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TMI Blog1995 (9) TMI 398X X X X Extracts X X X X X X X X Extracts X X X X ..... tate of Haryana agreed to subsidies the same to the extent of 50 per cent and they, accordingly issued Bank Draft on 31-3-1970 infavour of the defendant for an amount of ₹ 75,000/- and defendant also issued a receipt on 9-4-1970 for the amount of ₹ 74,955/- after deducting ₹ 45/- towards the bank charges. 4. It is averred by the plaintiff that the plaintiff had advanced the said 50 per cent of the cost of the project on clear understanding and undertaking that the project will be implemented within a period of six months and in the event of implementation of the said project they were to have the shares of the said amount but in the event the said project was not implemented then the amount of ₹ 75,000/- would be refunded with interest at the rate of 9.5% per annum. It is further averred by the plaintiff that the defendant had obtained a license from the Government of India under the Industries Development Regulation Act, 1951 and had also moved an application on 14-6-1969 for issuance of a Letter of Intent which is a condition prerequisite for grant of a licence. The said Letter of Intent was issued on 1-4-1970 and it was valid for six months. The defe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest @ 9.5% per annum. 6. It is contended that when the said project report was prepared it was found that lot of electrical energy was required for implementing the said project and there was shortage of electric supply and, Therefore, they could not go on with the project but the project report is not with them and the project report has become the property of the Government of Haryana. The defendant had never agreed to refund with interest 50 per cent of the cost of the project report which was paid by the State of Haryana. 7. It is further contended that by the letter dated 13-1-1974 the defendant had made it quite clear that the terms of refunding ₹ 75,000/- with 9% interest mentioned in the Agreement dated 31-3-1970 were net acceptable to the defendant and the defendant had withdrawn the said Agreement of 31-3-1970, which was not signed by the plaintiff even till that date. Thus, according to the defendant, they themselves had incurred all expenses in the said project and the project could not be carried on for no fault on their part. Defendant was never liable to return the amount of 50 per cent of the cost of project report as the said amount was to be convert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ehalf of the plaintiff one Mr. Prem Nath Wadhwa has entered the witness box. He has deposed that he is working as an Assistant in the Industries Department. He identified the signatures of Dhanendra Kumar and he has also deposed that he was Director of Industries of the State of Haryana. But he does not claim in his examination-in-chief that the Government of Haryana had authorised Shri Dhanendra Kumar, the Director of Industries, to file the present suit and to sign the present suit on behalf of the State of Haryana. No government resolution or any document is produced to show that the Director of Industries Shri Dhanendra Kumar was authorised by the State of Haryana to file the present suit. What this witness is doing is only identifying and proving the signature of Dhanendra Kumar but he nowhere makes a claim that Dhanendra Kumar was authorised by the State of Haryana to sign the plaint on behalf of the State of Haryana. In the cross-examination this witness has deposed as under: The plaint and power of attorney were not signed by Dhanendra Kumar in my presence. I did not see any document to say that Dhanendra Kumar was authorised to file this suit and to sign the plaint on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the said letter as well as per the admitted position if the project which the defendant had undertaken was implemented then the said amount of ₹ 75,000/- was to be converted into government's share capital in the said industry. But, unfortunately, the said letter does not mention as to what was to happen in case the said project was not implemented. But merely because the said letter does not specifically mention as to what was to happen in case the project was not implemented, it could not be said that the amount paid by the Government was paid gratuitously to the defendant. When the letter said that in case the project was implemented the amount was to be converted into government's share in the capital, the natural corollary of the same would be that in case the said project was not implemented then the amount was to be returned to government. Therefore, the cause of action for the Government to claim back the amount would arise when it is made known to the government that the said project was not to be implemented. The plaintiff has clearly averred in the plaint itself that in order to have the said project implemented the defendant was to obtain a letter of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as that of a debtor ad creditor and it must appear that the statement is made with intention to admit such jural relationship. No doubt such intention can be inferred by implication from the nature of admission and need not be expressed in words. Though the admission need not be express, it must be made in circumstances and words from which the Courts can reasonably infer that the person making the admission intended to infer to a subsisting liability as at the date of the said statement. The principle of acknowledgment has been laid down by the Supreme Court in the case of Vilaiama v. Sivathanu [1980]1SCR354 Under Section 18 of the Limitation Act one of the essential requirements for a valid acknowledgment is that the writing concerned must contend that admission of a subsisting liability. A mere admission of a past liability is not sufficient to constitute such an acknowledgment. Thus, the release deed executed by the original mortgagees stating, in effect, that the mortgages had been established by payment of the mortgage debts in entirety by the redeeming co-mortgagor, do not amount to acknowledgements of a subsisting liability, which could give a fresh starting point of li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were issued and the same were circulated through respective Chambers of Commerce, and we have already sent a copy of the said guidelines received by us through Engineering Association of India. For your ready reference we enclose herewith one more copy of the said guidelines (Annexure A). 14. Then it has been further mentioned in the said letter that the defendant had incurred expenditure in all of ₹ 9,45,000/- out of which only ₹ 75,000/- were paid by the Government of Haryana and the non-implementation of the plant, was not on account of any default on their part and, Therefore in these circumstances, they were not liable to pay any amount and the recovery of the amount should be waived. 15. Thus, it is the stand of the defendant that they were never to refund the amount and the claim of the refund amount made by the Government was not proper. No doubt they have used the word that the recovery should be waived because after all the claim was made by the government and the government could force the recovery by having recourse to law of recovering the dues as revenue dues. But merely because of the same it could not be said that the defendant has acknowledged it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore the defendant withdraws the same. But the plaintiff had not acted accordingly and, thus, gave ample opportunity to the defendant to withdraw that offer from May 1971 till Oct. 1974. Therefore, in view of the above considerations. I hold that it was not open for the plaintiff to treat the said agreement as a valid and binding agreement by signing the same on 16-10-1975 after the same was withdrawn by letter dated 6-10-1974. 17. There could not be any obstacle for the defendant to withdraw Clause No. 5 from the said agreement. Merely because he had signed and forwarded the said agreement with his letter dated 14-5-1971, it could not be said that defendant was estopped from withdrawing the same and that he was prevented by the principle of estoppel from withdrawing the same. The principle of Estoppel will come into play only in case the plaintiff had accepted the said agreement and had acted in pursuance of the said agreement and in detriment to its own interest. It could not be said that because of the said agreement the plaintiff was in any way mislead and plaintiff had acted detrimental to his own interest and, consequently, the defendant could not be allowed in Oct. 1974 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nted subsidy would be converted into equity capital and in the event of non-implementation of the project the feasibility report will become the property of the State Government. Guidelines in this behalf were issued and the same were circulated through respective Chambers of Commerce and we have already sent a copy of the guidelines received by us through Engineering Association of India. For your ready reference we enclosed herewith one more copy of the said guidelines (Annexure A). 19. The Annexure A mentioned in the above para are the documents Exhibits P/10 and P/11. Therefore, documents, forming Exhibit P/10 and Exhibit P/11 are part of document marked Exhibit P/9, i.e. the letter dated 9-8-1979 which was sent by the defendant. Therefore, it could not be said that this letter dated 13/15-9-1969 sent by the Engineering Association of India (Northern Region) containing the alleged details of the incentives and concessions available in Punjab and Haryana are, as a matter of fact, concessions given by the Governments of Punjab and Haryana. Therefore, that Government could not be said to be a document of the plaintiff and that the plaintiff is bound by the said document. Learn ..... X X X X Extracts X X X X X X X X Extracts X X X X
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