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TMI Blog2003 (11) TMI 333X X X X Extracts X X X X X X X X Extracts X X X X ..... mplied with and acted upon by the parties. Apart from what has been said, subsequent to the MOU there was also a lot of correspondence between the parties by exchanging letters giving offers and counter-offers, as would be revealed in the letters dated 16-6-1994, 23-12-1994, 12-6-1995, 15-6-1995 and 19-6-1995. All these correspondences would go to show that the parties failed to arrive at a consensus even on what were the terms of the MOU. Thus, it is clear that there was no concluded contract nor was there any novation. - CIVIL APPEAL NOS. 8132-8133 OF 2001 - - - Dated:- 4-11-2003 - S.N. VARIAVA AND H.K. SEMA, JJ. Dhruv Mehta, Mohit Chaudhary, Ms. Shalini Gupta and K.L. Mehta for the Appellant. Ranjit Kumar, Rana Mukherjee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compromise as conveyed by the appellant bank by letter dated 20-5-1994. Since, there was talk of compromise between the parties which actually took place on 18-5-1994 at 3.00 p.m., the consensus arrived at must be taken to be a new contract between the parties and in the event the terms of this contract is obeyed by any party the other side cannot get away from it on the principle laid down in section 62 of the Contract Act. The clause-II of the enclosure containing the terms of the compromise fixes these settled amount at Rs. 33.14 lakhs plus interest at 6% thereon till the date of liquidation which is fixed at 12 months from the payment of first instalment of 12 lakhs which is to be paid within a month from the date of arriving at the M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alone and there was no resolution of the Board of Directors to that effect on the said date. It is true that there was some exchanging of letters between the parties after the MOU. But that does not mean that the MOU looses its legality and significance, rather such correspondence were made around between the parties due to wrong interpretation given to the said MOU by one party and non-compliance of the terms by the Bank. Therefore, the MOU creating a new contract between the parties does not loose its force because of such correspondence. Accordingly, I came to the conclusion that the Bank is precluded from claiming any higher rate of interest or claiming the interest from the debt of the claim case in view of the terms of MOU. Accordingl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er full and final payment. 3. The payment of the aforesaid amount will be made in instalments. The first instalment of Rs. 12.00 lakhs will be made within 30 days and then the residual amount will be repaid by 4/5 instalments in 12 months. On receipt of the first instalment of SOM compromise amount of Rs. 12.00 lakhs, UBI will participate in rehabilitation/restructuring of SVPL a/c. It will parallelly discuss with IRBI for the expansion scheme and will also subscribe to equity shares as required under the project. 4. In case of default of instalment payment of SOM as prescribed above, the entire outstanding liability will attract normal rate of interest with quarterly rests. 5. UBI will pay up to date fixed-deposit interest on the mon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terms of Order 23 Rule 3 of Civil Procedure Code. 9. Mr. Ranjit Kumar, learned senior advocate contended that in view of the MOU signed by the parties the original contract stood substituted by the MOU and it is a fit case where section 62 of the Indian Contract Act can be invoked. We have already said that there was no concluded settlement or novation. Even otherwise, there has been non-compliance of the terms and conditions of the MOU by the respondents and a party in breach can hardly seek to enforce a contract. Therefore, the MOU does not amount to novation of contract as envisaged under section 62 of the Indian Contract Act. The contention of Mr. Ranjit Kumar is, therefore, legally untenable. 10. For the reasons aforestated, w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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