Madras High Court
M/S. Saravana Global Energy Limited vs Tamil Nadu Transmission Corporation ... on 23 September, 2024
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 22.12.2023
PRONOUNCED ON : 23.09.2024
CORAM:
THE HON`BLE MR.JUSTICE A.A.NAKKIRAN
C.S. No. 810 of 2012
M/s. Saravana Global Energy Limited
Rep. by vice president and company secretary,
No.15, New Giri Road, T.Nagar,
Chennai-600 017. ....Plaintiff
Vs
Tamil Nadu Transmission Corporation Limited,
(TANTRANSCO)
Chief Engineer/Transmission,
having office at 5th Floor, TANTRANSCO HQ,
144, Anna Salai, Chennai-600 002. ....Defendant
(As per amendment order dated 12.09.2023 in A.No.4720 of 2023)
Prayer: Civil Suit filed under Order IV Rule 1 of Original Side Rules read
with Order VII Rule 1 CPC praying to pass a Judgment and decree:
1/31
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(i) For directing the defendant to pay sum of Rs.1,38,35,732/- along
with the interest at 12% per annum from 12.09.2012 till the date of
realization.
(ii) For the cost of the suit and,
(iii) To pass such further or other orders.
For Plaintiff : Mr. S.R. Raghunathan
For Defendant : Ms. M. Sneha
*****
JUDGMENT
This Civil Suit is filed for the relief as stated in the prayer.
2. The case of the Plaintiff, as set out, in the plaint is as
follows:-
(a) The plaintiff is a manufacturer of electrical insulators and a
small scale industry providing gainful employment to scores of families.
The defendant had invited tenders and the plaintiff had participated in the
tender and was declared as the successful bidder. The price agreed was as
under:
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i. 110 KV Solid core Insulators: Rs.6049.95 per unit [PO NO. 1651].
Though as per the tender the quantity was indicated as 2176 the Purchase
order No. 1651 dated 05/03/2007 was placed for 2720 numbers/ units for a
total value of Rs. 1,64,55,864/- (Rupees One Crore Sixty Foupppr Lakhs
Fifty Five Thousand Eight Hundred Sixty Four Only). The price was
inclusive of all taxes, cess and freight.
ii. 230 KV Solid core Insulators: Rs.15572.68 per unit[PO NO. 1724].
Under Purchase order No.1724, dated 30/08/2007, 4104 units were required
to be supplied for a total value of Rs.6,39,10,278.72 (Rupees Six Crore
Thirty Nine Lakhs Ten Thousand Two Hundred Seventy Eight and Paise
Seventy Two Only]. The price was inclusive of all taxes, cess and freight.
iii. 110 KV Solid core Insulators: Rs. 7270.21 Per unit. [PO NO.
1725].
Under Purchase order No.1725 dated 29/08/2007, 5721 units were required
to be supplied for a total value of Rs.4,15,92,871.41 [Rupees Four Crore
Fifteen Lakhs Ninety Two Thousand Eight Hundred Seventy One and Paise
Forty One Only). The price was inclusive of all taxes, cess and freight.
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b). The terms and conditions were enumerated in the Annexure to the
Purchase order, and hence not a contract arising out of any commercial
bargain. The goods were required to be supplied to the various stores of
TNEB running through the State of Tamilnadu. The goods were mostly
required as a stock.
c. The Plaintiff has sold and delivered the goods to various stores of
TNEB and the defendant have without any quarrel or repudiation received
the goods. The petitioner has raised periodical invoice for the supplies.
