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Ramalingam Chettiyar Vs. Gokuldas Madavji and Co. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1926Mad1021; 97Ind.Cas.871; (1926)51MLJ243
AppellantRamalingam Chettiyar
RespondentGokuldas Madavji and Co.
Cases ReferredIn Pannalal v. Radha Kissen
Excerpt:
- - if it be held that the plaintiff cannot get interest from the date of his filing his plaint, it is equivalent to saying that the plaintiff must be deprived of the fruits of his success to the extent of losing interest from day to day during the pendency of his suit on the sum that he was entitled to at the date of his going to court. the plaintiff must make out the very special case set up by him and he has failed to do so......the section. no distinction is made in the section between an ascertained sum of money and unliquidated damages. as a question of construction, i find it difficult to accept the suggestion that the word ' money ' in the section should be understood in the limited sense of an ascertained sum. the expression ' decree for the payment of money ' is very general and to give it due effect, it must be construed as including a claim to unliquidated damages. the court is not bound to give interest, for, it must be noted, that the section gives a discretion to give or refuse interest; and whatever the nature of the claim is, whether it is a claim to a fixed sum of money or to unliquidated damages, the court is bound in every case to exercise a sound discretion. the mere fact that the decree is.....
Judgment:

Spencer, J.

1. This is a suit for damages upon a contract to sell 80 candies of cotton at Rs. 414 a candy entered into in June, 1918. The plaintiff appeals.

2. He tendered and the defendants took delivery of 36 and odd candies. They declined to take delivery of the remaining 43 and odd candies as the market was falling. The plaintiff re-sold the rejected goods and brought this suit for damages and got a decree. The learned Subordinate Judge gave the plaintiff a decree for damages based on the price prevailing at the end of December. The goods which the defendants would not receive were actually sold in March, 1919, the breach of contract having been on December 26, 1918. The Subordinate Judge took an earlier date, upon the principle that every party to a contract is bound to mitigate the damages as far as possible. The plaintiff got the goods sold through a broker who is P.W. 4. He stated that the cotton season ends with 31st December and that there was no market for cotton for two or three months and so they were unable to sell the goods till Messrs. Harvey & Co. purchased them in March at Rs. 282 a candy. His statement that there was no market for cotton for two or three months is belied by the market report book, Ex. L, which has been filed as evidence on plaintiff's behalf. This shows sales of cotton at varying prices in December, 1918 and in January, February and March, 1919. On certain dates there is an entry that no business was done. The man who kept this book has not been examined as a witness and therefore it is impossible to accept the suggestion now put forward that the prices entered therein do not represent real sales of cotton offered for sale on the dates upon which the price is entered. The Subordinate Judge, therefore, acted reasonably in taking a date in December when the market price of cotton was Rs. 330 as being the price at a date nearer the date of breach than the date on which the goods were actually sold in March.

3. The next point which has been argued before us is that the plaintiff is entitled to cartage upon the goods taken from Virudupatti to Tuticorin for which he claimed Rs. 265-12-0 in his plaint. The defendants contented themselves with a statement that the plaintiff was not entitled to any cart-hire and that the' amount claimed was excessive. The goods were taken to Tuticorin because the defendants closed their branch of business at Virudupatti. The plaintiff alleged that the defendants asked him to deliver the goods at Tuticorin when they ceased to keep their branch open at Virudupatti. It was evidently on the defendants' account that the goods were taken to Tuticorin and delivered there, and the defendants, as thev changed their place of business, must bear the costs incurred by the plaintiff in doing an act necessary on defendants' account to be done for the performance of the contract. Although the plaintiff did not specifically include this claim for cartage among his grounds of appeal he appealed in respect of the whole amount claimed by him in the Lower Court which was disallowed. We must therefore allow his appeal in respect of the sum of Rs. 265-12-0, the details of which have not been questioned.

4. The Lower Court gave interest to the plaintiff from the date of plaint only upon the sum of Rs. 778-2-0 which related to a prior contract. Interest was not given upon the main sum of Rs. 3,690 and odd found to be due as damages and the plaintiff makes this a ground of appeal. In many cases decided by this Court interest has been given upon damages from the date of plaint, of which Sheik Mahamad Ravuther v. The British India Steam Navigation Co. Ltd. : (1908)18MLJ497 and Boddu Sanyasiraiu v. Kotra Ramamurthi (1913) M.W.N. 374 are instances. In Pannalal v. Radha Kissen (1922) 39 C.L.J. 77 interest was similarly allowed by a Bench consisting of the Chief Justice and another Judge.In Crewdson v. Ganesh Das Hari Bux (1920) 60 I.C. 288 Mookerjee, J. observed that he could see no difference between interest prior to suit and interest pendente lite when the claim is for an unliquidated amount of damages. In my opinion it is discretionary for the Court to allow interest upon damages from the date of plaint under Section 34 of the Code of Civil Procedure. I see no reason why a successful party should be made to suffer because his claim is not decided soon after the filing of his plaint. When he files his plaint he puts the matter in the hands of the Court for decision. If it be held that the plaintiff cannot get interest from the date of his filing his plaint, it is equivalent to saying that the plaintiff must be deprived of the fruits of his success to the extent of losing interest from day to day during the pendency of his suit on the sum that he was entitled to at the date of his going to Court. The date of instituting the suit is the date upon which the rights of parties are ordinarily determined, and when the decree fixes the amount of damages due, I think that they may be taken as fixed as on the date of the suit, and interest allowed upon that sum.

