K.L. Shroff vs State Of Haryana And Anr.
2003 Latest Caselaw 937 Del

JUDGMENT

Mahmood Ali Khan, J.

1. This is a suit for recovery of Rs. 24,53,445.61 p.

2. The case of the plaintiff is as follows. The plaintiff No. 1 K.L. Shroff is the sole trustee of plaintiff No. 2 K.L. Shroff Family Trust under the registered trust deed dated 1.7.1978. The trust is carrying on the printing work in the name and style of M/s. Nu Tech Photolithographers, plaintiff No. 3. The defendant State of Haryana awarded the work of printing of lottery tickets for the period 1.4.1985 to 31.3.1986 and 1.4.1986 to 31.3.1987 under an agreement. In terms of the agreement, the defendant was responsible for supplying papers for printing of lottery tickets at the premises of the plaintiffs; the plaintiffs were to carry out the printing work and deliver them within the time stipulated as per print order, delivery was to be given at the printing press and printing was to be done under the supervision of an official of the defendant. During the contract period, the defendant issued print orders to the plaintiff from time-to-time under the said agreement. The print orders were in respect of the following weekly lotteries:

(1) Hari Om 9th to 25th draw

(2) Shri Ganesh 72nd to 128th draw

(3) Jai Durge 1st to 73rd draw

(4) Mahalakshmi 388th to 445th draw

3. The plaintiffs after executing the print order supplied the printed lottery tickets to the lottery department of the defendant in accordance with the agreement and submitted various bills for payment. The defendant made the payment of the reduced amount in these bills on the pretext that penalty was imposed on the plaintiff for delayed delivery of the lottery tickets, but it did not disclose the basis of the deduction. The plaintiffs submitted a statement in respect of the lotteries, Jai Durge, Mahalakshmi and Shri Ganesh showing the amount of bills, actual amount paid, the date and the deficiency in the payment, which was annexed to the plaint as Annexures-A, B and C. The deficiency in payment are Rs. 5,80,800/- in respect of Jai Durge; Rs. 2,81,600.65 in respect of Mahalakshmi and Rs. 3,30,800/- in respect of Shri Ganesh lottery. The defendant has unlawfully made deductions from the bills submitted by the plaintiffs on account of delay in delivery of lottery tickets and for supply of papers in excess of the requirement, etc. The delay in delivery of the tickets, if any, was on account of the defaults committed by the lottery department of the defendant by not supplying papers for printing of the tickets at the premises of the plaintiff before commencement of the printing; by not issuing and delivering the print orders 21 days before the date of supply of the tickets, which period on such failure on the part of the defendant was to stand extended in terms of the agreement; by not supervising of the printing work by the lottery department of the defendant for causing delay in the printing and delivery schedule; by counting the time for delivery from the date of printing order instead of from the date on which order of the defendant reached the printing press of the plaintiffs in accordance with the agreement and by not taking delivery of the printed tickets by the defendant on time. The defendant cannot take advantage of its own wrong. The defendant is liable to make payment of the amount shown in Annexures A, B and C to the plaint with interest @ 18% p.a. from the due date of payment to the date of recovery of the amount. The amount of interest due up to 15.12.1988 was Rs. 2,78,065.45 in respect of Jai Durge series; Rs. 1,35,988.80 in respect of Mahalakshmi and Rs. 1,60,021.20 in respect of Sri Ganesh series.

4. Further allegations in the plaint are that in accordance with the agreement, papers for printing the lottery tickets were not supplied by the lottery department of the defendant, but either it failed to supply the papers in time or did not supply it at all. As a result, the plaintiffs had to arrange the papers from its own stock and other sources and at its cost in order to enable the defendant in making draw in time. The plaintiffs used 1,322 reams of paper at its own cost for printing the lottery tickets, which were supplied to the defendant. The price of the paper is at Rs. 1,82,436/-, which is payable by the defendant. The statement of the outstanding supply of paper used by the plaintiffs in printing the lottery tickets has been shown in Annexure D to the plaint. The plaintiffs are entitled to recover the aforementioned amount with interest, which up to 15.12.1988 is Rs. 1,85,425.17 p. The plaintiffs are entitled to recover a sum of Rs. 3,67,861.17 p. only from the defendant on this account. The defendant has also not paid the amount of bill No. 618 dated 29.10.1985 of 43rd Jai Durge draw for Rs. 42,440/-, bill No. 181 dated 28.5.1986 of 73rd Jai Durge draw for Rs. 42,240/- and bail No. 840 dated 21.12.1985 of 420th Mahalakshmi draw for Rs. 35,200/-, making a total sum of Rs. 1,19,680/-, which is payable by the defendant. The plaintiffs are also entitled to interest @ 18% p.a. on this amount, which in respect of the above-mentioned three bills due up to 15.12.1988 comes to Rs. 15,623/-, Rs. 18,747.60 p. and Rs. 18,643.45 p. In total, a sum of Rs. 53,014.05 p. is payable with interest, which has been shown in Annexure E. Furthermore, the defendant was making payments to the plaintiffs for various bills late, as shown in Annexures F, G, H and I. Consequently, the plaintiffs are entitled to recover the interest of Rs. 1,45,534.29 p. @ 15% p.a. on these late payments. A sum of Rs. 24,53,445.61 p. is payable by the defendant to the plaintiffs, as shown in Annexure J. Despite service of notice dated 17.10.1987 under Section 80, CPC, the defendant had failed to pay it. The interest was being claimed according to the mercantile in the trade and in the alternative in equities under the Interest Act and for recovery of Rs. 24,53,445.61 p. with pendente lite and furture interest @ 19% p.a. and costs of the suit.

