Calcutta High Court
Mc. Nally Bharat Engineering Co. Ltd. vs Benoy Krishna Bose on 19 October, 2001
Equivalent citations: 2003(1)ARBLR143(CAL)
Author: Tarun Chatterjee
Bench: Tarun Chatterjee, Amitava Lala
JUDGMENT Tarun Chatterjee, J.
1. This appeal is preferred against the judgment and decree passed by a learned Judge of this Court in a suit for recovery of money for non-payment by the defendant/appellant of the final bill of the plaintiff/respondent, a contractor with respect to construction of certain building for the defendant/appellant.
2. The prayer (a) of the plaint is as follows:
"Decree for Rs. 5,93,580.02 P. as stated in paragraph 11 of the plaint."
3. The case made out by the plaintiff/respondent in the plaint was as follows :
The plaintiff/respondent by his letter dated 10th December, 1975 submitted his tender to the defendant/appellant and offered to construct Block-H Building, Time-Office-cum-Workers' Canteen and extension of the main Office Building, for the defendant at Kumardhubi in the State of Bihar. The defendant/appellant by its letter dated 24th December, 1975 accepted the offer made by the plaintiff/respondent in pursuance of the tender. The plaintiff/ respondent completed the construction work in April, 1978 and prepared its final bill for a sum of Rs. 13,85,909.67 p. During the continuance of the construction work the defendant/appellant paid and the plaintiff/respondent received diverse sums of money and by a covering letter dated 31st August, 1979 the plaintiff/respondent submitted the final bill to the defendant/appellant and demanded payment of the balance sum of Rs. 3,89,232.70 p. The defendant/ appellant by its letter dated 24th November, 1979 disputed the correctness of the aforesaid bill and alleged that there were anomalies in the bill and claimed that nothing was due or outstanding to the plaintiff/respondent. As the bill amount was not paid, the plaintiff/respondent instituted the suit for recovery of money against the defendant/appellant on 11th August, 1982 claiming a decree for an aggregate sum of Rs. 5,93,580.02 p. of which Rs. 3,89,232.70 p. was the principal sum and Rs. 2,04347.32 p. was the interest, calculated at the rate of 18% per annum from August 31, 1979 till 31st July, 1982.
4. The defendant/appellant entered appearance in the suit and filed a written statement denying the material allegations made in the plaint. In the written statement it was contended by the defendant/appellant that the terms and conditions, printed on the reverse of the purchase orders were made known to the plaintiff/respondent immediately upon the defendant/appellant issuing and plaintiff/respondent receiving six purchase orders and therefore there was an agreement in that respect between the parties. The plaintiff/ respondent did, not raise any objection thereafter in that respect. It was further alleged in their written statement that there was clear and specific reference in that respect, in a letter of acceptance of the defendant/appellant dated 24th December, 1975 and also in two other letters dated 7th January, 1976 and 28th March, 1976 by which some minor amendments to the purchase orders were sought by the defendant/appellant. Even thereafter there was no objection by the plaintiff/respondent as to the "Terms and Conditions". The defendant/ appellant further alleged that in those circumstances the plaintiff/respondent was estopped from denying that the parties had agreed the terms and conditions which were incorporated in the contract upon issuance of the purchase orders which would be evident from the letter dated 24th December, 1975 that had merged with the aforesaid provisions and thereafter there was no independent validity or existence of the terms and conditions of the contract. Accordingly, it was alleged by the defendant/appellant in the written statement that in the aforesaid circumstances Clause 17 of the terms and conditions (as wrongly referred to as Clause 18) applied and the suit ought to have been filed in a Court of Bihar as the parties had so agreed and therefore this Court had no jurisdiction to try and entertain the suit. It was further alleged that the claim of the plaintiff/respondent even if there be any and even if this Court had the jurisdiction to try the suit, became barred on 11th August, 1982, the date on which the suit was instituted, under Article 18 of the Limitation Act. On the basis of the aforesaid defence taken by the defendant/appellant in its written statement a prayer for dismissal of the suit was made by the defendant/ appellant.
