Delhi District Court
M/S Capitol Hills Hotels And Resorts ... vs Shourya Saluja on 30 March, 2026
1
IN THE COURT OF MRS. VEENA RANI, DISTRICT JUDGE
(COMMERCIAL COURT)-8, SOUTH-EAST DISTRICT,
SAKET COURTS, NEW DELHI
CS (COMM.) No.3885/2024
CNR No. DLSE01-012309-2024
M/s Capitol Hills Hotels & Resorts
Through it's A.R. Mr. Surendra Kumar Mishra
Regd. Office at:
C-42, Greater Kailash Part-I,
New Delhi-110048
Telephone no. 09999060046
Email id: [email protected] .....PLAINTIFF
VERSUS
Mr. Shourya Saluja
Architecture and Interiors
E-69, 2nd floor, South Extension,
Part-I, New Delhi-110049
M-8130065399, 7303737888
Email: [email protected] .....DEFENDANT
Veena
rani
Digitally signed
by Veena rani
Date:
2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr.
16:30:56 +0530
Shourya Saluja
2
COMMERCIAL SUIT SEEKING RECOVERY OF
MONEY AMOUNTING TO RS. 12,00,000/- (RUPEES
TWELVE LACS ONLY) ALONG WITH INTEREST.
Date of filing of suit :25-11-2024
Arguments heard on :25-03-2026
Date of Judgment :30-03-2026
JUDGMENT
1. The plaintiff has filed the present suit against the defendant praying therein that the defendant is liable to pay a sum of Rs.12,00,000/-(Rupees Twelve Lacs) to the plaintiff towards principal amount along with interest @ 24 % P.A. till the realization of the said amount along with the cost of the suit.
PLAINTIFF VERSION:
2. The Plaintiff's case, as averred in the plaint, is that the plaintiff being in the business of providing the service of hospitality in South Delhi having its registered office at C-42, Greater Kailash Part-I, New Delhi 110048 was approached in September 2023 by the Defendant--a proprietorship firm managed by Mr. Shourya Saluja with its office at E-69, 2nd Floor, South Extension, Part-I, New Delhi-110049--representing itself in the expertise in civil Veena and architectural services. Relying upon these rani representations, the Plaintiff awarded a renovation contract Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:57 +0530 Shourya Saluja 3 for its hotel premises to the Defendant, culminating in an agreement dated 19.10.2023. While work commenced in October 2023 with a stipulated completion period of four months, it is alleged that the Defendant abruptly abandoned the project midway without lawful justification.
Despite the Plaintiff having disbursed advance payments totaling ₹10,50,000/- and making several requests via telephonic and written correspondence, the Defendant failed to fulfill its contractual obligations. Consequently, the Plaintiff served a legal notice dated 12.06.2024, demanding the recovery of ₹12,00,000/- plus interest, which remains unsatisfied to date.
3. Regarding procedural compliance under the Commercial Courts Act, 2015, the Plaintiff initiated Pre- Institution Mediation under Section 12A of the Act on 24.05.2023. The South East District Legal Services Authority issued notices to the Defendant; however, the Defendant failed to participate in the proceedings. Resultantly, a 'Non-Starter Report' was issued by the concerned Authority on 09.09.2024.
4. On the aspect of jurisdiction, it is submitted that the Defendant maintains its registered office and carries on business for gain within the territorial limits of South Extension, New Delhi. As this location falls within the administrative and territorial jurisdiction of this Court at Veena Saket, this Court is competent to try and adjudicate the rani present dispute.
Digitally signed by Veena rani Date:2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:54 +0530 Shourya Saluja 4 DEFENDANT'S VERSION:
5. Per contra, the Defendant, in its Written Statement, has vehemently denied the allegations, characterizing the suit as a frivolous attempt to extort money. While admitting the execution of the contract dated 19.10.2023 for a total valuation of ₹12,30,000/-, the Defendant contends that no fixed timeline of four months was ever committed. The Defendant further asserts that the cessation of work was not arbitrary but was necessitated by significant cost escalations in raw materials, which had been previously discussed with the Plaintiff.
6. The Defendant further pleads that the delay was attributable to force majeure conditions, specifically the restrictions imposed by the Government of NCT of Delhi on construction activities during January 2024 due to adverse weather conditions. While admitting receipt of payments, the Defendant contends that the Plaintiff's specific requests for premium materials exceeded the original budget. It is claimed that the Defendant funded these additional costs from his own pocket on the Plaintiff's assurance of reimbursement.
