w w w . L a w y e r S e r v i c e s . i n



M/s Jaga Industries, Rep. by its Managing Partner M. Jeganathan & Another v/s M/s Sulochana Cotton Spinning Mills Pvt. Ltd., Rep. by its Managing Director S. Krishnakumar


Company & Directors' Information:- P A S COTTON MILLS PRIVATE LIMITED [Active] CIN = U17111TN2005PTC058104

Company & Directors' Information:- V R A COTTON MILLS PRIVATE LIMITED [Active] CIN = U15311PB1997PTC020061

Company & Directors' Information:- C A V COTTON MILLS PRIVATE LIMITED [Active] CIN = U17115TZ1987PTC002014

Company & Directors' Information:- SULOCHANA COTTON SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1990PTC002580

Company & Directors' Information:- V K S M COTTON MILLS LIMITED [Active] CIN = U17111TZ1998PLC008682

Company & Directors' Information:- P K COTTON MILLS PRIVATE LIMITED [Active] CIN = U17111DL2004PTC130281

Company & Directors' Information:- K G COTTON SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17219PB1997PTC019422

Company & Directors' Information:- K P G COTTON MILLS PRIVATE LIMITED [Active] CIN = U17115TZ1993PTC004509

Company & Directors' Information:- D B V COTTON MILLS PRIVATE LIMITED [Active] CIN = U17115TZ1982PTC001145

Company & Directors' Information:- SULOCHANA INDUSTRIES PRIVATE LIMITED [Under Process of Striking Off] CIN = U24230JH2006PTC012560

Company & Directors' Information:- S S COTTON MILLS PRIVATE LIMITED [Active] CIN = U17115PB1997PTC019918

Company & Directors' Information:- P R COTTON INDUSTRIES PRIVATE LTD. [Active] CIN = U74899DL1987PTC028281

Company & Directors' Information:- J R COTTON MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TN1996PTC034302

Company & Directors' Information:- D C H COTTON MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ1997PTC008130

Company & Directors' Information:- L D COTTON MILLS PRIVATE LIMITED [Strike Off] CIN = U17291MH2014PTC256832

Company & Directors' Information:- A D COTTON MILLS PVT LTD [Active] CIN = U99999MH1970PTC014837

Company & Directors' Information:- J S COTTON SPINNING MILLS PRIVATE LIMITED [Amalgamated] CIN = U17111TZ1990PTC002643

Company & Directors' Information:- V P K COTTON MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ2000PTC009530

Company & Directors' Information:- KRISHNAKUMAR MILLS COMPANY LIMITED [Not available for efiling] CIN = U99999MH1951PLC010099

    A.S.No.895 of 2008

    Decided On, 25 January 2012

    At, High Court of Judicature at Madras

    By, THE HONOURABLE MR. JUSTICE G. RAJASURIA

    For the Appellants: P. Valliappan, Advocate. For the Respondent: M/s. T.R. Rajaraman, Advocate.



Judgment Text

(Prayer: This appeal is focussed as against the judgment and decree of the Additional District Court (Fast Track Court No.4 of Coimbatore) at Tiruppur dated 30.07.2008 in O.S.No.620 of 2004.)

1. This appeal is focussed by the defendants as against the judgment and decree dated 30.07.2008 made in O.S.No.620 of 2004 on the file of the Additional District Court (Fast Track Court No.4 of Coimbatore) at Tiruppur. The parties are referred to hereunder according to their litigative status and ranking before the trial Court.

2. A summation and summarisation of the relevant facts absolutely necessary and germane for the disposal of this appeal would run thus:

The plaintiff filed the suit with the following prayer for recovery of a sum of Rs.7,19,583/- with interest:

"(a) To direct the defendant to repay the above sum of Rs.7,19,583/- together with interest at 24% per annum on Rs.6,25,000/- from the date of suit till date of realisation; and

(b) for costs." (extracted as such)

3. The defendants filed the written statement resisting the suit; whereupon issues were framed.

4. During trial, on the side of the plaintiff, P.W.1-Muthu Palaniappan and P.W.2-Jayaraman were examined and Exs.A1 to A8 were marked. On the side of the defendants, the second defendant-Jeganathan examined himself as D.W.1 and Exs.B1 to B6 were marked.

5. Ultimately, the trial Court decreed the suit. Being aggrieved by and dissatisfied with the said judgment and decree of the trial Court, the appellants/defendants preferred this appeal on various grounds.

6. The learned counsel for the appellants/defendants placing reliance on the grounds of appeal would put forth and set forth his arguments, which could pithily and precisely be set out thus:

(a) The trial Court failed to take into account that even by January 2004 the plaintiff did not hand over the demised premises, namely the factory with fixtures and fittings in view of Exs.B1 and B3 letters.

