Delhi District Court
S.P.J Cargo Private Limited vs A1-Ayaan Foods Private Limited on 14 December, 2023
IN THE COURT OF MS. KIRAN BANSAL,
DISTRICT JUDGE, COMMERCIAL COURT-02,
SHAHDARA, KARKARDOOMA COURTS, DELHI
CS(COMM) NO. 612/2020
In the matter of
SPJ CARGO PRIVATE LIMITED
D9/3, Okhla Industrial Area
Phase 1, South Delhi
New Delhi-110020. ......... Plaintiff
Versus
AL-AYAAN FOODS PRIVATE LIMITED
House No. 21-A, Gali No.6,
Bihari Colony, Shahdara East,
Delhi - 110032
Email: id:[email protected] ........ Defendant
Date of Institution : 09.12.2020
Date of conclusion of final arguments : 04.11.2023
Date of judgment : 14.12.2023
JUDGMENT
1. The present suit has been filed by the plaintiff for recovery for an amount of Rs.13,15,696/- along with interest @ 24% per annum. Though, initially the suit was filed under Order 37 CPC. However, vide order dated 12.03.2021, it is revealed that the counsel for plaintiff submitted that the present case may be treated as an ordinary commercial suit for recovery and plaintiff was granted three CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED weeks time to file court fees. Summons of ordinary suit were issued to the defendant vide order dated 24.01.2022.
2. Briefly stated the facts are that plaintiff is a Private Lim- ited Company engaged in providing services of cargo handling, frieght forwarding, custom clearance and other allied activities having its reg- istered office at Okhla Industrial Area, New Delhi. The plaint has been filed through AR Sh. Niranjan Kumar Singh. The defendant is also stated to be a Private Limited Company having its registered office at Shahdara, Delhi. It is stated that the defendant availed the services of the plaintiff for freight forwarding, custom clearance and allied ser- vices to export the delivery for custom, the delivery against which the plaintiff had raised several invoices. It is stated that several payments were made by the defendant as per the ledger account, however, de- spite the credit of the amount paid, there is still an outstanding total principal amount of Rs.7,82,970/-. Plaintiff has further stated there is outstanding of Rs.13,15,696/- which includes the interest amount of Rs.5,32,726/- computed @ 24% per annum after giving a credit period of 30 days as on 14.02.2020. Despite several request, the defendant did not make the payment and thereafter, the plaintiff updated the ledger statement along with interest amount and communicated the same to the defendant. The plaintiff also served a demand notice in form 3 under Section 8 of the Insolvency and Bankruptcy Code, 2016 read with Rule 5 of Application to Adjudicating Authority Rules, 2016, however, it is stated that the plaintiff was unable to file the In- solvency and Bankruptcy Code, 2016 as the registry/filing counter and the Tribunal itself was closed on account of pandemic situation after which the threshold limit to file a petition under the Code was in- creased to INR 1 crore from INR 1 lakh. The plaintiff filed an applica-
CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED tion for pre institution mediation on 24.08.2020 immediately on re- sumption of DLSA whose working was also closed on account of pan- demic situation and received the non-starter report dated 26.10.2020 on 04.11.2020. It is stated that the cause of action for filing the present suit arose on 05.05.2017 when the invoices was unpaid for the ser- vices rendered by the plaintiff. It further arose when the defendants promised to clear all outstanding verbally on call several times. Fur- ther, when the plaintiff had issued a demand notice under Section 8 of Insolvency and Bankruptcy Code, 2016. It is stated that cause of ac- tion is continuous and running and the present suit has been filed within expanded period of limitation as per the order of Hon'ble Supreme Court of India in Suo Moto Writ Petition (Civil) 03/2020, dated 23.03.2020 vide which the Hon'ble Supreme Court has extended the period of limitation w.e.f. from 15.03.2020. Plaintiff has thus, prayed that a decree for a sum of Rs.13,15,696/- with future interest @ 24% per annum and cost of litigation. Plaint is supported by an affi- davit of AR of plaintiff firm. Statement of Truth in support of plaint by way of affidavit of Niranjan Singh is also filed.
