KAMDHENU CHEMICALS AND FERTILIZER INDUSTRIESversusSOUTHERN PETROCHEMICALS INDUSTRIES CORPORATION

            Digitally signed
SWAROOP by SWAROOP
        SHARAD
SHARAD PHADKE
PHADKE  Date: 2026.08.29
            19:10:51 +0530                                            26 sa 317 of 2026.doc

                               IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                    CIVIL APPELLATE JURISDICTION
                                    SECOND APPEAL NO.317 OF 2026
                                                WITH
                                 INTERIM APPLICATION NO.6093 OF 2026

   Kamdhenu Chemicals and Fertilizer Industries
   a partnership firm, through its partners and Ors. ...        Appellants
         versus
   Southern Petrochemical Industries Corporation …              Respondent

   Mr. S.S.Kanetkar with Mr. P. Kothari, for Appellants.
   Mr. Raj Mehta with Ms. Hesha Mehta i/by RKM Legal Services for
   Respondent.

                                 CORAM:    N.J.JAMADAR, J.

                                 RESERVED ON          : 19 AUGUST 2026
                                 PRONOUNCED ON        : 29 AUGUST 2026

   ORDER :

   1.             Heard the learned Counsel for the parties.

   2.             This Second Appeal is directed against the judgment and decree dated

   29 October 2025 passed by the learned District Judge, Pune, in RCA No.566

   of 2016, whereby the appeal preferred by the Appellants against the decree

   dated 27 November 2001 passed by the learned Civil Judge, Sr. Division, in

   SCS No.453 of 1992, thereby passing a money decree in favour of the

   Respondent and dismissing the counter-claim filed by the Appellants-

   Defendants, came to be dismissed.

   3.             The Respondent was dealing in the business of manufacture and sale

   of urea and Dia Ammonium Phosphate (DAP).                    Defendant No.1 is a


   SSP                                                                     1/7
                                                                  26 sa 317 of 2026.doc

registered partnership firm.    Defendant Nos.2 to 11 were the partners of

Defendant No.1. Defendant No.1 was engaged in manufacture and sale of

fertilizers.

4.     Since June 1987, the Plaintiff claimed to have supplied urea and DAP

to the Defendants, pursuant to the orders placed by the Defendants. An

amount of Rs.16,57,250.50 was outstanding towards the price of the goods

sold and delivered by the Plaintiff. Thus, the suit was instituted for recovery of

the said amount along with interest @ 20% upto 19 July 1991 and @ 26%

p.a. from 20 July 1991.

5.     The Defendants resisted the suit by filing the Written Statement. A

Counter-claim in the sum of Rs.40,19,854/- was also made to recover the

alleged losses suffered by the Defendants on account of the breach of the

contract by the Plaintiff, in as much as the Plaintiff had not supplied urea and

DAP in equal proportion and that impacted the manufacture of the granule

fertilizers. It was further contended that, the goods were to be supplied by the

Plaintiff to the Defendants for captive consumption and they were to be paid

for by the Defendants after the manufacture of the fertilizers.

6.     By a judgment and order dated 27 November 2001, the learned Civil

Judge was persuaded to decree the suit, holding that the Plaintiff was entitled

to recover an amount of Rs.35,42,877.27 along with interest @18% p.a on the

principal amount of Rs.16,57,250/-.      Conversely, the Counter-claim of the


SSP                                                                    2/7
                                                              26 sa 317 of 2026.doc

Defendants came to be dismissed. It was also held that the Counter-claim

was barred by law of limitation.

7.    Being aggrieved, the Defendants preferred an appeal before the District

Court. By the impugned judgment and decree dated 29 October 2025, the

learned District Judge dismissed the appeal finding no error in the decree

passed by the trial Court.

8.    Mr. Kanetkar, learned Counsel for the Appellants, submitted that the

learned District Judge committed a grave error in law in returning a finding

that the Defendants did not function as the consignee for captive consumption

for the goods supplied by the Plaintiff, though the trial Court has answered

Issue No.7 in the affirmative to the extent of supply of 250 tones of DAP.

Secondly, the Courts below committed an error in misconstruing the

documents which indicated that the Defendants were the consignee of the

Plaintiff for captive consumption and that led to mis-carriage of justice.

Thirdly, both the Courts were in error in holding that the counter-claim was

barred by law of limitation. It was a case of continuing cause of action and the

Courts below were wrong in holding that the period of limitation for the

counter-claim started to run from the date the Plaintiff stopped supply of DAP.

9.    In opposition to this, Mr. Mehta, learned Counsel for the Respondent,

submitted that, the concurrent findings of facts do not warrant interference in

exercise of the appellate jurisdiction under Section 100 of the Code of Civil


SSP                                                                3/7
                                                              26 sa 317 of 2026.doc

Procedure, 1908. Both the Courts, upon appraisal of the evidence, especially

the admissions in the cross-examination of the Defendants witness, have

recorded categorical findings that the Defendants failed to establish that the

Defendants were the consignee for captive consumption. Nor the Defendants

could establish that they ever raised any grievance on the count that the

Plaintiff did not supply urea and DAP in equal proportion and that affected the

manufacturing of fertilizers.    Such findings of facts are not open for

interference in Second Appeal, was the thrust of the submission of Mr. Mehta.

