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TMI Blog2008 (12) TMI 818X X X X Extracts X X X X X X X X Extracts X X X X ..... t No. 1; that the defendant No. 1 was to pay the amount of the invoice on or before the due date; that it was however agreed by the defendants that if they fail to make the payments on time they will pay interest at 24% per annum on the value of the invoice; that the plaintiff effected the supply of goods on the defendants and the defendants used to make on account payments from time to time against the various invoices raised by the plaintiff; that the said payments were adjusted against the various invoices by the plaintiff after giving due credit as and when the payments were received; that the plaintiff filed CS(OS) No. 2742/1999 in this Court for recovery of ₹ 39,67,465.19 then due from the defendants; that during the pendency of the aforesaid suit the matter was settled and the plaintiff agreed, against the then outstanding amount of ₹ 29,17,253/- as on 25th January, 2001, to pay a sum of ₹ 19,17,253/- only in full and final settlement; that the plaintiff in the circumstances withdrew CS(OS)No. 2742/1999 on 3rd September, 2001; that the plaintiff thereafter continued transacting business with the defendants and the defendants issued to the plaintiff various ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to incur personal responsibility, is liable personally on the instrument, except to those who induced him to sign upon the belief that the principal only would be held liable. Section 7 of the said Act defines the maker of a cheque as the drawer. Section 30 of the Negotiable Instruments Act makes a drawer of a cheque liable to compensate the holder. Thus, in the present case, as far as the claim on the basis of the cheques signed by the defendant No. 3 is concerned, the defendant No. 3 having signed as a cheque as authorized signatory and having not disclosed that he does not intend to incur personal liability, would be liable for the amount, if any, found due on the said cheques. 5. Coming back to the issue of limitation, the plaintiff has in the plaint set out a table of the cheques issued by the defendants and returned dishonoured to the plaintiff as under: Sr. No. Cheque No. Date Amount (Rs.) 1. 252010 20.12.2001 25,921 2. 252012 22.12.2001 37,721 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28. 252049 09.01.2002 15,041 Similarly, the plaintiff has in the plaint set out a table of the cheques issued by the defendants but not presented by the plaintiff as under: Sr. No. Cheque No. Date Amount (Rs.) 1. 252562 07.01.2002 26,220 2. 252577 15.01.2002 17,480 3. 252586 16.01.2002 40,000 4. 252716 22.01.2002 24,357 5. 252722 24.01.2002 28,655 6. 252732 27.01.2002 35,000 7. 252733 28.01.2002 42,499 8. 586955 01.02.2002 59,339 9. 586954 31.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 205754 12.12.2001 17379 15. 255257 21.11.200,1 2058.60 6. As far as the limitation qua the amount for which cheques were issued, the limitation prescribed in Article 14 of Schedule 1 of the Limitation Act for the recovery of price of goods sold and delivered, as the transaction between the parties herein was, where no fixed period of credit is agreed upon is prescribed as three years commencing from the date of the delivery of the goods. Article 15 concerns a suit for the price of goods sold and delivered, to be paid for after the expiry of a fixed period of credit. The limitation of three years in such cases commences from the date when the period of credit expires. Though, the witness of the plaintiff in his affidavit aforesaid deposed in para 14 that the defendants were liable to pay the amount of the invoices on or before the due dates, a perusal of the invoices-cum-challans proved by the plaintiff does not have a column of due date. It does have a column of payment terms, but nothing is filled therein. In the absence of any pleading or evidence to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s within time. The plaintiff would thus be entitled to a decree in the said amount only towards principal, the balance principal amount being barred by time. 10. The next question is of the rate of interest. The plaintiff has in the plaint pleaded the agreement for payment of interest at 24% per annum. However, the witness of the plaintiff has not deposed of interest at such rate at any time in the earlier transactions between the parties being paid. The plaintiff itself has claimed pre-institution interest @ 12% per annum only. The invoices-cum-challans of the plaintiff do not bear any provision for interest. However, transaction between the parties, even though, of sale of goods, being a commercial transaction, I find the claim for interest at 12% per annum to be reasonable. The plaintiff is held entitled to pre- institution interest at 12% per annum from the date of each of the cheques, claim where for is found to be within time, till the institution of the suit. However, post institution of the suit, the record reveals that the plaintiff has been highly negligent in prosecuting the suit. The plaintiff failed to take steps for service of the defendants after the institution o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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