BHAGAWATI ENTERPRISES Vs. PRAKASH ENGINEERING WORKS

JUDGEMENT

(1.) THE plaintiff seeks money decree against the defendant. According to the plaintiff, it had entered into an agreement with the defendant to buy 450 metric tonnes of cast iron scraps at a rate of Rs.4,000/ - per metric tonne. As consideration thereof the plaintiff paid an advance of Rs.18 lakhs by four several cheques between the period September 1, 1990 and September 13, 1990. All the aforesaid cheques were encashed and proceeds thereof appropriated by the defendant. According to the plaintiff, the defendant failed and neglected to deliver any cast iron scraps. The plaintiff demanded refund of the advance. Since the defendant did not have money to refund, it agreed to refund the advance with interest at the rate of 18 per cent per annum.

(2.) THE defendant refunded an aggregate sum of Rs.10 lakhs during the period November 4, 1991 till April 20, 1993. The plaintiff claims that it is entitled to appropriate the said sum of Rs.10 lakhs first towards interest and then towards the principal amount outstanding.

(3.) ACCORDING to the plaintiff it is entitled to interest at the rate of 18 per cent per annum as the defendant had agreed of such rate of interest. According to the plaintiff after giving credit to the interest account and after adjusting the sum of Rs.10 lakhs first towards the interest accrued and, thereafter towards principal, a sum of Rs.20,49,065/ - became due and payable by the defendant to the plaintiff.