- 1 - IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION SUIT SUIT SUIT NO.846 OF 1989 NO.846 OF 1989 NO.846 OF 1989. The Board of Trustees of the Port of Bombay. ...Plaintiff. vs. Daga Impex Pvt. Ltd. ...Defendant. .... Mr.U.J. Makhija, a/w. Parag Khandhar, i/b. Mulla & Mulla, for the Plaintiff. Mr.S.P. Kanuga, for the Defendant. .... CORAM CORAM CORAM: A.S.OKA,J. A.S.OKA,J. A.S.OKA,J. DATE DATE DATE : NOVEMBER 20,2008 : NOVEMBER 20,2008 : NOVEMBER 20,2008. ORAL JUDGMENT: ORAL JUDGMENT: ORAL JUDGMENT: . In the present suit, the plaintiff is seeking a decree in the sum of Rs.4,00,000/- together with the further interest on the sum of Rs.3,53,695.61 paise at the rate of 15% per annum from the date of suit. 2. The plaintiff is a body corporate constituted under the provisions of the Major Port Trusts Act, 1963. The defendant is a Company registered under the Companies Act, 1956. The case of the plaintiff is that in or about December 1985, the defendant imported a consignment of 61 bales allegedly containing wool waste which was manifested at Item No.136 of the import general manifest no.2991 dated 11th December 1985 - 2 - of vessel M.V. ‘LANKA MUDITHA’. According to the case of the plaintiff, the general landing date and the last free day of the cargo of the vessel fell on 12th December 1985 and 17th December 1985 respectively. 3. According to the case of the plaintiff, the defendant was the importer and/or the owner of the consignment within the meaning of the said Act of 1963. However, the defendant failed to clear the consignment within a period of 7 clear days from the date of landing and the consignment remained in the premises of the plaintiff. The defendant failed to make payment of wharfage, demurrage and other charges accrued thereon. 4. Under the order dated 21st November 1986, the consignment was ordered to be confiscated by the Collector of Customs under the provisions of sections 111(d) and 111(m) of the Customs Act, 1962 read with section 3(2) of the Import and Export (Control) Act, 1947. The case of the plaintiff is that the consignment incurred port trust charges amounting to Rs.3,53,695.61 paise accrued upto the date prior to the date on which the aforesaid order was passed by the Collector of the Customs. The plaintiff has placed reliance on a letter dated 13th January 1988 issued to the defendant informing the - 3 - defendant about the aforesaid order dated 21st November 1986 and calling upon the defendant to pay a sum of Rs.3,53,695.61 paise. The letter also records that if the defendant failed to remit the amount within a period of 15 days, the plaintiff will be entitled to charge interest at the rate of 15% per annum from the date of demand. 5. There is a further letter dated 1st April 1988 sent by the plaintiff calling upon the defendant to pay the aforesaid amount. Even in the said letter, there is a demand made of the payment of interest at the rate of 15% per annum. The said letter was replied to by the defendant by the reply dated 15th April 1988. It was stated in the said letter that the defendant had abandoned and relinquished the title of the goods to the department before an order for clearance of the goods was made by the customs department. Therefore, the defendant declined to comply with the demand. A reminder was issued by the plaintiff on 31st October 1988 to the defendant. As compliance was not made by the defendant, the present suit has been filed by the plaintiff. The particulars of the claim made by the plaintiff in the suit read thus :- . (i) Wharfage : Rs. 498.41 - 4 - . (ii)Demurrage till the date prior to day of confis- cation, i.e. 20.11.1986. : Rs.3,52,571.40 (iii)Sale W/H Charges @ Rs.28/-PT : Rs. 625.80 _________________ Total : Rs.3,53,695.61 _________________ Add : Interest @ 15% p.a. from the date of Demand notice dt.13.1.1988 till filing of suit.: Rs. 46,304.39 ___________________ Total Claim : Rs.4,00,000.00 ___________________ . The written statement was filed by the defendant. One of the contentions raised is that the suit was barred by limitation. The second contention is that the defendant was not the importer/owner or consignee of the suit consignment. The case of the defendant is that the goods forming part of the consignment were not the goods which were ordered by the - 5 - defendant and in any case, the plaintiff was required to dispose of the goods. The defendant prayed for dismissal of the suit. 6. The issues have been settled on 22nd August 2007 which reads thus :- (i) Whether the suit is barred by the Law of Limitation as alleged in paragraph 2 of the written statement ? (ii) Whether defendant is not the importer/owner/consignee of the suit consignment as alleged in paragraphs 3(h) and 5 of the written statement ? (iii) Whether the confiscation of suit consignment incurred pre-confiscation port trust charges of Rs.3,53,695.61 as stated in paragraphs 9 and 11 of the plaint ? (iv) Whether the plaintiffs are entitled to recover the amount of Rs.3,93,695.61 being the pre-confiscation port trust charges in respect of suit consignment together with a sum of Rs.46,304.39 paise being interest @ 15% p.a. from 13.01.1988 till 7/12/1988 aggregating to Rs.4,00,000/- as stated in paragraph 12 of the plaint ? (v) To what reliefs, are the plaintiffs entitled ? (vi) What order and generally ? 