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2012 DIGILAW 2118 (BOM)

Gaffar Bilal Meena v. Ital Construction Represented by its Proprietor

2012-11-02

S.J.VAZIFDAR

body2012
Judgment: 1. This is an appeal by the defendant No2 against the judgment and decree dated 30th March, 2007 passed by the learned Civil Judge, Senior Division at Vasco-da-Gama, Goa, decreeing the suit filed by respondent No.1 in the sum of Rs. 20,87,740/- together with interest at the rate of 10% p.a. from the date of filing of the suit till date of payment. 2. Respondent No.1 was the plaintiff. Respondent No.2 - AIR-O-MEC Engineers was defendant No.1. The appellant and respondent Nos.3 and 4 were defendant Nos. 2, 3 and 4 respectively to the suit. The appellant and respondents No.3 and 4 were the partners of respondent No.2. I will, for convenience, refer to the parties as they were arrayed in the suit. 3. The plaintiff (respondent No.1) failed to appear. Mr. Thali states that he also failed to appear on the last date of hearing. Mr. Thali further states that the plaintiff has not even filed a Vakalatnama in this Court. I, accordingly, heard the appeal in his absence. 4. It is not necessary to refer to the pleadings and to the evidence, in detail for Mr. Thali, learned Counsel appearing on behalf of the appellant confined his argument to the aspects I will deal with in this judgment. It is sufficient to note only a few facts. The plaintiff, by a letter dated 1st August, 1997, placed a work order with the defendants in respect of certain civil works to be carried out by the defendants. The approximate value of the work was Rs.36,11,425/- as per the schedule of quantities attached thereto. Paragraph 11 of the letter stipulated that the work was to be completed in all respects by 1st February, 1998. By a letter dated 28th October, 1998, addressed by the plaintiff to the defendants, it was recorded that there would be certain changes in the consideration on account of an increase in quality of concreting and reinforcement and on account of additional work of land development, compound wall and sanitary and plumbing work. The total value of the work stood enhanced to Rs.54,82,000/-. The work was to be completed before December, 1998. 5. The plaintiff submitted running/interim bills from time to time in respect of the work completed and as required by clause 7 of the work order. The plaintiff admitted having been paid Rs.27,50,000/- in this regard. The total value of the work stood enhanced to Rs.54,82,000/-. The work was to be completed before December, 1998. 5. The plaintiff submitted running/interim bills from time to time in respect of the work completed and as required by clause 7 of the work order. The plaintiff admitted having been paid Rs.27,50,000/- in this regard. He also admitted having received a sum of Rs.10,49,800/-, directly from a third party, namely EDC Limited to the credit of the defendants. It is important to note that according to the plaintiff there remained a balance of Rs.16,60,740/- payable by the defendants to him. I will refer to certain further documents while dealing with the issues. Suffice it to note at this stage that the decree is sought by the plaintiff in the sum of Rs.20,87,740/-, including the said sum of Rs.16,60,740/- and interest thereon of Rs.5,27,000/- till the end of the year 2001. This aspect is important while dealing with the issue regarding the interest claimed by the plaintiff. 6. Defendant No.1 (respondent No.2) and two of its partners, namely defendant Nos. 3 and 4 (respondent Nos. 3 and 4) filed their written statement. Defendant No.2 (appellant) filed a separate written statement. Only defendant 2 has challenged the decree passed by the trial Court. Defendant No.2, in his written statement, generally denied the averments and submissions in the plaint and raised various contentions regarding the quality and the quantum of the work. He, however, neither examined himself nor any witness. 7. The plaintiff (respondent No.1) is the sole proprietory concern of one Ishant Furtado who examined himself and his site supervisor one Mahesh S. Mayannavar. They produced all the documents. The documents were tendered in evidence, taken on record and admitted by the trial Court. This included the documents that I will refer to. The admission of those documents was not objected to. It is also important to note that another partner, namely defendant No.3 (respondent No.3), examined himself. He has, in fact, admitted the documents which I will refer to, shortly. 8. The trial Court framed the following issues: ISSUES 1. Whether the plaintiffs prove that the defendants are individually and severally liable to pay to the plaintiff a sum of Rs.20,87,740/- (Rupees twenty lakhs eighty seven thousand seven hundred forty only) which are outstanding dues towards the constructions work carried out at Verna for the defendants ? 2. 8. The trial Court framed the following issues: ISSUES 1. Whether the plaintiffs prove that the defendants are individually and severally liable to pay to the plaintiff a sum of Rs.20,87,740/- (Rupees twenty lakhs eighty seven thousand seven hundred forty only) which are outstanding dues towards the constructions work carried out at Verna for the defendants ? 