Privi Exports PVT LTD vs. Ratan Ladha

Held

The Court held that the plaintiff had successfully proved its principal claim of Rs. 3,06,56,535.00. The Court found that the parties maintained mutual, current, and continuous accounts, evidenced by the defendant's written confirmations which were duly proved. The final balance confirmation dated April 1, 2023, established the principal amount due. Regarding the claim for interest at 12% per annum, the Court found that the rate of interest was never explicitly agreed upon between the parties. While acknowledging that interest on delayed payments in commercial transactions is essential, the Court held that in the absence of an agreed rate, it is within the court's discretion to grant interest. Consequently, the Court decreed the principal sum of Rs. 3,06,56,535.00 along with interest at 8% per annum from April 1, 2023, until realization. The Court noted that the defendant had not participated in the mediation process and had not cross-examined the plaintiff's witness.

Facts

This commercial suit was filed by Privi Exports Pvt. Ltd. (plaintiff) against Ratan Ladha (defendant) for recovery of outstanding dues. The defendant failed to file a written statement, leading to the suit being marked as undefended. The plaintiff supplied various plastic granules and sweepings to the defendant on high-sea sales and from its go-down between April 1, 2016, and March 31, 2020. The terms included payment within 30 days with a default interest of 12% per annum and maintenance of an open, running account. The defendant made part payments over these periods, but substantial balances remained due. The plaintiff provided e-way bills for GST purposes. The defendant confirmed the outstanding balances in writing on multiple occasions. After a demand notice and failed pre-institution mediation, the plaintiff claimed the principal amount and interest. The plaintiff's witness was not cross-examined by the defendant.

Key Issues

1. Whether the plaintiff has successfully proved its principal claim of Rs. 3,06,56,535.00 against the defendant, considering the documentary evidence and the defendant's failure to contest the claim. (Question of fact and law) 2. Whether the plaintiff is entitled to claim interest at the agreed rate of 12% per annum on the outstanding principal amount, as per the terms of the agreement and commercial transaction principles. (Question of law) Petitioner/Plaintiff's Arguments: Mr. K. C. Garg, learned counsel for the plaintiff, argued that the plaintiff had sold and delivered goods as per the defendant's orders, and the transactions were supported by bills (PD-2, PD-3, PD-4) and confirmed by the defendant's written balance confirmations (PD-6, PD-9, PD-11, PD-12). He contended that the plaintiff had proved its case through evidence on affidavit and examination-in-chief, and the defendant's failure to cross-examine the plaintiff's witness meant the evidence remained unchallenged. The plaintiff claimed interest at 12% per annum based on the agreement and commercial nature of the transaction. Revenue/State's Arguments: No arguments were recorded for the revenue or state, as this was a commercial suit between private parties.