3. The defendants were issued summons of the suit vide or- der dated 24.01.2022. Defendants were served on 16.09.2022 and WS was filed stating that the suit is barred by limitation and the invoices upon which the claims are based are from 03.03.2017 to 27.07.2017 and the miscellaneous application no. 740/21 under Order IX Rule 9 CPC was filed on 02.12.2021 and thus, suit is not covered within the prescribed period of 3 years computed as per the Limitation Act 1963 and, hence, is not maintainable. The defendant further stated that they are engaged in the production, processing and preservation of meat, CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED fish, fruit, vegetables, oils and fats and have received services for frieght forwarding, custom clearance and allied services from time to time from the plaintiff for its business requirements, however, the plaintiff has failed to adduce relevant contracts / agreements. It is fur- ther stated that the plaintiff on terms of continuing the business with the answering defendant has forfeited the opening balance figure of Rs.7,82,870.00/-. It is further stated that the plaintiff has not filed complete statement of account deliberately and intentionally. Further, the statement of account as maintained by the plaintiff i.e. SPJ Cargo Pvt. Ltd. is for Rayban Foods Pvt. Ltd. as well as AL Ayan Foods Pvt. Ltd. as annexed as per the email correspondence dated 27.04.2017 and 02.05.2017 between the plaintiff and the defendant deals with alleged outstanding in both alleged account in financial year 2017 and cannot be held against the answering defendant as the reconciliation of the account in question i.e. AI Ayaan Foods Pvt. Ltd. has since taken place and the alleged outstanding principal amount of Rs.7,89,920/- along with alleged interest @ 24% per annum of Rs.5,32,726/- totaling to Rs.13,15,696/- as on 14.02.2020 stands re- bated as on 31.08.2022 and no amount remains to be recovered from the answering defendant.
4. Defendants have further stated that the plaintiff has raised several invoices for the services availed by the defendant, however, such invoices and claims are raised in a malafide manner on account of deficiency of service and the original shipment containing packages and products as mentioned in the consignment notes varied at the con- signee designation and at times did not reach the consignee at all. It is further stated that the invoices so raised does not take into considera-
CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED tion the deficiency in service and the reconciliation of the account by rebate and discount. It is further stated that the plaintiff has charged interest at an exorbitant, excessive and usurious rates and as per the guidelines issued RBI from time to time, interest at such exorbitant rates cannot be charged by the plaintiff. On merits, the defendant in his WS has denied that the principal amount of Rs.7,82,970/- is due and recoverable from the defendant. In response of other paragraphs, it is stated that all the allegations are wrong, false and specifically de- nied. The defendant has prayed that the suit of the plaintiff be, thus, dismissed with cost. Along with this a certified copy of resolution has been filed dated 17.09.2022 whereby authorizing Sh. Ravinder Singh to do all necessary acts on behalf of defendant in the present case.