d. As per the terms and conditions, the defendant had agreed to make
payment of 90% of the "all inclusive price" within a reasonable time after
receipt of material, which time as per the prevalent practice of TNEB being
30 days. In breach of this condition/practice, payments have been made with
delay. The petitioner is entitled to interest for such delayed payment as
under:
i. P.O. No. 1651 - Rs. 3,51,802.00
ii. P.O.NO. 1724 -Rs.37,70,004.00
iii. P.O.No. 1725 -Rs.23,68,098.00
------------------------
Total -Rs.64,89,905.00
------------------------
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e. After completion of supply of the goods, the plaintiff had
approached the defendant for balance payment due under the invoice raised
by our client. To the shock and surprise of plaintiff, the defendant had sent
letters dated 26/05/2009, 25/06/2009 and 06/06/2009 informing the plaintiff
that a sum of Rs.2,19,673.65, Rs. 43,18,226.06 and Rs. 19,67,790.95 in
respect of P.O.Nos 1651, 1724 and 1725 respectively were recovered
towards Liquidated damages for delayed supply. Further the defendant had
also informed that a sum of Rs.3635/- and Rs.8523.80 was being recovered
towards Liquidated damages towards non supply of 5 & 3 nos, of insulators
under P.O.No. 1725 and 1724 respectively. Though the defendant had
agreed to release the balance payment to the plaintiff, however, they failed
to even make payment of this. The balance payment including the amount
withheld as Liquidated Damages was Rs.73,45,827/- (Rupees Seventy Three
Lakhs Forty Five Thousand Eight Hundred Twenty Seven Only.)
f. Since the plaintiff's activities were affected due to severe flood,
heavy rain, labour problem and frequent power cuts by Tamil Nadu
Electricity Board, some deliveries were delayed. The reasons were force
majeure events and not attributable to the plaintiff. No proof whatsoever, has
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been produced by the defendant establishing any loss suffered by the
defendant. The liquidated damage clause even if applicable to the transaction
in question is subject to the limitation stipulated under Section 73 and 74 of
the Contract Act. The defendant, as a matter of right, is not entitled to deduct
the entire amount stipulated as liquidated damages. Notwithstanding the
above, the said clause is only in the nature of penalty.
g).The defendant vide its letter dated 04/03/2010, in complete
disregard to the provisions of Contract Act and the circumstances refused to
refund the amount withheld. The said letter dated 04/03/2010 is in violation
of the Contract Act. Hence, the plaintiff caused a lawyer's notice to be issued
on the defendant on 17/12/2011 and the said notice was returned by the
defendant. Subsequently the defendant has made certain part payments and
the last of the payment was made on 5th January 2011. The defendant is still
liable to pay a sum of Rs. 1,38,35,732/-[Rupees One Crore Thirty Eight
Lakhs Thirty Five Thousand Seven Hundred and Thirty Two only). Hence,
this suit is filed seeking to direct the defendant to pay the aforesaid amount
along with the interest at 12% per annum from 12.09.2012 till the date of
realization.
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2. The case of the Defendant, in a nutshell, as set out in the
written statement, is as follows:-
a. The purchase order issued to the firm are containing all the
commercial and technical terms, GTP Annexure to purchase order etc,
including payment and delivery clause which is a contract and mutually
agreed by the Purchaser TNEB and the supplier M/s.Saravana insulators,
and same are bound in all respect of the Purchase order (PO) issued.
b.The insulators ordered against the above purchase orders are to
be supplied to various stores of TNEB as per delivery schedule and dispatch
instructions given then and there. These insulators are very essential and
required to execute the substation erection works and commissioning of the
same to maintain more and reliable power supply to consumers. It is not
correct to state that, as the terms & conditions were enumerated in the
annexure to the purchase order and hence they are not contract arising out of
a commercial bargain. In fact, the purchase order annexure is also part of the
contract and binding on both parties.
c. The plaintiff firm have delivered the quantum of insulators as per
the dispatch instructions issued to them but beyond the due date of delivery
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fixed under clause 10 (a) of respective purchase orders. However the same
has been accepted subject to the condition that, 90% payment only will be
released initially without prejudice to levy of Liquidated Damages (LD) as
per PO clause 8.03 (i) (b) which reads as below:
For the equipments/materials delivered beyond the contractual delivery
period
i) 90% of the all inclusive price (Including Central Sales
Tax/TNVAT) of the materials of each consignment will be paid within a
reasonable time after receipt of materials in good condition at Stores and
submission of bills with required documents.
ii) Balance 10% payment will be paid within a reasonable time after
completion of the execution of the contract and after closure of the Purchase
Order finalizing the amount of LD to be levied.
In case of delay in supply, the materials will be accepted subject to the
following conditions.
a. There should be no declining trend in prices.
b. Payment will be released as per the recent purchase order rates or lowest
rates obtained during the recent tenders opened subject to levy of liquidated
damage for belated supplies.