5. Along with the suit the plaintiffs have annexed a statement, Annexures A to J showing the deficiency in payment of the amount due and the amount of interest, which has accrued in respect of the three bills. The deficiency and the delayed delivery of papers supplied by the defendant for printing of the lottery tickets, the statement of interest due on various bills on late payments and the statement showing the amount due towards the outstanding bills for printing work, shortage in payment of the bills, the amount due for short supply of paper and the amount of the interest recoverable from the defendant.

6. The defendant contested the suit by filing a written statement by pleading that this Court had no jurisdiction to try the shall since the seat of the Government of State of Haryana was at Chandigarh. The awarding of contract for printing lottery tickets to the plaintiffs by the lottery department of the defendant Government, as alleged in the plaint, was not disputed. It was denied that the paper was to be supplied before he commencement of each order of printing of ticket. Some of the conditions of the agreement were also reproduced in the written statement. As regards deductions made from the bills, it was alleged that it was done in accordance with the terms and conditions of the agreement. The conditions of the contract, which have been alleged by the petitioner in para 13 were denied. It was disputed that the defendant had committed breach of any term and condition of the tender or the penalty imposed by it was not in accordance with the contract. The claim of the petitioner towards interest was also repudiated. As regards the paper, it was alleged that the paper was being supplied to the plaintiff's press in accordance with the agreement. The lottery department of the defendant had also reimbursed the papers where even the plaintiff had used the papers in the printing work from their own stock. The plaintiff's press had consumed 22,959 reams and 349 sheets against the departmental supply of 24,017 reams and 276 sheets of papers. Each seat of paper was measuring 51 x 76 cms. on the order quantity of 3,680 lacs lottery tickets during 1985-86, 1057 reams and 427 sheets of the value of Rs. 1,62,190/- was consumed in excess, as pointed out in the audit report of the Accountant General, Haryana. The plaintiffs could not justify the excess consumption of the papers and failed to supply the information, as called in by the defendant by the letters dated 20.7.1988 and 17.10.1988. The plaintiff was not entitled to interest from the defendant either. The plaintiffs in accordance with term 17(c) of the agreement were required to acknowledge a delivery receipt taken from Delhi Office of the lottery department to determine the amount of penalty, if any, in respect of each bill, but they failed to supply the said information despite letters and reminders. The plaintiffs are not entitled to claim interest because they themselves failed to supply the documents, which have been mentioned above. All payments were made regularly to the plaintiff in accordance with the terms of agreement. If there was delay in some payments, that was due to objections that might have been raised on the bill and when certain clarification was needed from the plaintiffs. The defendant was to pay on printing charges of three bills pertaining to 420th draw of 'Mahalakshmi' scheme and 73th draw of 'Jaidurga' scheme provided the delivery challans were furnished and subject to deduction of Rs. 68,834/- and Rs. 1,62,190/-, which was the excess payment made due to difference in rates and the cost of papers respectively, as pointed out in the audit report of the Accountant General.

In the replication, the plaintiffs reiterated their own case and denied the allegations of the defendant made in the written statement.

On the basis of the pleadings and the documents, the Court framed the following issues on 2.2.1994:

 (1)    Whether the Court has no territorial jurisdiction? OPD 
 

 (2)    Whether plaintiff No. 2 is duly registered family trust and plaintiff No. 1 is the sole trustee thereof and whether the said trust is carrying on business of printing under the name and style of M/s. Nutech Photolithographers? OPP 
 

 (3)    What are the terms and conditions of tender for printing of lottery tickets? OPP 
 

 (4)    Whether the plaintiff made late deliveries of lottery tickets as alleged, if so, to what effect? OPD 
 

 (5)    Whether defendant has made deductions on account of penalty according to contract? If so, how much?
 

 (6)    Whether the delay, if any, in making deliveries of lottery tickets were on account of defaults committed by defendant of various terms of tender?  OPP 
 

 (7)   Whether the defendant supplied paper in excess than actually used for printing of lottery tickets, if so, how much and of what value?
 

 (8)   Whether the defendant is entitled to deduct Rs. 68,834/- and Rs. 1,62,190/- from the dues of plaintiff and as cost, if any of paper allegedly supplied in excess? OPD 
 

 (9) To what amount, if any, is the plaintiff entitled to recovery?
 

 (10) Whether the defendant is liable to pay interest? If so, at what rate?
 

 (11) Relief.
 

 Issue No. 1 was decided against the defendant as a preliminary issue by order dated 17.4.1998. The parties have produced their respective evidence. The plaintiffs examined Shri Sanjeev Gandhi, PW1 whereas the defendant examined S/Shri Raj Kumar Sharma, G.D. Kakar, Sham Lal Duggal, Jai Singh and Balbir Kumar Saini, DW1 to 5 respectively,
 

