PREFACE :
I run a technical consultancy & advisory firm for Land Survey & Geo-technical advices. I was approached by a Baroda-based firm as a Sub-Consultant for certain part of Environmental Impact Assessment(EIA) studies.
I gave the consultancy in 2007 & subsequently raised an invoice in the month of August,2007 for services I rendered. The bill mentioned the amount of Rs.1,00,000/- (Rs. 1 Lac) + Service Tax(@12.36%) as consultancy fees. The party(Baroda-based firm) paid me Rs.15,000/- against the bill amount mentioned above & assured that the balance amount will be paid in sometime.This Rs.15,000/- was paid to me in November of 2007. But even after repeated reminders they didn't pay-up.Furthermore,they(Baroda-based firm) issued me a TDS certificate in the month of April,2008 wherein they deducted the TDS(at the rate of 10.30%) on full amount (i.e.)Rs.1,12,360/- Since May,2008 I was following-up for my balance amount.But they kept on giving excuses such as financial problems & death in the family,poor health & hospitalization.So,on humanitarian grounds I didn't take legal action against them. But in November of 2008,I sent them an email requesting them to remit the balance amount to me before December,31st of 2008. And I had also mentioned in the email that if they fail to pay my balance by December,31st of 2008 ,they would liable to pay the balance amount along with 18% interest per annum. But they failed to pay the same.So,they replied via email requesting me not to initiate legal action against them & they would pay the balance as soon as possible. The email was followed by a telephonic conversation between me & co-proprietor of the firm,in which he requested for additional time for clearing my dues. I kept reminding them for payment of dues via email & sms but they didn't respond/pay my dues. Then,in November of 2010,they paid another Rs.15,000/- to me via NEFT.But again requested me not to take legal action against them & they would certainly clear my dues & request for additional time-period,to which we mutually agreed over the phone that they would clear my remaining dues by 30th,June of 2011. But they failed to clear my dues by June,30th,2011.
Hence,I sent them legal notice through an advocate on July,20th,2011 that if the dues are not cleared with 60 days of the receipt of legal notice,I would sue them.
Subsequently,I filled a case under Order 37(Summary Suit) of Civil Procedure Code on November,29th,2011 of which the 1st court-date was held on January,17th of 2012. The judgement of the same was pronounced ex-party on July,4th,2012,as they failed to present any defense against the plaint.
Later,when I read the judgement the Honorable Judge awarded 6% interest p.a. on the Principal Amount due (i.e.)Rs.70,000/-+Service Tax from the date of filing of the plaint.
My Query :
Why did the ' honorable judge' award interest from the date of filing of plaint,when I had produced copies(along with the plaint) of e-mail sent to the Baroda-based firm in November of 2008 that if my dues are not cleared before December,31st,2008 they would liable to pay the balance amount along with 18% interest per annum.Also when they(Baroda-based firm) replied via email they never objected to the payment of interest part & just requested some more time for settling my outstanding dues.
- As you can see,I have a point that when the Baroda-based firm knew that they would be liable to pay interest at the rate of 18% p.a. from January,1st of 2009 till the date of realization of the amount,then why did the judge not take this fact into account????
- Isn't the Baroda-based firm liable to pay interest w.e.f. January,1st of 2009 instead of November,29th of 2011(as mentioned in the Judgement) ?
- Is there any past judgments/citations w.r.t. to liability for payment of interest in case of Summary Suits?
Awaiting your expert advice on the same.
Thanks & Regards,
TUSHAR
Mumbai,Maharashtra.