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c. Board reserves the right to accept or reject the delayed supplies without
assigning any reason therefore and take action as per the other terms and
conditions of this specification.
From the above payment clause, it may seen that, no where the specific date
/ period for making payment has been mentioned. Also the above PO
contract payment clause including periodical delivery schedule has been
accepted by Mr. Vimal sharma, DGM-Marketing on behalf of the plaintiff
firm during perusal of the said draft purchase orders, based on which
detailed PO's placed on them. Also it is submitted that, the Board had not
included payment of interest against delayed payments in the contract. The
supplier is not eligible to entitle interest on delayed payment and claiming
the interest is breach of the contract agreed into by the plaintiff firm. It is not
correct to state that, a prevalent practice of TNEB is to pay the purchase
price within 30 days as stated in the plaintiff. It has been stated in the
purchase order and accepted by the plaintiff that, within a reasonable time
payments for the purchased materials would be disbursed. The calculations
made by the plaintiff for payment of interest in the plaint are not payable to
the plaintiff as the purchase orders do not envisage payment of interest.
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d. The plaintiff firm have, admittedly completed their supply against
the purchase order placed on them with delay in delivery. The respective
purchase orders were closed and the firm has been informed about
Liquidated Damages to be recovered as per PO clause 13.01 from the
retention 10% amount available with the Board. The LD and other
recoveries are made as per agreed and accepted terms of the PO by plaintiff
firm. Further it is submitted that, the firm has submitted 10% bill towards
balance of payment based on PO closer order issued by TANTRANSO,
hence the same has been paid to them after making recoveries as per PO
closure order. No bill is pending to be paid against the above PO's. It is not
correct to state that, the defendant has not made payment of the balance to
the plaintiff. It is also not correct to state that, the balance payment including
the LD comes to Rs.73,45, 827/-.
e. Even though, no actual proof or loss may not have been given to the
plaintiff, however, the projects were delayed due to the lack of supply of
materials in this stipulated period. The provisions of the Contract Act quoted
by the plaintiff namely Section 73&74 of the Contract Act squarely applies
to the plaint's failure to supply materials in time and the defendant slapping
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of LD on the plaintiff's delayed supply is quite legal. The delivery schedule
of the said PO's are as below:
POTR No. 1651/ dated 5.03.2007.
The delivery schedule of the 110 KV solid core insulators ordered in this
Purchase Order shall be commenced before the end of 2nd month and
completed within 5 months from the date of receipt of order. The materials
were delivered from 28.04.07 to 16.10.07 with an overall delay of one to 6
weeks.
POTR No. 1724/ dated 29.08.2007: The delivery schedule of the 230KV
solid core insulators ordered in this Purchase Order shall be commenced and
completed from the date of receipt of order. The firm had supplied 4101Nos.
insulators out of 4104Nos. from 30.10.07 to 11.7.08 with over all delay of 1
to 23 weeks.
POTR No. 1725/dated.29.08.2007
The delivery schedule of the 110 KV solid core insulators ordered in this
Purchase Order shall be commenced and completed from the date of receipt
of order. The firm had supplied 5717Nos. insulators out of 5721Nos. from
12.11.07 to 16.4.08 with over all delay of 3 to 16 weeks. In respect of POTR
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No. 1651/ dated 5.03.2007 it may be noted that, the firm have completed the
entire supply with last date of supply received on 16.10.2007. During the
above period, the plaintiff have claimed that their activities were affected
due to severe flood, heavy rain, labour problem, and frequent power cut due
to cyclone. Where as the evidence given by the firm corresponds to
November 2007 which clearly shows that the firm had furnished false
statement to this Honb'le Court and produced evidences to get waiver of LD
which is not valid one. Hence their request for waiver of LD was not
accepted. The insulator quantities delivered by the plaintiff firm are almost
equal and constant in all the time and no where reduced drastically in the
period in question i.e. November 2007. Hence, it was concluded that the
firm's activities were not affected their factory premises due to flood, heavy
rain and power cuts though it has affected in Cuddalore District and the
firm's statement cannot be relied upon and therefore their request for waiver
of LD imposed on them under Force Majeure is not acceptable.
f.PO clause 13.07 reads as below. "The purchaser reserves the right to
cancel the order if the supply is not made as per the delivery schedule
specified in the Purchase Order, notwithstanding its right to claim LD for the
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belated supplies and quantities outstanding to be supplied on the date of
cancellation".