5. In this view plaintiff's appeal must be allowed to the extent of the claim for cartage and the interest from the date of suit at 6 per cent. The plaintiff will also get proportionate costs on the amount in respect of which his appeal has succeeded.

Venkatasubba Rao, J.

6. I agree. The first question to be decided is, what is the correct measure of damages? The contract was broken on the 25th December, 1918. The plaintiff sold the goods on the 24th March, 1919, and claims the difference between the contract price and the price realised at the sale. When there is an available market for the goods the difference between the contract price and the market price on the date of the breach is the amount of the damages prima facie payable. Mr. Anantakrishna Aiyar, the learned vakil for the plaintiff, urges that his client postponed the sale as there was no market for cotton at Tuticorin for a period of three months subsequent to the breach. This is extremely unlikely and the evidence on the record shows that the contention is unfounded. The plaintiff must make out the very special case set up by him and he has failed to do so. The damages have been rightlv fixed with reference to the date of the breach.

7. The second question that arises is, is the plaintiff entitled to interest on damages from the date of the suit to the date of the decree? The right to interest may fall under three heads : (1) Interest that accrued due prior to the institution of the suit : (2) Interest from the date of the suit to the date of the decree; (3) Interest from the date of the decree to the date of realisation.

8. No claim has been made to interest for the period previous to the institution of the suit. The right to. such interest is governed by the general law and we are not at present concerned with any question relating to it.

9. The right to interest under the second and third heads must be determined with reference to Section 34 of the Civil Procedure Code. The plaintiff's right to interest from the date of the decree to the date of realisation is conceded and the point to be decided is therefore confined to the plaintiff's right to interest that has accrued during the pendency of the suit.

10. The material portion of Section 34 reads thus:

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.

11. A decree for payment of damages is undoubtedly a decree ' for the payment of money '. It is however contended for the defendant that if at the time of the suit the damages were unliquidated, interest cannot be awarded under the section. No distinction is made in the section between an ascertained sum of money and unliquidated damages. As a question of construction, I find it difficult to accept the suggestion that the word ' money ' in the section should be understood in the limited sense of an ascertained sum. The expression ' decree for the payment of money ' is very general and to give it due effect, it must be construed as including a claim to unliquidated damages. The Court is not bound to give interest, for, it must be noted, that the section gives a discretion to give or refuse interest; and whatever the nature of the claim is, whether it is a claim to a fixed sum of money or to unliquidated damages, the Court is bound in every case to exercise a sound discretion. The mere fact that the decree is for the payment of damages cannot; by itself be a bar to the plaintiff being awarded interest. It is important to bear in mind that Section 34 contains the rule of law applicable and that reference to the Interest Act is irrelevant.

12. On this question there is not much authority. There are two cases of the Calcutta High Court in which two different views have been taken [Crewdson v. Ganesh Das Han Bux (1920) 60 I.C. 288 and Pannalal v. Radha Kissen (1922) 39 C.L.J. 77. In the first case it was held that interest should not be awarded on damages from the date of the suit to the date of the decree. Mookerjee, J. refers to cases where interest was refused from the date of the breach to the date of the suit and observes that there is no distinction in principle between a claim to interest for the period previous to the suit and for the period subsequent to the suit. With all respect I am unable to agree. The distinction is clear. The claim to interest prior to the suit must be determined with reference to the general law, whereas a claim to interest for the period during which a suit is pending is governed by a specific provision, Section 34 of the Code of Civil Procedure. Mookerjee, J. does not cite any authority in support of his view.

13. In Pannalal v. Radha Kissen (1922) 39 C.L.J. 77 Sanderson, C.J. points out that on the Original Side of the Calcutta High Court it was usual to grant interest on unliquidated damages from the date of the suit to the date of the decree. That the Court has a discretion even in such a case under Section 34 was not disputed before the learned Chief justice, who, however, observes that it is advisable to give reasons when interest is awarded on unliquidated damages. This is more in the nature of a rule for the guidance of Subordinate Courts, and it may probably be followed by them with advantage. The Code, however, does not say that reasons shall be given, and when they are not given, the High Court may examine the material before it with a view to find out if the Lower Court has exercised the discretion properly. In the present case the Lower Court has not awarded interest and its attention does not seem to have been called to the point. In my opinion, we shall be exercising our discretion soundly by awarding interest to the plaintiff. He filed his plaint within a few months of the breach and a few weeks of the sale.

14. In coming to Court, therefore, he did not make any delay. It has not been shown that he has protracted the trial of the suit. It stands to reason; that the plaintiff's right must not be made to depend upon the mere accident of a speedy disposal or otherwise of a case. In a Court where there is a congestion of work, a plaintiff may obtain a decree only after the lapse of six years, in another Court in six months. Why should the plaintiff's right to get interest be made to depend upon circumstances over which he has no control?

15. In regard to cartage claimed I agree that the plaintiff is entitled to it. The place of performance was changed to suit the convenience of the defendants and he cannot be heard to say that cartage is not payable.

16. The result is, that the appeal succeeds to this extent, namely, that to the amount awarded by the Subordinate Judge, the amount of cartage will be added and the total sum will carry interest at 6 per cent per annum from the date of the suit to the date of realisation.

17. I agree in the order proposed by my learned brother regarding costs.


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