Facts of the Case

This is a commercial recovery suit appeal over a cancelled travel package, not a GST case. M/s K Home Appliances had sued M/s Marvs Travel India Pvt Ltd and its director for recovery of Rs. 8,00,000 paid as advance for a 63-person group tour to Australia (6 nights/7 days, Sydney and Melbourne), quoted at 1,245 Australian Dollars per person plus GST, which was cancelled due to Covid-19 before travel could occur in June 2020. The Commercial Court (West District, Tis Hazari, Delhi) dismissed the appellant's application under Order VII Rule 11 CPC seeking rejection of the plaint, while dropping two individual defendants (directors) from the array of parties. The appellant challenged this dismissal in a First Appeal under the Commercial Courts Act, 2015.

Issues Involved

  1. Whether the plaint disclosed a cause of action against the appellant company such that its rejection under Order VII Rule 11 CPC was unwarranted.

Petitioner's Arguments

  • The appellant company was never a service provider for the international tour and was merely a BPO/call-centre/agent for its Australian counterpart, M/s Marvs Travel Group (MTG), which had actually made the tour offer; there was no privity of contract between the plaintiff and the appellant, so the plaint was liable to be rejected under Order VII Rule 11(d) CPC.

Respondent's Arguments

  • The plaint clearly averred that it was the appellant and its director who had painted the picture of organising the international tour, that the quotation of 1,245 Australian Dollars per person plus GST was given by the appellant's representative, and that the advance of Rs. 8 lakh was paid directly into the appellant company's own bank account, as reflected in the plaintiff's bank statement.

Court Order / Findings

  • The Delhi High Court (Justice Yashwant Varma and Justice Dharmesh Sharma) reiterated that under Order VII Rule 11 CPC, only the averments in the plaint — not the defence in the written statement — are relevant to deciding whether a cause of action is disclosed.
  • On a plain reading, the plaint disclosed a cause of action against the appellant, supported by documents including the plaintiff's bank statement showing payment into the appellant's account.
  • The appeal was dismissed in limine, with the Court clarifying that its observations would not amount to any expression of opinion on the merits of the underlying recovery claim.

Important Clarification

GST appears in this case only as part of the per-person tour package price quoted by the travel agency — the dispute and the ruling are entirely about whether a civil plaint discloses a cause of action under Order VII Rule 11 CPC in a Covid-cancellation refund claim. There is no GST determination in this judgment.

Sections Involved

  • Commercial Courts Act, 2015 — Section 13(1A) (appeal).
  • Code of Civil Procedure, 1908 — Order VII Rule 11.

Decision – In Favour of

In favour of the Respondent (plaintiff, K Home Appliances) — the appeal against dismissal of the Order VII Rule 11 application was itself dismissed, allowing the recovery suit to proceed to trial; this is a civil procedure ruling, not a GST decision.

Case Details

Court: High Court of Delhi at New Delhi
Case No.: FAO (COMM) 159/2023
Coram: Justice Yashwant Varma and Justice Dharmesh Sharma
Date of Judgment: 16.08.2023

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