Case Note & Summary
The appellant, Karnataka State Agro Corn Products Ltd., a Government of Karnataka undertaking, was the defendant in a suit for recovery of money filed by the respondent, M/s Kerala Agro Seeds. The respondent claimed that there was an agreement for supply of 500 metric tonnes of Rice Bran Extraction at Rs.1677 per metric tonne, with payment due within 45 days of supply. The respondent alleged that it sent six consignments and deposited Rs.50,000 as security, but the appellant did not pay the amount, leading to a suit for recovery of Rs.1,75,013. The appellant denied the claim and filed a counter claim. The trial court decreed the suit in favor of the respondent. The appellant appealed. The High Court found that the respondent failed to produce the written agreement and delivery challans, which were the best evidence. The court drew an adverse inference under Section 114(g) of the Indian Evidence Act, 1872, that the documents would have been unfavorable to the respondent. The court held that the respondent did not prove the terms of the agreement or the delivery of goods. Consequently, the appeal was allowed, the trial court's judgment and decree were set aside, and the suit was dismissed. The counter claim was also dismissed as not pressed.
Headnote
A) Evidence Act - Adverse Inference - Section 114(g) Indian Evidence Act, 1872 - Non-production of Best Evidence - Where the plaintiff failed to produce the written agreement and delivery challans despite being in possession, the court drew an adverse inference that the documents would have been unfavorable to the plaintiff's case. (Paras 10-12) B) Civil Procedure - Recovery Suit - Burden of Proof - Sections 101, 102 Indian Evidence Act, 1872 - The plaintiff must prove the existence of the agreement and delivery of goods. Failure to produce primary evidence shifts the burden and leads to dismissal of the suit. (Paras 8-10) C) Contract Law - Agreement - Non-production of Written Contract - Where the plaintiff admitted the existence of a written agreement but did not produce it, the court held that the terms of the agreement could not be proved, and the suit for recovery based on oral evidence alone was unsustainable. (Paras 9-11)
Issue of Consideration
Whether the trial court erred in decreeing the suit for recovery of money when the plaintiff failed to produce the best evidence, i.e., the agreement and delivery challans, and whether an adverse inference should be drawn against the plaintiff under Section 114(g) of the Indian Evidence Act, 1872.
Final Decision
The appeal is allowed. The judgment and decree dated 11.11.2011 passed in O.S.No.2959/2005 by the XL Additional City Civil Judge, Bengaluru, are set aside. The suit of the plaintiff is dismissed. The counter claim of the defendant is also dismissed as not pressed. No order as to costs.
Law Points
- Adverse inference under Section 114(g) of Indian Evidence Act
- 1872 when best evidence withheld
- Burden of proof in recovery suits
- Non-production of documents leads to presumption against party