7. It is the Defendant's contention that during the Veena period January, 2024, all the construction work were rani stopped by the Delhi Government due to worse weather Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:56 +0530 Shourya Saluja 5 condition (Pollution) in Delhi, therefore, the work was never delayed on the part of the defendant. It is stated that two factors which were involved for delay of the renovation work was rise in cost of renovation work and Bad weather condition (pollution). It is further pleaded that there is no breach of terms and condition on the part of the defendant and defendant never committed to complete the work within four months from the date of commencement of work. It is asserted that the plaintiff is not entitled to recover the outstanding amount of Rs.10,50,000/- alongwith compensation of Rs.1,50,000/- towards damage, Rs.5,00,000/- due to rise in the cost of renovation work along with Rs.2,00,000/- for mental pain as prayed.
8. From the pleadings of the parties, the following issues were framed on 23-01-2025:-
ISSUE No.1 : Whether plaintiff is entitled for recovery of an amount of Rs.12,00,000/- as prayed in prayer clause(a) of the suit for ?OPP.
ISSUE No.2 : Whether plaintiff is entitled for interest, if so, at what rate and for which period ?OPP.
ISSUE No.3 : Relief.
EVIDENCE OF THE PARTIES:
Veena 9. In support of her case, plaintiff has examined Sh. rani Surendra Kumar Mishra , Authorized Representative of Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:55 +0530 Shourya Saluja 6 plaintiff's company as PW1 and filed his evidence by way of affidavit, Ex.PW1/A, wherein he has reiterated and reaffirmed the same facts as stated in the plaint and exhibited and marked the following documents:- a. Original Authority Letter dt. 11-11-2024 is Ex.PW-1/1.
b. Copy of the Agreement dated 19-10-2023 is Ex.PW-1/2(OSR).
c. Printout of the Payment Chart is Ex.PW-1/3. d. Computer Generated Coloured Photographs of incomplete work is Ex.PW-1/4(Colly). e. Office copy of Legal Notice dated 12-06-2024 is Ex.PW-1/5.
f. Copy of reply dated 20-06-2024 is
Ex.PW-1/6(OSR).
g. Bills of other contractors Mark A (Ex.PW-1/7 is de exhibited being photocopy.
h. Original Non Starter Report is Ex.PW-1/8. i. Certificate under Section 63 of the Bhartiya Sakshya Adhiniyam, 2023 in respect of all the electronics documents is Ex.PW-1/9.
10. PW1 has been cross examined by the ld. Counsel for the defendant on 04-08-2025 & 22-09-2025.
11. No other witness was examined by the plaintiff and authorized representative of the plaintiff closed the evidence of plaintiff on 22-09-2025.
Veena 12. On the other hand, the defendant Mr. Shourya rani Saluna has examined himself as DW1 and filed his Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:54 +0530 Shourya Saluja 7 evidence by way of affidavit Ex. DW1/A. DW1 has been cross examined by the ld. Counsel for the plaintiff on 06- 10-2025, 13-11-2025.
13. The defendant has also examined Sh. Krishna Murari as DW2 and filed his evidence by way of affidavit Ex.DW2/A. DW2 was also cross examined by ld. Counsel for the plaintiff on 06-10-2026 and 12-02-2026.
14. No other witness has been examined by the defendant and defendant closed his evidence. Findings and Observations:
15. I have heard the final argument on behalf of both the parties and gone through the record and written submissions of the parties on record. Issue wise findings are as under:-
ISSUE No.1 : Whether plaintiff is entitled for recovery of an amount of Rs.12,00,000/- as prayed in prayer clause(a) of the suit for ?OPP.
16. Burden of Proof and Breach of Contract: The core dispute pertains to the non-completion of renovation work and the retention of advance payments. Under Section 101 of the Indian Evidence Act, 1872 now Section 104 of the BSA, the burden of proof rests on the Plaintiff to establish that the Defendant failed to fulfill the contractual obligations. The Plaintiff has proven the payment of ₹10,50,000/- (admitted by the Defendant) in para 6 of his Veena written statement. and the execution of the contract dated rani 19.10.2023. In commercial works contracts, once a breach Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:54 +0530 Shourya Saluja 8 is prima facie established by the employer (Plaintiff) through evidence of abandonment, the onus shifts to the contractor (Defendant) to justify the delay or stoppage. The Defendant's claim of 90% completion is a bare assertion unsupported by a third-party measurement book or completion certificate, leading to an adverse inference against the Defendant.