(b) As envisaged in Ex.B2, the surrender of possession by 15.09.2003, which happened to be the date earlier agreed for handing over possession by the plaintiff in favour of the defendants should be borne by documentary evidence. In the absence of such document evidencing the alleged surrender of the premises by the plaintiff in favour of the defendants, the trial Court ought not to have simply decreed the suit accepting the case of the plaintiff for gospel truth.

(c) Merely because reply was not given to the notice sent by the plaintiff to the defendants, it does not mean that the defendants accepted the contentions of the plaintiff in Ex.A4.

(d) The trial Court wrongly placed reliance on the statement of the defendants in W.P.No.29791 of 2003.

(e) The rate of interest awarded by the trial Court was erroneous and enormous.

Accordingly, the learned counsel for the appellants/defendants would pray for setting aside the judgment and decree of the trial Court and for the dismissal of the suit.

7. In a bid to torpedo and pulverise the arguments as put forth and set forth on the side of the appellants/defendants, the learned counsel for the respondent/plaintiff would pilot his arguments inviting the attention of this Court to various portions of the records, which could tersely and briefly be set out thus:

(a) On the expiry of eleven months' period of lease, the plaintiff handed over physical possession of the factory premises in favour of the defendants. The correspondences would unambiguously and unequivocally highlight and spotlight the fact that by 15.09.2003 itself the demised premises was handed over by the plaintiff in favour of the defendants. Inasmuch as the defendants raised certain queries relating to performance of repairs to be carried out by the plaintiff, the latter by way of purchasing peace, sent certain correspondences agreeing to carry out the repairs etc., but that it does not mean that possession of the premises was not handed over on the expiry of the lease period.

(b) The trial court took into account correctly and appropriately the statement of the defendants before the writ court in the writ proceedings. As such, no interference with the reasoned findings of the trial Court, is warranted.

Accordingly, the learned counsel for the respondent/plaintiff would pray for the dismissal of the appeal.

8. The points for consideration are as to:

(1) Whether the trial Court was justified in interpreting the correspondences to the effect that the demised premises was handed over by the plaintiff to the defendants on the expiry of the lease period, so to say by 15.09.2003, even though the correspondences would speak to the effect that the premises was not in usable condition even in the month of January 2004?

(2) Whether the trial Court was justified in awarding 24% pre suit interest, together with pendentelite interest as well as post decreetal interest?

(3) Whether there is any perversity or illegality in the judgment and decree of the trial Court?

9. All these points are taken together for discussion as they are inter-linked and inter-woven with one another.

10. The indubitable and indisputable or atleast, the undeniable and unarguable facts would run thus:

The plaintiff and the defendants entered into an agreement of lease, vide Ex.A3 dated 11.09.2002, whereby the latter leased out their factory premises in favour of the former for eleven months at a monthly rent of Rs.50,000/- after receiving an advance of Rs.12 lakhs. There is no dispute regarding the lease period. The fact remains that after the expiry of the lease period, on the one hand, the plaintiff would contend that the premises was handed over in good condition to the defendants; whereas, the defendants would gainsay the same and contend that the premises was not handed over as alleged by the plaintiff and whereupon alone, the defendants raised objections and that was also responded to positively to some extent by the plaintiff, but not fully to the satisfaction of the defendants.

11. Pellucidly and palpably, apparently and obviously, the plaintiff did not take care to obtain a receipt or any memorandum evidencing that the demised premises was handed over in good condition to the defendants and that is a draw back and a weak point on the side of the plaintiff.

12. On the side of the defendants, I could see also a weak point, because the defendants did not take any steps to get the demised premises surveyed by an authorised surveyor at the relevant time. Had that been done, then there would not have been any trouble at all relating to the usable condition of the factory premises soon after the expiry of the lease period. As such, both sides went to trial with patchy as well as insufficient evidence. In this factual matrix, the Court cannot throw the baby along with the bath water, but in the interest of justice should from the available evidence on record see to what extent remedy could be provided to either side keeping in mind "Lexsemper dabit remedium : The Law ever provides a remedy.

13. Certain excerpts from some exhibits are worthy of being set out hereunder.

(a) An excerpt from Ex.B1- the letter sent by the defendant Mills to the Managing Director of the plaintiff Industries, would run thus:

".......Just imagine the situation, that would be in other areas. I have been noticing that just care is not taken in all areas. Only money is spent unproductively. Hence at the request of Mr.Palaniappan & Mr.Jayaraman, I have agreed to carry out the necessary work inside the factory area. I have requested them to atleast complete the work on ETP side so that the factory could be leased to other party. For your kind information, I had been assured of the handing over of the factory in proper condition latest by end October 2003."