7. The suit was being shown in the list of 'Finals' since long, but nobody appeared on behalf of the defendant after evidence of the parties was over. In the meantime, on 8.8.2002 the suit was dismissed in default, but it was restored by order dated 19.8.2002. A notice for actual date of the hearing was also directed to be served on the defendant through Counsel for 19.9.2002. A report for service of notice on the defendant was received on 19.9.2002 but a fresh actual date Court notice was directed to be issued to the defendant for 12.12.2002. Learned Counsel for the plaintiff was also asked to communicate a letter to the defendants' previous Counsel Mr. J.S. Malik as well as to the present Standing Counsel for the State of Haryana in the High Court. Standing Counsel of Haryana State was not served. So a fresh notice was issued to him for 29.1.2003. The notice was duly served on the Standing Counsel for State of Haryana, but nobody appeared on its behalf on 20.1.2003. This Court directed a Court notice to be issued to the Resident Commissioner, State of Haryana, Haryana Bhawan, New Delhi to ensure presence of the Counsel for the defendant State on the next date. Incase the Counsel did not appear, the Resident Commissioner was directed to remain present in the Court. The notice was issued for 23.4.2003. The notice was served, but none appeared for the plaintiff. The case was re notified in the list of 'Finals'. In these circumstances, the Court was constrained to hear the arguments of learned Counsel for the plaintiff. Since the evidence of both the parties have been recorded in this case, the Court proceeded to decide the suit on merit.

Arguments of learned Counsel for the plaintiff have been heard. The findings on the issues Nos. 2 to 10 framed on 2.2.1994 are as under:

Issue No. 2 :

Sanjiv Gandhi, PW 1 has stated that plaintiff Trust was carrying on the business of printing press at 10/1-B, Jhilmil Industrial Area, Shahdara Area and its Head Office at 4759/11, 23, Darya Ganj. Delhi and that the business was being carried on in the name an style of Nu Tech Photo Lithographers. It was also stated that the plaint bore the signatures of plaintiff No. 1 K.L. Shroff, who is the sole trustee. He himself was General Manager of the business of plaintiff. PW 1, Sanjiv Gandhi produced the original trust deed dated 31.7.1978 and identified the signatures of the Settler, Smt. Kanwal Rani and trustee K.L, Shroff, who was named as sole trustee. He, deposed that he has seen these persons signing and writing papers and was familiar with their signatures. He also identified the signatures of P. Sarvaria and Yoginder Lal, who are the attesting witness to the trust deed. It was stated that both the attesting witnesses have died. He has placed on record true photocopy of the trust deed, Exhibit PW1/1. It is also deposed that the plaintiff K.L. Shroff was sole trustee of plaintiff No. 2 Trust and that the Trust is carrying on business of printing in the name and style of plaintiff No. 3 M/s, Nu Tech Photo Lithographers. There is no cross-examination of this witness on behalf of the defendant in respect of the above mentioned statement. None of the witnesses examined by the defendants. DWs 1 to 4 have deposed anything on this issue. Accordingly, on the basis of the oral statement of Sanjiv Gandhi, PW1 and the Trust deed dated 31.7.1978 proved by him, it is held that the plaintiff No. 2 is a Trust and plaintiff No. 1 K.L. Shroff is the sole trustee thereof. It is further held that the plaintiff No. 2 is carrying on printing business under the name and style of M/s. Nu Tech Photo Lithographers, plaintiff No. 3 herein. The issue is decided in affirmative.

Issue No, 3:

PW 1 Sanjiv Gandhi has stated that the printing work awarded by the defendant was executed in accordance with the agreement, Exhibit P1, which related to the period from 1.4.1986 to 31.3.1987. He also admitted that the terms and conditions of the agreement for the period from 1.12.1984 to 313.1986 are contained in the agreement, which has been produced by the defendant and was Exhibit D1. There is no dispute between the parties that the terms and conditions of the printing work executed by the plaintiff are contained in Exhibit P1 and Exhibit D1. Sanjiv Gandhi PW 1 and the witnesses of the defendant, DW1 to DW 5 namely Raj Kumar Sharma, G.D. Kakar, Sham Lal Duggal, Jai Singh and Balbir Kumar Saini have not disputed this fact. Consequently, it is held that the terms and conditions of the printing work executed by the defendant are contained in agreements, Exhibit P1 and Exhibit D1. Some of the main terms and conditions in Exhibit P1 are reproduced as under:

 (5)    Paper will be supplied by the Lottery Department at the press premises at the cost of Lottery Department, Haryana.
 

 (12) The entire work of each draw assigned to a press will have to be completed and the ticket supplied within the stipulated period as given in the print order failing which a penalty for the late supply of ticket will be levied on the amount payable as under:
  (a) Grace period of three days    No penalty
(b) For delay up to 7 days   333-1/3% of the ptg. value of
    tickets                       given in the print order.
(c) For delay up to 15 days   60-2 /3% of the value of
    tickets                       given in the print order.
(d) For delay after 15 days   Total ptg. cost of the print order.
 

 (13) In case the work or a print order of a particular draw is not completed three days before the date of the draw, the total order is liable to be cancelled and the security forfeited to Government, in addition to maximum penalty indicated in condition 12 above, the press is also liable to be blacklisted.
 

 (15-A) The tickets are to be supplied as per dated given in the P.O., The P.O. Will be issued by the Lottery Department 21 days before the exact date of supply of lottery tickets. In case the P.O. is not issued 21 days before the exact date of supply of lottery tickets, the supply date will extended accordingly.
 

 (16) The delivery of the printed tickets will be taken by the representatives of the Lottery Department at the press premises after carefully counting/ checking the tickets and got packed and dispatched in his presence. The printer will not be responsible for the shortage of any kind at later stage. The printed tickets are to be delivered in the office of the Department at Delhi duly packed in packets of ten thousand tickets each.
 

 (18) 1/2% wastage of paper will be allowed per colour per impression for printing of lottery tickets. The work will have to be carried out in accordance with the specifications to be given with the orders.
 