17. The cross-examination of the witness PW-1 reveals the following aspects (relevant aspects only):
a. That there was no written schedule approved by both the parties which could show that the time frame of completion of work was four months;
b. That there was no clause in the agreement dated 19.10.2023 that any time period was fixed for the completion of the work (PW-1 was shown the contract to which the witness PW-1 stated that there was no such clause);
c. That the amount of Rs.12,30,000/- mentioned in the agreement dated 19.10.2023 was an 'estimate';
d. That there was no email or communications from the plaintiff to the defendant regarding the work to be completed in four months;
e. The witness PW-1 denied the suggestion that the defendant had completed 90% work;
Veena f. The witness PW-1 was aware of GRAPE (Graded Response Action Plan) restrictions and that no rani Digitally signed permission was taken from the authorities to by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:55 +0530 Shourya Saluja 9 continue the work during GRAPE NORMS restrictions;
g. The witness PW-1 also stated that the remaining work was completed by another contractor and it took 3-4 months to complete the said work;
18. The cross-examination of the witness DW-1 reveals the following aspects (relevant aspects only):
i. The witness DW-1 admitted that the contents stated in Para No. 5 & 6 of the evidence affidavit were not pleaded in the Written Statement;
ii. The witness DW-1 was confronted with the photographs of incomplete work Ex.PW-1/4 which the witness DW-1 admitted that it were the photographs of the terrace where the work was ongoing. However, the said witness denied the suggestion that the defendant had not proceeded with the work from the point of time when theses photographs (Ex.PW-1/4) were taken;
iii. The witness DW-1 admitted that Ex.PW-1/2 did not reflect anything about the purchasing of the material;
iv. The witness DW-1 said that he did not stop the work and again said that the work was stopped due to Govt. circular regarding the Veena rise in pollution;
rani v. The witness DW-1 stated that there was no Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:57 +0530 Shourya Saluja 10 timeline agreed between the parties regarding the work;
19. Force Majeure and Cost Escalation: The Defendant has pleaded two primary defenses:
I. GRAPE restrictions due to Delhi Government construction bans in January 2024, and II. Cost escalation of materials.
GRAPE restrictions due to Delhi Government construction bans in January 2024 (force majeure)
20. The Defendant has raised the plea of force majeure, citing the Graded Response Action Plan (GRAP) restrictions imposed by the Government of NCT of Delhi in January 2024. The witness PW-1 admitted knowledge of these pollution-related construction bans. Under Section 56 of the Indian Contract Act, a contract to do an act which, after the contract is made, becomes impossible by reason of some event which the promisor could not prevent, becomes void when the act becomes impossible. While a government-mandated lockdown or statutory restriction on activity (like construction bans under GRAP) constitutes a valid ground for temporary non-performance, there must be a bona fide endeavor to commence the work again. In the present case the defendant has not proved that the incomplete work was ever endeavored to be completed.
Veena 21. The law relating to Force Majeure has been recently rani settled by the Supreme Court in the case of Energy Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:56 +0530 Shourya Saluja 11 Watchdog v. Central Electricity Regulatory Commission, (2017) 14 SCC 80. The principles laid down by the Supreme Court in paragraphs 34-42 are as under:
a) Force Majeure would operate as part of a contract as a contingency under section 32 of the Indian Contract Act 1872 (`ICA').
b) Independent of the contract sometimes, the doctrine of frustration could be invoked by a party as per Section 56, ICA.
c) The impossibility of performance under Section 56, ICA would include impracticability or uselessness keeping in mind the object of the contract.
d) If an untoward event or change of circumstance totally upsets the very foundation upon which the parties entered their agreement it can be said that the promisor finds it impossible to do the act which he had promised to do.
e) Express terms of a contract cannot be ignored on a vague plea of equity.
f) Risks associated with a contract would have to be borne by the parties.
g) Performance is not discharged simply if it becomes onerous between the parties.
Veena h) Alteration of circumstances does not lead to rani frustration of a contract.
