UNION OF INDIA Vs. BHAGWATI COTTONS LTD

JUDGEMENT

(1.) THIS Suit, filed on 8th April 1999, against the Defendants, is for recovery of sum of rs. 3,46,07,726/- (Rupees Three Crores Forty-six lakhs Seven Thousand Seven Hundred and Twenty-six)with further interest on the principal sum of rs. 2,10,25,350/- (Rupees Two Crores Ten Lakhs twenty-five Thousand Three Hundred Fifty) at the rate of 24% per annum from the date of filing of the Suit until payment/realisation thereof. The suit is already decreed ex-parte against the defendant No. 1. It now proceeds against Defendant no. 2 only.

(2.) THE Plaintiffs assert that the Office of the Textile Commissioner in the Ministry of textiles of India used to release quota of raw cotton and cotton wastes for exports from time to time as per the then prevailing exim policy. As per the quota released, the Textile Commissioner issues Memorandum in the beginning of each cotton year specifying the terms and conditions for export of raw cotton and cotton wastes. That the defendant No. 1 and GPB Fibres Limited were carrying on export business from the same premises. Later on, said GPB Fibres Ltd. amalgamated with defendant No. 1 Company as per the order of the company Judge dated 12th September 1997 in Company petition No. 382 of 1997 and connected proceedings. As per the said Scheme, all the debts and liabilities of GPB Fibres Ltd. have been taken over by the Defendant No. 1 Company. It is stated that the present Suit has been filed against the defendant No. 1 not only in respect of the liabilities of Defendant No. 1 but also the liability of said GPB Fibres Ltd.

(3.) ACCORDING to the Plaintiffs for the cotton season 1995-1996, the Government of India had released cotton export quota of 0. 10 lakhs bales (each of 170 kg.) extra long staple cotton in favour of private traders and State Co-operative marketing Federation. Accordingly, the terms and conditions for export of raw cotton for the cotton season 1995-96 was prescribed in Memorandum-I dated 6th November 1995 issued by the Textile commissioner, Mumbai. A Press Note and a memorandum was issued on 9th January 1996 by the textile Commissioner, Mumbai, inviting applications for allotment of the said quota as per the terms and conditions specified in Memorandum-I dated 6th november 1995.