But the Board has not cancelled the said PO's as per the above clause due to
delay in delivery schedule, the insulators were accepted subject to levy of
LD. During the financial year 2007-08 the following named 13 Nos. 230 KV
Substation and 46 Nos. 110 KV substation erection and commissioning
works under new Substation category has been programmed with Rs
54,699.99 lakhs fund allocation. The insulators ordered in the purchase
orders were very essentially required to fix bus bars and AB switches which
are all critical materials of the Substations. Due to delay in delivery of those
insulators by the plaintiff firm 3 Nos. 230 KV Substations and 12 Nos. 110
KV substations (marked) commissioning works were suffered and executed
with delay by 3 to 5 months which affects power distribution to consumers.
g. The plaintiff has stated that, there were flash floods and water
logging in plaintiff factory during the last quarter of 2007 and 2008, and that
there had been strike very frequently by the transporters and as a result of
said position plaintiff have stated that Force Majeure conditions has
happened which affected the supply schedule. The Plaintiff having accepted
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the purchase orders cannot turn its eyes blind on the purchase order
conditions particularly clause 14.0 of the said POs which deal with Force
majeure, which provides that, on the happening of any event mentioned in
the said clause, notice of the happening of any such eventuality is to be
given by the supplier to the Board within 15 days from the date of
occurrence thereof. However, for the reasons best known to plaintiff, he has
not sent any such notice to the Board within stipulated time specified in the
said clause. Therefore, the TNEB is not in a position to admit the
happenings alleged to have been occurred under Force Majeure clause for
the reason that no notice has been received by the Board within the time
specified in the said clause as per contract conditions. Therefore the reasons
stated by plaintiff for the delay in supply of the materials is not acceptable as
per contract conditions. Plaintiff's further contention that the Accepting this
plaintiff claimed bill for the balance payment of Rs.52,94,165.00 and the
same was paid vide cheque No. 813762 & 813798 dt 30.12.2010. Without
any request for waiver of LD and also the defendant Board have no due to be
paid to the plaintiff firm as on date. It is not correct to state that, the
defendant is liable to still to pay a sum of Rs 1,38,35,732/-.
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h. In respect of POTR 1651/ 5.3.07, the firm delivered entire quantity
with overall delay of 1to 6 weeks from 28.4.07 to 16.10.07, from which it is
to be noted that, the supply had been completed before the alleged flood and
rain in the region happened in November 2007, so Force Majeure will not
apply. In any case, the plaintiff is not entitled seek relief under Force
Majeure in view of the position. If the manufacturing activities were affected
as stated by the firm, then there must be drastic reduction in production
during November 2007, where as it is to be noted that, the pattern of
delivery of materials were uniform throughout the delivery period in respect
of all PO's. As per PO clause 13.07, the Board has not cancelled the said
PO's because of delay in delivery schedule and the insulators were accepted
subject to levy of LD and the same was accepted by the firm as the LD was
levied as per PO terms & conditions only. As there is a delay, 90% payment
only will be released initially without prejudice to levy of LD as per clause
13.0 of the purchase order and also the acceptance of material does not
absolve the firm from fulfilling their contractual obligations of the PO.
i. With regard to plaintiff further contention that, plaintiff had made a
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written request for extension of delivery period up to 31.3.08 without
imposition of LD were received by TNEB without prejudice, it was
informed that the materials were accepted with delay, but subject to the
condition that the 90% payment only will be released initially without
prejudice to levy of liquidated damages as per PO clause 13.0 of the PO's
and the same had been communicated to plaintiff in the subsequent dispatch
instructions issued from this office in respect of the subject PO's. Despite
the plaintiff have requested the Board to sympathetically consider its case
for waiver of LD, by letter dated 14.12.09, it is not feasible of compliance
as per the respective PO conditions.
j. As per the Force Majeure clause, notice of the happenings such as
flash flood, devastations, flooding of factory premises, non reporting of
workers for work, frequent power failures etc, is to be given by the supplier
to the Board within 15 days from the date of occurrence thereof. In absence
of the above, their request for waiver of LD under this clause beyond the
period is not acceptable and from the supply pattern it appears there is no
substantial reduction in quantity supplied during November 2007 and
subsequently in all the above 3 PO's. Hence Plaintiff claim for waiver of LD
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was not acceptable. Further, the suit is hopelessly barred by limitation in as
much as the order of recovery relating to the respective purchase orders were
passed as early as on 26.06.2009, 06.06.2009, and 25.06.2009 and were
allowed to become final. As such, the suit is liable to be dismissed as time
barred. Hence, the defendant prays that this Hon'ble Court may please be
pleased to dismiss the suit with cost and thus render justice.