5. The learned trial Judge framed the following issues :
(1) On what terms did the plaintiff agree to execute the construction work referred to in the plant at the factory premises of the defendant ?
(2)(a) Did the purchase orders issued by the defendant contain any term of condition which was not applicable to the contract for construction as alleged in paragraph 5 of the plaint ?
(b) Did the plaintiff object to any of the terms and conditions as recorded in purchase orders issued by the defendant as alleged in paragraph 5 of the plaint ?
(c) Did the defendant waive the terms and conditions recorded in the purchase orders issued by it as alleged in paragraph 5 of the plaint ?
(3) Whether in view of the forum selection clause contained in purchase orders issued by the defendant this Hon'ble Court would try, entertain and determine the suit ?
(4)(a) Did the plaintiff execute the various works of an aggregate value of Rs. 13,85,909.07 as alleged in paragraph 6 of the plaint ?
(b) Is the plaintiff entitled to claim from the defendant a sum of Rs. 3,89,232.70 towards the balance sum payable by the defendant to the plaintiff in paragraph 8 of the plaint ?
(c) Is the plaintiff entitled to claim from the defendant interest on the aforesaid sum of Rs. 3,89,232.70 @ 18% per annum as alleged in paragraph 9 of the plaint ?
(d) What relief, if any, is the plaintiff entitled to ?
6. Parties adduced evidence in support of their respective cases. The learned trial Judge after considering the evidence on record, oral and documentary and other materials, finally decreed the suit of the plaintiff/ respondent in terms of prayer (a) of the plaintiff with interest at the rate of 18% per annum till 11th August, 1982 and thereafter at the rate of 6% per annum till the realization of the entire decretal dues. Being aggrieved by the judgment and decree of the learned trial Judge, this appeal has been preferred by the defendant/appellant.
7. We have heard Mr. Bimal Kumar Chatterjee, the learned senior counsel appearing on behalf of the defendant/appellant and Mr. Shyama Prosad Sarkar, the learned counsel appearing on behalf of the plaintiff/ respondent. We have also examined the judgment under appeal in detail and considered the submissions made by the learned counsel for the parties in detail. After considering the rival submissions made on behalf of the parties we are of the view that this appeal is devoid of any merit and accordingly, it must be dismissed subject to the directions made hereinafter.
Reasons are as follows :
8. The first question that was raised by Mr. Chatterjee on behalf of the appellant was the question of jurisdiction of this Court to entertain the suit. According to Mr. Chatterjee, in view of the terms and conditions referred to in Clause 17 (incorrectly stated in the plaint as Clause 18) of the general terms and conditions contained in the purchase orders by the defendant/ appellant, this Court had no jurisdiction to entertain the suit. Mr. Chatterjee had drawn our attention to Annexure 'E' at page 350 of the Paper Book, a letter of the defendant/appellant dated 12th November, 1975, a letter written by the plaintiff/respondent to the defendant/appellant on 10th December, 1975, another letter written by the defendant/appellant to the plaintiff/ respondent dated 24th December, 1975, a letter dated 30th December, 1975 written by the defendant/appellant in which it was stated that supply of goods were made as per terms and conditions annexed to the said letter of - the defendant/appellant. Mr. Chatterjee had also drawn our attention to the evidence of Sri Benoy Krishna Bose, the plaintiff/respondent, particularly question No. 310 in which the P.W. 1 stated that the terms and conditions of the purchase order remained unsettled between the parties. Accordingly, Mr. Chatterjee contended that in view of Clause 17 (wrongly stated in plaint as Clause 18) this Court could not have any jurisdiction to try the suit and it was only the Bihar Court which alone had the jurisdiction to try any suit for recovery of money. In support of this contention Mr. Chatterjee relied on two Supreme Court decisions, viz., in the case of A.B.C. Laminart Pvt. Ltd. and Anr. v. A.P. Agencies, Salem, . and also in the case of Kollipara Sriramulu v. Aswatha Narayana. . Mr. Sarkar appearing on behalf of the plaintiff/ respondent, however, disputed the submission of Mr. Chatterjee as to the question of jurisdiction of this Court to entertain the suit. Mr. Sarkar had taken us through a letter written by the defendant/appellant to the plaintiff/ respondent regarding construction of apartment building and office at Kumardhubi on 24th December, 1975 in which it was clearly stated by the defendant/appellant the following :
"We have the pleasure in accepting your offer for all three buildings together at the rates quoted by you less 5% (five per cent) discount on the total price as agreed by you for awarding all the three buildings to you.
