R.S.A. No.2468 of 2010 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH REGULAR SECOND APPEAL No.2468 of 2010 DATE OF DECISION: 4 th APRIL, 2011 M/s. Model Dairy Plant .... Appellant Versus M/s. Arun Poly Packs Pvt. Ltd. .... Respondent CORAM :- HON'BLE MR. JUSTICE L. N. MITTAL. PRESENT: Mr. T. C. Dhawal, Advocate for Mr. Ranjan Lohan, Advocate for the appellant. Mr. Gagan Oberoi, Advocate for the respondent. * * * * L.N. MITTAL, J. (ORAL) Defendant M/s. Model Dairy Plant having failed in both the courts below has filed instant second appeal. Suit was filed by respondent-plaintiff M/s. Arun Poly Packs Pvt. Ltd. against appellant-defendant No.1 and its General Manager defendant No.2 for recovery of Rs.35,551.75 alleging that plaintiff supplied goods to the defendants worth Rs.1,04,775/-, out of which defendant paid Rs.77,000/- only leaving behind a balance of rs.27,775/- as principal amount. The plaintiff also claimed Rs.7,776.75 as interest @ 21 % per annum till filing of the suit. Defendants alleged that the material supplied by the plaintiff was without placing of any order by the defendants. To complete the formalities, the defendants placed order dated 16.11.1996. The material was not required R.S.A. No.2468 of 2010 -2- immediately by the defendants and, therefore payment was not released immediately. The material was found to be short and also defective. It was thus pleaded that no amount is due from the defendants to the plaintiff. Learned Civil Judge (Senior Division), Chandigarh vide judgment and decree dated 31.07.2006 decreed the plaintiff's suit for recovery of Rs.35,551.75 with pendente lite and future interest thereon @ 9% per annum. First appeal preferred by defendant No.1 has been dismissed by learned Additional District Judge, Chandigarh vide judgment and decree dated 16.02.2010. Feeling aggrieved, defendant No.1 has preferred instant second appeal. At the time of motion hearing, contention on behalf of appellant regarding merits of the case was not accepted. However, notice of motion was issued limited to rate of interest for pre-suit period. I have heard learned counsel for the parties and perused the case file. Learned counsel for the appellant contended that interest @ 21% per annum for pre-suit period as claimed by the plaintiff and as allowed by the courts below is highly excessive. Per contra, learned counsel for the plaintiff- respondent contended that interest amount claimed in the suit was not @ 21% per annum but at lesser rate. I have carefully considered the rival contentions. The plaintiff specifically claimed interest for the pre-suit period @ 21 % per annum. Learned counsel for the respondent plaintiff is unable to tell as to at what rate, interest amount was calculated and claimed in the suit. Be that as it may, the principal amount is Rs.27,775/- In my considered opinion, interest for the pre-suit period @ 15% per annum would be just and proper because the amount relates to R.S.A. No.2468 of 2010 -3- commercial transaction between the parties. Interest rates when the material was supplied in November, 1996 were high. Interest rates started falling down in the year 2000. The suit itself was filed on 30.03.1998. The interest rates prior to it were not as low as these days. In view of the aforesaid, I am of the considered opinion that pre-suit interest allowed @ 21% per annum by courts below is excessive. Substantial question of law to this effect arises for adjudication in this second appeal and the same is answered in favour of appellant holding that plaintiff is entitled to pre- suit period interest @ 15% per annum. For the reasons aforesaid, instant second appeal is allowed partly and judgments and decrees of the courts below are modified. Plaintiff's suit is decreed partly for recovery of principal amount of Rs.27,775/- with interest thereon @ 15% per annum w.e.f. 16.11.1996 the date of supply of the material till 30.03.1998 the date of filing of the suit and thereafter @ 9% per annum on the principal amount of Rs.27,775/-, till recovery. The plaintiff shall be entitled to proportionate costs throughout. (L. N. MITTAL) JUDGE 4th April, 2011 'raj'