4.On the pleadings of the parties, the following issues were framed in
both suits:-
1.Whether the Plaintiff is entitled to suit claim of Rs.
1,38,35,732 along with interest 12%.
2.Whether the defendant is entitled to the liquidated
damages, if so, to what extent?
3.Whether the stipulated liquidated damages in the
purchase order is in the nature of penalty?
4.Whether liquidated damages is payable during Force
Majeure condition?
5.Whether the suit is barred by limitation?
6.Whether the Defendant is correct in accepting the
extension of delivery period letter subject to the condition of
90% payment and without prejudice to levy liquidated
damages?
7. To what other relief the plaintiff is entitled for?
5. To substantiate the respective contentions, P.W.1 was examined
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and Ex.P1 to Ex.P37 were marked on the side of the plaintiffs. D.W.1 was
examined and Ex.D1 to Ex.D12 were marked on the side of the defendants.
6.Heard both sides and perused the material available on records.
7. The learned counsel for the plaintiff submits that the plaintiff
completed supply of the insulators to the various stores of the defendant and
the defendant had also without any quarrel received the goods. The plaintiff
raised periodical bills but the defendant did not make payment on time as
per the practise and it was delayed beyond 30 days. The plaintiff is entitled
for interest for the delayed payment. After supplying the material, the
plaintiff approached the defendant for the balance payment, but the
defendant had sent letters dated 26.05.2009, 25.06.2009 and 06.06.2009
informing the plaintiff that a sum of Rs.2,19,673.65/-, Rs.43,18,226.06 and
Rs.19,67,790.95/- in respect of the three purchase orders were recovered
towards Liquidated Damages for delayed supply. A sum of Rs.3635/- and
Rs.8523.80/- recovered towards non-supply of 5 & 3 nos of insulators under
PO 1725 & 1724 respectively. Hence, a sum of Rs.73,45,827/- which
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includes the balance payment and the Liquidated damages is to be paid to
the plaintiff.
8. The learned counsel for the plaintiff further submits that the
reasons for the delayed supply is due to unforeseen floods, labour problem
and frequent power cuts by TNEB. The reasons were force majeure events
and not attributable to the plaintiff. Hence, the plaintiff filed WP 26709 of
2009 and the same was disposed on 22.12.2009 by directing the defendant to
consider the plaintiff's representation. Subsequent to the order of this Court,
the defendant by letter dated 04.03.2010 refused to refund the withheld
amount. Hence, the plaintiff issued a legal notice dated 17.12.2011 and the
defendant thereafter made part payment. However, the defendant is still
liable to pay a sum of Rs.1,38,35,732/-.
9. The learned counsel for the plaintiff further submits that the
plaintiff was awarded three purchase orders in the year 2007 where supply
has to be completed within a period of 2 years. As per the terms of the
purchase order in clause 8.03(ii), the payment of 90% of the "all inclusive
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price" shall be made within a reasonable time after the receipt of material
which is relevantly 30 days as per the prevalent practice of the Defendant.
The Purchase orders were closed (Ex.P.15 to 17) and the balance amount
outstanding stands to the tune of Rs. 73,45,827/- as evident from Ex.P.36 to
be received from the defendant. Relying upon the Judgments of the cases of
in “Union of India V. Raman Iron Foundry” reported in (1974) 2 SCC 231
and “Hardware (India) Co. V. Firm shamlal and Bros.” reported in AIR
1954 Bom 423, he has submitted that the alleged liquidated damages
adjusted by the Defendant cannot be sustained as the said claim is not a debt
and the appropriate procedure to recover the alleged damage is by way of
suing the plaintiff for damages. While so, the levying of liquidated damages
by the Defendant is arbitrary and illegal and void.
