Disposed

National Insurance Co. Ltd. v. M/S Hotel Natraj

Gauhati HC4 Apr 2019RSA/101/2007

Case brief

AI extract

What is this about?

Second appeal disposed via out-of-court settlement. High Court directed appellant to pay respondent Rs. 1,42,897.10 representing outstanding debt, interest, and costs arising from a hotel accommodation contract dispute, with payment due within four weeks.

What did the court decide?

Direction to appellant to pay respondent Rs. 1,42,897.10 within four weeks; Local Court Records suspended.

National Insurance Co. Ltd. Vs M/S Hotel… — Contract and Commercial Disputes | Gauhati HC (2019)

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Page No.# 1/5

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GAHC010002732007

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THE GAUHATI HIGH COURT

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(HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

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Case No. : RSA 101/2007

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1:NATIONAL INSURANCE CO. LTD.

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REGD. OFFICE AT 3 MIDDLETON STREET, KOLKATA-71, DIVISIONAL OFFICE AMONGST OTHERS AT MANCOTTA ROAD, DIBRUGARH TOWN, PO, PS/DIST. DIBRUGARH, ASSAM.

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VERSUS

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1:M/S HOTEL NATRAJ

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HAVING ITS PLACE OF BUSINESS AT H.S.ROAD, DIBRUGARH TOWN, PO/PS/DIST. DIBRUGARH, ASSAM.

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Advocate for the Petitioner : MR.S S SARMA Advocate for the Respondent : MD.A KHAN

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:: BEFORE ::

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HON’BLE MR. JUSTICE PRASANTA KUMAR DEKA

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-O R D E R-

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04.04.2019

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Heard Mr. SS Sharma, learned Senior Counsel assisted by Mr. BJ Mukherjee, learned counsel for the appellant. Also heard Mr. PKR Choudhury, learned counsel for the respondent.

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The respondent/ plaintiff filed a suit for recovery of Rs. 4,64,293.79. The defendant/ appellant, the National Insurance Company Limited through its Divisional Manager requested and called quotation from the respondent/ plaintiff for providing accommodation facility together with facility of breakfast, lunch and dinner for 20 (twenty) persons for accommodation and training centre for Inspectors on permanent basis. The quotation was

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Page No.# 2/5

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sent and after negotiation the defendant/ appellant on 18.05.1990 accepted the rate and directed the plaintiff/ respondent to provide accommodation for 26 (twenty six) persons from 20.05.1990. Hotel was booked from time to time for the purpose of training. But it was seen that number of persons in most sessions were less than 20 and the participants in the training centre were decreasing day by day. This reduction caused loss to the plaintiff/ respondent. Accordingly, it wrote a letter to the defendant/ appellant requesting to give minimum guarantee of 20 persons in each session. Though there was a written up communication but the defendant/ appellant failed to give the assurance as sought for. The plaintiff/ respondent asked the defendant to increase the contract rate by 20% due to increase of prices of all commodities. Finally, the defendant/ appellant agreed to give minimum guarantee of 14 persons and to increase the price by 10% w.e.f. 01.09.1999. The plaintiff/ respondent used to submit the bill on minimum guarantee basis and the defendant/ appellant used to pay on actual participant basis. The defendant/ appellant stopped availing accommodation and kept only one office room. The said act of keeping only one office room caused loss to the plaintiff/ respondent and intimated the defendant/ appellant that it would be difficult on their part to allot the office room at the subsidised rate of Rs. 172.50 and the same would be charged @ Rs. 350/- w.e.f. April, 1992. The defendant/ appellant left the office room w.e.f. 01.11.1992. Hence, the suit was filed for recovery of the aforesaid amount.

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The defendant/ appellant contested the suit. It denied about the minimum guarantee of 20 persons as pleaded in the plaint. Rather, it was the stand that they used to pay on the basis of actual participants since there was no contract of guarantee of 20 persons. It was further denied that the plaintiff/ respondent used to receive the payment under protest as alleged. Accordingly, it was sought for dismissal of the suit.

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The learned trial court after framing of issues decreed the suit in favour of the plaintiff/ respondent and ordered that the suit be decreed for Rs. 3,79,933/- only to be paid within 3 months failing which interest at the rate of 12% per annum from the date of decree with cost of Rs. 15,775.85.