Our detailed and formal order for each building separately will follow shortly.
In the meantime you are requested to make all necessary arrangements to start the construction work at Block-H as early as possible. Drawing for this building can be collected by you that from our Civil Department once your people have moved in. Mindly note that date of order cor construction of Block-H will be considered as 1st January, 1976 and the completed building is to be handed over ready for occupation within thirty four weeks of the date of order."
9. This letter of the defendant/appellant written to the plaintiff/ respondent was exhibited as Exbt.'J' in the suit. Reliance was also placed by Mr. Sarkar to another letter written by the defendant/appellant to the plaintiff/ respondent on 3rd January, 1976 which was exhibited as Exbt. 'K' in the suit. The said letter contains as follows :
"Please refer to our letter Civil/BL/-H/BBC dated December 24, 1975 concerning the above. We are now enclosing herewith our formal purchase orders 15323/LP to 15328/LP (six numbers) for various works to be executed by you. Please acknowledge receipt."
10. Mr. Sarkar also had taken us through another exhibit being Exbt. "K1" from which it appears that "one of the terms and conditions was that the parties had agreed that the High Court of Bihar or the appropriate in the High Court of Bihar or the appropriate Court in the State of Bihar alone will have jurisdiction to try any claim arising out of this contract".
11. Accordingly Mr. Sarkar contended that the terms and conditions regarding jurisdiction to entertain any claim of either of the parties were not clear to vest the jurisdiction only on the Court of the State of Bihar.
12. Having heard the learned counsel for the parties on the question of jurisdiction and after giving our anxious consideration to the submission made on this question, we are unable to hold that the learned trial Judge was not justified in holding that this Court had the jurisdiction to try the suit. It now needs to be considered whether the parties had actually agreed as to the terms and conditions referred to by the defendant/appellant in its written statement as "special conditions incorporated as well as general terms and conditions" which was printed overleaf the six purchase orders. From the letter dated 12th November, 1975 it appears that the defendant/appellant had invited "lowest offer" for certain building construction work which was to be done at Kumardhubi and had specifically indicated that "the offer should be in line with the following terms and conditions" and the terms and conditions were fully set out. The plaintiff/respondent by its letter dated 10th December, 1975 offered to do the work and had elaborately set out its terms and conditions. The defendant/appellant accepted the offer by its letter dated 24th December, 1975 to which we shall refer as the letter of acceptance. It would appear from the said letter dated 24th December, 1975 that prior to the acceptance there had been clarifications and modifications by the defendant/appellant and discussions between the parties on diverse dates. In the letter of acceptance that defendant/appellant made it clear that "our detailed and formal order for each building separately will follow shortly. In the meantime you are requested to make all necessary arrangements to start the construction work of Block-H as early as possible, the completed building is to be handed over ready for occupation within 34 weeks of the date of the order". Contract was subject to special terms and conditions which would be printed overleaf the purchase orders. We do not find anything on record to establish that the terms and conditions at all featured at any time during the negotiations or discussions between the parties prior to acceptance of the contract or at the time of effecting the clarification and modifications. It was only upon receipt of the purchase orders dated 31st December, 1975 that for the first time the plaintiff/respondent was intimated "please supply the following goods as per terms and conditions stated below and overleaf". The defendant/appellant thereafter by two letters dated 11th January, 1975 and 20th March, 1976 effected minor amendments to certain clauses in the contract and in both the two letters the defendant/appellant had taken care to add "all other terms and conditions of our purchase order will remain unaltered". This was a unilateral statement which was made by the defendant/appellant intending to incorporate the terms and conditions which had been printed overleaf the purchase orders. Therefore, until then there was nothing in evidence to conclude that the parties would be bound by special "terms and conditions" which would be found printed on the reverse of the purchase orders. Therefore, there was no consensus between the parties in this respect.