Digitally signed by Veena rani Date:2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:55 +0530 Shourya Saluja 12
i) Courts cannot generally absolve performance of a contract either because it has become onerous or due to an unforeseen turn of events. Doctrine of frustration has to be applied narrowly.
j) A mere rise in cost or expense does not lead to frustration.
k) If there is an alternative mode of performance, the Force Majeure clause will not apply.
l) The terms of the contract, its matrix or context, the knowledge, expectation, assumptions and the nature of the supervening events have to be considered.
m) If the Contract inherently has risk associated with it, the doctrine of frustration is not to be likely invoked.
n) Unless there was a break in identity between the contract as envisioned originally and its performance in the altered circumstances, doctrine of frustration would not apply.
63. It is the settled position in law that a Force Majeure clause is to be interpreted narrowly and not broadly. Parties ought to be compelled to adhere to contractual terms and conditions and excusing non- performance would be only in exceptional situations. As observed in Energy Watchdog (supra) it is not in the domain of Courts to absolve parties from Veena performing their part of the contract. It is also not rani the duty of Courts to provide a shelter for justifying Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:57 +0530 Shourya Saluja 13 non- performance. There has to be a 'real reason' and a 'real justification' which the Court would consider in order to invoke a Force Majeure clause."
22. In the present case the defendant can be given a limited benefit of the GRAPE-IV restrictions but the work could have been resumed thereafter and the said GRAPE- IV restrictions did not justify the abandonment of work.
Cost escalation of materials.
23. As far as the demand of the Defendant for additional costs of ₹3,20,000/- is concerned, the defendant has not raised counter-claims in the Written Statement. It is a settled position of law that a defendant is required to exclusively raise Counter-Claim so as to realize any pending amount(s) / damages etc.
24. During cross-examination, DW-1 admitted that key aspects of his evidence affidavit (specifically Paras 5 and 6 regarding additional material costs) were not pleaded in the Written Statement. It is a settled principle of law that no amount of evidence can be looked into upon a plea which was never put forward in the pleadings. Consequently, the Defendant's defense of "additional costs" and "reimbursement" must be rejected as an afterthought.
25. The core issue for determination pertains to the Veena procedural and substantive requirements for a defendant to seek affirmative relief, specifically the recovery of pending rani payments or damages, within a suit instituted by the Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:56 +0530 Shourya Saluja 14 plaintiff. It is observed that a defendant often attempts to claim such amounts by merely incorporating a request within the prayer clause of their written statement. However, the mandate of the Code of Civil Procedure, 1908 (CPC), particularly under Order VIII Rule 6-A, establishes that a prayer for recovery cannot exist in a vacuum. A defendant is legally obligated to treat their claim for money as a cross-suit by filing a formal Counter- claim. This requires distinct pleadings, a clear cause of action, and the mandatory payment of ad-valorem court fees. Without these elements, a prayer for payment in a written statement is a mere redundancy that lacks the force of a claim.
26. A Counter-claim is, for all practical purposes, a separate suit that is merely tried jointly with the main suit for the sake of judicial economy. The procedural law exists to facilitate justice, but it cannot be bypassed to grant a decree for money to a defendant who has not formally pleaded their case or contributed the requisite court fees to the state exchequer. Thus, a defendant who fails to file a separate Counter-claim is barred from seeking any monetary decree against the plaintiff. The judicial process requires a structured exchange of pleadings. By merely placing a demand in the prayer clause, the defendant evades the responsibility of providing a detailed "Statement of Truth" and the payment of court fees Veena applicable to the recovery amount. Consequently, such rani prayers must be disregarded, as they do not constitute a Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:55 +0530 Shourya Saluja 15 valid legal claim upon which an issue can be framed or a decree can be passed.
27. Thus the legal position is clear that defendant seeking to realize any payment or damages from the plaintiff must file a separate Counter-claim. A mere prayer clause in the written statement, however clearly worded, does not satisfy the requirements of the law. The defendant must explicitly plead the facts constituting the claim and pay the necessary court fees to transform a defensive plea into an actionable claim for recovery.
