Karnataka High Court
Gayathri Steel Suppliers vs Shyam Trading Company on 30 January, 2026
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NC: 2026:KHC:5200
RFA No. 977 of 2018
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 30TH DAY OF JANUARY, 2026
BEFORE
THE HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE
REGULAR FIRST APPEAL NO. 977 OF 2018 (MON)
BETWEEN:
GAYATHRI STEEL SUPPLIERS
OFFICE AT NO. V/4, 3RD CROSS,
1ST STAGE, PEENYA INDUSTRIAL AREA,
BANGALORE - 560058.
REPRESENTED BY ITS PARTNER,
SRI. ANIL KEDIA,
AGED ABOUT 46 YEARS,
REPRESENTED BY ITS GPA HOLDER,
MR. RAHUL BANSAL,
S/O. MR. SUSHIL KUMAR BANSAL,
AGED ABOUT 30 YEARS,
...APPELLANT
(BY SRI TRIBHUVAN PRAJWAL K, ADVOCATE
SRI K B NAVEEN KUMAR, ADVOCATE)
Digitally
signed by
AND:
PRAMILA G V
Location: SHYAM TRADING COMPANY
HIGH COURT OFFICD AT F-9, SWASTIK MANANDI ARCADE,
OF NO.401/2, AST FLOOR, SR ROAD,
KARNATAKA SHESHADRIPURAM,
BANGALORE - 560020.
REPRESENTED BY ITS PARTNER,
SRI. LALIT KUMAR JHUNJHANWALA,
AGED ABOUT 51 YEARS,
OFFICE AT F-9, SWASTIK MANANDI ARCADE,
NO.40/2, 1ST FLOOR, SR ROAD,
...RESPONDENT
(RESPONDENT IS SERVED BUT UNREPRESENTED)
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NC: 2026:KHC:5200
RFA No. 977 of 2018
HC-KAR
THIS RFA IS FILED UNDER SECTION 96 OF CPC,
AGAINST THE JUDGMENT AND DECREE DATED 09.09.2018
PASSED IN O.S.NO.6290/2016 ON THE FILE OF THE LVIII
ADDITIONAL CITY CIVIL AND SESSIONS JUDGE (CCH-59)
BENGALURU CITY, DECREEING THE SUIT FOR RECOVERY OF
MONEY.
THIS APPEAL, COMING ON FOR FINAL HEARING, THIS
DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE
ORAL JUDGMENT
This appeal is filed challenging the judgment and decree in a suit for recovery of money by one partnership Firm against another partnership Firm.
2. The plaintiff filed suit to recover Rs.3,39,091/- along with interest at the rate of 24% per annum. The Court decreed the suit for the sum of Rs.3,39,091/-, and awarded only 18% interest from the date of filing of the suit till realisation. Hence, the defendant is before this Court.
3. The plaintiff/respondent though served is not represented.
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4. Learned counsel appearing for the defendant/ appellant would urge that the plaintiff's Firm claims that it has supplied steel to the defendant's Firm and though the steel is said to have been supplied almost 3 years prior to the filing of the suit, no action is taken against the defendant for recovery of the said amount, despite the plaintiff's statement that it used to sell the goods on 15 days credit basis. It is his further submission that the suit is filed at the fag end of the period of limitation and except the tax invoice and e-sugam bill generated by the plaintiff, no document is produced to show that the plaintiff has actually supplied the goods to the defendant and defendant has received the goods.
5. It is his further submission that the Trial Court erred in rejecting the evidence of the defendant despite DW.1 being the duly constituted power of attorney holder of defendant No.1- Firm. Thus, would urge that the judgment and decree passed by the Trial Court have to be set aside and the suit has to be dismissed.
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6. In the alternative, learned counsel would submit that the Trial Court also erred in awarding 18% interest on the transaction and could not have awarded 18% interest, at the most, the interest that could have been awarded should be on par with the lending interest rate by the Nationalized Bank.
7. The Court has considered the contentions raised at the Bar and perused the records.
8. The following points arise for consideration:
(a) Whether the appellant has made out a case to hold that no transaction took place between the plaintiff and the defendant?
(b) Whether interest @ 18% per annum is justified?
9. To support the case of the plaintiff that it has supplied the steel worth Rs.3,39,091/-, plaintiff has produced Exhibit P2- the tax invoice. In the said tax invoice, the name of the defendant Firm is mentioned. In addition to that, e-sugam number, vehicle number is also mentioned. It -5- NC: 2026:KHC:5200 RFA No. 977 of 2018 HC-KAR is not in dispute that the details mentioned in e-sugam receipt is tallying with the details mentioned in Exhibit P2.