5. An affidavit of admission and denial was also filed along with WS. However, the said affidavit of admission and denial of docu- ments was not as per the Commercial Courts Act, 2015 and even the list of documents filed by the plaintiff was not as per the Commercial Courts Act, 2015. Vide order dated 17.11.2022, it is revealed that counsel for both the parties sought time for removing the objections. Plaintiff was directed to file fresh list of documents as per the Com- mercial Courts Act, 2015 and the defendant was also directed to file fresh affidavit of admission and denial of documents within 2 weeks. Thereafter, fresh list of documents was not filed by the plaintiff and last and final opportunity was granted to plaintiff for filing the same subject to cost of Rs.2,000/- vide order dated 15.12.2022. Plaintiff, thereafter, filed fresh list of documents which were permitted to be taken on record subject to cost of Rs.2,000/- vide order dated 31.01.2023. Defendant was thereafter directed to file fresh affidavit of CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED admission and denial of documents within 2 weeks. The defendant thereafter did file the affidavit of admission and denial of documents but it was revealed that the same was not pertaining to the documents of the plaintiff as the plaintiff has filed 17 documents, whereas, the af- fidavit of admission and denial of documents was in support of 7 doc- uments only. As the affidavit of admission and denial did not pertain to the documents of the plaintiff, defendant was directed to file fresh affidavit of admission and denial of documents as per the Commercial Courts Act, 2015 within a week subject to cost of Rs.5,000/- vide or- der dated 21.03.2023. Thereafter, fresh admission and denial of docu- ments was filed by the defendant, however, the same was again not correct as per the Commercial Courts Act, 2015. On 25.04.2023, counsel for the defendant submitted that the latest affidavit of ad- mission and denial of documents on behalf of defendant may be taken off the record and he also consented for dispensing with the proof of documents relied upon by the plaintiff in terms of Ordre 11 Rule 4 (3) CPC amended by Commercial Courts Act, 2015. The relevant portion of the said order dated 25.04.2023 is reproduced herein below:
".....At this stage, Present: Mr. Madhav Shankar(Enrol: D2181/16), proxy for Mr. Utkarsh Joshi, counsel for plaintiff.
Mr. Manu Gupta, counsel for defendant. Counsel for defendant submits that he has transferred previous cost of Rs.5000/- in the account of proxy counsel for plaintiff by PayTM. He further submits that CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED latest affidavit of admission/denial of documents filed on behalf of defendant may also be taken off the record and he has consented for dispensing with the proof of documents relied upon by plaintiff in terms of Order 11 Rule 4(3) CPC amended by Commercial Courts Act, 2015.
Accordingly, the affidavit of admission/denial of docu- ments dt. 28.03.23 filed by defendant be taken off the record....."
6. In the replication, plaintiff has reiterated the contents of the plaint and further stated that the statement of truth filed by the de- fendant along with WS is not as per the Commercial Courts Act, 2015 as it does not mention that which of the paragraphs are true to the knowledge of the defendant and which of the paragraphs are based on information received by the defendant which they believe to be cor- rect. It is further stated that the plaintiff has filed the suit within the period of limitation. It is stated on 12.03.2021, arguments on limita- tion were heard and court was satisfied that the suit was filed within statutory provided limitation period. It is further stated that the defen- dant has not filed any document, neither the defendant filed any com- plaint regarding the deficiency of the services and these averments are mere after thought. Also, the plaintiff has maintained two separate ledger for both companies and both the matters related to Rayban Foods Pvt. Ltd. and AL Ayan Foods Pvt. Ltd. are completely separate. The plaintiff has denied giving of any rebate to the defendant and has stated that the defendant has stated about deficiency of service solely CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED in order to evade their liability. Plaintiff, thus, has prayed for a decree as per the suit. Though, plaintiff has taken the objection that the state- ment of truth filed by the defendant is not as per the provisions of Commercial Courts Act, however, perusal of the file reveals that de- fendant had filed another statement of truth dated 24.02.2023 on 27.02.2023 along with affidavit of admission/denial in which all de- tails were stated as per the Commercial Court Act.
7. On the basis of pleadings of parties, following issues were settled for consideration:
(i). Whether the suit of plaintiff is barred by law of limitation?
OPD.
(ii). Whether the defendant has already reconciled the account and outstanding principal amount Rs.782970/- along with interest @24%p.a of Rs.532726/- totalling to Rs.1315696/- as on 14.02.2020 stands rebated as on 31.08.22? OPD.
(iii). Whether the plaintiff is entitled for money decree? If so, to what amount. OPP
(iv). Whether the plaintiff is entitled for any interest? If so, at what rate and for which period. OPP
(v). Relief.
