GS Marbles Vs Shree Granites

GS Marbles Vs Shree Granites, Judgment dated 15.07.2025, RFA(COMM) 83/2023: Neutral Citation:2025:DHC:5597-DB, High Court of Delhi, Coram: Hon’ble Mr. Justice Vibhu Bakhru and Hon’ble Mr. Justice Tejas Karia

The appeal arose from the judgment and decree dated 02.03.2023 passed by the District Judge (Commercial Court)-02, Tis Hazari, Delhi in CS (COMM) No. 496/2021, whereby the suit filed by M/s Shree Granites for recovery of ₹6,26,617/- with interest was decreed against M/s GS Marbles. The core dispute centred around a purchase order dated 15.06.2018 issued by the respondent for supply of granite slabs, for which an advance payment had been made. The respondent alleged non-supply of material and sought refund of the advance along with interest. The appellant, through its proprietor Mr. Manoj Saini, denied knowledge of the transaction and claimed that the business and accounts were controlled by Mr. Rajaram Agarwal, who allegedly committed GST fraud.

Procedurally, the appellant was served with summons but failed to file a written statement within the statutory period of 120 days, despite entering appearance. The trial court first proceeded ex parte but later set aside that order while closing the right to file the written statement. On an application under Order VIII Rule 10 CPC, the trial court decreed the suit in favour of the respondent, relying on the documents including the purchase order signed by Mr. Saini, bank statements showing receipt of advance, and the appellant’s reply letter which did not deny non-supply.

In appeal, the appellant contended that it was itself a victim of fraud committed by Mr. Agarwal and had no knowledge of the transaction. The respondent opposed this, arguing that the appellant had accepted the purchase order and failed to file a written statement even after repeated opportunities. The High Court noted that under Order VIII Rule 1 CPC, the outer limit for filing a written statement is 120 days from service of summons, beyond which the right stands forfeited. It also analysed whether in such a situation the suit must automatically be decreed or if the court must examine the merits.

Discussing legal precedents, the court held that a decree under Order VIII Rule 10 CPC is permissible where the plaintiff’s case is unimpeachable and there are no disputed questions of fact requiring evidence. On facts, it was found that the appellant had received the advance, failed to supply goods, and failed to place any credible material on record to substantiate its defence of fraud by Mr. Agarwal. The trial court had rightly held that the documents filed by the respondent were of unimpeachable character and the appellant’s plea was an afterthought.

Dismissing the appeal, the High Court upheld the decree in favour of the respondent along with interest, finding no cause to interfere with the impugned judgment and decree passed by the trial court. Pending applications were also disposed of.