As to interest, I find that no rate of interest was specified in the bills of exchange concerned. The cheques were dishonoured. So in view of Section 80 of the Negotiable Instruments Act, 1881 defendant 1 should, of course, be held liable to pay Interest at the rate of 18% per annum from the time it received the notices of dishonour. But there is no material on record from which such time can be ascertained. The liability was however, admitted by defendant 1 in its letter dated Sept. 7th. 1998. Hence in my view defendant 1 should be held liable to pay interest from this date, and the rate, in the absence of any specified rate, should be 18% per annum as provided in Section 80 of the Negotiable Instruments Act, 1881.
"(a) Judgment upon admission and decree against the defendant No. 1 for a sum of Rs. 43,87,255/-;
(b) Interim interest and interest on judgment at the agreed rate of 18% per annum on the balance principal sum of Rs. 28,45,500/-;
(c) Ad interim order in terms of prayers above;
(d) Costs;
(e) Such further or other order or orders be made and direction or directions be given as to this Hon'ble Court may deem fit and proper;"
2. The suit was filed on July 9th, 2002. The prayers in the suit are the following ;--
"(a) Decree for Rs. 43,87,255/- against the defendant No. 1;
(b) Interim interest and interest on judgment at the agreed rate of 18 per cent per annum on the balance principal sum of Rs. 28,45,500;
(c) Receiver;
(d) Injunction;
(e) Attachment before judgment;
(f) Cost;
(g) Further and/or other orders;"
3. The facts contained in the pleading, briefly, are these. By a letter dated April 21st 1998 defendant 1 requested the plaintiff to discount a bill for Rs. 32,11,000/-. Defendant 1 enclosed a post dated cheque for Rs. 32,11,000/- with this letter. Again by a letter dated May 26th, 1998 defendant 1 requested the plaintiff to discount a bill for Rs. 16,44,500/-. With this letter also defendant 1 enclosed a post dated cheque; it was for Rs. 16,44,500/-. The two bills were duly discounted, and payments were made by the plaintiff to defendant 2. The two post dated cheques issued by defendant 1 were dishonoured on presentation. The amounts due under the two instruments remained unpaid. On repeated requests by the plaintiff, under cover of its letter dated Sept. 7th, 1998. as against the bill discounting liability of Rs. 48,55,500/-, defendant 1 made a part payment of Rs. 20,000,00/-. This payment was made by a cheque dated Sept. 8th, 1998. The balance of the liability amounting to Rs. 28,55,500/- remained unpaid. By letter dated Nov. 8th, 1998 the plaintiff demanded payment of this balance amount together with interest. The demand was repeated by subsequent letters, but defendant 1 did not make the payment. Defendant 1 became a sick company, and the proceeding concerned remained pending before the competent authorities during the period from Feb. 16th, 1999 to Feb. 1st, 2001. However, by a letter dated June 22nd, 1999 defendant 1 informed the plaintiff that due to financial crisis it was unable to make the payment.
4. In the pending suit this application for judgment on admission has been filed. Notices of this application could not be served by the plaintiff at the last known addresses of the defendants, as none of the defendants were found available there. The plaintiff took out an application (G.A. No. 2553 of 2003) for leave to take steps for substituted service. By order dated July 23rd. 2003 Ansari, J. was pleased to allow such application. An affidavit of service dated August 8th 2003 has been filed stating that in terms of order dated July 23rd, 2003 notice of this case was published in two newspapers. However, no one entered appearance for the defendants. In the circumstances by order dated August 11th, 2003 this application was directed to appear as adjourned motion. On Oct. 28th, 2003 it was taken up for hearing. On this date also no one appeared for the defendants. The matter was again adjourned for a week. Then it was taken up on Nov. 6th, 2003 when also no one appeared for the defendants. After hearing the learned counsel for the plaintiff, the matter was directed to appear for orders on the next day. On Nov. 7th, 2003 also no one appeared for the defendants. In the circumstances hearing has been concluded ex parte.