13. As noted hereinearlier, Mr. Chatterjee appearing on behalf of the defendant/appellant strongly relied on the word 'alone' as incorporated in Clause 17 of the terms and conditions as contained in the purchase orders in order to satisfy us on the question of jurisdiction of this Court to entertain the suit. According to Mr. Chatterjee it was only the Bihar High Court or any appropriate Court in the State of Bihar would have jurisdiction to try any claim arising out of the contract. Mr. Chatterjee contended that the use of the word 'alone' would oust the jurisdiction of any other Court to entertain the suit arising out of the contract as mentioned above. Strong reliance was placed by Mr. Chatterjee to a decision of the Supreme Court in the case of A.B.C. Laminart Pvt. Ltd. and Anr. v. A.P. Agencies, Salem (supra). Relying on paragraph 21 of the said decision Mr. Chatterjee strongly contended that it was only the Bihar Court would have the jurisdiction to entertain the suit and not this Court. In order to meet this submission of Mr. Chatterjee we feel it proper to quote paragraph 21 of the aforesaid decision which runs as follows :
"In our view, from the principles laid down in paragraph 21 of the said decision it can be reasonably deduced that when the claim in the contract is clear, unambiguous and specific accepted notions of contract would bind the parties and unless the absence of ad idem can be shown, the other Courts should avoid exercising jurisdiction. In the aforesaid decision the Supreme Court has also observed that when the Court has to decide the question of jurisdiction pursuant to an ouster clause it is necessary to construe the ousting expression or clause properly".
14. Keeping this principle in our mind as laid down by the Supreme Court in the aforesaid decision let us now consider whether the ouster clause as mentioned above takes away the jurisdiction of this Court to entertain the suit. At the risk of repetition we may also say at this juncture that in paragraph 11 of the said decision the Supreme Court has clearly laid down the principle that it can be reasonably deduced that where such an outster clause occurs, it is pertinent to see whether there is ouster of jurisdiction of other Courts. It is also clear from the aforesaid decision of the Supreme Court, that what is an appropriate case for ousting the jurisdiction of a Court which was otherwise competent to entertain the suit shall depend on the facts of that case. In such a case mention of one thing may apply exclusion of another. From the aforesaid decision it is also clear that when certain jurisdiction is specified in a contract, intention to exclude all others from its operation may in such cases be also inferred. From the aforesaid decision of the Supreme Court as was relied on by Mr. Chatterjee strongly on the question of ouster of jurisdiction of this Court to entertain the suit, it is clear to us that before coming to a conclusion on the question of jurisdiction, the ouster clause should be interpreted carefully and properly. In the present case the ouster clause is Clause 17 (wrongly mentioned as Clause 18) of the terms and conditions of the purchase orders. The ouster Clause 17 contained in the purchase orders reads as under :
"It is agreed that the High Court of Bihar or an appropriate Court in the State of Bihar alone will have jurisdiction to try and claim arising out of this contract."