 Except that there is no term similar to the term 15-A of Exhibit P1, rest of the terms and conditions in Exhibit D1 are identical. So need not be reproduced. The issue stands decided accordingly. 

 Issues Nos. 7 and 8:
 

8. Both these issues may be conveniently decided together by the same evidence. Mr. Sanjiv Gandhi PW 1 deposed that the plaintiff had printed in total 36,80,00,000/- tickets, which were supplied to the defendant. The size of the different tickets has been shown in Exhibit PW 1/104. Size of tickets of different series was same except Mahalakshmi draw series, which is slightly shorter in size. The plaintiff consumed in total 25,40 reams of 51x76 cms size. The papers received from the defendant and consumed in the printing work had been correctly shown in the statement, Exhibit PW 1/105. The defendant had supplied 24,017 reams and 276 sheets for the printing work. The statement, Exhibit PW 1/105 also showed quantity of papers received from the defendant, consumed by the plaintiffs and the price of the papers, which the plaintiffs had to purchase for supply of the lottery tickets to the defendant in accordance with the agreement. Mr. Gandhi further stated that the size of the lottery tickets Shri Ganesh, Jaidurge and Hari Om was 15.75x6.7 cms and the the size of Mahalakshmi was 16x5.75 cms. It was also stated that on a size of paper measuring 51x76 cms, in all tickets of Jai Durga, Shri Ganesh and Hari Om, 36 tickets of Mahalakshmi draw could be printed. In the cross-examination, he has denied a suggestion made on behalf of the defendant that 33 tickets of the size of 15.75x6.7 cm could be printed on one sheet of paper or that the defendant had supplied adequate quantity of the paper for printing tickets for which orders were placed. There is no cross-examination in respect of the correctness of the statement, Exhibit PW 1/104 and PW 1/105.

9. Raj Kumar Sharma, DW 1 examined by the defendant stated in the cross-examination that in accordance with the terms and conditions of the contract that printed tickets were to be supplied by the plaintiffs as per the dates given in the order, which was to be issued by the lottery department of the defendant 21 days before the exact date of supply of the ticket. It was testified that in case it was not issued in time, date of the supply of the tickets was to get accordingly extended. He did not remember if the printed tickets were sent by ordinary or registered post. According to him, deductions were made by him by seeing the print order. He did not verify the date of the delivery of the print orders. He had considered only the date of draw and the date of delivery of the consignment as per the challan. He could not say if the paper for the printing of the tickets was supplied by the defendant to the plaintiff late since he was not concerned with it. He also did not take into consideration the dates on which the papers were supplied by the defendant to the plaintiffs and the account of delay in making supply of the papers. He also could not say whether the tickets were to be printed under the supervision of the representative of the defendant. He also could not say whether there was delay in taking delivery of the printed tickets from the plaintiffs by the defendant. He also did not take into consideration all these facts while calculating the delay in delivery of the consignment of the printed tickets by the plaintiffs. He had only seen the challans and the bills and did not examine any other document for computing the delay in supply made by the defendant while calculating the deductions made. DW 2 G.D. Kakar has not deposed anything on these issues.

10. DW 3 Sham Lal Duggal stated that in accordance with the terms and conditions of the contract, paper for printing of the tickets was to be supplied by the lottery department of the defendant. This supply could be made before and after printing tickets. Papers used to be supplied in bulk sometimes in excess of the actual requirement. The paper which was supplied in excess of the requirement of a particular print order could be used against the next printing order. Wastage at the rate of 11/2% was allowed in accordance with the terms and conditions. The Audit had raised an objection regarding use of the papers in excess of the actual requirement for in the execution of the work. The plaintiff had shown wastage at 4%. The standard size of Mahalakshmi and Jaidurge ticket is 16x6 cm, but the size of Sri Ganesh was 15x7 cm. The defendant had supplied in total 24,017 reams and 276 sheets. The delivery of the printed tickets was delayed by the plaintiffs. The statement of delay has been filed. The plaintiffs had used inferior quality paper and not the standard quality from its own stock. In the cross-examination, he deposed that the defendant was liable for supply of papers for printing of the lottery tickets. He did not know the quantity of papers supplied by the defendant to the plaintiffs except what has been mentioned in the audit report. He also did not know the price of the paper on the basis of which the price of the paper supplied in excess of the actual requirement was claimed by the defendant. In the cross-examination, he further stated that he was concerned with the taking of the delivery of printed tickets in Delhi and was not aware of anything else in the matter. He also did not know on what basis the price of the excess paper was claimed @ Rs. 158,32 p. per ream. He also could not say whether printing work was executed under the direct supervision of officials of the defendant.

11. DW 4 Jai Singh stated that the paper for printing lottery tickets used to be supplied by the defendant. The paper was supplied by the defendant late, but it was supplied in excess of the requirement. A letter was sent to the plaintiffs that the paper has been supplied in excess of the actual requirement, but no reply was received from the plaintiffs. He further stated in the cross-examination that he joined the department in May, 1988 after print order had been executed in this case. He had carried out the audit of accounts. He did not carry out the audit in relation to the plaintiffs' work. It was done by his predecessor. He did not know, who had audited this work. He did not know whether the plaintiffs had used their own paper in execution of the printing order. His predecessors had been asking the plaintiffs to give account of the paper used by it in the work of printing of lottery tickets. He denied the suggestion that the plaintiffs had used their own paper in the printing work. He admitted the letter, Exhibit DW 4/1.