2. Whether the plaintiffs prove that the defendants are liable to pay interest at the rate of 18% p.a. from January, 2002 till actual date of payment? 3. Whether the defendant no.2 proves that the suit is barred by law of limitation? 4. What relief? What order? Re – Issue No.1 : Whether the plaintiffs prove that the defendants are individually and severally liable to pay to the plaintiff a sum of Rs.20,87,740/- (Rupees twenty lakhs eighty seven thousand seven hundred forty only) which are outstanding dues towards the constructions work carried out at Verna for the defendants ? 9. As noted earlier, the plaintiff from time to time, forwarded interim bills in respect of the work done, to the defendants. These bills are proved. Defendant No.2 (appellant) has not proved his case that the work was not as per the contractual specifications as to quality or quantity. He led no evidence in this regard. Defendant No.3 examined himself. In his affidavit-in-evidence, he admitted that by a letter dated 8 fa183-07 6th January, 2001, the defendants had requested for additional time to clear the outstanding dues. He stated that a sum of Rs.1,00,000/- has been paid in March, 2002. I have proceeded on the basis that this is correct and accordingly, granted respondent No.2 (appellant) credit for the same. In his cross examination, he admitted that the plaintiff had forwarded the bills and that the plaintiff had completed the work as per the agreement. He also admitted that there was no shortfall or deficiency in the plaintiff's work and that the bills were verified by him and by the defendant’s Architect. He, however, denied that the plaintiff is entitled to interest at the rate of 18% per annum. 10. The second defendant's (appellant's) advocate cross examined defendant No.3. He denied the suggestion that the plaintiff had not completed the work and that the work was defective. 11. The position then is this. The bills are 9 fa183-07 established. He, however, denied that the plaintiff is entitled to interest at the rate of 18% per annum. 10. The second defendant's (appellant's) advocate cross examined defendant No.3. He denied the suggestion that the plaintiff had not completed the work and that the work was defective. 11. The position then is this. The bills are 9 fa183-07 established. The plaintiff proved that he completed the work as per the work order and the amended work order. The defendants also admitted that a sum of Rs.16,60,740/- was due. Out of this amount, must be deducted a sum of Rs.1,00,000/- stated by the defendants to have been paid in March, 2002. The plaintiff admitted having received the same in paragraph 9 of the plaint. Thus, the principal sum is Rs.15,60,740/-. The plaintiff claimed the decree in the sum of Rs. 20,87,740/-. The difference is on account of the interest that the plaintiff claimed. The plaintiff was not entitled to include in the decretal amount as principal the interest of a sum of Rs.5,27,000/- which was calculated at 18% per annum. The work order dated 1st August, 1997 and the additional work order dated 20th October, 1998 do not provide for any interest. The plaintiff, however, by a letter dated 22nd October, 2002, inter alia, demanded interest at 18% p.a.. Thus, under the Interest Act, the plaintiff is entitled to interest from the date of the notice i.e. 22nd October, 2002 to the date of the suit. The plaintiff is also entitled to interest from the date of filing of the suit i.e. 31.12.2003 till the date of the decree. 12. Thus, the suit is liable to be decreed for a sum of Rs.15,60,740/- together with interest thereon at the rate of 18 % p.a. from 22nd October, 2002 to 31st December, 2003. Issue no.1 is, therefore, answered accordingly. Re Issue No.2: Whether the plaintiffs prove that the defendants are liable to pay interest at the rate of 18% p.a. from January, 2002 till actual date of payment? 13. While dealing with issue no.1, I have held that the plaintiff is entitled to interest at 18% p.a. on the sum of Rs.15,60,740/- from 22nd October, 2002 till the date of filing of the suit i.e. 31st December, 2003. 13. While dealing with issue no.1, I have held that the plaintiff is entitled to interest at 18% p.a. on the sum of Rs.15,60,740/- from 22nd October, 2002 till the date of filing of the suit i.e. 31st December, 2003. The plaintiff would not be entitled to interest from January, 11 fa183-07 2002 as the agreement does not provide for any interest and the notice demanding interest is dated 22nd October, 2002. Issue no.2 is answered accordingly. 14. There is no warrant for interfering with the rate of interest i.e. 10% from the date of the suit till the date of the decree. The plaintiff (respondent No.1) has, however, failed to appear. There is no evidence regarding the rate of interest under Section 34. The rate of interest, therefore, after the date of the decree must be limited to 6% p.a. Thus, with regard to issue no.2, it must be held that the plaintiff (respondent No.1) is entitled to interest on Rs.15,60,740/- at 10% p.a. from the date of the filing of the suit i.e. 31.12.2003 till the date of the decree i.e. 30th March, 2007 and, thereafter, at 6% p.a. till payment and/or realisation. Re Issue No.3: Whether the defendant no.2 proves that the suit is barred by law of limitation ? 