INDIA BUSINESS WORLD - JANUARY 16^th - JANUARY 31^st - 2008

SUPREME COURT ASKS FIRST FLIGHT COURIERS TO DEPOSIT RS 15 LAKH

The Supreme Court has asked First Flight Couriers to deposit Rs 15 lakh within two months as a condition to defend a suit against it. Sify had filed a suit in the Bombay High Court alleging that the courier company hired its services for connection of its networks across India, which included internet access and virtual private network (VPN) but defaulted in payment.

However, the courier company refuted the claim saying there had been deficiency in service provided by the petitioner. A single bench of the court had ruled that the courier company was entitled to defend the suit on deposit of Rs 15 lakh.

Feeling aggrieved, the courier firm preferred an appeal before a division bench of the HC which overturned the condition imposed, and ruled that the courier company can defend the suit without depositing the amount. Then, Sify took the issue to the apex court.

A SC bench comprising Justice Tarun Chatterjee and Justice Dalveer Bhandari said it is evident that the courier company was liable to pay for the services provided by the appellant. The letter of June 26, 2002, produced by the courier company claiming for the first time after 2000 that there was deficiency in service, must be, prima facie, found to be an afterthought. The courier company was making payments towards various invoices raised by the appellant.

It is also evident from the record that the courier company did not raise any such claim regarding deficiency in service when the appellant was demanding its past balance/dues for the services rendered. "We are, therefore, of the view that the division bench was not justified in interfering with the discretionary order of the learned Single Judge granting conditional leave to defend to the respondent (First Flight) on deposit of Rs 15 lakhs," the apex court said.