12. DW 5 Balbir Kumar Saini also stated that the paper for execution of the printing work was to be supplied by the defendant to the plaintiffs. According to him, the defendant had no right to use their own paper for printing the lottery tickets. In the cross-examination, it is stated that the paper was to be supplied in advance in accordance with the agreement, but he did not know whether the paper was supplied in accordance with the terms and conditions of the agreement on the date on which supply was made or the quantity of the paper actually supplied. He did not know whether the defendants had purchased the paper from the market and used it for printing the lottery tickets as per the orders or whether the defendant has reimbursed the payment for it. The printing and stationery department was concerned only with the settlement of the terms and conditions and not with the execution of the supply order or the supply of papers.

13. Learned Counsel for the plaintiffs has pointed out to the letter dated 10.7.1986, Exhibit DW4/1 sent by the Joint Director of Haryana State Lotteries to the plaintiffs. It was in response to the letter of the plaintiffs dated 15.5.1986. In the letter it was written that the plaintiffs in their letter had mentioned that 6,322.074 reams of paper was outstanding against the defendant, but according to the record of the defendant, 5,295.474 reams of paper was to be supplied, accordingly, 5000 reams of paper was being supplied to the plaintiffs. Regarding the remaining papers, the same was to be supplied after reconciliation by the department. The plaintiffs were requested to contact the defendant for reconciliation of the variation in the two accounts.

14. None of the parties has produced the letter dated 15.5.1986 sent by the plaintiffs to the defendant, but from the letter Exhibit DW 4/1 it appears that the plaintiffs had demanded 6,322.074 reams of paper alleging that it was deficiently supplied. Learned Counsel for the plaintiffs also pointed out to Exhibit PW1/135. It is a letter sent by the plaintiffs to the defendant. By this letter the plaintiffs had sent statement showing the date of receipt of the print order, dated of paper received and the date of delivery of paper by the plaintiffs. This letter was sent with intention to clear any doubts in respect of the above matter. Counsel for the plaintiff has also invited attention to Exhibit PW1 /107, which is also a letter sent by the plaintiff to the defendant complaining non-supply of papers and objecting to the Imposition of heavy penalty by the defendant. In the letter it was mentioned that the plaintiffs had been writing repeatedly for supply of 6,322.74 reams of papers utilised by the plaintiffs for printing of lottery tickets, but no reply was received despite personal contract. The particulars of the letters and the date of the personal visit in this regard were also mentioned. Referring to the term 15A of the agreement, Exhibit P1, it was contended that the defendant was responsible for the delay in placing the order and in terms of the agreement, the date for supply of the tickets was to be extended. The defendant was also bound to supply the requisite quantity of papers for execution of the printing work, but it was not supplied on time. Therefore, the plaintiffs in order to execute the work, had to resort to local buying of the papers as per instructions of the defendants so that it could carry on the printing work in order to help the defendant in getting supply of printed work time. It was further stated that despite persistent requests by letters, trunk-calls and personal visits for supplying the papers, the defendant did nothing in the matter and although the entire order has been complied with, still the deficiency in the supply of paper has not been made good although an assurance for it was given by the defendant. It is stated that despite receipt of this letter, no reply was received from the defendant. Reference is also made to the letter, Exhibit PW 1/108 by which the plaintiff had intimated the defendant about the quantity of papers used for printing tickets for various draws of lotteries. There was also no response to this reply. This letter was served on the defendant vide acknowledgement due, Exhibit PW 1/113. Exhibit PW 1/111 is yet another letter of plaintiff dated 22.7.1987. It was mentioned that the defendant is yet to supply 1248 reams of papers, which was outstanding for more than one year and a request was made to supply it immediately. There is no suggestion to PW 1 Sanjiv Gandhi that this letter was not received by the defendant. Exhibit PW 1/134 is a letter of the plaintiff dated 18.4.1987. It was sent to the defendant about outstanding supply of paper lamenting that in spite of elapse of about 4 months, no decision for supplying of balance paper had been taken. It was requested that the long outstanding issue may be settled and the balance paper may be supplied immediately. There is no suggestion to Sanjiv Gandhi, PW 1 that this letter was not received. Exhibit PW 1/128 is also a letter of the plaintiff dated 25.6.1986. It was with reference to the penalty imposed by the defendant on the plaintiff. In this letter also it was complained that the papers were not supplied by the defendant as per requirement and the plaintiff was under an obligation to replenish papers, which were not supplied. This letter was also acknowledged by the dispatcher of the defendant and there is no suggestion to Mr. Sanjiv Gandhi, PW 1 that this letter was not received in the office of the defendant. Exhibit PW 1/36 is a letter of the defendant dated 5.4.1986, which is also in respect of the deductions made in the bills for delay in supply of the printed tickets. It was with reference to the letter dated 26.2.1986 and it was alleged that the reply has not been received. Along with the letter/statement showing the quantity of paper which was supplied short or late, etc. was enclosed. It bears the signatures of the dispatcher of the defendant and there is no suggestion to PW1 Sanjiv Gandhi that this letter was not received in the office of the defendant.

15. Learned Counsel for the plaintiff has also referred to the notice, Exhibit P2 dated 17.10,1987, which was served by the plaintiffs on the defendant under Section 80, CPC In this letter also, it was alleged that the defendant has not supplied full requirement of the papers for execution of the printing work in accordance with the printing order placed and that the plaintiffs had to print it using the papers from their own stock. Receipt of this letter has been admitted by the defendant in para 22 of the written statement. There is no reply to this letter from the side of the defendant.