10.   I have perused the material on record and given careful consideration

to the submissions canvassed across the bar. The submission premised on

the captive consumption, forcefully canvassed by Mr. Kanetkar, is not borne

out by the evidence on record. Learned Civil Judge has, after meticulous

evaluation of the evidence, recorded a clear and unequivocal finding that,

neither the oral nor documentary evidence supported the stand of the

Defendant that they were the consignee for captive consumption. On the

contrary, the correspondence exchanged between the parties indicated that

the Defendants had repeatedly placed orders for supply of urea and DAP.

11.   The submission of Mr. Kanetkar that the Courts below had

misconstrued the documents, is simply not borne out by the evidence

adduced by the parties. Indeed, the trial Court has recorded a finding that the

initial supply of 250 tones of DAP by the Plaintiff to the Defendants was in the


SSP                                                                4/7
                                                             26 sa 317 of 2026.doc

nature of consignment. However, there was overwhelming evidence to show

that, thereafter, the jural relationship between the parties was that of pure

seller and purchasers of the goods.

12.   In regard to the counter-claim as well, the Courts below have upon the

evaluation of the evidence, recorded findings that there was no material to

show that the Defendants had ever raised the dispute about the non-supply of

the urea and DAP in equal proportion or contemporaneous conduct of the

Defendants supported the said defence.         Incontrovertibly, there was no

express contract between the parties in regard to the supply of urea and DAP

in equal proportion and simultaneously. The case of oral agreement and

understanding between the parties was demolished during the course of

cross-examination of the Defendants witness. To add to this, the Defendants

chose not to examine a witness who was allegedly privy to such verbal

arrangement. At any rate, the determination by the Courts below is in the

arena of appreciation of evidence and finding of facts.

13.   The last ground raised by Mr. Kanetkar was that of alleged error in

dismissing the counter-claim as being barred by law of limitation. Once the

Courts have found that no case for damages on account of non-supply of

urea and DAP in equal proportion was proved, in a sense, the bar of limitation

looses significance. Even otherwise, under no circumstances, the aspect of

non-supply of the goods assumes the character of a continuing cause of


SSP                                                               5/7
                                                                       26 sa 317 of 2026.doc

action. The legal position is well settled.            In the case of Balakrishna

Savalram Pujari Waghmare V/s. Shree Dhyaneshwar Maharaj Sansthan 1,

a three-Judge Bench of the Supreme Court expounded as to when a

continuous cause of action arises, as under :

               “31…...Does the conduct Does the conduct of the trustees
               amount to a continuing wrong under S. 23 ? That is the
               question which this contention raises for our decision. In other
               words, did the cause of action arise de die in them as claimed
               by the appellants ? In dealing with this argument it is
               necessary to bear in mind that S. 23 refers not to a continuing
               right but to a continuing wrong. It is the very essence of a
               continuing wrong that it is an act which creates a continuing
               source of injury and renders the 'doer of the act responsible
               and liable for the continuance of the said injury. If the wrongful
               act causes an injury which is complete, there is no continuing
               wrong even though the damage resulting from the act may
               continue. If, however, a wrongful act is of such a character that
               the injury caused by it itself continues, then the act constitutes
               a continuing wrong. In this connection it is necessary to draw a
               distinction between the injury caused by the wrongful act and
               what may be described as the effect of the said injury. It is only
               in regard to acts which can be properly characterised as
               continuing wrongs that s. 23 can be invoked.”
                                                         (emphasis supplied)


14.     In the case at hand, the Plaintiff had allegedly stopped supply of DAP in

the month of February / March 1989 and the counter-claim was filed on 7

1   AIR 1959 sc 798

SSP                                                                         6/7
                                                               26 sa 317 of 2026.doc

December 1992. Failure to supply the goods at a particular point of time,

thus, gave rise to the cause of action for the Defendants. It was not the case

of continuing cause of action. Thus, the Courts below have rightly held that,

the counter-claim was barred by the law of limitation.

15.   The conspectus of aforesaid consideration is that, no question of law,

much less, a substantial question of law, arises for consideration on any of the

counts. Resultantly, the Second Appeal fails.

16.   Hence, the following order :

                                             ORDER

            (i)      The Second Appeal stands dismissed.

            (ii)     In view of the dismissal of the Second Appeal, IA No.6093

      of 2026 also stands disposed.




                                                          ( N.J.JAMADAR, J. )

17.   At this stage, the learned Counsel for the Appellants seeks stay to the

execution and operation of the decree. Since the decree in question is a

money decree passed in the year 2001, the prayer for stay does not deserve

to be entertained.

18.   Oral application for stay, thus, stands rejected.

                                                  ( N.J.JAMADAR, J. )



SSP                                                                 7/7