Allowed

Ebi Thomas v. M/S.Pooram Kuries and Loans (P) Ltd.

Kerala HC4 Jul 2019RSA/936/2004

Case brief

AI extract

What is this about?

In a regular second appeal regarding a chitty transaction dispute, the High Court held that a decree granting pre-litigation interest without a calculation statement specifying the period and date of accrual cannot be sustained. The court modified the decree to award interest at 6% per annum from the date of suit.

What did the court decide?

The decree was modified to grant recovery of Rs.96,000/- with interest at 6% per annum from the date of suit till realization.

Ebi Thomas Vs M/S.Pooram Kuries and Loans… — Contract and Commercial Disputes | Kerala HC (2019)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE P.SOMARAJAN

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THURSDAY, THE 04TH DAY OF JULY 2019 / 13TH ASHADHA, 1941

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RSA.No.936 of 2004

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AGAINST THE DECREE & JUDGMENT IN AS 61/2004 of DISTRICT COURT, THRISSUR DATED 20-02-2004

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AGAINST THE DECREE & JUDGMENT IN OS 163/2000 of PRINCIPAL SUB COURT,THRISSUR

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APPELLANTS/APPELLANTS/DEFENDANTS:

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1 EBI THOMAS, AGED 46 BANK EMPLOYEE, S/O. CHERUVATHOOR THOMAS, KUNNAMKULAM VILLAGE, THALAPPILLY TALUK.

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2 LALU ISAC, AGED 44 COLLEGE LECTURER, W/O. 1ST APPELLANT,, KUNNAMKULAM VILLAGE, THALAPPILLY TALUK.

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BY ADVS. SRI.R.T.PRADEEP SRI.V.VIJULAL

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RESPONDENT/RESPONDENT/PLAINTIFF:

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M/S.POORAM KURIES AND LOANS (P) LTD RICE BAZAR, THRISSUR, CHEMBUKKAVU VILLAGE, THRISSUR TALUK.

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BY ADVS.

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SRI.P.VIJAYA BHANU (SR.)

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THIS REGULAR SECOND APPEAL HAVING BEEN FINALLY HEARD ON 04.07.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

RSA No.936/04

JUDGMENT

This appeal is filed by the defendant in a suit for

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recovery of money based on arrears of chitty amount.

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The defendant is the subscriber. Prize money received comes to Rs.46,000/-. The plaintiff, a chitty company, claims that an amount of Rs.96,000/- is due on account of default of monthly instalment @ Rs.3,000/- from

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7.7.1997 onwards. An amount of Rs.43,560/- also claimed @ 18% interest totalling an amount of

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Rs.1,39,810/-. A decree was granted and confirmed in appeal, against which this appeal was preferred.

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The questions came up for consideration are:

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i) Whether it is permissible to grant interest @ 18% without showing anything in support of rate of interest agreed into ?

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ii) Whether it is permissible to grant a decree for recovery of interest without specifying the period in which the interest was accrued and without showing its details?

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The main challenge in this appeal is with

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respect to the interest claimed and decreed which comes

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RSA No.936/04

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to Rs.43,560/-. In the plaint, the same is claimed at

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18% interest without disclosing the period in which the interest was accrued. Nothing mentioned in the calculation statement attached to the plaint with respect to the date or period on which interest was calculated. Needless to say that a claim without disclosing its details cannot be allowed especially when it was claimed by way of interest. When the plaintiff claims interest there should be a statement in the plaint from which date onwards interest was claimed and calculated. It is a chitty transaction. Even according to the plaintiff, the defendant has defaulted in remitting monthly instalments @ Rs.3,000/starting from the month of July,1997. If that be so, the liability to pay interest would arise on each and every default and it should be separately calculated and a calculation statement must be incorporated with

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the plaint. That has not been done. An amount of

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Rs.43,560/- claimed by way of 18% interest without disclosing any period and without annexing any calculation statement. It was put in darkness as to how it was assessed. The interest calculated must be

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RSA No.936/04

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capable of ascertainment by the court for which there should be a calculation statement. In the absence of a calculation statement, no decree for pre-litigation interest can be granted. The amount claimed by way of pre-litigation interest should be capable of calculation and ascertainment by the court. Even the period or the date on which the interest claimed not specified in the statement. Only a lumpsum amount of Rs.43,560/- claimed by way of interest at 18% without stating the period and without showing the calculation. So the decree granting interest at Rs.43,560/- is liable to be set aside by allowing this appeal. I do so.

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In the result, the appeal is allowed. The decree and judgment of the courts below are modified by granting a decree of Rs.96,000/- with interest @ 6% per annum from the date of suit till realization. No order as to costs of appeal.

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Sd/-

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P.SOMARAJAN JUDGE

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RSA No.936/04 5

Ebi Thomas v. M/S.Pooram Kuries and Loans (P) Ltd.

Case brief

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Ebi Thomas v. M/S.Pooram Kuries and Loans (P) Ltd.

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