5. By referring to the two letters Sept. 7th, 1998 and June 22nd, 1999 the learned counsel for the plaintiff has submitted that defendant 1 clearly admitted its liability to the extent of Rs. 48,55,500/-. He has submitted that on the basis of such admission made by defendant 1 in its said two letters, and in view of non traverse of the case made out by the plaintiff in this application, the plaintiff is entitled to a judgment on admission. He has relied upon the provisions of Order XII, Rule 6 of the Code of Civil Procedure. He has submitted that in view of these provisions the admission of the liability by defendant 1 in its letter dated Sept. 7th, 1998 can be taken into consideration for the purpose of passing a judgment on admission. In support of his submissions he has relied upon the decisions in the cases of:--
(1) Freeman v. Cox, (1878) 8 Ch D 148; and
(2) Porret v. White, (1885) 31 Ch D 52. He has also relied on an unreported decision dated Dec. 21st 1998 given by Pinaki Chandra Ghose, J. in G.A. No. 2040 of 1997 in C.S. No. 214 of 1994 (Simplex Engineering and Foundry Works Limited v. Modi Tele Fibers Ltd.).
6. The two letters issued by defendant 1 on Sept. 7th, 1998 and June 22nd, 1999, for convenience' sake, are reproduced below :--
(a) letter dated Sept. 7th 1998 :--
"This has reference to the bill discounting liability for Rs. 48,55,500/-. A post dated Cheque No. 036936 dated 24-7-1998 and 051366 dated 20-7-1998 drawn on Standard Chartered Bank, Gariahat Br. were handed over to you in connection with the said transaction.
On repeated requests from your side, we are pleased to make a part payment of Rs. 20,00,000,00/- (Rupees twenty Lacs only) by Cheque No. 188268 dated 8-9-1998 on Standard Chartered Bank, against the above mentioned liability.
Kindly acknowledge receipt."
(b) letter dated June 22nd 1999 :--
This has reference to the outstanding liability in respect of the bill discounting. In this connection please note that you have visited our office a number of times and enquired as to what the present status is in relation to your outstanding liabilities. In this connection, please note that the Company was saddled with huge financial crunch and as such payment could not be made in time in respect of your liability. However, our Divisional President, Mr. P.N. Venugopalan is carrying out effective negotiations with equity partners who will be interested to induce necessary equity for carrying out the business operation of the company. The talks are at an advanced stage and it is felt that the deal may go through. The new equity investors after taking over the management of the company would pay off the existing creditors of the Company and as such your liability would also be met.
Kindly bear with us till date."
7. I do not find any legal infirmity in the two bills of exchange drawn by defendant 2 directing defendant 1 to pay Rs. 32,11,000/-and Rs. 16,44,500/- to the plaintiff. Towards discharge of such liability defendant 1 issued cheques No. 051366 dated July 20th, 1998 for Rs. 32,11,000/- and No. 036936 dated July 24th, 1998 for Rs. 16,44,500/-, in favour of the plaintiff, but these cheques were dishonoured. These facts, appearing from the pleading and the documents filed by the plaintiff, have not been disputed by the defendants. I find that these facts are in separately connected with the facts contained in the letter dated Sept. 7th, 1998 written by defendant 1 to the plaintiff. This letter contains a clear admission of defendant 1 about its undischarged liability to the extent of Rs. 28,55,500/-. It also shows that the liability arose in connection with the above bills of exchange. This letter and the letter dated June 22nd, 1999 written by defendant 1 to the plaintiff leave no room to doubt about the case made out by the plaintiff in its pleading. Such case has moreover not been disputed by the defendants in any manner, though they had opportunity to do so. They have chosen not to contest this application. I find no reason to doubt about the genuineness of the above two letters, or to disbelieve the case made out by the plaintiff. I also find that defendant 1 unconditionally and without any reservation admitted its liability in the two letters mentioned before.
8. Provisions contained in Order XII, Rule 6, of the Code of Civil Procedure, 1908 empower the Court to pronounce a judgment on admissions. Rule 6 reads as follows :--
"6. Judgment on admissions. -- (1) Where admissions of fact have been made either in the pleading or otherwise, whether orally or in writing, the Court may at any stage of the suit, either on the application of any party or of its own motion and without waiting for the determination of any other question between the parties, make such order or give such judgment as it may think fit, having regard to such admissions.
(2) Whenever a judgment is pronounced under Sub-rule (1) a decree shall be drawn up in accordance with the judgment and the decree shall bear the date on which the judgment was pronounced."
9. The position of law is that for pronouncing a Judgment on admission the Court can rely also on admission of fact made by a party in any thing other than the pleading filed by such party. The word "otherwise" in Sub-rule (1) of Rule 6 of Order XII leaves no room for any doubt about such legal position. Hence in a case where a document containing admission of a fact by a defendant is produced along with the pleading and relied on by the plaintiff for a judgment on admission, and such defendant, in spite of notice, chooses not to enter appearance and file pleading or affidavit denying and disputing the claim of the plaintiff regarding such admission, in my view, a judgment on admission can be pronounced by the Court against such defendant by placing reliance on such admission.
