaintiff and defendant<\/p>\n
during the relevant period.\n<\/p>\n
      19.   However, according to the learned counsel for the defendant,<\/p>\n
going by the averment in the plaint, the last transaction was on January 12,<\/p>\n
1989. Suit was instituted only on December 19, 1992 after expiry of three<\/p>\n
years from the day of the last transaction. Of course the above contention<\/p>\n
will carry some weight, if it is found that the last transaction was on January<\/p>\n
12, 1989.\n<\/p>\n
      20. In this context, learned counsel for the appellant has invited our<\/p>\n
attention to Article 1 in the Schedule of the Limitation Act which provides<\/p>\n
A.S.No.543 OF 1995
\n                                     :: 9 ::\n<\/p>\n
that:\n<\/p>\n
      a suit for the balance due on a mutual, open and current<\/p>\n
      account where there has been reciprocal transaction between<\/p>\n
      the parties, has to be instituted “within a period of three years<\/p>\n
      from the close of the year in which the last item admitted or<\/p>\n
      proved is entered in the account.”<\/p><\/blockquote>\n
      21.   It came out in evidence particularly from the account books<\/p>\n
(ledgers) and Invoice, Bill Book (Exts.A6 and A9 respectively) that the last<\/p>\n
transaction between the plaintiff and defendant was in fact on March 31<\/p>\n
1989 and that the account between the plaintiff and defendant was mutual,<\/p>\n
open and current. The accounting year ended on December 31, 1989. If the<\/p>\n
period of limitation is reckoned on the basis of the accounting year, the suit<\/p>\n
was well within the period of limitation, as contended by learned counsel for<\/p>\n
the appellant\/plaintiff.  The evidence of DW1 will clearly indicate that he<\/p>\n
had had regular transactions with the plaintiff. According to the defendant,<\/p>\n
large amounts were due from the plaintiff towards conversion charges; but<\/p>\n
he did not choose to proceed against him, since he thought it may not be<\/p>\n
easy for him to recover it from the plaintiff.\n<\/p>\n
      22. It is also pertinent to note that in paragraph 9 of the written<\/p>\n
statement, the defendant admitted that he had issued two cheques in favour<\/p>\n
of the appellant\/plaintiff towards the price of the raw material supplied by<\/p>\n
the latter. The first of the two cheques was admittedly encashed by the<\/p>\n
plaintiff on January 10, 1992 and the second cheque a little later.       But<\/p>\n
A.S.No.543 OF 1995
\n                                    :: 10 ::\n<\/p>\n
according to the defendant, the above raw material was “got entangled in<\/p>\n
his factory because of labour problem, and he made the above payments<\/p>\n
realising plaintiff’s difficulty”.\n<\/p>\n
      23. Still further, in paragraphs 10 and 11 of the written statement, the<\/p>\n
defendant had referred to several payments (not less than ten) made by him<\/p>\n
to the plaintiff. But according to him, all these payments were towards the<\/p>\n
price of raw materials (granules) brought by the plaintiff for “the purpose of<\/p>\n
conversion into sheets etc.”       These raw materials, according to the<\/p>\n
defendant, got “entangled” in his factory and therefore the plaintiff could<\/p>\n
not take them back. All the payments made by him were only towards the<\/p>\n
value of the raw materials left behind by the plaintiff.<\/p>\n
      24. Having carefully perused the oral testimony of the plaintiff and the<\/p>\n
defendant and the documents produced by both sides, we have no hesitation<\/p>\n
to hold that the account that was being maintained by the plaintiff was<\/p>\n
mutual, open and current and therefore the plea of bar of limitation raised<\/p>\n
by the defendant is without any merit especially in view of the admission<\/p>\n
made by the defendant that he made a cheque payment to the plaintiff in<\/p>\n
January 1992. We hold so.\n<\/p>\n
      25. As regards the question whether the plaintiff had succeeded in<\/p>\n
proving his case on the basis of the documents produced by him before the<\/p>\n
court below, it can be seen that the evidence of PW1 and PW2 clearly<\/p>\n