10. It has been further submitted by the learned counsel for the
plaintiff that the Defendant had been paying the Plaintiff for the supplies
made belatedly and it is evident from the Ex.P.17 that the last such payment
received from the Defendant was on 05.01.2011. As per the Limitation Act,
3 years is the limitation stipulated. In the present case the last payment was
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received on 05.02.2011 and the suit has been filed on 20.11.2012. Even
assuming the date stated by the DW1 in her cross examination in Q16 i.e.,
30.12.2010 is taken for the purpose of calculation of the limitation, the same
being well within the 3 years stipulated under the Act, the present suit is not
barred by limitation. Hence, he seeks the relief as prayed for.
11. The learned counsel for the defendant submits that even the
plaintiff had agreed to all the terms and conditions of the contract, the
plaintiff had supplied the insulators as per the dispatch schedule but beyond
the date of delivery which is fixed in clause 10(a) of each of the contract.
Though the supply was delayed, the same was accepted by the defendant
subject to the condition that only 90% payment will be released initially and
without prejudice to the levy of liquidated damages as per P.O clause
8.03(i)(b). The said levy of LD was accepted by the firm and supplied
insulators even beyond the stipulated date. The time for payment for each
bill had not been stated in the PO and there is no clause for payment of
interest on delayed payment, since there is no time stipulated for the
payment of the invoice.
12. It has been further submitted by the learned counsel for the
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defendant that the force majeure clause was never invoked by the plaintiff
during the period of occurrence. It is only an after thought. The pattern of
supply of insulators with respect to the three purchase orders all long the
entire period will show that the sudden floods as alleged by the plaintiff
during November 2007 had not even had the slightest effect on the plaintiff.
The supply of materials all along had been the same and there had not been a
sudden dip on the supply of materials. The notices necessary for invoking
the force majeure clause were never sent within a 15 days to the defendant
and the said plea is taken only after the defendant had closed the purchase
order and invoked liquidated damages. 90% of the payment has been made
and the balance is adjusted towards liquidated damages towards delayed
supply and for non supply.
13. The learned counsel for the defendant submits that it is an
admitted fact by the plaintiff in para c (g) of the plaint that, the defendant
had sent letters dated 26.05.2009, 25.06.2009 and 6.6.2009 informing the
plaintiff that a sum of Rs.2,19,673.65/-, Rs.43,18,226.06/- and Rs.
19,67,790.95 in respect of P.O. Nos: 1651, 1724 & 1725 were recovered
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towards Liquidated damages and for delayed supply. The denial of
liquidated damages was on the year 2009, the present suit claiming
liquidated damages is filed in the year 2012. When the said suit is filed for
released of withheld amount towards liquidated damages, the denial is of the
year 2009. The cause of action arose on the date of denial and therefore the
present suit ought to have been filed within three years from the date of
denial and the suit being filed beyond the three years period is barred by
limitation. Hence, he seeks to dismiss the suit.
14. Having considered the facts and circumstances of the case
and submissions made by the learned counsel for both parties, it is admitted
fact is that there is a delay in supply of insulators with respect to all purchase
orders. The reason for the same alleged by the Plaintiff is force majeure, due
to heavy floods in the month of November 2007. However, no such notice
was issued by the plaintiff within a period of 15 days from the date of
occurrence and the defence of force majeure clause was first taken only on
11.08.2009 after three months of closure of purchase order. The so called
alleged floods in November 2007 had no role to play in their delayed supply.
Further, the first purchase order ought to have been completed even prior to
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the floods, with respect to the other two purchase orders, even before the
floods there was a delayed supply and the said pattern continued during the
alleged floods and even after the floods.
15. In so far as the claim of the plaintiff on the interest for the delayed
payment, Article 19 of the limitation Act, speaks as follows:
19.Effect of payment on account of debt or of
interest on legacy: Where payment on account of a debt or of
interest on legacy is made before the expiration of the
prescribed period by the person liable to pay the debt or legacy
or by his agent duly authorised in this behalf, a fresh period of
limitation shall be computed from the time when the payment
was made.
Provided that, save in the case of payment of
interest made before the 1st day of January, 19*28, an
acknowledgment of the payment appears in the handwriting of,
or in a writing signed by, the person making the payment.
