M/S Richa & Co. vs D.Nirmala
2009 Latest Caselaw 867 Del

*           IN THE HIGH COURT OF DELHI AT NEW DELHI


                                                Date of Reserve: March 05, 2009
                                                   Date of Order: March 18, 2009

+ CS(OS) 2028/1999
%                                                                   18.03.2009

       M/s Richa And Co.                                      ...Plaintiff
       Through : Mr. Anurag Rawat, Advocates

       Versus

       D. Nirmala                                            ...Defendant
       Through: None




       JUSTICE SHIV NARAYAN DHINGRA

1.     Whether reporters of local papers may be allowed to see the judgment?

2.     To be referred to the reporter or not?

3.     Whether judgment should be reported in Digest?


       JUDGMENT

1. The plaintiff filed this suit for recovery of Rs.38,31,250/- along with

pendent-lite and future interest.

2. The case of the plaintiff is that plaintiff deposited a sum of Rs.25 lac

with the defendant as the defendant was facing shortage of funds for her

business. This amount was given by way of three bank drafts dated 14th

August 1996 (details of drafts given in paragraph 3 of the plaint). The plaintiff

asked the defendant to refund this amount but despite several demands, the

amount was not refunded hence this suit had been filed by the plaintiff after

serving a demand notice dated 7th May 1999 claiming an amount of Rs.25 lac

with 18% interest. This suit was filed on 12th August 1999. The defendant was

CS (OS) 2028/1999 M/s Richa Ands Co. vs. D. Nirmala Page 1 Of 5 proceeded ex parte as defendant failed to appear. However, defendant later

on moved an application under Order 9 Rule 7 CPC wherein defendant

informed the Court that the defendant had after filing of the suit entered into

an agreement with the plaintiff and paid back the amount of Rs.25 lac vide

DD No.186717 dated 26th February 2000. This amount was accepted by the

plaintiff as full and final settlement of his claim. The defendant gave details of

the demand draft handed over to the plaintiff along with a covering letter.

The plaintiff did not deny the receipt of this demand draft. Considering the

circumstances, this Court set aside the ex parte order passed against the

defendant. In the written statement defendant raised objection about

jurisdiction of this Court and also submitted that by payment of Rs.25 lac

entire account of plaintiff stood settled.

3. Following issues were framed in this suit on 21st April 2006:

1. Whether this Court has no territorial jurisdiction to entertain the

present suit? OPD

2. Whether there was any agreement between the plaintiff and defendant

No.1 with respect to payment of interest in terms of letter dated

14.8.1996. If so, whether the plaintiff is entitled to interest?

3. If issue No.2 is decided in affirmative, at what rate?

4. Whether the plaintiff has accepted the DD No.186717 for Rs.25 lac in

full and final settlement? OPD

5. Relief.

4. During arguments, counsel for the plaintiff submitted that the plaintiff

had received the principal amount, as stated by the defendant. However, the

CS (OS) 2028/1999 M/s Richa Ands Co. vs. D. Nirmala Page 2 Of 5 plaintiff was still entitled to interest and costs of the suit. It is argued that

though, there was no written contract qua rate of interest, still this Court

should award a reasonable rate of interest. It is also submitted that the

amount of Rs.25 lac was returned only after filing of the instant suit and not

before that.

5. Issue No.1: The onus of proving this issue was on the defendant. The

defendant has not led any evidence to substantiate this issue and failed to

show as to how this Court had no territorial jurisdiction. The amount was sent

to the defendant from Delhi. The bank drafts were prepared at Delhi. This

Court, therefore, had jurisdiction to entertain the present suit. The issue is

decided accordingly.

6. Issue No.2 & 3: The onus of proving these issues was on the

plaintiff. The letter by which the amount of Rs.25 lac was sent to the

defendant is silent about any contract between the parties about rate of

interest. The counsel for the plaintiff during arguments admitted that there

was no contract about the rate of interest. It is also not clear from the

covering letter written by the plaintiff while depositing money as to why this

amount was deposited by a firm with an individual and for what period this

money was given. The demand of this money was made by the plaintiff from

the defendant vide a notice dated 7th May 1999. Prior to that, no demand was

made neither any request was made for payment of interest. If the money

had carried an interest, the plaintiff would not have been silent about the

interest for this period. It is therefore clear that there was no understanding

between the parties of payment of interest over this amount. Therefore, the

defendant was not liable to pay any interest till the money remained

CS (OS) 2028/1999 M/s Richa Ands Co. vs. D. Nirmala Page 3 Of 5 deposited and was not demanded by the plaintiff. However, once the money

had been demanded by the plaintiff, it ought to have been returned by the

defendant. Since it was not returned within a reasonable time, the defendant

was liable to pay interest on this amount. The notice of demand was served

on 7th May 1999. I consider by end of May 1999, the money should have been

returned, since it was laying without earning interest with the defendant.

Since the money was not returned in time, the defendant was liable to pay a

reasonable rate of interest to the plaintiff from 1st June 1999 onwards. In my

view 6% rate of interest would meet the ends of the justice. The plaintiff is,

therefore, entitled to 6% interest on Rs.25 lac from 1st June 1999 till 12th

February 2000 when the amount was returned.

7. Issue No.4: The onus of proving this issue was on the defendant. The

defendant has placed on record the letter dated 12 th February 2000 whereby

the amount of Rs.25 lac was returned to the plaintiff. Vide this letter it was

communicated that this was towards full and final settlement. However, by

mere writing that this amount was towards full and final settlement, it cannot

be said that the plaintiff accepted the demand draft of Rs.25 lac towards full

and final settlement or there was an agreement to this effect. The plaintiff

had already filed this suit and had also served a notice of demand that the

money should be paid back with interest. I consider that the defendant failed

to establish that this amount of Rs.25 lac was received as a full and final

settlement.

8. Relief : Since the principal amount has already been received by the

plaintiff, the only relief which can be granted to the plaintiff is regarding

interest on the principal amount of Rs.25 lac from 1st June 1999 till 12th

CS (OS) 2028/1999 M/s Richa Ands Co. vs. D. Nirmala Page 4 Of 5 February 2000 @ 6% per annum and the costs of the suit, as the amount was

paid by the defendant only after filing of this suit. The suit of the plaintiff is

hereby decreed for an interest @ 6% per annum from 1st June 1999 till 12th

February 2000 on amount of Rs.25 lac, which comes to Rs.10,500/- plus costs

of the suit. Decree sheet be drawn accordingly.

March 18, 2009                                      SHIV NARAYAN DHINGRA J.
rd




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