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TMI Blog2017 (4) TMI 1649X X X X Extracts X X X X X X X X Extracts X X X X ..... mstances of the present case, denial of pre-suit interest to the plaintiff appears to be inequitable. It cannot be lost sight of that the defendant, inspite of showing the sum of Rs. 50 lakhs as payable to the plaintiff in the balance sheet, took a false stand before the Court. A Division Bench of this Court in Bank of Maharashtra v. G.K. Enterprises [ 2005 (5) TMI 699 - DELHI HIGH COURT] to have, relying on SECRETARY, IRRIGATION DEPARTMENT, GOVT. OF ORISSA VERSUS GC. ROY [ 1991 (12) TMI 268 - SUPREME COURT] held that interest is recoverable both at law and in equity on money obtained by fraud or conversion and retained by the defendant and that it is always open to the Court, as the Interest Act is not exhaustive of all claims of interest, to appreciate the facts of each case and then to grant interest in cases not coming strictly within the purview of the said Act, on principles of justice, equity and good conscience. The said binding judgment unfortunately remained unnoticed in Zile Singh [ 2007 (11) TMI 714 - DELHI HIGH COURT] As far as the rate of interest, pre-suit, pendente lite and future is concerned, the suit is found to have been instituted first on 27th April, 2016. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50,000/- towards interest @ 18% from 1st November, 2013 on the said amount of Rs. 3.75 crores; pendente lite and future interest @ 18% is also claimed. 2. The suit came up for admission before this Court on 31st May, 2016, when the defendants No. 1 to 3 were not found to be necessary and proper parties to the suit and their names were struck off from the array of defendants and summons issued to the defendant No. 4 only which is now the sole defendant. The plaintiff has filed amended memo of parties and allowed the said order to attain finality. 3. The sole defendant has filed a written statement denying the claim; insofar as claim for recovery of Rs. 50 lakhs received by cheques is concerned, the same is to be barred by time. 4. The plaintiff has filed a replication reiterating his claim. 5. The suit came up on 27th March, 2017 for framing of issues when both the counsels handed over proposed issues. On going through the pleadings, the personal presence of the plaintiff as well as of Mr. Rajinder Rai/Mr. Bharat Sidheshwar Rai, erstwhile defendants No. 1 3 respectively was directed for 29th March, 2017. 6. On 29th March, 2017, the plaintiff and Mr. Bharat Sidheshwar Rai, Director o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In your books of accounts, has any other money been shown as due to plaintiff Gopesh Mehta? A. Not at all. Q. Were there any other banking transactions between the plaintiff Gopesh Mehta on the one hand and any of the defendants on the other hand? A. No. Q. What interest was agreed to be paid? A. No interest was agreed to be paid as it was a friendly loan repayable on the company Swift Initiative Pvt. Ltd. making profit. Q. Was Rs. 3.25 crores received in cash? A. Not at all. 7. On the basis of the aforesaid statements, it was observed (i) that a decree could forthwith be passed in favour of the plaintiff and against the defendant for recovery of Rs. 50 lakhs with interest post institution of the suit at such rate as may be deemed appropriate by the Court; (ii) that there is no likelihood of the plaintiff being able to substantiate the claim of payment of Rs. 3.25 crores also to the defendant. It was as such put to the counsel for the plaintiff that if at all the plaintiff wants to press for the relief of recovery of Rs. 3.25 crores, the plaintiff will have to give undertaking or deposit in this Court the costs which the defendant would suffer for contesting the suit. On request ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te mentioned in this regard in a written notice given by the person entitled or the person making the claim to the person liable that interest will be claimed, to the date of institution of the proceedings: Provided that where the amount of the debt or damages has been repaid before the institution of the proceedings, interest shall not be allowed under this section for the period after such repayment. (2) Where, in any such proceedings as are mentioned in sub-section (1),- (a) judgment, order or award is given for a sum which, apart from interest on damages, exceeds four thousand rupees, and (b) the sum represents or includes damages in respect of personal injuries to the plaintiff or any other person or in respect of a person's death, then, the power conferred by that sub-section shall be exercised so as to include in that sum interest on those damages or on such part of them as the court considers appropriate for the whole or part of the period from the date mentioned in the notice to the date of institution of the proceedings, unless the court is satisfied that there are special reasons why no interest should be given in respect of those damages. (3) Nothing in this section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the facts of the case and not by any precedent law unless, of course, limited by a statute and that if a Court comes to the conclusion on a given set of facts that a party has been wrongly denied the use of its own money, it is the duty of the Court to see that the said party is appropriately compensated and pre-suit interest @ 12% per annum was awarded. 13. I have considered the controversy. 14. I may at the outset clarify that the counsel for the plaintiff has not pressed for an opportunity to lead evidence to prove the agreement claimed for payment of interest. 15. The judgment of the single Judge of this Court in Zile Singh supra merely follows (i) Bengal Nagpur Railway Co. Ltd. v. Ruttanji Ramji AIR 1938 Privy Council 67 by observing that the provisions contained in the Interest Act, 1978 are almost similar to the provisions contained in the Interest Act, 1839; and, (ii) judgment of the Division Bench of the Madras High Court in Batliboi Co. Ltd. v. Beama Mfg. Pvt. Ltd. (2006) 1 MLJ 276. Both the said judgments, on interpretation of the provisions of the respective Interest Act, held pre-suit interest to be payable thereunder only if conditions of the statute were satisfie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elies on the judgment of Division Bench of Madras High Court in Batliboi Co. Ltd. supra but the Madras High Court also, as far back as in Sena Muhammad Abdul Gaffur Rowthar v. Hamida Beevi Ammal AIR 1919 Mad. 164 held that Interest Act is not comprehensive of all claims to interest. This view was reiterated in Ramireddi Rayalamma v. Sree Muthangi Butchiramayya Garu ILR 1942 (Mad) 464 (DB). 21. As far as Aditya Mass Communications (P) Ltd. supra cited by the counsel for the plaintiff is concerned, the Trial Court therein had awarded interest pre-suit, pendente lite as well as future @ 12% per annum but the High Court in appeal modified the rate of interest from that awarded of 12% to 9% per annum. The observation cited by counsel for the plaintiff came to be made while deciding the only question whether the High Court was justified in reducing the interest from 12% per annum to 9% per annum . It was held that the High Court was not justified in so reducing the rate of interest. It would thus be seen that the Supreme Court in the said judgment was not debating the liability for payment of pre-suit interest and the said judgment cannot be construed as a precedent for the said question ..... X X X X Extracts X X X X X X X X Extracts X X X X
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