(b) An excerpt from Ex.B2 - the letter sent by the defendant Mills to the plaintiff Industries, would run thus:

"...........................

The Premises detailed in the agreement duly cleaned and painted.

Kindly take proper care in handling the above and the same to be delivered back to us in the same condition as per the agreement on the completion of the agreement."

(c) An excerpt from Ex.B3 - the letter sent by the defendant Mills to the Managing Director of the plaintiff Industries, would run thus:

".....With regard to handling over the premises leased by you from us, I am very sorry to inform you that till today no proper are has been taken from your deputees. About 10 days ago, Mr.Palaniappan & Mr.Jayaram did meet me and informed that they weer in perfect position to hand over the factory. I went to the dyeing factory for inspection and to the distres I found few of the winches were not even mounted properly. I believe that the re-erection has been assigned to the contractors and before calling me nobody cared to see whether the job has been done properly.

In addition, the ETP was not cleaned and few alterations have been made by your consultant, which was not brought back to original condition. Further more there wee few breakages and missing installations, which would render ETP not functional. I have painted out these to your deputees.

Yesterday there was a SMS from Mr.Palaniappan which reads as follows.

"All work completed pls arrange cheque tomorrow positively Palaniappan sulochana mills........"

14. A cumulative reading of those documents would unambiguously and unequivocally display and demonstrate, project and establish that the plaintiff also admitted that certain repairs should be carried out as expected by the defendants in the demised premises even during the month of January 2004. The SMS referred to in Ex.B3 would evidence that even according to the plaintiff only during the month of January 2004 the repair works were completed by them and they demanded cheque in respect of the remaining advance amount payable by the defendants in favour of the plaintiff.

15. The learned counsel for the defendants placing reliance on that SMS would argue that the admission as contained therein would give a go bye to the cause of action alleged in the plaint and as such on that ground itself, the entire suit could be dismissed adhering to the principle that even a little bit falsity would non-suit the plaintiff. Whereas, the learned counsel for the plaintiff would submit that because the plaintiff in order to purchase peace positively responded to the request of the defendants and carried out certain repairs, the Court cannot arrive at the conclusion that the plaintiff did not hand over possession of the demised premises after the expiry of the lease period of eleven months i.e. by 15.09.2003.

16. To the risk of repetition and pleonasm, but without being tautologous, I would like to point out that in the absence of clinching evidence adduced on either side, what the Court could understand from the available records is that even during the month of January 2004 and until the first week of February, no settlement or consensus was arrived at between the parties relating to the actual handing over and taking over of the premises. No doubt, the learned counsel for the plaintiff would try to garner strength based on the statement of the defendants in the writ proceedings in W.P.No.29791 of 2003. He would try to advance his arguments by pointing out that had not really possession of the demised premises been handed over, then in the writ proceedings which were pending during the last quarter of the year 2003, certainly the defendants would have detailed and delineated about the default committed by the plaintiff. Per contra, the defendants were accepting their status as that of the occupiers and accordingly, they participated in the writ proceedings which were initiated by an association complaining about the pollution of Noyyalaru river by the factories thereabout.

17. I would like to observe that simply because in the writ proceedings the defendants did not plead that they were not in physical possession, but only the plaintiff was in possession of the premises, that it does not mean that they should be mulcted with liability. The writ proceedings are entirely different from the civil proceedings. In the writ proceedings indubitably initiated by an association so as to safeguard the purity of Noyyalar river, one cannot expect the defendants to elaborate and detail the inter se dispute between the plaintiff and the defendants herein. As such, I am of the considered view that the plaintiff cannot try to make a mountain out of a mole hill. Before the civil Court the plaintiff should prove the facts adhering to the maxims:

(1) Affirmantisest probare: The person who affirms must prove.

(2) Affirmanti, non neganti, incumbit probatio: The proof is incumbent on the one who affirms, not on the one who denies.

But the plaintiff did not adduce clear evidence that by the end of the lease period, possession was handed over by the plaintiff to the defendants. On 13.02.2004, the defendants issued a cheque for a sum of Rs.1,25,000/- towards the remaining part of the advance amount and that itself is indicative of the fact that the defendants got satisfied with the conduct of the plaintiff and whereupon alone such amount was issued. My mind is redolent and reminiscent of the maxim: Actaexteriora indicant interiora secreta: Outwards acts indicate the thoughts hidden within. Anterior to the issuance of the cheque on 13.02.2004 by the defendants in favour of the plaintiff, they were at logger heads and they cannot see eye to eye. In such a case, the logical conclusion would be that as on 13.02.2004, the defendants got satisfied about the handing over of possession by the plaintiff in favour of the defendants and now it is too late in the day on the part of the defendants to veer round and take a plea quite antithetical to their own conduct during February in issuing the cheque dated 13.02.2004.