16. On perusal of the oral as well as documentary evidence, which has been proved on record including the letter of the defendant, Exhibit DW 4/1, it is clear that the plaintiffs had been repeatedly writing to the defendant about short supply of papers for execution of the printing orders and that the plaintiffs had been using their own papers for supplying the printed material on time. It is also clear that the defendant had supplied 5,000 reams of papers and had undertaken to the settle the account. The plaintiffs had attached the statement, Exhibit PW 1/105 (Annexure-D to the plaint) in which the total quantity of the paper received from the defendant has been shown. It is a detailed statement in which name of the lottery, draw number, date of draw, the paper which should have been supplied by the defendant and the paper which was used, the paper which was actually supplied by the defendant, shortage in supply of the paper, price of the paper and the interest on delayed payment has been mentioned. There is no statement of account filed on behalf of the defendant in rebuttal. The defendant has not produced its stock register. It has also not produced how the paper was supplied in excess, as claimed by it.

17. In this context, it may also be noticed that Sanjiv Gandhi, PW 1 has stated that size of the lottery tickets of Sri Ganesh, Jaidurge and Hari Om was 15.75 x 6.7 cm and the size of Mahalakshmi lottery ticket was 16 x 5.75 cms. It was also stated by him that on a paper of the size of 15.75 x 6.7, 30 tickets may be printed. On a sheet of paper of the size of 51 x 76 cms, 36 tickets of Mahalakshmi lottery could be printed. In the cross-examination, the only suggestion was that 33 tickets of the size of 15.75 x 6.7 cms could be printed. There no evidence to rebuttal to this evidence led by the defendant. During the course of arguments, learned Counsel for the plaintiffs has prod need sheet which was used for printing the paper along with the sketch of the tickets. It has been point out that a margin for gripping of the paper in the machine has to be left out and further the number of tickets is to be printed on the counterfoil and on the ticket at different places. Moreover for sharp edge cutting of tickets, some margin is to be left between printed tickets. Therefore, the number of tickets which could be prjnted on a sheet of paper is 30 and 36, as stated by Sanjiv Gandhi. PW 1. He has demonstrated it by producing the sheet of paper. Only basis of the claim of the defendants is the audit report, but no other material is produced to corroborate it. For the reasons stated above, it is proved by the plaintiff by oral and documentary evidence that the defendant had supplied 1322.074 reams of paper short than what was required for the printing of the tickets as per the print order issued by the defendant. The plaintiffs have mentioned the price of the deficient papers in Annexure D attached to the plaint Exhibit PW 1/105. There is no evidence produced by the defendant to rebut this statement. Accordingly, it may be held that the total amount due from the defendant to the plaintiffs on count of short supply of paper is as it is shown in Annexure D, Exhibit PW 1/105 and the total amount due from the defendant on this account is Rs. 1,82,436/-. Accordingly, it is held that the defendants have failed to prove that they had supplied papers in excess than what was required to print the lottery tickets of ordered quantity. It is further held that the defendants were not entitled to deduct Rs. 68,834/- and Rs, 1,62,190/- from the bills of the plaintiff on this account. The issues Nos. 7 and 8 are decided accordingly.

Issue Nos. 4 and 5:

18. PW 1, Sanjiv Gandhi has deposed that the order of printing of the lottery tickets used to be received at their office in Delhi and the printing work used to be done at Shahdara under the supervision of the officers of the defendant. After execution of the work, the printed tickets used to be delivered in Delhi to the officers of the defendant. The defendant has a camp office for lotteries in New Delhi in Regal Building in Connaught Place. The paper fro printing of lottery tickets was to be supplied by the defendant in accordance with the agreement. However, the defendant was lacking in supply of papers. The defendant was to supply papers at least 21 days prior to the due date of the draw of the lottery tickets, but the defendant did not adhere to that schedule. It was one of the reasons for the delay in supply of the lottery tickets. Whenever there was inordinate delay in supply of papers by the defendant, the plaintiff used to make procurement from the market for executing the print order. In the cross-examination he deposed that there were many reasons for the delay in the delivery of the printed tickets. One of them was non-supply of papers by the defendant in time; second was delay in issuing the print order; third was the Supervisor of the defendant not attending to the printing press of the plaintiff; fourth was the defendant's failure to collect the supplies from the premises of the plaintiff. So the supply used to be delivered to the defendant at their Delhi office. He perused the copy of the ledger account of the defendant maintained in their books of account, Exhibit P1/127 and testified that it was a correct copy. He also deposed that there was no delay in supply of the printed material by the plaintiffs and the dates of the delivery of the printed tickets given by the defendant in the statement, marked 'A' was not correct.

19. DW1 Raj Kumar Sharma has stated that the defendant used to place orders for printing of lottery tickets with the plaintiffs and the date of the delivery also used to be mentioned in the print order. The defendant made deductions for delay in the delivery of the printed tickets from the bills in accordance with the terms and conditions of the agreement. A statement of such deduction was also sent to the plaintiff with the letter dated 30.1.1986. He referred to the delivery challan, Exhibit D15 and the bill, Exhibit PW 1/9 dated 11.2.1986 and stated that there was 14 days' delay in delivery of this consignment. It is further stated that there was delay in delivery of other consignments also, which have been mentioned in the statement of delay filed on behalf of the defendant. In the cross-examination, it was stated that in accordance with Clause 15A of the contract, Exhibit P1, tickets were to be supplied on the date given in the print order, which was required to be issued 21 days before the date of delivery of the lottery tickets and in case the print order was not issued as per schedule, the date of delivery of the printed tickets also used to be extended. He did not remember whether the print orders were sent to the plaintiff by ordinary or registered post and that the same would be mentioned in the dispatch register,. which he had not seen. It was also stated that while preparing statement of deductions, he had only taken into account the date of draw and the date of delivery of the consignment as per challan. The paper for printing work had to be supplied by the defendant and the tickets were to be printed on that paper. He did not know on what date and what quantity of paper was supplied to the plaintiffs. He did not take into consideration the date of supply of papers by the defendant to the plaintiffs while preparing the statement of deductions for delay. He also did not know whether the printing work was to be done under the supervision of the officer of the plaintiffs. He could not admit or deny that the defendant delayed in taking delivery of the printed material from the plaintiffs. This fact has not been taken into consideration while preparing statement of deductions for delay. It was further admitted by him that he had not taken into consideration any other document or any other fact for calculating the amount of deductions on account of the delay.