8. In order to prove its case, the plaintiff examined Sh. Niranjan Singh as PW1 who tendered his evidence by way of affidavit PW1/A. He relied upon the following documents:
i. Master data of plaintiff as Ex.PW1/1; ii. Copy of Board Resolution as Mark A;
iii. Print out of defendant's details from MCA website as Ex.PW1/3; iv. Copy of Invoice as Ex.PW1/4 (colly); v. Copy of ledger statement as Ex.PW1/5;
CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED vi. Computation table of amounts due as Ex.PW1/6; vii. Emails as Ex.PW1/7 (colly);
viii. Legal Notice dated 26.02.2021 as Ex.PW1/8; ix. Non starter report as Ex.PW1/9;
x. Certificate under Section 65B of Indian Evidence Act as Ex.PW1/10;
xi. Declaration under Order XI Rule 6 CPC as Ex.PW1/11.
Thereafter, PE was closed.
9. On the other hand, defendant has preferred not to lead any DE.
10. The court has gone through the testimony of witnesses and perused the material placed on record. The court has also gone through the law on the point and duly considered the arguments advanced by counsel for both the parties as well as the written submissions filed on behalf of plaintiff.
11. The findings on various issues are as under:
Issue no. 1. Whether the suit of plaintiff is barred by law of limitation? OPD.
12. The onus of proving this issue was upon the defendant. It is pertinent to mention that the suit was initially filed on 09.12.2020, thereafter, due to covid period no substantial proceedings took place and even none appeared on behalf of plaintiff through cisco web app during the virtual hearing. Vide order dated 23.01.2021, ld. counsel for plaintiff who appeared through VC was directed to file original documents, thereafter, as the original court fees was not filed, plaintiff was granted 3 weeks time to file the court fees vide order dated CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED 18.02.2021 and again on 12.03.2021. However, as the court fees was not filed, the suit was dismissed for non prosecution and in default vide order dated 08.04.2021. Again, an application under Order IX Rule 9 CPC was filed on 30.11.2021 which was allowed vide order dated 24.01.2022 and the suit was restored to its original number. The court fees for an amount of Rs.16,000/- is purchased on 05.10.2021 as per the court fees certificate and filed on 02.12.2021 along with the application under Order IX Rule 9 CPC.
13. It is pertinent to mention that the Apex Court has suo moto passed the order dated 10.01.2022 in suo moto Writ Petition(c) 2020 In Re: Cognizance for extension of limitation. While discussing the difficulties faced by litigants due to outbreak of Corona Virus, it was directed that period from 15.03.2020 till 28.02.2022 shall stand excluded for the purpose of limitation as may be prescribed under any general or specific laws in respect of all judicial or quasi judicial proceedings. The invoices are Ex.PW1/4 reveals that two invoices dated 03.03.2017, one invoice dated 06.04.2017, one invoice dated 03.06.2017, one invoice dated 26.06.2017 and the last invoice dated 26.07.2017 and due date for payment are after one month of the date of the invoice. Thus the payment was to be made by the defendant for the invoice dated 03.03.2017 by 03.04.2017. The limitation period thus would be expired on 03.04.2020 for the invoice dated 03.03.2017. However, due to covid-19 pandemic the limitation period from 15.03.2020 till 28.02.2022 has been excluded. The present suit was instituted on 09.12.2020. The court fees was also filed on 02.12.2021 and thus, in view of order of Hon'ble Supreme Court whereby the period from 15.03.2020 till 28.02.2022 was excluded for the purposes of limitation, the suit filed by the plaintiff is within CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED limitation. Also, the non starter report reveal that the application for pre institution mediation was made on 24.08.2020 and the defendant had failed to appear on 19.09.2020, 01.10.2020 and 26.10.2020 and the non starter report was issued on 26.10.2020. The period from 24.08.2020 to 26.10.2020 is also required to be excluded as per rules/law for computing the period of limitation. Moreover, defendant has not led any evidence on this aspect and has failed to discharge the onus placed upon the them. The present suit filed on 09.12.2020 is thus, filed within the prescribed period of limitation as extended by Hon'ble Supreme Court as discussed above.
