INTEREST IN COMMERCIAL TRANSACTION FOR DELAY PAYMENT GRANTED AT 12% PA BUT NOT AT 18% PA = according to the bills, the amount has to be paid within a period of thirty days from the date of delivery of the goods. Though innocence is sought to be pleaded by the learned counsel for the appellant saying that this condition is not known, it is very difficult to accept the plea of the defendant since in commercial transactions when the goods were delivered on credit, the amount has to be paid within a short period and if that is not paid, naturally the persons will be entitled to the interest at agreed rate or at the market rate. In fact, Exs.B7 to B37 and Ex.B41, which were filed by the defendant clearly go to show that there was a term for payment of interest at 18% per annum, if the amount is not paid within 30 days. Therefore, the contention of the appellant that there is no liability to pay interest is not valid. It is true that in the legal notice and also the accounts filed by the plaintiffs, the particulars of crediting of the interest were not mentioned. But, however, when once the fact that there is a liability to pay interest is accepted, it is a matter of calculation as to how the interest is to be arrived at. In fact, several entries contained in Ex.A52 and also other statements filed with regard to the other suit clearly go to show that how there was a delay payment. Therefore, in view of the above circumstances, when there is nothing on record to show that the plaintiffs have waived the right of recovery of the interest, as per the contract, a calculation can be made with regard to the delay payments and amount can be claimed. Therefore, merely because the ledger account did not show the interest pleaded from time to time, the claim of the plaintiffs for recovery of the interest cannot be denied.

THE HON’BLE SRI JUSTICE  N.R.L.NAGESWARA RAO

C.C.C.A.NO.34 OF 1993

AND

TR.A.S.NO.145 OF 2010

COMMON JUDGMENT:

          Both appeals arise out of the common judgment in O.S.No.323 of 1985 and O.S.No.557 of 1986 on the file of  III Additional Judge, City Civil Court, Hyderabad at Secunderabad.

2.       The suits were filed by two different plaintiffs against the same defendant for recovery of the amounts due with regard to the Commercial transaction.

3.       The suit O.S.No.323 of 1985 is filed for recovery of Rs.11,486.73 Ps. and a sum of Rs.29,806.72 Ps. towards interest at 18% per annum. 

4.       The suit O.S.No.557 of 1986 is filed for recovery of  Rs.563.89 Ps. towards principal and a sum of Rs.7,180.58 Ps. towards  interest at 18% per annum.

5.       In both the suits, according to the case of the plaintiffs, the defendant was supplied goods on credit basis and the bills have to be cleared within a period of thirty days and the defendant was making some payments, but the sums claimed in the above suits were pending. Therefore, the suits were filed on the basis of the accounts maintained by the plaintiffs. 

6.       The defendant in O.S.No.323 of 1985 apart from taking a plea about want of jurisdiction, has also raised a plea that a sum of Rs.50,000/- was paid towards  full satisfaction of the claim of the plaintiff and, therefore, the suit is not maintainable.  It was further pleaded that there was no contract to pay the interest as claimed by the plaintiff and consequently the claim for interest is not maintainable.  The defendant in both the suits has taken the similar plea.

7.       The Court below has jointly tried both the suits and after considering the evidence on record, i.e., on behalf of the plaintiffs, P.W.1 and Exs.A1 to A70 and on behalf of the defendant,  DW.1 and Exs.B1 to B41, decreed the suits of the plaintiffs as prayed for. Aggrieved by the said judgment, the present appeals are filed.

8.       The points that arise for consideration are:

1)     Whether  the appellant is not liable to pay the interest as

     claimed by the plaintiffs ?

2) Whether the Court below is right in granting subsequent    

     interest over the interest already claimed in the suit while   

     decreeing the suit ?

3) Whether the judgment and decree passed by the Court  

     below is legal and sustainable ?               

9.       POINTS:

In fact, there is no dispute about the fact that the defendant has got business dealings with the plaintiffs and according to the bills, the amount has to be paid within a period of thirty days from the date of delivery of the goods. Though innocence is sought to be pleaded by the learned counsel for the appellant saying that this condition is not known, it is very difficult to accept the plea of the defendant since in commercial transactions when the goods were delivered on credit, the amount has to be paid within a short period and if that is not paid, naturally the persons will be entitled to the interest at agreed rate or at the market rate. In fact, Exs.B7 to B37 and Ex.B41, which were filed by the defendant clearly go to show that there was a term for payment of interest at 18% per annum, if the amount is not paid within 30 days. Therefore, the contention of the appellant that there is no liability to pay interest is not valid.         

10.     It is true that in the legal notice and also the accounts filed by the plaintiffs, the particulars of crediting of the interest were not mentioned. But, however, when once the fact that there is a liability to pay interest is accepted, it is a matter of calculation as to how the interest is to be arrived at. In fact, several entries contained in Ex.A52 and also other statements filed with regard to the other suit clearly go to show that how there was a delay payment. Therefore, in view of the above circumstances, when there is nothing on record to show that the plaintiffs have  waived the right of recovery of the interest, as per the contract, a calculation can be made with regard to the delay payments and amount can be claimed. Therefore, merely because the ledger account did not show the interest pleaded from time to time, the claim of the plaintiffs for recovery of the interest cannot be denied. 

11.     Therefore, from the above circumstances, I hold that the claim of the plaintiffs for total amount and also the interest for the delayed amount cannot be doubted since there is no other evidence on the side of the defendant to dispute the correctness of the above claim. Consequently, the finding of the Court below in decreeing the suits for the amount claimed is correct. But, however, as rightly claimed by the counsel for the appellant since the suit itself is one for recovery of the interest, which has accrued on the principal amount, the grant of further interest subsequent to the filing of the suit is not valid since it is granting of interest over the interest which is not according to law.  Therefore, to the extent of the above, the appeals are to be allowed.

12.     Accordingly the suit O.S.No.323 of 1985 was decreed for the suit sum with interest at 12% per annum on the principal sum of Rs.11,486.73 Ps instead of 18% per annum. So far as the interest granted over the interest is deleted.  Similarly, the O.S.No.557 of 1986 is decreed for a sum of Rs.563.89 Ps with interest at 12% per annum and the decree of the lower Court in granting interest on interest of Rs.7,180.58  Ps is deleted.

13.     With the above findings, both the appeals are allowed accordingly.  No costs. Consequently, the miscellaneous petitions, if any, pending in these appeals shall stand closed.

                                                              

___________________________

N.R.L.NAGESWARA RAO, J

15^th February, 2013.

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THE HON’BLE SRI JUSTICE N.R.L.NAGESWARA RAO 

C.C.C.A.NO.34 OF 1993 & TR.A.S.NO.145 OF 2010

                                     15^th February, 2013

inl/kkm