20. DW 2, G.D. Kakar has not deposed anything on this issue. He has proved the delivery challan. DW 3 Sham Lal Duggal has, however, deposed that there was delay in delivery of the printed tickets by the plaintiffs and a statement of delay has already been filed by the defendant. He further deposed that delivery of the printed tickets used to be made at Delhi office and that endorsement of the challan was made at that time. In the cross-examination, it is stated that Exhibits PW 1/114 and PW 1/ 115 are the orders for printing placed by the defendants with the plaintiffs. He did not know whether they were sent by post or delivered by hand. He was concerned only with receiving of the delivery of the printed tickets and had no personal knowledge of any other matter. He also could not say whether the printing work was being done tinder the direct supervision of the official of the defendant. It was also stated that the statement, marked 'A' was not prepared by him. PW 4 Jai Singh has not made statement on this issue. The deposition of DW 5 Balbir Kumar Saini is also not on this issue.

21. Onus of proving that the plaintiffs were making delivery of the printed lottery tickets late was on the defendant. The defendant did not lead any evidence to prove its allegations. Statement, Mark 'A' (p 119) has been filed to calculate the deductions which were to be made by the defendant on account of the plaintiff not adhering to the schedule of delivery of the tickets, but it has not been proved by any of the witnesses examined on behalf of the defendant. On the other hand, the plaintiffs have denied that there was delay in delivery of the tickets. PW 1 Sanjiv Gandhi, however, stated that if there was any delay, it was on account of the defendant's own fault either in supplying the papers for printing work on time, absence of supervisor of the defendant, not taking delivery of the printed material at the printing press or delay in issue of printing order. The defendants have not been able to prove that the delay was not attributable to them. In fact, they have not been able to point out print order wise that there was delay in delivery of the printed material in accordance with the terms and conditions for which the defendant is not to be blamed, but it is due to the acts and omission of the plaintiff and the breach of terms and conditions of the contracts, Exhibits P1 and D1.

22. The onus of issue No. 5 is also on the defendant. The defendant has not shown as to how it had calculated the amount which has been deducted by it from various bills of the plaintiffs. In fact the defendant's witnesses have admitted that while making these deductions, various factors, which were relevant, were not taken into consideration. For instance, it has been stated that the date on which the print order was actually received by the plaintiffs and the date on which the delivery of the tickets was made to the defendant were not taken into consideration. It is also not denied that it had not taken into consideration whether the delay, if any, in the delivery of the printed material was on account of the defendant not deputing someone to supervise the printing work since the printing work was tobe done only under the supervision of an official of the defendant. For the aforesaid reason, I am constrained to hold that the defendant has failed to prove that the plaintiffs have made the delivery of the printed tickets late for which they were responsible. The defendant further failed to prove that the deductions which have been made by it for various bills submitted by the plaintiffs were justified and were in accordance with terms and conditions of the contracts, Exhibits P1 and D1. Accordingly, both the issues are decided against the defendants.

Issue No. 6:

23. PW1 Sanjiv Gandhi has stated on oath that there was no delay in making delivery of the printed lottery tickets by the plaintiffs. He conceded that the delay, if any, in supply of the printed material could have been for various factors. It may be on account of non-supply of the papers by the defend ant in time; delay in issuing the print order on the plaintiff, absence of an official of the defendant for supervising the printing work and the delay in taking delivery at the printing press and insisting the delivery to be made at the office of the defendant in Delhi. In the cross-examination, no tiling has come on record to prove that the plaintiffs were responsible for any delay. Learned Counsel for the plaintiffs has stated that in the letter it has been mentioned by the tickets by the except in one case there was no delay in delivery of the tickets by the plaintiffs and that delay was also not in respect of the bills for which the suit is filed. In fact there was no cross-examination on this letter on behalf of the defendant and, therefore, the submissions made at the Bar have to be believed. As held in issue Nos. 4 and 5, the plaintiffs were not responsible for any delay in supply of the printing material and the defendant was not justified in making deductions on account of delay. The defendant's witness DW1 Raj Kumar Sharma, DW 2 G.D. Kakar, DW 3 Sham Lal Duggal, DW 4 Jai Singh and DW 5 Balbir Kumar Saini have not stated anything material to prove this issue. Having regard to the oral and documentary evidence, it is held that the plaintiffs were not responsible for committing breach or default of any of the terms and conditions of the tender. Issue is disposed of accordingly.