We have carefully examined Clause 17 of the terms and conditions of the contract. From a plain reading of this ouster clause it appears to us that it is totally vague about the exclusion of jurisdiction of Courts excepting the Court in Bihar. It is also vague whether the suit was to be filed in the High Court of the State of Bihar or any other Court in the State of Bihar. It is well known that there is no High Court of Bihar before the division of the State of Bihar. It was the High Court of Patna which was the High Court in the State of Bihar. Therefore, the language used in Clause 17 of the contract was, in our view, totally vague as to where the suit must be filed. Was it in the High Court of Patna in the State of Bihar or another particular Court (not named in the clause) in the State of Bihar ? The word used in the contract "any other Court in the State of Bihar" is also equally vague. Therefore, we have no hesitation in our mind to hold that the ouster clause in the contract being totally vague, this Court which was otherwise competent to entertain the suit would retain its jurisdiction to entertain the suit of this nature. Therefore, from a plain reading of the aforesaid ouster clause it can be safely concluded that the said clause being vague and unambiguous, no firm conclusion can be made from the ouster clause that jurisdiction in the High Court of Bihar or any appropriate Court of Bihar would have only the jurisdiction to decide the claim of any of the parties to the contract although the word 'alone' was incorporated in such a clause. Therefore, we are of the view that the maxim "expressio unius cst exclusio alterius" cannot be applied in the facts and circumstances of the case and therefore, it cannot be held that merely because it has been incorporated that the High Court of Bihar or any other appropriate Court of Bihar will alone have the jurisdiction to try any claim of any of the parties to the contract and therefore, it excluded the jurisdiction of all other Courts who were otherwise competent to entertain the suit. In the case of R.S.D.V. Finance Co. Pvt. Ltd. v. Since Vallabh Class Works Ltd. . The Supreme Court in paragraph 9 observed as follows :
"The endorsement subject to Anand Jurisdiction" has been made unilaterally by the defendant while issuing the deposit receipt.
"The endorsement subject to Anand" does not contain the ouster clause using the words like alone only exclusive and like. It is true that from a plain reading of the observation of the Supreme Court in the aforesaid decision that the word 'alone' was not incorporated in the ouster clause although the same would be evident from the contract in hand but in view of our discussions made hereinabove and in view of the findings made hereinabove that the words used in the ouster clause were totally vague and unambiguous, in our view, only the word 'alone' occurring in the ouster clause cannot take away the jurisdiction of this Court to entertain the suit filed by the plaintiff/respondent.
15. For the reasons aforesaid we are, therefore, of the view that this Court had the jurisdiction to try the suit and the learned trial Judge was fully justified in holding that this Court had the jurisdiction to try the suit.
16. The next question that was raised by Mr. Chatterjee was the question of limitation. Mr. Chatterjee contended that since the construction work was completed in the middle of June, 1978 and the suit was filed on 11th August, 1982 and in view of Article 18 of the Limitation Act, the suit must be held to be barred by limitation as the same was not filed within three years from the date when the work was completed. In support of this contention Mr. Chatterjee relied on certain decisions of the Supreme Court, as well as, other High Courts of India, viz., Zilla Parishad v. Shanti Devi, . S.F. Mazda v. Durga Prasad; Tilak Ram v. Nathu, . which followed (supra), L.C. Mills v. Aluminium Corporation of India ." ; Cannon Dunkerly & Co. v. Union of India . ; Great Eastern Shipping Company v. Union of India AIR 1971 Cal 1150. and Lalchand v. Union of India. . This submission of Mr. Chatterjee on the question of limitation was hotly contested by Mr. Sarkar appearing on behalf of the plaintiff/respondent. According to Mr. Sarkar, in view of the letter dated 25th September, 1978 being Exbt. 'FF' the suit must be held to have been filed within the period of limitation. In support of this contention Mr. Sarkar had relied on certain decisions of different High Courts of India, viz., M.L. Dalmia & Co. v. Union of India, . State of Rajasthan v. Ram Krishan. (FB). Union of India v. M.L. Dalmia . and Gambhirmull v. Indian Bank Ltd. . In our view, the suit cannot be held to be barred by limitation in the facts and circumstances alleged in the plaint and the evidence adduced by the parties. It is not in dispute that the suit out of which the present appeal arises was instituted on 11th August, 1982. From the records it appears to us that final bill was submitted by the plaintiff/respondent on 31st August, 1979 which was acknowledged by the defendant/appellant by its letter dated 24th November, 1979. From the materials on record it is also clear to us that the plaintiff/respondent had not completed the work in terms of the purchase orders and in fact had in its final bill claimed in respect of the work which the plaintiff/respondent did not at all