M/S Rajora Builder vs Delhi Jal Board
2016 Latest Caselaw 245 Del

$~57
*      IN THE HIGH COURT OF DELHI AT NEW DELHI
+      EX.P. 246/2007
M/S RAJORA BUILDER                                 ..... Decree Holder
                  Through              Mr. Sacchin Puri, Advocate with
                                       Mr. Abhinav Sharma and Mr.Karn
                                       Bhardwaj, Advocates

                          versus

DELHI JAL BOARD                                   ..... Judgement Debtor
                          Through      Mr. Ashok Bhasin, Sr. Advocate
                                       along with Ms. Sadhana Sharma and
                                       Ms. Ginny Gawri, Advocates

CORAM:
HON'BLE MR. JUSTICE VALMIKI J. MEHTA
                  ORDER

% 13.01.2016

EA (OS) No.937/2012 (u/S 151 CPC)

1. This application filed by the judgment debtor/Delhi Jal Board is for

restitution of an amount of Rs.31,47,198.40 on the ground that this amount

is overpaid to the decree holder. Judgment debtor also claims interest on this

amount which is to be refunded by the decree holder.

2. The law with regard to restitution is stated by the Supreme Court in

the case of Kavita Trehan (Mrs) and Anr. vs. Balsara Hygiene Products

Ltd., (1994) 5 SCC 380, and which is that the principle of restitution is much

EX.P. 246/2007 page 1 of 8 wider than comprised in the language of Section 144 CPC. This is so stated

in paras 21 and 22 of the judgment in the case of Kavita Trehan (supra) and

which paras read as under:-

"21. Section 144 CPC incorporates only a part of the general law of restitution. It is not exhaustive. (See Gangadhar v. Raghubar Dayal : AIR 1975 All 102 (F.B.): 1974 All LJ 751 and State Govt. of Andhra Pradesh v. Manickchnd Jeevraj & Co. Bombay: AIR 1973 AP 27: (1972) 2 Andh LT 23.

22. The jurisdiction to make restitution is inherent in every court and will be exercised whenever the justice of the case demands. It will be exercised under inherent powers where the case did not strictly fall within the ambit of Section 144. Section 144 opens with the words "Where and in so far as a decree or an order is varied or reversed in any appeal, revision or other proceeding or is set aside or modified in any suit instituted for the purpose,..." The instant case may not strictly fall within the terms of Section 144; but the aggrieved party in such a case can appeal to the larger and general powers of restitution inherent in every court."

3. If therefore the decree holder has been paid an excess amount than the

amount to which the decree holder was entitled to under the subject Award

dated 16.06.2007, the decree holder will be liable to refund that amount i.e

restitution of the extra amount received by the decree holder to the judgment

debtor along with interest.

4. Before I proceed further, it is necessary to refer the order of a learned

Single Judge of this Court dated 15.12.2008 in these very execution

EX.P. 246/2007 page 2 of 8 proceedings by which it was held that interest payable under the Award is

simple interest and not compound interest. This order dated 15.12.2008

reads as under:-

"Counsel for the parties have drawn my attention to page 46 of the paper book and the relevant part of the award. Interest @ 12% per annum has been awarded on claim Nos. 1 and 8 with effect from 01.7.1997.

With regard to claim Nos. 2, 3 4 and 5 interest is to be paid with effect from the date when amounts became due and payable on different dates during the period 01.4.1994 to 31.1.1997. For example if Rs.1000/- became due and payable on 01.05.1994 interest will be payable @ 12% per annum from the said date and not for the prior period. However, with effect from 1.2.1997, interest @ 12 % per annum will be payable on the entire amount due and payable on claim Nos.2,3,4 and 5. Learned arbitrator has not awarded compound interest. Simple interest has been awarded @ 12% per annum. Parties will file revise statement of accounts on the above basis with affidavits within two weeks from today.

List again on 9th February, 2009."

5. A reading of the order leaves no manner of doubt that there is a final

and binding observation that the impugned Award only gives simple interest

to the plaintiff at 12% per annum with respect to claim nos.2, 3, 4 and 5.

6. The aforesaid order dated 15.12.2008 holding that only simple interest

is payable was carried in an appeal but this appeal was disposed of as not

pressed, as this is so recorded in the order of the Division Bench dated

EX.P. 246/2007 page 3 of 8 22.03.3012 in EFA(OS) No.10/2009, and which order reads as under:-

"Learned senior counsel on instructions states that he does not wish to press the appeal and that in case the executing court passes an order directing refund of any amount already paid to the appellant, the appellant would be within his rights to take recourse to appropriate legal remedy.