10. In support of the proposition that an admission contained in a document produced along with the pleading by the plaintiff, if remains uncontroverted by the defendant, can form the basis of a judgment on admission, reference can be made to the Supreme Court decision in the case of Uttam Singh Duggal & Co. Ltd. v. United Bank of India . The authorities cited also support the case of the plaintiff. In Freeman v. Cox (1878) (8) Ch D 148) it was held that affidavit of the plaintiff and the served notice of motion having remained unanswered by the non appearing defendant constituted sufficient admission for directing defendant to pay the admitted claimed amount. Hence I find that the plaintiff is entitled to a Judgment on admission against defendant 1.
11. As to interest, I find that no rate of interest was specified in the bills of exchange concerned. The cheques were dishonoured. So in view of Section 80 of the Negotiable Instruments Act, 1881 defendant 1 should, of course, be held liable to pay Interest at the rate of 18% per annum from the time it received the notices of dishonour. But there is no material on record from which such time can be ascertained. The liability was however, admitted by defendant 1 in its letter dated Sept. 7th. 1998. Hence in my view defendant 1 should be held liable to pay interest from this date, and the rate, in the absence of any specified rate, should be 18% per annum as provided in Section 80 of the Negotiable Instruments Act, 1881.
12. The expenses incurred by the plaintiff for making advertisement, together with the costs of this application, should also be paid by defendant 1 to the plaintiff.
13. For the aforestated reasons this application is allowed in part. There will be a decree against defendant 1. This defendant shall pay to the plaintiff a sum of Rs. 28,55,500/- with Interest calculated at the rate of 18% per annum from Sept. 7th, 1998 till the date of payment or realisation, it shall also pay the advertisement expenses and costs of this application. Defendant 1 is hereby granted a month's time to make the payment. On the failure of defendant 1 to make the payment within the time specified herein, the plaintiff will be entitled to realise the same by putting the decree into execution. Let the decree be drawn up and completed accordingly.
14. Urgent Xerox certified copy of this judgment may be supplied to the parties, if applied for.
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Calcutta High Court
Uic Finance Pvt. Ltd. vs Carews Pharmaceuticals Pvt. Ltd. ... on 2 December, 2003
Equivalent citations: AIR 2004 Cal 68, IV (2004) BC 471
1. This application dated March 4th, 2003 has been taken out by the sole plaintiff in its pending suit (C.S. No. 303 of 2002); it is for judgment on admission. The prayers are as follows :--"(a) Judgment upon admission and decree against the defendant No. 1 for a sum of Rs. 43,87,255/-;
(b) Interim interest and interest on judgment at the agreed rate of 18% per annum on the balance principal sum of Rs. 28,45,500/-;
(c) Ad interim order in terms of prayers above;
(d) Costs;
(e) Such further or other order or orders be made and direction or directions be given as to this Hon'ble Court may deem fit and proper;"
2. The suit was filed on July 9th, 2002. The prayers in the suit are the following ;--
"(a) Decree for Rs. 43,87,255/- against the defendant No. 1;
(b) Interim interest and interest on judgment at the agreed rate of 18 per cent per annum on the balance principal sum of Rs. 28,45,500;
(c) Receiver;
(d) Injunction;
(e) Attachment before judgment;
(f) Cost;
(g) Further and/or other orders;"
3. The facts contained in the pleading, briefly, are these. By a letter dated April 21st 1998 defendant 1 requested the plaintiff to discount a bill for Rs. 32,11,000/-. Defendant 1 enclosed a post dated cheque for Rs. 32,11,000/- with this letter. Again by a letter dated May 26th, 1998 defendant 1 requested the plaintiff to discount a bill for Rs. 16,44,500/-. With this letter also defendant 1 enclosed a post dated cheque; it was for Rs. 16,44,500/-. The two bills were duly discounted, and payments were made by the plaintiff to defendant 2. The two post dated cheques issued by defendant 1 were dishonoured on presentation. The amounts due under the two instruments remained unpaid. On repeated requests by the plaintiff, under cover of its letter dated Sept. 7th, 1998. as against the bill discounting liability of Rs. 48,55,500/-, defendant 1 made a part payment of Rs. 20,000,00/-. This payment was made by a cheque dated Sept. 8th, 1998. The balance of the liability amounting to Rs. 28,55,500/- remained unpaid. By letter dated Nov. 8th, 1998 the plaintiff demanded payment of this balance amount together with interest. The demand was repeated by subsequent letters, but defendant 1 did not make the payment. Defendant 1 became a sick company, and the proceeding concerned remained pending before the competent authorities during the period from Feb. 16th, 1999 to Feb. 1st, 2001. However, by a letter dated June 22nd, 1999 defendant 1 informed the plaintiff that due to financial crisis it was unable to make the payment.