Issue no. 1 is thus, decided in favour of the plaintiff and against the defendant.
Issue no. ii. Whether the defendant has already reconciled the account and outstanding principal amount Rs.782970/- along with interest @ 24% p.a of Rs.532726/- totaling to Rs.1315696/- as on 14.02.2020 stands rebated as on 31.08.22? OPD.
14. The onus of this issues was also upon the defendant. The this defendant has not led any evidence on this account to prove that outstanding principal amount of Rs.7,82,970/- along with interest at the rate of 24% of Rs.5,32,726/- was rebated as on 31.08.2022. The relevant cross-examination of PW-1, in this respect is reproduced hereinbelow:
"Cross dated 27.05.2023 .......It is correct that reconciliation / settlement of accounts was made, however, no payment was received after reconciliation of accounts. No such document showing the reconciliation of accounts has been placed CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED on record. I can produce the said document on the next date. Again said, I can check if the same can be located since it is an old record. It is wrong to suggest that the accounts of both defendant and sister company were reconciled and that is why we are continuing work with the defendant company. No new work has been done with the defendant company but only with the sister company.
At this stage, ld. Counsel for defendant has confronted the witness with the printout of email dated 17.09.2022 and witness is questioned if the said email was sent by him, to which the witness submits that as per the email the same has been sent by Rahul, who is my Accountant, however, he can confirm about the said email only after consulting Mr. Rahul, since the same has not been issued by him. The email is marked as Mark X. Further, cross examination of the witness is deferred on the request of ld. Counsel for the defendant who wishes to witness to produce the emails exchanged between the parties from 2017 to 2022. the witness submits that he shall have to check if the mails are available and he can produce the same on the next date, if available......
Cross dated 03.07.2023 ........I could not locate the emails from 2017 to 2022 CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED as desired by the counsel for defendant as the same are not available.
The mails must have been exchanged between the parties. I am not aware about the emails. The email dated 14.02.2020 annexed with my plaint at page no.49 in the list of documents is sent under my name but I am not aware about the same but it might by possible that some other employee of our company has sent the same.......
........It is wrong to suggest that the amount which has been claimed by the plaintiff company has been reconciled on 14.02.2020 stands rebated as on 31.08.2022 and there is no outstanding against the alleged bill........
........Ques: I put to you that settlement/reconciliation happened from this email ID. What do you have to say?
Ans: It is correct that reconciliation happened from our company email ID i.e., [email protected]. Vol. I am not sure about such reconciliation. It might be in my absence but no settlement has happened........"
15. PW-1, thus, has denied of any settlement with the defen- dant. Though, he has admitted that some reconciliation of accounts was made, but, he further stated that no payment was received after reconciliation of account. He has specifically denied that the account which was reconciled stood rebated as on 31.08.2022 or there was no CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED outstanding against the alleged invoices. The initial onus of proving this issue was upon the defendant. The defendant has not led any evi- dence. On the other hand, the witness of the plaintiff has denied that the amount stood rebated as on 31.08.2022. Once this suggestion was denied by witness of the plaintiff that the account which was recon- ciled on 14.02.2020 stood rebated on 31.08.2022, the onus was again upon the defendant to prove by leading cogent evidence that the amount stood rebated by the plaintiff company on 31.08.2022. The de- fendant in fact has not led any evidence and as revealed from the order sheet dated 25.04.2023, ld. Counsel for defendant has consented for dispensing with the proof of documents relied upon by the plaintiff in terms of Order XI Rule 4 (3)CPC amended by the Commercial Courts Act, 2015. The plaintiff was not, thus not formally even required to prove all the documents relied upon by them.
