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TMI Blog2016 (8) TMI 1566X X X X Extracts X X X X X X X X Extracts X X X X ..... of without prejudice is if the terms proposed in the letter are not accepted, the position of the writer of the letter does not get prejudiced or if the terms are accepted, the complete contract is established. This means that when the plaintiff wrote letter dated 16.4.2003 and later, he wanted to safeguard his position. The defendant, from the correspondence at Exh. P-7 to P-12, does not appear to have accepted the proposal of the plaintiff and therefore, in my view, there is no binding agreement between the plaintiff and the defendant that the defendant will prosecute the suit against the insurance company. The answer to issue No. 1 therefore, is in the negative. Whether the defendant No. 1 proves that one time settlement entered into between the original plaintiff and defendant No. 1 was comprehensive and no amount is due or payable by defendant No. 1 to the plaintiff? - HELD THAT:- The counsel for the plaintiff agreed that the OTS with the defendant was a comprehensive settlement and the agreement to continue to sue insurance company as alleged by the plaintiff came up only after the one time settlement was entered into. In view thereof and considering the correspondence w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany) and the policies issued by the Insurance company were also given to defendant as security. It should be noted that it is not the plaintiff's case that the defendant was also an assured under the insurance policies. I am stating this because if it was so, defendant would have been a co-assured with the plaintiff and the policies would have been issued directly in favour of the defendant No. 1. Disputes arose between the plaintiff and the defendant on repayment of the loans and advances whereby the defendant sought to recover sum of ₹ 1,81,74,292.40/- from the plaintiff, Ramesh Agarwal Dying Printing Mill Pvt. Limited and Agarwal Textiles Industries. The defendant filed a suit, being Suit No. 1631 of 1979, in this court, which, after the promulgation of Recovery of Debts due to the Banks and the Financial Institutions Act, 1993, got transferred to the Debt Recovery Tribunal. On 24.10.1979, interim reliefs were granted by this court and the Court Receiver came to be appointed before the suit was transferred to the Debt Recovery Tribunal. On 20.10.1979 a fire broke out in the factory premises of Ramesh Agarwal Dying Printing Mill Pvt. Limited while the court receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting Pvt. Ltd. which was pending before the Debt Recovery Tribunal. 7. It is the case of the plaintiff that by virtue of paying amount of ₹ 1,82,00,000/- to the defendant, the plaintiff came to be subrogated to all the rights that defendant had against the insurance company and there was an agreement between the plaintiff and the defendant that the defendant would continue to prosecute the suit against the insurance company and pay over the decretal amount to the plaintiff. There is no subrogation agreement filed in evidence and the plaintiff has not even referred to any law to claim subrogation rights. No submissions were also made. It is stated by the plaintiff that despite this agreement, the defendant allowed O.A No. 2364 of 1999 against insurance company to be dismissed and thereby breached the agreement with the plaintiff. It is the case of the plaintiff that the defendant had claimed ₹ 1,87,00,000/- and the interest as accumulated on the said sum would work out to ₹ 6,55,00,000/-, which amount, together with further interest @ 15% p.a. from the date of the suit, was payable. If one sees the particulars of claim annexed to the plaint, the amount claimed f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the New India Assurance Company Limited, stood vested and/or subrogated in favour of the original plaintiff and the amounts payable, if any, under the insurance policy by the Insurance Company is payable to the original plaintiff? (2) Whether the defendant No. 1 proves that one time settlement entered into between the original plaintiff and defendant No. 1 was comprehensive and no amount is due or payable by defendant No. 1 to the plaintiff? (3) Whether the plaintiff proves that, the plaintiff is entitled to a decree in the sum of ₹ 6,55,70,725.95 together with interest thereon at 15% per annum from the date of filing of the suit until payment and/or realization? (4) What decree? What order? 10. As regards the 1st issue, there is no evidence whatsoever presented by the plaintiff that the right of the defendant in the insurance policy stood vested and subrogated in favour of the plaintiff. The entire basis of the so-called understanding with the defendant started with the correspondence at Exhibit P-7 to the plaint. It should be remembered that the one time settlement happened sometime between 12.3.2001 and 17.6.2002. On 17.6.2002 the defendant iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecreed by DRT and claim is released by bank. The above shall help both of us, realize the claim at an early date and bank shall get 10% of the settled claim amount and all future litigation also could be avoided on this score. We request you to consider the above request for mutual benefit. Thanking You, truly, Yours For Ramesh Agarwal H.U.F. (emphasis supplied) 11. This letter is only an offer or suggestion from the plaintiff to the defendant with a request to consider the suggestion. This was followed two years later by a letter dated 6.7.2005 (Exh. P-8) again on without prejudice basis enquiring with the defendant the status of the suit against the insurance company. Six weeks after Exhibit P-8 was written the plaintiff follows by another letter (Exh. P-9) on without prejudice basis to the defendant. This letter was addressed to the Deputy General Manager of the defendant and it states Your assurance to pursue the claim on our behalf was after you succeeded in objecting to our intervener application in DRT case. Our letter dated 16.4.2003 (Exh. P-7) was written consequent upon your such assurance The intervener application t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the understanding was between one Mr. Arora and the plaintiff. This itself shows that the testimony of PW-1 cannot be accepted. Moreover, the correspondence written by the plaintiff to the defendant are all on without prejudice basis. Therefore, in my view, we cannot even place reliance on such documents to conclude that there was a concluded understanding. The meaning of without prejudice has been stated in Oberoi Constructions Pvt. Ltd. v. Worli Shivshahi Co-op. Hsg. Society Ltd. 2008(5) Bom CR 855 Paragraph-9 reads as under :- The next legal contention advanced is as to what will be the effect of the words without prejudice . On behalf of the appellants, the learned Counsel has drawn our attention to the judgment of the Supreme Court in the case of Chairman and MD, NTPC Ltd. v. Reshmi Constructions, Builders and Contractors reported in AIR 2004 SC 1330. The Apex Court noted that even correspondence marked as without prejudice may have to be interpreted differently in different situations. The interpretation would be based amongst others according to usage in the profession and that no issue of public policy is involved. The Supreme Court quoted with approval the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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