15. Mr. Thali submitted that the suit is barred by limitation. He submitted that the work was to be completed by December, 1998. The suit having been filed on 31st December, 2003 is, therefore, according to him, barred by limitation. He submitted that the payment of the sum of Rs.1,00,000/- on account in March, 2002 cannot save the bar of limitation for the payment was made beyond the original period of limitation. 16. I will assume that part payment of Rs.1,00,000/- was made in March, 2002, but the same cannot save the bar of limitation, as it was made after the expiry of the period of limitation. That, however, is not the end of the matter. It is of vital importance to note that in paragraph 10 of the plaint, the plaintiff stated that the defendants had, by a letter dated 6th January, 2002 acknowledged the outstanding dues to be cleared by them and further stated that they be given 4 months' time to clear the dues. The letter dated 6th 13 fa183-07 January, 2002 reads as under: “Sub.:- Clearing of dues – Sum of Rs. 20,87,740/-. The letter dated 6th 13 fa183-07 January, 2002 reads as under: “Sub.:- Clearing of dues – Sum of Rs. 20,87,740/-. Dear Sir, We acknowledge for having received your letter dated 8th Sept. 2001. We agree that we have to pay you above stated amount towards construction of factory building at Verna Industrial Estate. However there might be some delay due to the financial burden, we request you to keep the discount alive till we settle your dues, that might take four months time from the date of this letter. We thank you for extending your Co-operation and bear with us for some more time. Thanking you. Yours truly, For Air-O-Mec Engineers.) Sd/- (B.F. Correia) Partner” 17. Before considering this letter, it is necessary to note that the letter is admitted by defendant Nos. 1, 3 and 4 and has been established against defendant No.2 (the appellant). Defendant No.2, in paragraph 10-(b) of his written statement alleged that the letter had not been written by him and that it was fabricated and his signature was forged. The appellant, however, neither examined himself nor adduced any other evidence. On the other hand, his other partners i.e. defendant Nos. 3 and 4 admitted the letter. Defendant No.3 who had signed the letter admitted having written the letter. Further, the letter was tendered in evidence. No objection was raised. The letter was marked in evidence. It is impossible, therefore, to ignore the letter. 18. The letter dated 6th January, 2002 (Exhibit 33) is not merely an acknowledgment of the debt. It constitutes a promise to pay the debt. The letter does not merely state that the defendants agreed that they have to pay the said amount, but requested the plaintiff for time to pay the same. Even more important is the fact that the letter expressly states that it would take 4 months' time to make the payment. In conclusion, it thanked the plaintiff for extending his co-operation and bearing with the defendants. This is, indeed, an express promise to pay the time-barred debt. Even assuming that the debt was barred, the letter properly construed discloses an intention and a promise to pay the time barred debt. The contention that the claim is barred by limitation is rejected. 19. Issue no.3 is, accordingly, answered in the negative i.e. in favour of the plaintiff. 20. Even assuming that the debt was barred, the letter properly construed discloses an intention and a promise to pay the time barred debt. The contention that the claim is barred by limitation is rejected. 19. Issue no.3 is, accordingly, answered in the negative i.e. in favour of the plaintiff. 20. In the circumstances, issue No.1 is answered in the affirmative, but to the extent of Rs.15,60,740/-, together with interest thereon at 18% p.a. from 22nd October, 2002 to 31st December, 2003. Issue No.2 is answered in favour of the plaintiff, but as discussed above. Issue no.3 is, answered in the negative i.e. in favour of the plaintiff. 21. The appeal is disposed of by modifying the decree to the limited extent indicated above. The appeal is, therefore, disposed of by the following order and decree : The suit is decreed in favour of the plaintiff i.e. respondent No.1 and against the appellant (defendant No.2) in the sum of Rs.15,60,740/-, together with interest thereon at the rate of 18% p.a. from 22nd October, 2002 to 31st December, 2003 and at the rate of 10% p.a. from 1st January, 2004 till 30th March, 2007 and, thereafter, at 6% p.a. The order as to costs is upheld. The decree of the trial Court against the other defendants stands as they have not challenged the judgment. As the plaintiff-first respondent has remained absent during the hearing of the appeal, there shall be no order as to costs of the appeal.