perform. According to the defendant/appellant, the plaintiff/respondent did not in its final bill give credit for payment made by the defendant/appellant to the suppliers and sub-contractors of the plaintiff/respondent which payments the plaintiff/ respondent had duly authorized. It will also appear from the final bill which was prepared by the defendant/appellant that excess payment was made by the defendant/appellant to the plaintiff/respondent and that a sum of Rs. 51,582.91 was due and payable by the plaintiff/respondent to the defendant/appellant. The witness for the defendant/appellant also deposed to the effect that in terms of the contract the defendant/appellant had paid large sums of money towards income tax and had supplied cement to the plaintiff/respondent which money the plaintiff/respondent was entitled to be reimbursed though in its final bill the defendant/appellant had failed to give credit in that respect. In view of the fact stated hereinabove that since the plaintiff/respondent had submitted its final bill on 31st August, 1979 and the defendant/appellant had refused to pay the final bill by its letter dated 24th November, 1979 and in view of the admitted fact that the suit was instituted within the three years from the date of refusal by the defendant/ appellant, the learned Judge was fully justified in holding that the claim of the plaintiff/respondent was not barred by limitation
17. In the case of M.L. Dalmia and Co. v. Union of India (supra), P.C. Mallick, J. as His Lordship then was considered the question regarding the starting point of limitation in the case of contract. Article 115 of the Limitation Act, 1908 has been replaced by Article 55 of the Limitation Act, 1963. The starting point of limitation under Article 55 of the Limitation Act, 1963 is from the date of breach even where the loss cannot be quantified till some time after the breach. Let us, therefore, consider in the facts of this case from which date the limitation began to run. Is it from the date of submitting the final bill on 31st August, 1979 which was refused by the defendant/appellant on 24th November, 1979. On the date of submitting final bill we are of the view that the starting point of limitation does not start as there is no breach on 31st August, 1979 on which date only the final bill was received by the defendant/ appellant from respondent/plaintiff. According to us the breach would occur only when the bill was refused by the defendant/appellant. In this case admittedly such refusal was made by the defendant/appellant by a letter dated 24th November, 1979. That being the position and in view of the aforesaid decision of the Calcutta High Court in M.L. Dalmia and Co. v. Union of India (supra), with which we are in respectful agreement, we are of the view that the starting point of limitation would be 24th November, 1979 and suit having been filed within three years from this date when breach occurred it cannot be held that the suit was barred by the law of limitation as was correctly held by the learned trial Judge in the impugned judgment. Similar view was expressed in a full Bench decision of the Rajasthan High Court in the case of State of Rajasthan v. Ram Krishan (supra). In view of the discussion made hereinabove we are of the view that the suit filed within the period of limitation as rightly held by the learned Trial Judge At this juncture we are to consider the decisions on which Mr. Chatterjee learned senior counsel appearing on behalf of the defendant/appellant strongly relied on. The first of such decision is reported in Jogeshwar Roy v. Raj Narain Mitter and Benode Behary Mookherjee v. Raj Narain Mitter. ILR 31 Calcutta 195. In our view this decision is not applicable to the facts and circumstances of this case. In view of our discussion made hereinabove and as we have already held that starting point of limitation would be the date on which the final bill was refused to be paid by the defendant/appellant, the principles laid down in the same cannot be applied here. So far as ILR 31 Calcutta 195 (supra) is concerned, we are of the view that this was a decision on the question of acknowledgement of liability. We are not concerned in this case about the acknowledgement of liability. The next decision is a decision of the Supreme Court in the case of Shapoor Freedom Mazda v. Durga Prosad Chamaria and Ors. . Similarly this case is also distinguishable because this decision dealt with essentials of acknowledgement under Section 19 of the Limitation Act, 1908. The next decision on which Mr. Chatterjee had strongly relied on is the decision of the Supreme Court in the case of Tilak Ram and Ors. v. Nathu and Ors. (supra). In that decision the Supreme Court held that mere statement expressing jural relationship between parties does not constitute acknowledgement. In view of our discussions made hereinabove to the effect that the suit was filed within the period of limitation as the starting point of limitation would be the date on which the final bill was refused to be paid by the defendant/appellant, we are not concerned with the acknowledgement of liability under Section 19 of the Limitation Act. Accordingly, in our view, this decision cannot be considered for our present purpose. Similar is the position relating to the other decision of the Supreme Court in the case of Lakshmiratan Cotton Mills Co. Ltd. v.