4. In the pending suit this application for judgment on admission has been filed. Notices of this application could not be served by the plaintiff at the last known addresses of the defendants, as none of the defendants were found available there. The plaintiff took out an application (G.A. No. 2553 of 2003) for leave to take steps for substituted service. By order dated July 23rd. 2003 Ansari, J. was pleased to allow such application. An affidavit of service dated August 8th 2003 has been filed stating that in terms of order dated July 23rd, 2003 notice of this case was published in two newspapers. However, no one entered appearance for the defendants. In the circumstances by order dated August 11th, 2003 this application was directed to appear as adjourned motion. On Oct. 28th, 2003 it was taken up for hearing. On this date also no one appeared for the defendants. The matter was again adjourned for a week. Then it was taken up on Nov. 6th, 2003 when also no one appeared for the defendants. After hearing the learned counsel for the plaintiff, the matter was directed to appear for orders on the next day. On Nov. 7th, 2003 also no one appeared for the defendants. In the circumstances hearing has been concluded ex parte.
5. By referring to the two letters Sept. 7th, 1998 and June 22nd, 1999 the learned counsel for the plaintiff has submitted that defendant 1 clearly admitted its liability to the extent of Rs. 48,55,500/-. He has submitted that on the basis of such admission made by defendant 1 in its said two letters, and in view of non traverse of the case made out by the plaintiff in this application, the plaintiff is entitled to a judgment on admission. He has relied upon the provisions of Order XII, Rule 6 of the Code of Civil Procedure. He has submitted that in view of these provisions the admission of the liability by defendant 1 in its letter dated Sept. 7th, 1998 can be taken into consideration for the purpose of passing a judgment on admission. In support of his submissions he has relied upon the decisions in the cases of:--
(1) Freeman v. Cox, (1878) 8 Ch D 148; and
(2) Porret v. White, (1885) 31 Ch D 52. He has also relied on an unreported decision dated Dec. 21st 1998 given by Pinaki Chandra Ghose, J. in G.A. No. 2040 of 1997 in C.S. No. 214 of 1994 (Simplex Engineering and Foundry Works Limited v. Modi Tele Fibers Ltd.).
6. The two letters issued by defendant 1 on Sept. 7th, 1998 and June 22nd, 1999, for convenience' sake, are reproduced below :--
(a) letter dated Sept. 7th 1998 :--
"This has reference to the bill discounting liability for Rs. 48,55,500/-. A post dated Cheque No. 036936 dated 24-7-1998 and 051366 dated 20-7-1998 drawn on Standard Chartered Bank, Gariahat Br. were handed over to you in connection with the said transaction.
On repeated requests from your side, we are pleased to make a part payment of Rs. 20,00,000,00/- (Rupees twenty Lacs only) by Cheque No. 188268 dated 8-9-1998 on Standard Chartered Bank, against the above mentioned liability.
Kindly acknowledge receipt."
(b) letter dated June 22nd 1999 :--
This has reference to the outstanding liability in respect of the bill discounting. In this connection please note that you have visited our office a number of times and enquired as to what the present status is in relation to your outstanding liabilities. In this connection, please note that the Company was saddled with huge financial crunch and as such payment could not be made in time in respect of your liability. However, our Divisional President, Mr. P.N. Venugopalan is carrying out effective negotiations with equity partners who will be interested to induce necessary equity for carrying out the business operation of the company. The talks are at an advanced stage and it is felt that the deal may go through. The new equity investors after taking over the management of the company would pay off the existing creditors of the Company and as such your liability would also be met.
Kindly bear with us till date."
