2018 (3) TMI 1869 - HC - Indian Laws

Maintainability of suit - prayer for a decree against the defendant for a sum of ₹ 84,98,224/- together with pendants lite interest and interest on judgment @ 18% per annul and also for other consequential relief's - HELD THAT - Material disclosed in the plaint shows that the suit is well maintainable in law as the plaintiff's claim for the dues against the defendant has not yet been barred. Cause of action for the suit arose partly within and partly outside the jurisdiction and having regard to the leave granted under Clause 12 of the Letters Patent, this Court is vested with the jurisdiction to try the instant suit - In this suit, despite service of writ of summons in due course, no one appeared for the defendant to contest the suit. Considering the report of the Deputy Registrar (Court) and (Judicial) dated 16th June, 2017, the matter was placed under the 'undefended' category and it was heard as an 'undefended suit'. The plaintiff has claimed that there was an understanding between the plaintiff and the defendant that in case of any default, the defendant would be liable to pay interest on any sum due and payable by it, would be charged @ 18% per annum. However, in absence of any agreement or proof that the defendant is liable to pay interest @ 18% per annum, this Court holds that the defendant, in any case, should make payment of some interest on the admitted dues and in this case, in exercise of discretion, this Court holds that plaintiff is entitled to interest @ 9% per annum from 31.01.2017 as mentioned in paragraph 16 of the plaint. Therefore, the interest would be ₹ 7,24,393/- only, till the date of disposal of this suit. The defendant is directed to make payment of the entire sum together with interest as indicated above, within a period of three months from the date of communication of the decree failing which the defendant shall be liable to pay further interest @ 9% per annum on the entire decretal amount till realization thereof. Suit is decreed for the sum mentioned.

Summary

Issues Involved:
1. Maintainability of the suit.
2. Jurisdiction of the court.
3. Non-appearance of the defendant.
4. Proof of the plaintiff's claim.
5. Entitlement to the principal amount.
6. Entitlement to interest on the principal amount.

Detailed Analysis:

1. Maintainability of the Suit:
The court examined whether the suit was maintainable. The material disclosed in the plaint demonstrated that the suit was well maintainable in law as the plaintiff's claim for dues against the defendant had not yet been barred. The cause of action for the suit arose partly within and partly outside the jurisdiction, and the court, having granted leave under Clause 12 of the Letters Patent, was vested with the jurisdiction to try the instant suit.

2. Jurisdiction of the Court:
The plaintiff argued that part of the cause of action arose within the jurisdiction of the court. The orders for supply were made and received at the plaintiff's registered office within the jurisdiction of this court. Part-payments were also routed through the plaintiff's banker within this jurisdiction. The court, therefore, held that it had jurisdiction to entertain the suit.

3. Non-appearance of the Defendant:
Despite the service of writ of summons, no one appeared for the defendant to contest the suit. Consequently, the matter was placed under the 'undefended' category and was heard as an 'undefended suit.'

4. Proof of the Plaintiff's Claim:
The plaintiff produced various documents to substantiate its claim, which were marked as Exhibits. The documents included purchase orders, inspection certificates, tax invoices, consignment challans, and demand letters. The plaintiff also examined a witness, Arun Agarwal, who confirmed the transactions and the defendant's acceptance of the goods without any dispute. The witness's testimony and the documentary evidence collectively established the plaintiff's claim.

5. Entitlement to the Principal Amount:
The court found that the plaintiff supplied 1,23,710 pieces of SGCI Inserts to the defendant, who made part-payment of ?34,00,000/- against the total supply value of ?1,08,10,686/-. The balance amount of ?74,10,686/- remained unpaid. The plaintiff issued demand notices, but the defendant did not respond. The court held that the plaintiff was entitled to the principal amount of ?74,10,686/- for the goods sold and delivered.

6. Entitlement to Interest on the Principal Amount:
The plaintiff claimed interest at 18% per annum based on an alleged understanding with the defendant. However, the court found no agreement or proof supporting the claim for 18% interest. Exercising its discretion, the court awarded interest at 9% per annum from 31.01.2017, amounting to ?7,24,393/- till the date of the judgment. The defendant was directed to pay the total sum, including interest, within three months from the date of communication of the decree, failing which further interest at 9% per annum would accrue on the entire decretal amount until realization.

Conclusion:
The suit was decreed in favor of the plaintiff for the principal amount of ?74,10,686/- and interest of ?7,24,393/-, with further interest at 9% per annum on the entire decretal amount if not paid within the stipulated period. The department was directed to draw up and complete the decree expeditiously, and urgent certified copies of the judgment were to be provided upon compliance with usual formalities.