10. It is indeed true that there is no acknowledgment on behalf of the defendant to show that the goods mentioned in Exhibit P2 are delivered and received by the defendant. However, that by itself is not sufficient to hold that the goods are not supplied to the defendant.
11. The plaintiff has issued a notice to the defendant calling upon the defendant to pay the amount in respect of the goods said to have been sold on 11.09.2013. The said notice is duly served on the defendant. The defendant has not replied to the said notice. If at all the defendant had no transaction with the plaintiff, the defendant could have replied to the said notice. However, he has not replied. Only after the service of summons, he has taken a defence that the defendant Firm had no transaction with the plaintiff Firm.
12. Admittedly, both plaintiff and defendant Firm are involved in steel business. The defendant is a partnership Firm. None of the partners is examined to substantiate the -6- NC: 2026:KHC:5200 RFA No. 977 of 2018 HC-KAR case or rebut the inference coming from the evidence led by the plaintiff.
13. The power of attorney holder of defendant is examined. The power of attorney executed in favour of the defendant is marked at Exhibit D1. The DW1, the power of attorney holder, is not carrying on the business on behalf of the defendant's Firm. Thus, it is evident that DW1, who has been examined on behalf of the defendant, is a stranger to the said transaction. When the plaintiff has led evidence, and produced the records, it was for the defendant to lead evidence of either of the partners of the defendant Firm or to examine any person working for the defendant Firm. Such a recourse is not taken.
14. Under these circumstances, the Trial Court has disbelieved the evidence of the defendant and has come to the conclusion that there is no rebuttal evidence on behalf of the defendant.
15. The Court has also considered the cross- examination addressed to the DW.1. In the cross- -7-
NC: 2026:KHC:5200 RFA No. 977 of 2018 HC-KAR examination, has stated that the defendant DW.1 is also one of the persons involved in the steel business, carrying on the steel business in a different name and style.
16. The Trial Court has placed its reliance on Exhibit P2 and e-sugam bill. Though it is urged by the learned counsel for the defendant/appellant that e-sugam can be generated by anyone, the Court is unable to accept the said contention to hold that the plaintiff has generated e-sugam bill in the name of the defendant to evidence a transaction which has not taken place. Once the e-sugam bill is generated, it is an indication of the fact that some transaction has taken place between the persons named in the e-sugam bill. In that event, the person who claims to have made some transaction is liable to pay some tax relating to the sale involved in the said bill.
17. It is extremely difficult to accept the contention of the defendant that the plaintiff has ventured to generate the bill in respect of a transaction which has not taken place as contented by the defendant.
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18. Under these circumstances, the Court does not find any reason to interfere with the judgment and decree of the Trial Court which has held that the transaction has taken place and the payment is not made.
19. There is no difficulty in taking a view that the payment is not made as it is not the defence of the defendant that the payment is made. The defence is of total denial. Thus, there is no question of getting into the question as to whether the payment is made or not. However, it is required to be noticed that the plaintiff has claimed interest at the rate of 24% per annum on the transaction on the premise that it is the policy of the Company. The Trial Court has not accepted the said view and has awarded 18% interest.
20. The suit is of the year 2016, the transaction is said to have taken place in the year 2013. Under these circumstances, the Court is of the view that the 18% interest awarded by the Trial Court is on higher side. The interest to be awarded by the Court ideally should be on par with the -9- NC: 2026:KHC:5200 RFA No. 977 of 2018 HC-KAR interest rate of the Nationalized Banks on the loans to be advanced by such banks. No special grounds are made out to claim 24% or 18% interest per annum.
21. Under these circumstances, the Court is of the view that 9% interest would be just and proper in the facts and circumstances of the case.
22. Hence the following:
ORDER
(i) Appeal is allowed in part.
(ii) Judgment and decree dated 09.02.2018 in O.S.No.6290/2016 on the file of LVIII Additional City Civil Judge, Bangalore City are set aside in part.
(iii) In so far as 18% interest is concerned, the plaintiff is entitled to claim only 9% interest on the decreetal principal amount of Rs.3,39,091/-.
(iv) Since it is submitted that in execution proceeding, entire amount is recovered, the plaintiff is liable to reimburse 50% interest
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(v) In case, the amount is not paid within 60 days from today, the plaintiff shall pay interest @ 6% per annum on the amount due after expiry of 60 days from today.
Sd/-
(ANANT RAMANATH HEGDE) JUDGE GVP List No.: 1 Sl No.: 43