18. The core question arises as to whether the defendants were entitled to claim rent till 13.02.2004.

19. The learned counsel for the plaintiff would vehemently argue that simply because on 13.02.2004, belatedly a cheque was issued by the defendants, there is no legal inference that only on 13.02.2004 the plaintiff handed over possession to the defendants. He would also submit that already a sum of Rupees one lakh representing two months' rent also was paid by the plaintiff to the defendants by way of purchasing peace.

20. The learned counsel for the defendants would submit that the SMS sent by the plaintiff would clearly exemplify and establish that repairs were carried out by the plaintiff. As has been already highlighted supra, when evidence is patchy and sketchy, weak and meek, and the parties did not adduce best evidence before the Court, then from the available evidence alone the Court could draw inference and render justice. Both the plaintiff and the defendants with infinite caution should have conducted themselves in getting the happenings recorded properly atleast after the arisal of the dispute, even that they had not done so, and it is quite evident from the discussion supra. I hark back to the maxim : In re dubia magis infitiatio quam affirmatio intelligenda : In a doubtful matter, the negation is to be understood rather than the affirmation.

21. Wherefore, I am of the view considered that upto the first week of February 2004 the dispute continued, and thereafter alone, during the second week of February 2004 the defendants issued such the cheque dated 13.02.2004. As such, I hold that even after the expiry of the eleven months period on 15.09.2003, the plaintiff was liable to pay the rent to the defendants for a period of four months and three weeks, so to say upto the first week of February 2004 and out of that, already the plaintiff paid two months' rent and as such, there remains arrears of rent for a period of two months and three weeks, which would come to Rs.1,37,500/-. Even on this, the learned counsel for the defendants would try to put forth his argument to the effect that the said sum of rupees one lakh was paid not towards rent, but only for carrying out certain painting works, for which absolutely I could see no shred or shard, iota or miniscule, jot or molecular extent of evidence on record; wherefore, I do not countenance and uphold such an argument on the side of the defendants.

22. The next phase of analysis would be on pre-suit interest, pendentelite interest and post decreetal interest, which were awarded at the rate of 24% per annum and which in my considered opinion is exorbitant. Section 34 of the Code of Civil Procedure is extracted hereunder for ready reference:

"(34.) Interest

(1) Where and in so far as a decree is for the payment of money, the Court may, in the decree, order interest at such rate as the Court deems reasonable to be paid on the principal sum adjudged, from the date of the suit to the date of the decree, in addition to any interest adjudged on such principal sum for any period prior to the institution of the suit, with further interest at such rate not exceeding six per cent, per annum as the Court deems reasonable on such principal sum from the date of the decree to the date of payment, or to such earlier date as the Court thinks fit:

[Provided that where the liability in relation to the sum so adjudged had arisen out of a commercial transaction, the rate of such further interest may exceed six per cent, per annum, but shall not exceed the contractual rate of interest or where there is no contractual rate, the rate at which moneys are lent or advanced by nationalised banks in relation to commercial transactions."

23. It

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is only the discretion of the Court to award pendentelite interest as well as post decreetal interest. If the transaction is a commercial one, then contractual interest could be awarded right from pre-suit stage till realisation, but here there was no contract between the rival parties relating to payment of interest. Taking into account the inconvenience and discomfiture to which the plaintiff would be put into, pendentelite interest and post decreetal interest could be awarded and in the meantime, it should not be excessive. Pre-suit interest in view of my discussion supra could be awarded and the trial Court without any sound reason awarded it warranting interference by this Court in this appeal. Even in the banking sector, 24% interest per annum is not contemplated. Hence, I am of the view that awarding 9.5% interest per annum from the date of the suit till the date of realisation would meet the ends of justice. Accordingly, the aforesaid points are answered. 24. The calculation would run thus: Advance amount to be returned by the defendants: Rs.6,25,000/- Amount to be paid by the plaintiff towards four months' and three weeks rent : Rs.2,37,500/- Amount already paid by the plaintiff towards two months' rent : Rs.1,00,000/- ----------------------- Amount to be paid by the plaintiff towards remaining two months' and three weeks rent : Rs.1,37,500/- Remaining advance amount yet to be paid by the defendants : Rs.4,87,500/- Interest payable on the aforesaid amount from the date of the suit till the date of realisation : 9.5% 25. In the result, the judgment of the trial Court shall stand modified as under: The defendants are directed to pay a sum of Rs.4,87,500/- (Rupees four lakhs eighty seven thousand and five hundred only) to the plaintiff, with 9.5% per annum from the date of suit till the date of realisation on the said sum along with trial Court costs.
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