28. The Defendant's attempt to introduce evidence regarding additional costs (Paras 5 & 6 of DW-1's affidavit) which were not part of the Written Statement is legally impermissible. In Ram Sarup Gupta v. Bishun Narain Inter College, (1987) 2 SCC 555 (reiterated in Brahma Vart Sanathan v. Jagatguru Shankracharya Swaroopanand Saraswati, 2024 SCC OnLine SC 1234), the Court held:
"It is settled law that in the absence of pleadings, evidence, if any, produced by the parties cannot be considered... The object and purpose of pleading is to enable the case of the following party to be known to the opponent."
29. In the absence of such a formal pleading, the court Veena remains divested of the jurisdiction to grant any monetary rani relief to the defendant.
Digitally signed by Veena rani Date:2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:56 +0530 Shourya Saluja 16 Completion of 90% work not proved by the defendant:
30. As far as the Defendant's claim of having completed 90% of the work is concerned, the witness DW-2 (Sh. Krishna Murari - Work supervisor) has deposed that 90% work was completed by the defendant. The recovery of the advance of ₹10,50,000/-, the Plaintiff's entitlement is governed by the principle of quantum meruit and Section 70 of the Indian Contract Act. Since PW-1 admitted that the remaining work was completed by another contractor over a span of 3-4 months, it is evident that a substantial portion of the work remained incomplete when the Defendant exited the site. If a contractor fails to complete the work, the employer is entitled to the costs of completion through a third party. However, the Plaintiff herein has sought a flat recovery of ₹12,00,000/- without providing a detailed breakdown of the "loss" or the actual payments made to the substitute contractor.
31. In view of the fact that the Defendant admitted to ongoing work in the terrace photographs (Ex.PW-1/4) and failed to prove the completion of 90% of the project, the Defendant cannot retain the entire advance if the work performed does not commensurate with the payment received. Conversely, the Plaintiff cannot claim a full refund plus interest without accounting for the work actually executed by the Defendant before the dispute. Veena Therefore, while the Plaintiff has a right to seek damages, rani the lack of a "time is essence" clause and the intervening Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:54 +0530 Shourya Saluja 17 GRAP restrictions bar a claim for total breach. The Plaintiff is entitled to a partial recovery based on the valuation of the incomplete work, but the current prayer for ₹12,00,000/- is excessive given the evidentiary gaps on both sides.
32. In the light of the aforementioned observations, it is held that while the Defendant was not strictly bound by a four-month deadline, the act of not resuming work post- GRAP restrictions without a valid justification constitutes a cessation of service. However, the Plaintiff's prayer for ₹12,00,000/- lacks a granular basis, as no invoices for the 'substitute contractor' were placed on record to quantify the exact loss. Consequently, this Court finds that the Plaintiff is entitled to a refund of the advance payment, subject to a set-off for the work actually executed by the Defendant as per the 'estimate' admitted by PW-1. The Defendant's plea regarding additional expenses is struck out as it violates the rule of 'evidence beyond pleadings'.
33. The core controversy revolves around the mutual failure of the parties to strictly adhere to the evidentiary standards required to prove their respective claims of total breach and total performance. Upon an appreciative reading of the testimony of PW-1, it is observed that while the Plaintiff claims a total abandonment of work, the witness admits that the Defendant did indeed execute a Veena portion of the renovation, necessitating the hiring of two rani subsequent contractors to complete the remainder at an Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:55 +0530 Shourya Saluja 18 alleged cost of ₹6,00,000/- to ₹7,00,000/-. While the Plaintiff has failed to produce the ledger accounts or invoices of these third-party contractors to prove special damages, the factum of non-completion by the Defendant stands established by the admission that the project was finished by others. Here, the Plaintiff's failure to prove the exact additional expenditure leaves the Court to adjudicate based on the principle of equity and the preponderance of probabilities.
34. Conversely, the Defendant's plea for retaining the entire advance is hit by the principle of quantum meruit under Section 70 of the Indian Contract Act, 1872. It is a settled principle that where a party has enjoyed the benefit of a non-gratuitous act (the work done by the Defendant), they must compensate for the same, but only to the extent of the work actually performed. The evidence on record, specifically the photographs of the terrace (Ex.PW-1/4), demonstrates that the project was in a state of flux and far from completion. Since both parties have left "evidentiary gaps"--the Plaintiff failing to prove the exact cost of completion and the Defendant failing to prove 90% completion--the Court must adopt a balanced approach. This Court finds that the ends of justice would be met by acknowledging the work done by the Defendant while penalizing the failure to complete the project.