16. As far as email are concerned, the emails between the parties is Ex.PW1/7. Certificate under Section 65B of Indian Evidence Act in support of these emails has been filed by the plaintiff stating that these emails were downloaded on 25.02.2020 and affidavit/declaration on oath under Order 11 Rule 6 (3) of the Com- mercial Division and Commercial Appellate Division of High Court Act, 2015 in support of the digital evidence i.e. the master data of the company as well as the emails is also filed. The emails, thus, has been proved on record by the plaintiff and the last email is dated 25.02.2020 in which it was told to the defendant if they would not make the payment, the company would charge them interest at the rate mentioned in the invoice. No document has been filed by the defen- dant to prove that the principal amount as well as interest amount was CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED rebated by the plaintiff on 31.08.2022. As the defendant has not filed any document along with WS therefore, no affidavit of admission and denial of documents was filed by the plaintiff. The onus was upon the defendant to have filed the documents showing that the principal amount and the interest amount was rebated by the plaintiff. However, the defendant neither examined any witness nor filed any document in this regard and thus, has failed to discharge the onus placed upon him.
Issue no. 2 is thus, decided in favour of the plaintiff and against the defendant.
Issue No.3. Whether the plaintiff is entitled for money decree? If so, to what amount. OPP
17. The plaintiff has proved the invoices Ex.PW1/4 and the ledger account Ex.PW1/5. He also proved the amount of the interest claimed. On the invoices, there is a condition that if the amount is not paid by the due date then interest @ 24% will be charged. The defendant has not led evidence to prove that he is not liable to pay the amount of the interest. The defendant, though, in his written statement has stated that there is a deficiency in service but no such deficiency of service on the part of the plaintiff has been proved by the defendant at the time of evidence. As per email exchanged between the parties Ex.PW1/7 also nothing regarding deficiency of service was ever stated by Naim Khan. However, these emails have been responded by the Naim Khan on behalf of Rayban Foods Pvt. Ltd., but, perusal of the contents of the email reveals that statement of Rayban Foods Pvt. Ltd. as well as AL Ayan Foods Pvt. Ltd. both were sent as attachment. Plaintiff has already stated that as far as Rayban Foods Pvt. Ltd. is concerned, there was a separate account and plaintiff has proceeded CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED separately against the Rayban Foods Pvt. Ltd. and the amount claimed is in the present suit is not connected with the firm Rayban Foods Pvt. Ltd.
18. If there is any deficiency in service on the part of the plaintiff, the defendant would have certainly objected to the same at the time when invoices were raised. Nothing has been placed on record by the defendant to show that they have ever stated about the deficiency of service on the part of the plaintiff at any time before the filing of the WS. This plea of the defendant clearly seems to be an after thought.
19. As far as principal amount of Rs.7,82,970/- is concerned, it is not the case of the defendant that they had not availed the service of the plaintiff company. The only defence of the defendant is that the amount stood rebated as on 31.08.2022 and that there was a deficiency in service provided by the plaintiff. As already observed, the issue regarding the amount being rebated on 31.08.2022 has already been dealt with above and the defendant has not been able to prove the same. The other defence regarding the deficiency in service is also clearly an afterthought. The plaintiff is thus, fairly entitled to principal amount of Rs.7,82,970/- as per the invoice Ex.PW1/4 and the ledger Ex.PW1/5.
Issue no. 3 is thus, accordingly, decided in favour of the plaintiff and against the defendant.
Issue No.4. Whether the plaintiff is entitled for any interest? If so, at what rate and for which period. OPP
20. As far as interest for the period prior to the filing of the suit is concerned, the plaintiff has claimed the same on the basis of 24% p.a. as per the stipulation mentioned on the invoices Ex.PW1/4.
CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED Section 34 of the Code of Civil Procedure, 1908 deals with award of interest by the Court in suits for money. It reads as follows:
"34. Interest (1) Where and in so far as a decree is for the payment of money, the Court may, in the decree, order interest at such rate as the Court deems reasonable to be paid on the principal sum adjudged, from the date of the suit to the date of the decree, in addition to any interest adjudged on such principal sum for any period prior to the institution of the suit, with further interest at such rate not exceeding six per cent, per annum, as the Court deems reasonable on such principal sum, from the date of the decree to the date of payment, or to such earlier date as the Court thinks fit.
