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2002 DIGILAW 9 (AP)

Pati Chandraiah v. D. Satyanarayana

2002-01-03

L.NARASIMHA REDDY

body2002
L. NARASIMHA REDDY, J. ( 1 ) THIS revision is filed by the defendant in Small Causes Suit No. 188 of 1998 on the file of the Principal Senior Civil Judge, Tirupati, against the order dated 20-11-1999. ( 2 ) THE respondent filed the suit alleging that the petitioner is an agent of Unit Trust of India (UTI) and several other financial institutions and that on 17-4-1997, he paid an amount of Rs. 5,000. 00 to the petitioner through cheque, for the purpose of purchase of Units in the UTI. According to him, neither any certificates of Units of Fixed Deposit Receipts (FDRs) from any other financial institutions were delivered to him nor the amount was refunded. Therefore, he filed the suit for recovery of the amount of Rs. 5,000. 00 together with interest at the rate of 24% from 17-4-1997 to 26-8-1998. ( 3 ) THE petitioner resisted the claim stating that on the request of the respondent, he had taken the DD in favour of the CRB Corporation Limited, Hyderabad (for short the Corporation ) and sent the same along with the application to the Corporation through courier service and since the Corporation went into liquidation, he could not obtain and deliver the necessary FDRs. He ultimately denied his liability to refund the amount. ( 4 ) THE trial Court framed the issues on the basis of the pleadings. The respondent was examined as PW1 and the petitioner was examined as DW1 and his employee as DW2. On behalf of the respondent, Exs. A1 to A6 were marked and on behalf of the petitioner, Exs. Bl to B15 were marked. The trial Court, through its judgment and decree dated 20-11-1999 decreed the suit as prayed for i. e. , for Rs. 5,000. 00 plus Rs. 1,626. 00 as interest at 24% per annum from 17-4-1997 to 26-8-1998 on Rs. 5,000. 00and further ordered 6% interest on Rs. 5,000. 00 from the date of filing of the suit till the date of realisation. Aggrieved by the same, the defendant filed the present suit. ( 5 ) SRI A. Bhaskara Chary, the learned Counsel for the petitioner, submits that the respondent failed to establish any liability on the part of the petitioner. 00and further ordered 6% interest on Rs. 5,000. 00 from the date of filing of the suit till the date of realisation. Aggrieved by the same, the defendant filed the present suit. ( 5 ) SRI A. Bhaskara Chary, the learned Counsel for the petitioner, submits that the respondent failed to establish any liability on the part of the petitioner. According to him, the petitioner had taken out the DD and forwarded the same to the Corporation together with application and as such he cannot be held to be liable to pay the same, if there is failure on the part of the Corporation to deliver the FDRs. He further contends that the claim of interest at the rate of 24% between 17-4-1997 and 26-8-1998 is not supported by any agreement nor there was any pleading that the same is provided under any Act and, as such, the decree to the extent of interest for the said period cannot be sustained. ( 6 ) SRI K. S. Gopala Krishnan, the learned Counsel for the respondent, on the other hand, submits that it is not in dispute that the petitioner acted as an Agent on behalf of the financial institution i. e. , the CRB Corporation and it is also not in dispute that he received an amount of Rs. 5,000. 00 for the purpose of securing the necessary FDRs and since the FDRs are not delivered, the petitioner, is under obligation to refund the amount. He states that the respondent has paid the Court fee on the amount of interest claimed in the suit and no exception can be taken to the same. ( 7 ) THE petitioner has been acting as an agent of the UTI and other financial institutions. It is a matter of record that he received an amount of Rs. 5,000. 00 on 17-4-1997 through cheque for the purpose of investment. While the respondent says that the amount was given for purchase of Units in the UTI, the petitioner claims that the amount was given to him for the purpose of investment in the Corporation. ( 8 ) BE that as it may, once the petitioner has accepted the amount for the purpose of investment in a financial institution for which he is acting as an Agent, he is under an obligation to deliver the necessary documents evidencing the investment or deposit. ( 8 ) BE that as it may, once the petitioner has accepted the amount for the purpose of investment in a financial institution for which he is acting as an Agent, he is under an obligation to deliver the necessary documents evidencing the investment or deposit. If he finds any difficulty in making such deposits or obtaining such documents subsequent to the deposit, he is under obligation to refund the amount to the respondent. This is the minimum that is expected of an Agent. An agent cannot disown the liability once he accepts the receipt of payment on behalf of his Principal. Therefore, the judgment and decree of the trial Court making the petitioner liable to refund the amount cannot be found fault with. ( 9 ) COMING to the question of interest, the respondent claimed the same at 24% between the date of payment and filing of the suit. It is well-established principle that payment of interest is a matter of agreement between the parties and in the absence of the same; it has to be governed by the provisions of the Interest Act. Though, the respondent paid the Court fee on the amount of interest claimed in the suit, no factual foundation has been laid down. The trial Court also did not undertake any discussion on this aspect, obviously because the pleadings in this regard were almost silent. However, on this ground, the petitioner cannot be burdened. Having regard to the facts and circumstances of the case, interest at 24% cannot be sustained. ( 10 ) ONCE it is established that the petitioner received the amount of Rs. 5,000. 00on 17-4-1997 and that the respondent neither paid the amount nor given any certificates or FDRs, it follows that the petitioner had the advantage of retaining the amount with him. Therefore, it is just and reasonable that he shall pay interest at the rate of 12% instead of 24% for the period between 17-4-1997 and 26-8-1998. The decree of the trial Court is, therefore, modified as regards the interest between 17-4-1997 and 26-8-1998 and in all other aspects, it shall stand. ( 11 ) SRI Bhaskara Chary, the learned Counsel for the petitioner, submits that since his client could not realise the amount or the documents from the Corporation, he needs co-operation from the respondent. The decree of the trial Court is, therefore, modified as regards the interest between 17-4-1997 and 26-8-1998 and in all other aspects, it shall stand. ( 11 ) SRI Bhaskara Chary, the learned Counsel for the petitioner, submits that since his client could not realise the amount or the documents from the Corporation, he needs co-operation from the respondent. As and when the petitioner submits any claim with the Corporation and the same needs any endorsement from the respondent, the respondent will comply with it. ( 12 ) THE civil revision petition is accordingly allowed in part to the extent indicated above. But, in the circumstances of the case, there shall be no order as to costs.