The Aluminium Corporation of India Ltd., . 18. as we find the said decision also concerns the question of acknowledgement of liability under Section 19 of the Limitation Act. In Zilla Parishad (District Board) v. Shanti Devi and Anr. (supra), on which Mr. Chatterjee also relied on, it was held in the facts of that case that the suit was in substance for specific performance of contract and not breach of contract and therefore, Section 192 was not attracted. In our view, the principles laid down this decision also cannot be applied as we find that the suit out of which the present appeal arises was filed for recovery of money on the works done by the plaintiff/appellant on the basis of contract. Whereas in the aforesaid Full Beach decision of the Allahabad High Court it was held that the suit was in substance for specific performance of contract and not on breach of the contract. In the decision of the Supreme Court admitted position was that the suit was filed beyond three years of the date on which the claim was rejected by the Union of India. Admittedly in the present case the suit was filed within three years from the date of rejection made by the defendant/ appellant. That being the position in the facts of this present case the aforesaid decision of the Supreme Court is not applicable in this case. Accordingly we are unable to rely on this decision in the present case. So far as the single Bench decision of the Calcutta High Court in Great Eastern Shipping Co. Ltd. v. Union of India (supra), is concerned we are unable to find any application of the principles laid down in the said decision. In that decision also a learned single Judge of this Court held that the suit was not barred by limitation in the facts and circumstances of the said case. So far as the other two decisions which were relied on by Mr. Chatterjee appearing on behalf of the appellant/ defendant are concerned Ramlal Mistry and Ors. v. Commissioner of Tekari Municipality AIR 1961 Patna 435. and Lalchand Chowdhury v. Union of India, (supra), we have carefully perused this judgment and we do not agree with Mr. Chatterjee that these two decisions cannot be of any help to the defendant/appellant. Accordingly, however, on our discussions made hereinabove, we are therefore, firmly of the opinion that the suit was filed within the period of limitation and that the learned Judge was fully justified in holding that the suit was not barred by limitation.