Provided that where the liability in relation to the sum so adjudged had arisen out of a commercial transaction, the rate of such further interest may exceed six per cent, per annum, but shall not exceed the contractual rate of interest or where there is no contractual rate, the rate at which moneys are lent or advanced by nationalized banks in relation to commercial transactions.
Section 34 empowers the court to award interest for the period from the date of the suit to the date of the decree and from the date of the decree to the date of payment where the decree is for payment of money.
CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED Section 34 CPC does not empower the court to award pre-suit interest. The pre-suit interest would ordinarily depend on the contract (express or implied) between the parties or some statutory provisions or the mercantile usage - Secretary/General Manager, Chennai Central Co-operative Bank Ltd. Vs. S.Kamalaveni Sundaram 2011 (99) A/C 140 (SC).
21. The plaintiff has claimed an amount of Rs.5,32,726/- as interest at the rate of 24% per annum as per the calculation below:
Date Ref. No. Invoice Due on Overdue Interest as on 14th Amount by days Feb 2020 03.03.2017 SPJ/EXP/8235/16-17 249114.00 Dr 03-Apr-2017 1048 171663.00 Dr. 03.03.2017 SPJ/EXP/8236/16-17 249114.00 Dr 03-Apr-2017 1048 171663.00 Dr. 04.04.2017 SPJ/EXP/063/17-18 276562.00 Dr 06 May2017 1014 184395.00 Dr. 03.06.2017 SPJ/EXP/1811/17-18 2260.00 Dr 03-Jul-2017 956 1421.00 Dr. 26.06.2017 SPJ/EXP/2438/17-18 3560.00 Dr 26-Jul-2017 933 2184.00 Dr. 27.07.2017 SPJ/791/17-18 2360.00 Dr 27-Apr-2017 902 1400.00 Dr. Total 782970.00 Dr 532726.00 Dr. Total Invoice / Principal amount Rs.7,82,970/- (Rupees Seven Lakhs Eighty Two Thousand Nine Hundred and Seventy Only) Total Interest Amount @ 24% pe annum as on 14.02.2020, Rs.5,32,726/-
(Rupees Five Lakhs Thirty Two Thousand Seven Hundred and Twenty Six Only) Total outstanding as on 14.02.2020, Rs.13,15,696/- (Rupees Thirteen Lakhs Fifteen Thousand Six Hundred Ninety Six Only)
22. As per the terms and conditions on detailed invoices Ex.PW1/4, interest @ 24% was to be charged if the bill was not paid by due date. The plaintiff is thus entitled to interest after expiry of one month of the invoice. The plaintiff is thus entitled to an amount of Rs.5,32,726/- on account of interest as claimed by them.
CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED
23. However, as far as interest pendent-elite and future is concerned, as already observed it was directed vide order dated 24.01.2022 that the plaintiff shall not be entitled to interest for the period of delay and thus, it is directed that the plaintiff shall not be entitled to pendentelite interest for the period 23.01.2021 to 24.01.2022.
Issue No.5 Relief
24. In view of the findings on the issue no.1 to 4 and the documents proved on record, the suit of the plaintiff is decreed for a sum of Rs.7,82,970/- + Rs.5,32,726/- = Rs.13,15,696/- with cost to the extent of court fees and pendente lite and future interest @ 9% per annum on principal amount of Rs.7,82,970/- w.e.f 09.12.2020 (except for the period from 23.01.2021 to 24.01.2022), till its realization Decree sheet be prepared accordingly.
File be consigned to record room.
Announced in the open court (Kiran Bansal)
on 14.12.2023 District Judge, Commercial Court-02
Shahdara, Karkardooma
Delhi/14.12.2023
CS(COMM) NO. 612/2020 SPJ CARGO PRIVATE LIMITED Vs. AL-AYAAN FOODS PRIVATE LIMITED