revealed that the plaint claim was supported by the entries in the account<\/p>\n
A.S.No.543 OF 1995
\n                                     :: 11 ::\n<\/p>\n
books and other related documents produced by the plaintiffs. PW2, the<\/p>\n
accountant, had explained all the transactions with specific reference to the<\/p>\n
relevant entries made in relation to the claim in the suit.<\/p>\n
      26. As has been mentioned earlier, the defendant had no case that he<\/p>\n
had never had any transaction with the plaintiff, on the contrary he tacitly<\/p>\n
admitted that he had had transactions with the plaintiff. In fact the case of<\/p>\n
the defendant was that the plaintiff owed some money to him. Still further<\/p>\n
though the defendant had faintly alleged in the written statement that the<\/p>\n
books of accounts were fabricated, no such allegation or suggestion was<\/p>\n
made when the plaintiff was in the box. Having carefully perused the oral<\/p>\n
and documentary evidence adduced by the parties, we are totally satisfied<\/p>\n
that the court below was not justified in assuming that the books of accounts<\/p>\n
were fabricated.\n<\/p>\n
      27. What persuaded the court below to assume that the books of<\/p>\n
accounts might have been fabricated is the alleged failure of the plaintiff to<\/p>\n
produce the books of accounts along with the plaint. The learned Judge<\/p>\n
proceeded to hold that going by the provisions contained under Order 7 Rule<\/p>\n
17 of the Code, plaintiff ought to have produced books of accounts along<\/p>\n
with the plaint itself. But the plaintiff had explained before the court below<\/p>\n
that the books of accounts were not produced along with the plaint, since<\/p>\n
they were with his Chartered Accountant. He had produced those books<\/p>\n
later after taking them back from the Chartered Accountant.          PW2, the<\/p>\n
A.S.No.543 OF 1995
\n                                   :: 12 ::\n<\/p>\n
accountant, had spoken about the entries in the account books. In our view,<\/p>\n
even assuming there was failure on the part of the plaintiff to produce books<\/p>\n
of accounts along with the plaint, the court below was not justified in<\/p>\n
jumping to a conclusion that the books of accounts were fabricated or not<\/p>\n
genuine. Rule 17 does not enable the court to draw such a presumption. Of<\/p>\n
course the court can assess the credibility and genuineness of the accounts<\/p>\n
depending on the attendant facts and circumstances in each case. In the<\/p>\n
case on hand, we are totally satisfied that the plaintiff had established his<\/p>\n
case.\n<\/p>\n
      28. Therefore, the decree and judgment passed by the court below are<\/p>\n
set aside. The suit is decreed in terms of the plaint claim for a sum of<\/p>\n
Rs.89,918\/- with 6% interest thereon from the date of suit till the date of<\/p>\n
realisation from the defendant with cost throughout.<\/p>\n
      Appeal is allowed.\n<\/p>\n<\/p>\n
                                                      A.K.BASHEER, JUDGE<\/p>\n
                                              M.L.JOSEPH FRANCIS, JUDGE
\njes<\/p>\n","protected":false},"excerpt":{"rendered":"
Kerala High Court Zachariah James vs T.H.Bhaderuddin on 20 January, 2010 IN THE HIGH COURT OF KERALA AT ERNAKULAM AS.No. 543 of 1995() 1. ZACHARIAH JAMES … Petitioner Vs 1. T.H.BHADERUDDIN … Respondent For Petitioner :SRI.P.R.VENKETESH For Respondent :T.K.VENUGOPALAN,DINESH R.SHENOY The Hon’ble MR. Justice A.K.BASHEER The Hon’ble MR. Justice M.L.JOSEPH FRANCIS Dated :20\/01\/2010 O R […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,21],"tags":[],"class_list":["post-3583","post","type-post","status-publish","format-standard","hentry","category-high-court","category-kerala-high-court"],"yoast_head":"\nZachariah James vs T.H.Bhaderuddin on 20 January, 2010 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/zachariah-james-vs-t-h-bhaderuddin-on-20-january-2010\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Zachariah James vs T.H.Bhaderuddin on 20 January, 2010 - 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