7. I do not find any legal infirmity in the two bills of exchange drawn by defendant 2 directing defendant 1 to pay Rs. 32,11,000/-and Rs. 16,44,500/- to the plaintiff. Towards discharge of such liability defendant 1 issued cheques No. 051366 dated July 20th, 1998 for Rs. 32,11,000/- and No. 036936 dated July 24th, 1998 for Rs. 16,44,500/-, in favour of the plaintiff, but these cheques were dishonoured. These facts, appearing from the pleading and the documents filed by the plaintiff, have not been disputed by the defendants. I find that these facts are in separately connected with the facts contained in the letter dated Sept. 7th, 1998 written by defendant 1 to the plaintiff. This letter contains a clear admission of defendant 1 about its undischarged liability to the extent of Rs. 28,55,500/-. It also shows that the liability arose in connection with the above bills of exchange. This letter and the letter dated June 22nd, 1999 written by defendant 1 to the plaintiff leave no room to doubt about the case made out by the plaintiff in its pleading. Such case has moreover not been disputed by the defendants in any manner, though they had opportunity to do so. They have chosen not to contest this application. I find no reason to doubt about the genuineness of the above two letters, or to disbelieve the case made out by the plaintiff. I also find that defendant 1 unconditionally and without any reservation admitted its liability in the two letters mentioned before.
8. Provisions contained in Order XII, Rule 6, of the Code of Civil Procedure, 1908 empower the Court to pronounce a judgment on admissions. Rule 6 reads as follows :--
"6. Judgment on admissions. -- (1) Where admissions of fact have been made either in the pleading or otherwise, whether orally or in writing, the Court may at any stage of the suit, either on the application of any party or of its own motion and without waiting for the determination of any other question between the parties, make such order or give such judgment as it may think fit, having regard to such admissions.
(2) Whenever a judgment is pronounced under Sub-rule (1) a decree shall be drawn up in accordance with the judgment and the decree shall bear the date on which the judgment was pronounced."
9. The position of law is that for pronouncing a Judgment on admission the Court can rely also on admission of fact made by a party in any thing other than the pleading filed by such party. The word "otherwise" in Sub-rule (1) of Rule 6 of Order XII leaves no room for any doubt about such legal position. Hence in a case where a document containing admission of a fact by a defendant is produced along with the pleading and relied on by the plaintiff for a judgment on admission, and such defendant, in spite of notice, chooses not to enter appearance and file pleading or affidavit denying and disputing the claim of the plaintiff regarding such admission, in my view, a judgment on admission can be pronounced by the Court against such defendant by placing reliance on such admission.
10. In support of the proposition that an admission contained in a document produced along with the pleading by the plaintiff, if remains uncontroverted by the defendant, can form the basis of a judgment on admission, reference can be made to the Supreme Court decision in the case of Uttam Singh Duggal & Co. Ltd. v. United Bank of India . The authorities cited also support the case of the plaintiff. In Freeman v. Cox (1878) (8) Ch D 148) it was held that affidavit of the plaintiff and the served notice of motion having remained unanswered by the non appearing defendant constituted sufficient admission for directing defendant to pay the admitted claimed amount. Hence I find that the plaintiff is entitled to a Judgment on admission against defendant 1.
11. As to interest, I find that no rate of interest was specified in the bills of exchange concerned. The cheques were dishonoured. So in view of Section 80 of the Negotiable Instruments Act, 1881 defendant 1 should, of course, be held liable to pay Interest at the rate of 18% per annum from the time it received the notices of dishonour. But there is no material on record from which such time can be ascertained. The liability was however, admitted by defendant 1 in its letter dated Sept. 7th. 1998. Hence in my view defendant 1 should be held liable to pay interest from this date, and the rate, in the absence of any specified rate, should be 18% per annum as provided in Section 80 of the Negotiable Instruments Act, 1881.
12. The expenses incurred by the plaintiff for making advertisement, together with the costs of this application, should also be paid by defendant 1 to the plaintiff.
13. For the aforestated reasons this application is allowed in part. There will be a decree against defendant 1. This defendant shall pay to the plaintiff a sum of Rs. 28,55,500/- with Interest calculated at the rate of 18% per annum from Sept. 7th, 1998 till the date of payment or realisation, it shall also pay the advertisement expenses and costs of this application. Defendant 1 is hereby granted a month's time to make the payment. On the failure of defendant 1 to make the payment within the time specified herein, the plaintiff will be entitled to realise the same by putting the decree into execution. Let the decree be drawn up and completed accordingly.
14. Urgent Xerox certified copy of this judgment may be supplied to the parties, if applied for.
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