Issue No. 9:

24. The plaintiff has claimed a sum of Rs. 5,80,800/-, which was deducted by the defendant in making payment of various bills. The plaintiffs have filed statement of such deductions, which are Annexures A to C to the plaint and Exhibits PW1 /101 to PW1 /203. The short payment of the amounts on account of Jaidurge is Rs. 5,80,800/-, in respect of Mahalakshmi is Rs. 2,81,600.65 p and Shri Ganesh is Rs. 3,30,800/-. The defendant has not been able to justify these deductions. In view of the finding on issue Nos. 4 to 8 above, which are against the defendants, the defendants were not entitled to make these deductions. Accordingly, it is held that this amount is recoverable from the defendant.

25. The plaintiff has alleged in the plaint that the defendant has failed to pay the amount of three bills, details of which was given in Annexure J to the plaint. There werebillNo.618dated29.10.1985 for Rs.42,240/-,billNo. 181 dated 28.5.1986, for Rs. 42,240/- and bill No. 840 dated 25.12.1985 for Rs. 35,200/-. The plaintiff had claimed Rs. 1,19,680/- on account of these three bills. The defendant in reply has not disputed this fact, but wanted the plaintiffs to produce the bills and delivery challans. PW 1 Sanjiv Gandhi in his statement has stated that the print orders, Exhibits D3 to D5 were placed by the defendant on the plaintiffs, original of which were Exhibits PW 1/114 to PW 1/216. He has also proved the bills, Exhibits PW 1 / 117 to PW 1/119 and it is stated that payment of these bills has not been received from the defendant. A reminder dated 2.5.1987, Exhibit PW 1/117 has also been proved by him. He also deposed that the bills, Exhibits PW1/117 to PW1/119were in respect of the print orders. Exhibits PW 1 /114 to PW 1 /216. It is also stated that despite delivery of the printing material, delivery of the bills has not been made. The amount of the bills for Rs. 1,19,680/- was still outstanding against the defendant. There is no cross-examination on this statement on behalf of the defendant. In fact in the written statement, the defendant had not disputed that the amount of these three bills was outstanding. The defendant's witness Jai Singh, DW 4 has stated in the examination-in-chief that three bills of the plaintiffs were outstanding because the plaintiffs had not supplied the delivery challans of the printed material in accordance with the terms and conditions of the agreement despite several letters.

26. Having regard to the pleadings of the plaintiff and the defendant and the statement of Sanjiv Gandhi, PW 1 and that of Jai Singh, DW 4, it is held that amount of the three bills totaling Rs. 1,19,680/- is outstanding against the defendant and the plaintiff is entitled to the recovery of this amount.

27. In view of the finding on issue Nos. 7 and 8 above, it is further held that a sum of Rs. 1,82,436/- is due to the plaintiffs on account of short supply of papers for printing of tickets, as shown in the statement, Annexure-D to the plaint, Exhibit PW 1/105. The total amount recoverable from the defendant as principal is accordingly Rs. 14,95,396.65p. The issue is decided accordingly.

Issue No. 10:

28. Learned Counsel for the plaintiff has fairly conceded at the bar that the plaintiffs have not led any evidence to prove rate of interest payable on commercial transaction at the relevant time. He submitted that there is a letter sent by the plaintiff to the defendant in which the plaintiffs had intimated the defendants that in case the outstanding money was not paid, interest @ 18% p.a. will be payable. Anyhow there is neither oral nor documentary evidence to prove the rate of interest payable on commercial transaction. The transaction between the plaintiffs and the defendants were of commercial nature. The plaintiffs have claimed the interest @ 18% p.a. which apparently was not the rate of interest prevailing in respect of the commercial transaction during the relevant period. Having regard to the facts and circumstances, nature of the transactions, I am of the view that the plaintiff is entitled to recover interest @9% p.a. on the amount, which was due from the defendant and was not paid despite reminders and even service of notice under Section 80, CPC.

29. The plaintiffs have claimed interest on the amount which has been wrongfully deducted by the defendant from various bills, details of which have been given in Annexures A, B and C. The plaintiffs have claimed interest @ 18% p.a. The amount of interest should have been calculated @ 9% p .a. As per the statement of the plaintiffs, Annexures A to C, the amount recoverable on account of interest is calculated @ 18% p.a. As held above, the interest was recoverable @ 9% p.a. Accordingly, a sum of Rs. 5,96,640.32 p is payable by the defendants on account of short payment of the amount of the bills detailed in Annexures A, B and C.

30. The plaintiffs have also calculated interest @ 18% p.a. on the amount of decree on account of delay in supply of papers by the defendants. It has been shown in Annexure D to the petition. There is no agreement between the parties, but it being the commercial transaction, the plaintiff should be entitled to the rate of interest @ 9% p.a. The total amount recoverable as per Annexure D on account of interest comes to Rs. 92,712.58 p.

31. Furthermore, the plaintiffs are entitled to recover interest on the three outstanding bills. Tine interest has been calculated @ 18% p.a. and as held above, it is payable @ 9% p.a. The amount of interest as per the statement, Annexure E calculated at the rate of 9% p.a. comes to Rs. 26,507.02 p. The total amount of interest payable thus comes to Rs. 7,15,859/-. The plaintiff shall also be entitled to recover pendente lite and future interest @ 9% on the amount of Rs. 14,95,396.65 p and also cost of the suit.

32. Accordingly, a decree for Rs. 14,95,396.65 p as principal and a sum of Rs. 7,15,859/- as interest with pendente lite and future interest @ 9% p.a. calculated on the amount of principal of Rs. 14,95,396.65 p from the date of filing of the suit till the date of the recovery and costs of the suit is passed in favor of the plaintiffs and against the defendants.