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Money Appeal No. 8/2006 was filed in the court of learned District Judge, Dibrugarh. Vide judgment and decree dated 24.04.2007 the first appellate court reduced the principal

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amount to Rs. 2,80,669/- with interest at the rate of 20% per annum. Initially RFA 29/2000 was filed in this court but was sent to the court of learned District Judge, Dibrugarh upon increase of the pecuniary appellate jurisdiction by this court after directing to deposit 50% of the decreetal amount due vide order dated 29.03.2012 passed in MC 3149/2011. In compliance of the order, Rs. 1,89,967/- was deposited. Thereafter the learned District Judge, Dibrugarh modified the decree and reduced the principal amount to Rs. 2,80,669/- without distributing the 12% interest of pre-suit period and maintained 12% interest on principal in decree plus cost of Rs. 10,000/-. Both the courts below did not grant pendente lite interest. The plaintiff/ respondent did not file appeal against the order of the appellate court and as such the same attained finality. On the other hand, the defendant/ appellant filed this second appeal which was admitted on 01.10.2017 after formulating the following substantial questions of law:

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1. Was the learned appellate court justified to pass the decree for alleged unpaid rent at enhanced rate in view of clear receipts given by the plaintiff receiving the rent, as per occupancy?

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2. Was it proper for the learned courts below to increase the rent at agreed minimum guarantee of occupancy from 1.1.1991?

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3. Whether court has the jurisdiction to pass a decree for interest on increased rent for pre-suit period, the period of lis pendent as well as for future @ 12%, when there was no stipulation to pay the interest on such amount?

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4. Whether in view of bar of Section 34 of CPC, the courts were justified to award interest @ 12% post decree? And any other substantial question of law which would be required for effective decision of the present Second Appeal.

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While taking up this second appeal for hearing for its final disposal, both the learned counsel agreed to an out of court settlement and submitted before this court that they would not like to place their argument considering the following out of court settlement arrived at by the parties:-

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1. Suit filed on 01.02.1994 for Rs. 4,64,293.79 in the court of Civil Judge.

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2. Suit decreed on 23.12.1999 for Rs. 3,79,933/- i.e. from January 1991 upto 31.01.1994. Rs. 2,88,900/- as principal plus Rs. 90,000/- as interest @ 18% plus cost of suit Rs. 15,715.85 plus 12% from decree on principal.

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3. RFA 29/2000 was filed but was sent to District Judge upon increased appellate jurisdiction after ordering deposit of 50% of decreetal due in Misc. Case 3149/2011 dated 29.03.2012. Pursuant to same, Rs. 1,89,967/- was deposited.

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4. District Judge modified decree and reduced principal amount to Rs. 2,80,669/- and did not disturb 12% interest of pre suit period and maintained 12% interest on principal in decree plus cost of Rs. 10009/- on 24.04.2007.

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5. No court granted pendente-lite interest.

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6. Plaintiff did not file appeal against order of appellate court which became final as far as plaintiff is concerned.

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Both courts granted cost to plaintiff. Trial court granted

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proportionate cost but decree was prepared on full value of the suit. Advocates fee given as Rs. 10,000/- by both courts in decree.

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Principal sum decreed – Rs. 2,80,669/- (as per District Judge) & pre suit period interest @ 12%.

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i.e., from 01.02.1991 upto 31.01.1994 i.e. 36 months – Rs. 1,01,040.84 and interest made payable over same.

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Total = Rs. 3,81,709.84

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Add 8% interest on principal amount from 25.04.2007 upto 13.07.2007 i.e. 80 days amounting to Rs. 6,616.30.

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Total Amount = Rs. 3,88,326.14 due and payable on 13.07.2007.

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Since, Rs. 1,89,967/- was paid on 13.07.2007 in terms of High Court order in Misc Case No. 3149/2011 in RFA 29/2000.

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Therefore outstanding amount due and payable after 13.07.2007 is Rs. 1,98,359.14. Add 8% interest from 14.07.2007 upto 29.05.2012 i.e. 4 years 10 months 15 days – Rs. 77,360.06

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Total = Rs. 2,75,719.20

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Deduct Rs. 2,00,000/- which was paid on 29.05.2012 in terms of order passed in instant RSA 101/2007 from Rs. 2,75,719.20

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Therefore, outstanding amount left due and payable after 29.05.2012 is Rs. 75,719.20. Add 8% from 30.05.2012 upto 30.03.2019 i.e. 6 years 10 months is Rs. 41,393.05.

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Total = Rs. 1,17,112/- Add Cost – Trial Court Rs. 15,775.85 Appellate Court Rs. 10,009/- Total = Rs. 25,784.85

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Thus, total payable on 30.03.2019 is Rs. 1,42,897.10. Keeping in view the submission of the learned counsel for the parties, as there was dispute with respect to the interest part and in view of the out of court settlement this second appeal is disposed of with a direction to pay a sum of Rs. 1, 42, 897.10 to the respondent by the appellant within a period of 4 (four) weeks from today.

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Send back the LCRs.

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The draft settlement duly endorsed by the learned counsel for the parties to this appeal is kept on record.

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JUDGE

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Comparing Assistant

National Insurance Co. Ltd. v. M/S Hotel Natraj

Case brief

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National Insurance Co. Ltd. v. M/S Hotel Natraj

Case brief

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