18. Before we conclude we may take into consideration another short submission of Mr. Chatterjee on the question of granting a decree by the trial Court in respect of interest at the rate of 18% per annum till 11th August, 1982 and thereafter at the rate of 6% per annum till the realization of the entire decretal dues. In paragraph 9 of the plaint the plaintiff had stated that the defendant/appellant failed and neglected to pay a sum of Rs. 3,89,232.70 p. or any part thereof. Accordingly, the plaintiff/respondent claimed interest on the said sum at the rate of 18% per annum simple being the reasonable rate of interest prevalent in the market. The plaintiff also claimed in paragraph 9 of the plaint that interest at the aforesaid rate from August 31, 1979 till July 31, 1982 was assessed at Rs. 3,04,34732 p. From paragraphs 8 and 10 of the plaint it appears that the principal sum was assessed at Rs. 3,89,232.70 p and interest calculated from 31st August, 1979 till 31st July, 1982 amounted to Rs. 2,04,347.32 p. Finally the plaintiff/respondent claimed a decree for Rs. 5,93,580.02p. Mr. Chatterjee appearing on behalf of the defendant/appellant, however, contended that the plaintiff/respondent was not entitled to a decree regarding interest at the rate of 18% per annum till 11th August, 1982 as the said sum was already included in the claim of the plaintiff/respondent i.e. to say there cannot be a decree for interest against interest. In support of this contention Mr. Chatterjee relied on a decision of the Bombay High Court in the case of Union Bank of India v. Dalpat Gaurishankar Upadyay. . This submission of Mr. Chatterjee was hotly contested by Mr. Shayama Prosad Sarkar, the learned counsel appearing on behalf of the plaintiff/respondent. According to Mr. Sarkar, the trial Court was fully justified in granting interest in the manner granted by it. In support of this contention Mr. Sarkar relied on a decision of this Court in the case of Union of India v. M.L. Dalmia & Co. Ltd.(supra). After having heard the learned counsel for the parties on the question of interest we are of the view that Mr. Chatterjee was correct in submitting that since the plaintiff/respondent had already included interest in the original claim itself for the period from 31st August, 1979 to 31st July, 1982, they are not entitled to claim such interest over again.
19. In the case of Union Bank of India v. Dalpat Gaurishankar Upadyay (supra), a Full Bench of the Bombay High Court in paragraph 24 had made the position clear and accordingly we quote the said paragraph verbatim which is as follows:
"A clear picture which emerges from reading of this section is that the Court while decreeing the suit will adjudge; (i) the principal sum, and (ii) any interest on such principal sum prior to the date of institution of the suit. Both amounts adjudged by the Court by way of "principal sum" as well as "interest" thereon for the period prior to the institution of the suit together may be termed as "aggregate amount adjudged" as payable on the date of the suit. But interest under Section 34 is not payable on such aggregate amount. It is made payable only on the principal sum adjudged. No interest is payable on the amount of interest adjudged on such principal sum. Interest, whether simple or compound will remain "interest" for the purpose of Section 34 and shall never merge in the principal. The legislature while using the expression "in addition to any interest adjudged on such principal for any period prior to the institution of the suit" in Section 34 in contradiction to the expression "principal sum" has not made any distinction between the interest computed by way of simple interest or compound interest. The legislative scheme and intent being so dear, there is no scope for doubt that the expression "principal sum adjudged" would mean only the "principal sum". It will never include the interest whatever 19. . be the agreement between the parties. Interest under Section 34 therefore, can be allowed only the principal sum and not on the principal sum plus interest accrued thereon will the filing of the suit. In view of foregoing discussion, we hold that the "principal sum adjudged" used in Section 34 of the C.P.C. means the original amount lend without the addition thereto of any interest whatsoever. This will be the position notwithstanding any agreement between the parties or any prevailing banking or trade practice to the contrary. The first three questions are answered accordingly."
20. In the penultimate paragraph of the aforesaid decision of the Bombay High Court it has been made clear that interest can be awarded on the principal amount only and no interest is payable on the amount of interest. Applying the aforesaid principle laid down by the Bombay High Court in the facts of this case we find that in the plaint itself the plaintiff already claimed interest on the principal amount from 29th August, 1979 till the interest filing of the suit i.e. 11th August, 1982 which includes interest. Therefore, the plaintiff/respondent is not entitled to any interest for the aforesaid period as the said interest was already included in the plaint itself where the entire 'amount inclusive of interest has been decreed by the learned trial Judge. Accordingly, this part of the judgment is and accordingly the decree for interest from the period from 31st August, 1979 to 31st July, 1982 is set aside.
21. No other point was raised before us excepting the points dealt with by us hereinbefore.
22. Accordingly, we dismiss the appeal subject to setting aside the direction for payment of interest at the rate of 18% per annum from 31st August, 1979 to 31st July, 1982.
23. There will be no order as to costs.
Amitava Lala, J.
I agree.