We find there can be no doubt over the aforesaid position. Dismissed as withdrawn."

7. No doubt there is an observation in this order that appellant would be

within his rights to take recourse to appropriate legal remedy, however, that

only meant that taking that the interest is calculated at simple rate (and not at

compounded rate) yet even if thereafter it is found that after calculating

interest at a simple rate decree holder has not been overpaid, the judgment

will not be able to claim refund. The language of the order dated 22.03.2012

cannot be read to argue that the Division Bench had by allowing a

simplicitor withdrawal of the appeal resulting in sustaining the order dated

15.12.2008 yet had effectively set aside the order dated 15.12.2008 of the

learned Single Judge and as is contended on behalf of the decree holder

before this Court. Therefore, the limited legal remedy available to the decree

holder was that taking the interest payable at simple rate, whether at all

EX.P. 246/2007 page 4 of 8 decree holder had been overpaid or not by the judgment debtor (and as was

the contention and the case of the judgment debtor) would be determined in

a legal remedy/legal proceedings.

8. In my opinion nothing further needs to be decided in view of the order

of the learned Single Judge dated 15.12.2008 and the order of the Division

Bench dated 22.03.2012 and which has decided the controversy on the issue

of payment of simple interest only. However, I have still examined, though

only for academic purposes and not for legal effect, the argument of the

counsel for the decree holder as to whether interest was payable at a

compound rate under the Award as argued on behalf of the decree-holder.

Counsel for the decree holder for this argument invited the attention of this

Court to the first para of the second last page of the Award dated 16.06.2007

which records interest to be calculated from 01.04.1994 to 31.01.1997 on the

basis of "monthly accrual of amounts", and thus it is argued that this

expression means payment of compound interest. In my opinion the

argument of the decree holder in this regard is misconceived because the

expression "monthly accrual of amounts" is found because the different

EX.P. 246/2007 page 5 of 8 amounts under different claim nos.2, 3, 4 and 5 arose for different number of

months for the period from 01.04.1994 to 31.01.1997 and hence the

expression "monthly accrual of amounts". The expression "monthly accrual

of amounts" is not to be read for granting interest at compound rate because

for granting interest at compound rate there necessarily had to be a specific

direction of the interest being granted at compound rate, and which is

deliberately and consciously not found in the subject Award dated

16.06.2007.

9. Learned counsel for the decree holder thereafter sought to argue that

even if the interest is taken at simple rate of 12% per annum, decree holder

has not been overpaid and attention was invited of this Court to the

Annexure 'A' of the reply to EA No.937/2012 and as per which there are

calculations showing that decree holder has not been overpaid, but clearly

this argument is also misconceived because this chart filed as Annexure 'A'

to the reply shows that the decree holder has calculated the interest on

interest i.e compound interest by adding the amount which is due on

principal and interest as on 31.01.1997 and thereafter charging interest on

EX.P. 246/2007 page 6 of 8 the total amount of both principal plus interest amounts, thus effectively

claiming compound interest, and which compound interest as stated above

has neither been granted by the Award and much less so the decree holder so

entitled after clarification of the learned Single Judge of this Court given

vide order dated 15.12.2008 and which order was sustained in the appeal by

the Division Bench of this Court in its order dated 22.03.2012.

10. In view of the above, I accept the figures of computation given by the

judgment debtor filed as Annexure 'A' to the EA No.937/2012 and which

shows that the judgment debtor paid an amount of Rs.2,65,23,286.01 to the

decree holder as on 10.12.2007, whereas, decree holder had to be paid only

an amount of Rs.2,33,76,087.61 i.e an extra amount of Rs.31,47,198.40 has

been paid by the judgment debtor to the decree holder. Therefore, this

amount of Rs.31,47,198.40 is hence liable to be restituted and refunded to

the judgment debtor by the decree holder along with interest till payment at

the same rate of 12% per annum which was granted to the decree holder by

the Award.

EX.P. 246/2007 page 7 of 8

11. Accordingly, this application EA No.937/2012 is allowed and

disposed of by directing the decree holder to pay to the judgment debtor a

sum of Rs.31,47,198.40 along with interest at 12% per annum simple from

11.12.2007 till the date of payment which should be within three months

from today, failing which thereafter interest payable will become @ 18% per

annum simple.

Application is allowed and disposed of accordingly, leaving parties to

bear their own costs.

                                            VALMIKI J. MEHTA, J

JANUARY 13, 2016
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EX.P. 246/2007                                    page 8 of 8