Explanation. - For the purpose of this Section,-
a). Where mortgaged land is in the possession of
the mortgagee, the receipt of the rent or produce of such land
shall be deemed to be a payment;
b)”debt” does not include money payable under a decree
or order of a Court.
Hence, to attract the operations of this section, two conditions
are essential: first, payment must be made within the prescribed period of
limitation and secondly, by some form of writing either in the handwriting
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of payer himself it must be acknowledged or signed by him. It is the
payment which really extends the period of limitation: but the payment has
got to be proved in a particular way and a written or signed acknowledgment
is the only proof of payment and oral testimony is excluded unless there is
acknowledgment in the required form as per the Judgment in the case of
“Sant Lal Mahton v. Kamla Prasad” reported in A.I.R. 1951 S.C. 477. In
view of the above, the plaintiff is not entitled to interest on the delayed
payment.
16. As per the Section 14 of the Limitation Act enumerates, for
the price of goods sold and delivered, where no fixed period of credit is
agreed upon, the suit has to be filed within a period of 3 years from the date
of delivery of the goods. Against the placement of the three purchase orders,
the delivery has been completed in the month of June, 2009 and the
defendant has sent Ex.P18 dated 26.05.2009, Ex.P19 dated 06.06.2009, and
Ex.P20 dated 25.06.2009 for closing the three purchase order and levying of
Liquidated damages. If the plaintiff has aggrieved by levying the liquidation
damages, he has to come forward to file the suit within a period of three
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years. However, the suit has been filed as against the liquidation damages in
the month of November 2012 which is beyond the prescribed limitation
period, according to the Limitation Act. Hence, the suit filed by the plaintiff
is barred by limitation and accordingly, the suit is liable to be dismissed.
Thus, the Issue No.5 is answered against the plaintiff and in favour of the
defendant. Further, other issues involved in this case does not arise since the
issue No.5 is against the plaintiff.
17. In the result, the suit is dismissed. No costs.
23.09.2024
Index:Yes/No
Web:Yes/No
Speaking/Non Speaking
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Witnesses examined on the side of the plaintiff and defendant:
Marketing Manager - MR. T.R. Ramachandran (PW-1)
https://www.mhc.tn.gov.in/judis
Assistant Executive Engineer (A.E.E) – Mrs. K.Ammu (DW-1)
Exhibits produced on the side of the plaintiff:
S.No Exhibits Description of documents
1. Ex P1 Authorization Letter
2. Ex P2 Tender - Specification No. 1366 dated 20.09.2006
3. Ex P3 Tender - Specification No. 1407 dated 04.04.2007
4. Ex P4 Tender - Specification No. 1408 dated 05.04.2007
5. Ex P5 Purchase Order No. 1651 dated 05.03.2007
6. Ex P6 Purchase Order No. 1725 dated 29.08.2007
7. Ex P7 Purchase Order No. 1724 dated 30.08.2007
8. Ex P8 English Version of Letter from President, Pethanayakkam
Kuppam Panchayat dated 25.11.2007
9. Ex P9 Paper Publication - The Hindu dated 24.12.2007
10 Ex P10 Lingan's Weblog on flood affected area in Cuddalore
District - Tamilnadu dated 27.12.2007
11. Ex P11 English Version of Letter from Village Administrative
Officer, Pethanayakkam Kuppam Panchayat dated
05.01.2008
12. Ex P12 Letter Requesting for extension of delivery period without
imposition of Liquidated Damages dated 25.02.2008
13. Ex P13 Online Publication in the Indian news portal on Cyclone
hits Tamilnadu dated 27.11.2008
14. Ex P14 Publication Flash Floods Relief Efforts (Nov 2008 & Dec
