Airport Authority Of India vs Shri Sanjay Bhargava
2011 Latest Caselaw 5868 Del

*              IN THE HIGH COURT OF DELHI AT NEW DELHI

+                           RFA No. 853/2002
%                                                       1st December, 2011

         AIRPORT AUTHORITY OF INDIA                   ..... Appellant
                         Through : Ms.Anjana Gosain, Advocate.
                  versus

    SHRI SANJAY BHARGAVA                       ..... Respondent
                  Through : Mr. Sanjeev Ralli and Mr.Sandeep
                            Anand, Advocates.
CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA

    To be referred to the Reporter or not?


VALMIKI J. MEHTA, J (ORAL)

1.       The challenge by means of this Regular First Appeal (RFA) filed

under Section 96 Code of Civil Procedure, 1908 (CPC) is to the impugned

judgment of the Trial Court dated 11.10.2002 which decreed the suit for

recovery of monies filed by the respondent / plaintiff. The monies which

are/were claimed are in fact towards interest for delaying payment of the

principal amount. The principal amount was paid with respect to terry wool

suiting supplied by the respondent / plaintiff to the appellant / defendant.




RFA No. 853/2002                                                               Page 1 of 4
 2.     The impugned judgment refers to the clause in the bills / invoices

which were issued by the respondent / plaintiff which provided that in case

of delay in payment, interest will be chargeable at 21% per annum. The

Trial Court has held that in view of this clause in the invoice, the respondent

/ plaintiff was entitled to interest.


3.     During the course of hearing, I pointed out to the counsel for the

parties the Division Bench judgment of this Court in the case of Pandit

Munshi Ram Associates v. DDA, 2010 (9) AD (Delhi) 313 wherein a

Division Bench of this Court has said that a court may interfere with respect

to high rates of interest which are claimed even for the pre-suit period. The

Supreme Court also in the recent chain of judgments reported as Rajendra

Construction Co. v. Maharashtra Housing & Area Development Authority

and others, 2005 (6) SCC 678, McDermott International Inc. v. Burn

Standard Co. Ltd. and others, 2006 (11) SCC 181, Rajasthan State Road

Transport Corporation v. Indag Rubber Ltd., (2006) 7 SCC 700, Krishna

Bhagya Jala Nigam Ltd. v. G.Harischandra, 2007 (2) SCC 720 & State of

Rajasthan Vs. Ferro Concrete Construction Pvt. Ltd (2009) 3 Arb. LR 140

(SC) has said that the courts, in view of the changed economic scenario and

RFA No. 853/2002                                                            Page 2 of 4
 the consistent fall of rate of interest, must reduce the pendente lite and future

interest, more so when litigation remains pending for a long time.


4.      In view of the aforesaid position of law during the course of hearing,

counsel for both the parties have agreed that the appeal can be disposed of

by passing a decree in favour of the respondent / plaintiff for pre-suit interest

at 12% per annum simple and pendente lite and future interest at 9% per

annum simple. The suit of the respondent / plaintiff, therefore, will stand

decreed for `2,12,916/-. The respondent / plaintiff will also be entitled to

pendente lite and future interest at 9% per annum simple on this amount. It

is also agreed that the appellant will pay the due amount, and which is stated

to be a sum of ` 4,73,374/- as on date, within a period of two months from

today, failing which, the appellant / defendant will be liable to pay even the

pendente lite and future interest at 12% per annum simple. The respondent /

plaintiff will also be entitled to the court fees which have been paid for the

suit.


5.      Appeal is, therefore, partly allowed and disposed of by passing a

decree in favour of the respondent / plaintiff and against the appellant /

defendant for ` 2,12,916/- with pendente lite and future interest at 9% per
RFA No. 853/2002                                                              Page 3 of 4
 annum simple provided that the appellant / defendant pays a sum of

`4,73,374/- within a period of two months from today along with court fees

amounting to `6,004/- failing which, the pendente lite and future interest

will be at 12% per annum simple.


6.     Decree sheet be prepared. Trial court record be sent back.


7.     Appellant has given a bank guarantee as a security for the decretal

amount. The bank guarantee given by the Appellant will be discharged and

returned to the appellant only upon the appellant making payment to the

respondent / plaintiff in terms of today's judgment.


8.     Appeal is disposed of accordingly.




                                               VALMIKI J. MEHTA, J.

DECEMBER 1, 2011 dk