Veena 35. In view of the fact that the Defendant received rani ₹10,50,000/- and the Plaintiff was forced to engage Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:57 +0530 Shourya Saluja 19 external agencies to make the hotel premises functional, the Defendant is not entitled to retain the entirety of the advance. Applying the doctrine of proportionality, it is held that the Defendant is entitled to retain 50% of the disbursed amount as compensation for the materials and labor already expended on-site (quantum meruit), while being liable to refund the remaining 50% to the Plaintiff. This division accounts for the Plaintiff's admitted "additional pay" to subsequent contractors while recognizing the Defendant's initial mobilization. Consequently, the Plaintiff is entitled to a decree of recovery for ₹5,25,000/- (being 50% of the total paid amount) against the Defendant.
36. For the foregoing reasons and discussions, this Court is of the considered view that plaintiff has partially succeeded to discharge the onus to prove the issue. Accordingly, issue no.(i) is partly decided in favour of plaintiff and against the defendants.
ISSUE No.2 : Whether plaintiff is entitled for interest, if so, at what rate and for which period ?OPP.
37. The determination of the appropriate rate of interest in the present matter necessitates a departure from the standard interest rates applied in civil recoveries, in favor of a rate that reflects the commercial character of the transaction. It is noted that the Plaintiff has prayed for the Veena grant of interest at the rate of 24% per annum. While this rani Court acknowledges the Plaintiff's contention regarding Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:56 +0530 Shourya Saluja 20 the high cost of capital in the hospitality sector, a rate of 24% per annum is generally viewed as being in the nature of a penalty unless expressly stipulated in a signed commercial contract. However, under the proviso to Section 34(1) of the Code of Civil Procedure, 1908, the legislature has empowered the Court to award interest exceeding the 6% ceiling for "commercial transactions." In the exercise of this judicial discretion, this Court finds that although the Plaintiff is seeking 24% per annum, a rate of 12% per annum is more justified and commensurate with the commercial nature of the present transaction.
38. In commercial disputes, the objective of awarding interest is to ensure the creditor is placed in the same position as if the money had been paid on the due date. Thus the rate of interest @ 12% per annum serves as a fair "market-equivalent" for commercial defaults. Consequently, while the prayer for 24% is scaled down to maintain judicial balance, this Court holds that 12% per annum is the most justified rate to compensate the Plaintiff for the delay in recovery and the inflationary impact on the remaining renovation work.
39. The interest is calculated from the date of the legal notice (12.06.2024) to the present date (10.02.2026)
40. The ISSUE No.2 is accordingly decided in favour of Veena the plain tiff-herein and against the defendant-herein. rani ISSUE No.3 : Relief.
Digitally signed by Veena rani Date:2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:55 +0530 Shourya Saluja 21
41. The suit is decreed in favour of the Plaintiff and against the Defendant for a sum of ₹5,25,000/- (Rupees Five Lakh Twenty Five Thousand only). The Defendant is further directed to pay interest @ 12% per annum on the said principal amount from 12.06.2024 until the date of actual realization.
42. The cost of suit is allowed in favour of the plaintiff-
herein.
43. Decree sheet be prepared accordingly. All pending applications stand disposed of.
44. File be consigned to Record Room.
Announced in the open court Dated: 30-03-2026 (VEENA RANI) District Judge (Commercial Court)-08, South-East District, Saket Courts,New Delhi Veena rani Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:54 +0530 Shourya Saluja 22 IN THE COURT OF MRS. VEENA RANI, DISTRICT JUDGE (COMMERCIAL COURT)-8, SOUTH-EAST DISTRICT, SAKET COURTS, NEW DELHI CNR No. DLSE01-012309-2024 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. Shourya Saluja 30-03-2026 Present: Mohd. Haaris, ld. counsel for the plaintiff on VC.
Mohd. Fahad,ld. counsel for the defendant on VC. Vide my separate judgment, the suit of the plaintiff is decreed with cost. Decree sheet be prepared accordingly. File be consigned to record room.
Announced in the open court Dated: 30-03-2026 (VEENA RANI) District Judge (Commercial Court)-08, South-East District, Saket Courts,New Delhi Veena rani Digitally signed by Veena rani Date: 2026.03.30 CS (COMM.) No.3885/2024, M/s Capitol Hills Hotel & Resorts Vs. Mr. 16:30:57 +0530 Shourya Saluja