2007)
15. Ex P15 Statement of Account - POTR 1651
16. Ex P16 Statement of Account - POTR 1724
17. Ex P17 Statement of Account - POTR 1725
18. Ex P18 Letter Closure of Purchase Order and levy of liquidated
Damages for specification No. 1366 dated 26.05.2009
19. Ex P19 Letter Closure of Purchase Order and levy of liquidated
https://www.mhc.tn.gov.in/judis
17. Ex P17 Statement of Account - POTR 1725
Damages for specification No. 1407 dated 06.06.2009
20. Ex P20 Letter Closure of Purchase Order and levy of liquidated
Damages for specification No. 1408 dated 25.06.2009
21. Ex P21 Reply Letter- Request for waiver of liquidated Damage to
TNEB with enclosures dated 11.08.2009
22. Ex P22 Request to waiver of liquidated damage to TNEB with
Ref. to letter dated 11.08.2009 with enclosure dated
03.09.2009
23. Ex P23 TNEB's reply to letters dated 11.08.2009 and 03.09.2009
dated 12.09.2009
24. Ex P24 Letters to TNEB with Ref. to letters dated 11.08.2009 and
03.09.2009 dated16.09.2009
25. Ex P25 Letters to TNEB with Ref. to letters dated 11.08.2009,
03.09.2009 and 16.09.2009 dated 20.10.2009
26. Ex P26 Letter to The Chairman and the Chief Engineer, TNEB,
w.r.t Waiver of LD in POTR No. 1651 dated 14.12.2009
27. Ex P27 Letter to The Chairman and the Chief Engineer, TNEB,
w.r.t Waiver of LD in POTR No. 1724 dated 14.12.2009
28. Ex P28 Letter to The Chairman and the Chief Engineer, TNEB,
w.r.t Waiver of LD in POTR No. 1725 dated 14.12.2009
29. Ex P29 High Court Order in W.P. No. 26709 of 2009 dated
22.12.2009
30. Ex P30 Reply letter by TNEB to rep. dt. 16.09.2009, 20.10.2009
and 14.12.2009 dated 04.03.2010
31. Ex P31 Reply to TNEB w.r.t letter dt. 12.09.2009 and 04.03.2009
- POTR No.1651 dated 17.03.2010
32. Ex P32 Reply to TNEB w.r.t letter dt. 12.09.2009 and 04.03.2009
- POTR No.1724 dated 17.03.2010
33. Ex P33 Reply to TNEB w.r.t letter dt. 12.09.2009 and 04.03.2009
- POTR No. 1725 dated 17.03.2010
34. Ex P34 Reply from TNEB to M/s. Saravana Global w.r.t. rep. dt.
16.09.2009, 20.10.2009 and 14.12.2009 dated 29.03.2010
35. Ex P35 Legal Notice to TNEB dated 02.08.2010
36. Ex P36 Amount Outstanding from TNEB dated 11.09.2012
https://www.mhc.tn.gov.in/judis
35. Ex P35 Legal Notice to TNEB dated 02.08.2010
37. Ex P37 Interest for delayed payments dated 11.09.2012
Exhibits produced on the side of the defendant:
S.No Exhibits Description of documents
1. Ex D1 The true copy of the perusal and acceptance of Draft
purchase order-1651/5.3.07 dated 05.03.2007.
2. Ex D2 The true copy of the perusal and acceptance of Draft
purchase order 1724/25.08.2007 dated 25.08.2007.
3. Ex D3 The copy of the perusal and acceptance of Draft purchase
order 1725/25.08.07 dated 29.08.2007.
4. Ex D4 The copy of the 90% payment conditional dispatch
instruction POTR 1724 dated 01.03.2008.
5. Ex D5 The copy of the 90% payment conditional dispatch
instruction POTR 1724 dated 07.07.2008.
6. Ex D6 The copy of the 90% payment conditional dispatch
instruction POTR 1725 dated 31.01.2008.
7. Ex D7 The original of the request letter from plaintiff on priority
payment dated 19.01.2008.
8. Ex D8 The true copy of the request letter from plaintiff for
closure of PO dated 29.10.2007.
9. Ex D9 The true copy of the request letter from plaintiff for
closure of PO and delivery extension dated 03.01.2008.
10 Ex D10 The true copy of the request letter from plaintiff for
closure of PO dated 10.12.2008.
11. Ex D11 The original of the Transmission T&D programme 2007-
08 dated 23.08.2007.
12. Ex D12 The true copy of the Bill register of PO.No.1651, 1724 &
1725.
https://www.mhc.tn.gov.in/judis
23.09.2024
A.A. NAKKIRAN, J,
Lbm
https://www.mhc.tn.gov.in/judis
23.09.2024
https://www.mhc.tn.gov.in/judis
