M/S. Jindal Realcon Pvt Ltd & Ors vs M/S. Laxmi Narain Ram Dass & Co
2013 Latest Caselaw 1433 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

+                         RFA No.245/2012


%                                                      March 22, 2013


M/S. JINDAL REALCON PVT LTD & ORS            ..... Appellants
                  Through: Mr. Sanjeet Trivedi, Advocate.


                          Versus


M/S. LAXMI NARAIN RAM DASS & CO              ..... Respondent

Through: Mr. A.K. Gupta, Advocate.

CORAM:

HON'BLE MR. JUSTICE VALMIKI J. MEHTA

To be referred to the Reporter or not?

VALMIKI J. MEHTA, J (ORAL)

C.M. No.2687/2013(under Order 41 Rule 27 CPC)

This is an application filed under Order 41 Rule 27 of Code

of Civil Procedure, 1908 (CPC). This application is filed by the

respondent in the appeal and who was the plaintiff in the trial Court. Suit

of the plaintiff was decreed for recovery of money. There is no cross-

appeal by the respondent/plaintiff under Order 41 Rule 27 CPC. In the

absence of substantive appeal, interim application in the nature of Order

41 Rule 27 CPC cannot lie.

This application is accordingly dismissed.

Crl. M.A. No.1961/2013

Dismissed as not pressed.

C.M. Nos.15591/2012 (under Order 41 Rule 21 CPC) and 15592/2012(condonation of delay)

This applications are allowed and the appeal has been re-

heard.

+ RFA No.245/2012

1. The only limited issue which is urged on behalf of the

appellants/defendants and which was also urged when the earlier

judgment was passed on 31.5.2012, is for reduction of interest including

pendente lite and future interest.

2. I may note that the suit was filed under Order 37 CPC. The

appellants/defendants were given conditional leave to defend subject to

deposit of the amount, however, this condition was not complied with and

hence the suit was decreed as prayed for in the plaint.

3. In my opinion, during the pendency of the suit, it is the

Court which has necessary powers under Section 34 CPC to award a

particular rate of interest depending on the facts and circumstances of the

case. The power to award interest under Section 34 CPC is not restricted

by any clause in any agreement. Of course, I may hasten to add that no

documents are part of the record of the trial Court whereby the

respondent/plaintiff has shown what is the rate of interest payable prior to

filing of the suit. Respondent/plaintiff however did aver in para 12 of the

plaint about the entitlement to 10% interest in accordance with the form

filled however in the leave to defend application, this aspect was denied

by the appellants/defendants. In spite of the fact that rate of interest of

10% was denied, the respondent-plaintiff did not choose to file the form

or any other document showing entitlement to interest @ 10% per annum

simple till payment after the demand is made upon the

appellants/defendants.

4. The Supreme Court in a line of judgments has held that in

view of changed economic scenario where there has been consistent fall

in rates of interest, Courts must in accordance with the changed

circumstances grant lesser rates of interest. These judgments of the

Supreme Court are 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).

5. Accordingly, in view of ratio of the judgments of the

Supreme Court in the aforesaid cases, the respondent/plaintiff will be

entitled to pendente lite and future interest till payment @ 9% per annum

simple.

6. The issue now remains is the claim of pre-suit interest. The

Division Bench of this Court in the judgment reported as Pandit Munshi

Ram Associates vs. DDA 2010 (9) AD (Delhi) 313 has held that Courts

are entitled to interfere with high rates of interest with respect to pre suit

period if the rates of interest are very high, because such rates of interest

will be violative of public policy.

7. In view of the aforesaid discussion, so far as the fact of

pendente lite and future interest is concerned, the respondent/plaintiff will

be entitled to interest @ 9% per annum simple, however, the issue as to

the rate of pre-suit interest cannot be decided either way in the absence of

any documentary evidence in the trial Court record with respect to what

was the contractual rate of interest. Though I have already dismissed the

application under Order 41 Rule 27 CPC filed by the respondent/plaintiff

inasmuch as there is no substantive appeal or cross appeal filed by the

respondent/plaintiff, however, since the difference is only of interest of

1%, I am of the opinion that the interest of justice will be served if the

respondent/plaintiff is granted interest @ 10% per annum simple for the

pre-suit period on the amount of Rs.12 lacs from 7.11.2007 till the date of

filing of the suit.

8. Accordingly, the appeal is partly allowed by modifying the

impugned judgment and decree whereby the respondent/plaintiff will be

entitled to interest @ 10% per annum simple from the

appellants/defendants from 7.11.2007 (being the date of demand of

booking amount by the respondent/plaintiff) till the date of filing of the

suit, and thereafter for the pendente lite and future period, the

respondent/plaintiff will be entitled to interest @ 9% per annum simple

till payment of the decretal amount by the appellants/defendants. The rest

of the impugned judgment and decree stands. The concession in the rate

of interest as per today's judgment will be available in case the

appellants/defendants make payment in terms of today's judgment within

a period of 12 weeks from today, and if payment is not made within the

aforesaid period the original judgment and decree will stand revived. It is

clarified that if the appellants/defendants have already paid amounts to

the respondent/plaintiff, then, the said amounts will be taken as

adjustment of the amounts which are payable to the respondent/plaintiff

in terms of today's judgment.

9. Appeal is therefore partly allowed as stated above, leaving

the parties to bear their own costs of this appeal.

VALMIKI J. MEHTA, J MARCH 22, 2013 Ne