1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION SUIT NO.3389 OF 1986 1. Messrs National Textile Coropration Ltd. New Delhi, a Government company incorporated under the Companies Act 1 of 1956 having its registered office at Surya Kiran Building, Kasturba Gandhi Marg, New Delhi ...Plaintiffs 2. Messrs National Textile Corporation (S.M.) Ltd., a Government Company incorporated under the Companies Act 1 of 1956, having its registered office at N.T.C. House, 13, N.M.Marg, Ballard Estate, Bombay – 400 038 3. National Textile Corporation (MN) Ltd., A Govt. Company incorporated under the Companies Act, 1 of 1956, having its registered office at NTC House, 15, N.M.Marg, Ballard Estate, Bombay – 400 038 Versus M/s.Manish Trading Co., a firm carrying on business at 136/137, Dadar Gully, Bombay – 400 002 ...Defendant Mrs.P.M.Bajpai i/b. Ms.Swapnila Rane for the plaintiffs CORAM : A.S.OKA, J. DATE : 14TH SEPTEMBER, 2007 ORAL JUDGMENT 2 1. The plaintiffs have filed this suit for recovery of Rs.50,830/- together with future interest on a sum of Rs.31,373.18/- @ 21% from the date of filing of the suit till payment and/or realisation. 2. Originally the suit was filed by the 1st and 2nd plaintiffs. It is stated in the plaint that the management of Textile Mill namely Shree Sitaram Mills (U.C.) was taken over by the 1st and 2nd plaintiffs. It is stated that the management of the said Shree Sitaram Textile Mills came to be vested in the Union of India by the Textile Undertakings (Taking over of Management) Ordinace, 1983. The management vested in the Union of India with effect from 18th October, 1983. The Union of India appointed the National Textiles Coropration Limited, New Delhi, as the custodian under the said ordinance. The custodian appointed the second plaintiff as additional custodian to carry on the management of Shri Sitaram Mills U/s.4 of the Textile Undertakings (Taking over of Management) Act, 1983. The management of the said Textile 3 Undertakings vested in the custodian. By amending the plaint it was pointed out that by the Textile Undertakings (Nationalisation) Act, 1995, with effect from 1st April, 1994, the right, title and interest of the owners of Shri Sitaram Mills alongwith the other 13 Textile Mills was transferred and vested in the Central Government. Subsequently, by order dated 25th March, 1996, the third plaintiff Company was authorised to exercise the powers of general superintendence, direction, control and management of the affairs of the said mills. By a further order dated 8th January, 1998, the said Shri Sitaram Mills was transferred to the third plaintiff on the terms and conditions incorporated in the said order. 3. The claim in the suit is for recovery of the price of the cloth material supplied by Shree Sitaram Mills to the defendants. It is stated in the plaint when the accounts of Shri Sitaram Mills were scrutinised by the first and second plaintiffs it was found that the defendants are liable to make payments of a sum of Rs.31,373.18/- being the 4 amount due and payable at the foot of the account of the defendants as on 18th October, 1983. 4. By a letter dated 27th September, 1984 sent by the advocate for the plaintiffs, the defendants were called upon to pay the aforesaid amount together with interest thereon @ 21% p.a. The defendants replied to the said letter by a letter dated 18th October, 1984 and denied the claim. In the letter dated 27th September, 1984 the claim amount was mentioned as Rs.20,364.74/-. The said arrears were again demanded by sending letter dated 25th September, 1986 by the advocate for the plaintiffs to the defendants. In the present suit the plaintiffs are claiming interest @ 21% p.a. 5. A Written Statement has been filed by the defendants. The contention raised is that the plaintiffs have not produced any documents in support of their claim such as documents evidencing delivery of goods. The defendants denied the claim of the plaintiffs. 5 6. Following issues have been settled : (i) Whether the plaintiff is entitled to a decree of Rs.50,830/- with further interest @ 21% p.a. from the defendants ? (ii) Whether the defendants prove that the plaint is not verified as per the provisions of the Civil Procedure Code ? (iii) Whether the defendants prove that the claim is barred by limitation ? (iv) Whether the defendants prove that the goods worth Rs.31,373.18/- has not been delivered to them by the plaintiffs ? 7. The Plaintiffs filed an affidavit in lieu of the examination-in-chief of one Mr.A.B.Rane, Assistant Accounts Officer of the plaintiffs. The examination-in-chief of the said witness was recorded on 12th September, 2007 in this Court. On that day none appeared for the defendants. Therefore, the cross examination of the witness of the plaintiffs was stated as closed. Today when the suit is called out, none appeared for the 6 defendants. Hence, arguments of learned counsel appearing for the plaintiffs were heard. 8. In paragraph four of the affidavit in lieu of evidence, Mr.A.B.Rane has stated thus :- “I say that from the records and the account maintained by Sitaram Mills, of the defendant, it was found by the plaintiff that, on the basis of the delivery orders placed, the Sitaram Mills used to sell cloth material to the defendant. From the accounts maintained by the Sitaram Mills it was reflected that as on 18th October, 1983 i.e. at the time of taking over of management from Sitaram Mills, by the plaintiffs, Rs.31,373.18/- was due and payable by the defendant to the Sitaram Mills towards the supply of cloth material. The said amount is due and payable after adjustment of the payment received from the encashment of the Hundis. Copy of the account maintained by Sitaram Mills is annexed at item No.”P3” in the compilation of documents.” 7 In paragraph five of the said affidavit, detailed calculations have been made on the basis of the account of the defendants maintained by predecessors of the plaintiffs. It is stated that other documents such as gate pass, delivery orders, delivery challans and office copies of the notices have been misplaced. Considering the fact that there is no challenge to what has been stated by the witness in the paragraphs four and five of his affidavit, the statement of account of the defendants produced by the said witness along with affidavit will have to be treated as proved. The claim in the suit is based on the amount payable by the defendants at the foot of the account on 18th October, 1983. The correctness of the account has been proved by the witness. The said amount due and payable was Rs.31,373.18/-. Therefore, the plaintiffs have established their claim for recovery of a sum of Rs.31,373.18/-. 9. The plaintiffs have claimed interest @ 21% p.a. from 18th October, 1983 till filing of the 8 suit. There is nothing on record to show that rate of interest @ 21% p.a. was the agreed rate of interest. In my view, considering the fact that liability arises out of a commercial transaction, interest will have to be granted @ 9% p.a. 10. Hence, I pass the following order. a. The defendants are ordered and decreed to pay a sum of Rs.31,373.18/- to the plaintiffs together with interest thereon @ 9% per annum from 18th October, 1983 till the filing of the suit and further interest at the rate of 9% p.a.on the amount of Rs.31,373.18/- from the date of filing of the suit till payment and/or realisation. b. The defendants are ordered and decreed to proportionate costs of the suit to the plaintiffs. c. Certified copy is expedited. 9 (A.S.OKA, J.)