Shiv Lal Doda v. Pernord Ricard India Pvt. Ltd. & Anr.

1. This appeal is directed against the judgment and order dated 20.03.2024 passed by the learned Single Judge.

2. Via the impugned judgment and order, the learned Single Judge dismissed the application filed by the appellant under Order VII, Rule 11 of the Code of Civil Procedure, 1908 [in short, “CPC”] seeking rejection of the plaint in the suit action instituted by respondent no.1, i.e., Pernord Ricard India Pvt. Ltd., on the ground that it did not disclose a cause of action.

3. The record shows that the appellant, i.e., Mr Shiv Lal, was arrayed as defendant no.2 in the suit action.

4. The record shows that respondent no.1 has filed a suit for recovery of ₹11,13,04,754/- against the appellant and respondent no.2/defendant no.1, i.e., Mr Raj Kumar.

5. Respondent no.2/Defendant no.1 is, purportedly, the principal debtor. 5.[1] It is claimed that the appellant/defendant no.2 executed a surety bond in favour of respondent no.1/plaintiff, guaranteeing payments that respondent no.2/defendant no. 1 would be liable to pay.

6. Aggrieved by the dismissal of the application, the appellant/defendant no.2 has approached this Court via the instant appeal.

7. Although a preliminary objection was taken by respondent no.1/plaintiff concerning the maintainability of the appeal under Section 13(1A) read with the proviso appended to it under The Commercial Courts Act, 2015, we decided to hear the matter on merits since a Special Leave Petition (SLP) has been filed against one of the judgments cited by respondent no.1/plaintiff in support of the preliminary objection, i.e., HPL (India) Limited & Ors. vs. QRG Enterprises and Another (2017) SCC OnLine Del 6955. 7.[1] The SLP, the aforementioned case [i.e., SLP(C) no.5837/2017], is titled HPL (India) Ltd. & Ors. vs. QRG Enterprises & Ors.

8. As far as the merits of the case are concerned, Mr Deepak Jain, learned counsel, who appears on behalf of the appellant/defendant no.2, contends that if the averments in the plaint are read along with the document based on which liability is sought to be foisted on the appellant/defendant no.2, it would demonstrate that no cause of action arises against the appellant/defendant no.2. 8.[1] In this regard, our attention has been drawn to the document marked as Annexure A-4.

9. Drawing our attention to the contents of the documents, Mr Jain submits that there is no limit with regard to the liability that the appellant/defendant no.2 can be mulcted with. 9.[1] Furthermore, Mr Jain points to an apparent inconsistency in the document, which is, that the purported signatures of the appellant/defendant no.2 have been appended under the name of Raj Kumar, i.e., respondent no.2/defendant no.1.

10. Mr Jain contends that this document could have been closely scrutinized and evaluated by the Court while hearing the application under Order VII, Rule 11 of the CPC. 10.[1] In other words, apart from the plaint, the documents filed in support of the assertions made therein can be examined by the Court to avoid falling into the trap of a cleverly drafted suit action/plaint.

11. We have heard Mr Jain, who appears on behalf of the appellant/defendant no.2 as well as Mr Ankit Virmani, learned counsel, who appears on behalf of respondent no.1/plaintiff, at some length.

12. We are of the view that no interference is called for with the impugned judgment and order for the following reasons:

(i) Insofar as the blank space in the surety/guarantee document is concerned, respondent no.1/plaintiff may be able to demonstrate that there was no cap on the liability, given that it would depend on the total value of the transactions entered into between respondent no.1/plaintiff and respondent no.2/defendant no.1 in the specified period, i.e., 2017-2018, and the amount(s) that respondent no.2/defendant no.1 would ultimately owe to respondent no.1/plaintiff. To our minds, it would be premature, for the present, to conclude one way or the other that the document is intrinsically flawed merely because there is no cap on the liability of the appellant/defendant no.2.

(ii) As regards the other submission advanced by Mr Jain that since the purported signatures of the appellant/defendant no.2 are appended under the name of respondent no.2/defendant no.1, the document (Annexure A-4 ) presents an inconsistency as regards the case that is set up against him, is a submission which, also, does not impress us, at least at this juncture, as this fact by itself cannot, in our opinion, have us conclude at this stage that the suit against the appellant/defendant no.2 does not disclose a cause of action. This is, again, a matter for trial.

13. Thus, for the foregoing reasons, the appeal is dismissed.