7. The plaintiff filed an affidavit in lieu of examination-in-chief of one Mr. Elias J.Almeida and has filed 7 original documents. The defendant examined one Mr. Gulab Daga as a witness by filing his affidavit in lieu of examination-in-chief. - 6 - 8. The learned counsel appearing for the plaintiff submitted that before the Court Commissioner and even before this Court, a statement has been made by the learned counsel appearing for the defendant that the defendant was not disputing the liability to pay the principal amount but was disputing the claim made by the plaintiff regarding the interest. He submitted that a demand was made for payment of interest by the plaintiff by letters dated 13th January 1988 and 1st April 1988, the receipt of which is not disputed by the defendant. He pointed out that as the claim regarding the principal amount is not disputed and the only dispute is regarding the interest, the plaintiff did not examine the witness who had filed an affidavit in lieu of examination-in-chief. He, therefore, submitted that the plaintiff is entitled to a decree as prayed. The learned counsel appearing for the defendant invited my attention to the affidavit in lieu of exmination-in-chief filed by one Mr. Gulam Daga. He pointed out that in the affidavit, it is stated that though the plaintiff was entitled to sell the consignment after expiry of two months, the plaintiff failed to do so. He submitted that if the goods were disposed of immediately on the expiry of two months, the demurrage charges could have been minimized. He submitted that the plaintiff is - 7 - not entitled to claim interest for a period upto the date of filing of the suit and the prayer for interest at the rate of 15% per annum from the date of the institution of the suit is exorbitant. 9. I have carefully considered the submissions. As reflected from the submissions made across the bar, the only dispute is as regards the entitlement of the plaintiff to interest for a period of prior to the date of the institution of the suit and the interest from the date of the institution of the suit. The reliance is placed by the plaintiff on a demand made for the interest at the rate of 15% per annum under letters dated 13th January 1988 and 1st April 1988 which have been admittedly received by the defendant. In fact, the defendant has replied to letter dated 1st April 1988. As far as the interest claimed at the rate of 15% per annum from the date of demand notice dated 13th January 1988 is concerned, it is an admitted position that there is no agreement between the parties for the payment of interest. Therefore, the plaintiff can claim the interest only under the provisions of Interest Act, 1978. Under section 3 of the said Act of 1978, there is a power vesting in the Court to allow the interest to the person entitled to debt or damages or the person making such claim, as the case may be, at the rate not exceeding the - 8 - current rate of interest for the whole or part of the period commencing from the date of written notice given by the person entitled to interest to the person liable to the interest by which the interest is claimed, till the date of the institution of the proceedings. 10. In the present case, the date of demand is 13th January 1988, under which the interest is claimed at the rate of 15% per annum. Considering the facts and circumstances of the case and the then prevailing rates, the interest deserves to be allowed from 13th January 1988 at the rate of 12% per annum till the date of filing of the suit. For the period from the date of the institution of the suit till realisation, in view of section 34 of the Code of Civil Procedure, 1908, interest will be payable at the rate of 6 % per annum. 9. Hence, I pass the following order :- (1) The defendant is ordered and decreed to pay to the plaintiff a sum of Rs.3,53,695.61 paise together with the interest thereon at the rate of 12% per annum from 13th January 1988 till the day prior to the institution of the suit. The defendant is ordered and decreed to pay interest at the rate of 6% per annum on the same amount of Rs.3,53,695.61 - 9 - paise at the rate of 6% per annum from the date of institution of the suit till the realisation or payment. (2) The defendant is ordered and decreed to pay the costs of the suit to the plaintiff. [ A.S.OKA,J.]