Court upheld the trial court's ruling on limitation and interest, emphasizing ongoing commercial transactions while invalidating the claim for hand loan.

JUDGMENT :

(PER: HON'BLE MR. JUSTICE C.M. POONACHA)

1. The present appeal is filed under Section 13 (1-A) of the Commercial Courts Act, 2015 ('2015 Act') by the defendants, assailing the judgment and decree dated 30.1.2025 passed in Com.O.S.No.762/2023 by the LXXXII Additional City Civil and Sessions Judge, Bengaluru (CCH-83) ('Trial Court'), whereunder the suit for recovery of money filed by the respondent/plaintiff against the appellants/defendants has been decreed directing the defendants to pay a total sum of Rs.42,54,223/- together with a sum of Rs.21,69,653/- being the interest from 1.9.2020 till filing of the suit and further interest at 18% per annum from the date of the suit till realization.

2. The parties will be referred to as per their rank before the Trial Court for the sake of convenience.

3. It is the case of the plaintiff [a proprietorship concern] that it was engaged in the business of manufacture and supply of packaging materials and trading in Kraft papers. That defendant No.1 was engaged in the manufacture, import and supply of packaging material. Defendant No.2 and defendant No.3 were its directors. The plaintiff and the defendants had a business relationship with each other for the past thirty years. The plaintiff had supplied goods on credit as and when requested by the defendants and the parties were having continuous and running transactions.

3.1. It is the further case of the plaintiff that it used to raise invoices in respect of the goods supplied to the defendants and the defendants acknowledged receipt of the goods on the said invoices. That the plaintiff raised invoices amounting to Rs.98,32,927/- for the period from April 2017 to March 2020 towards the material supplied to the defendants. That defendant No.2 had sought a hand loan of a sum of Rs.3.00 lakhs, which was paid by the plaintiff. Hence, the total amount payable under the invoices and the hand loan is a sum of Rs.1,01,32,927/-. That the defendants had supplied certain materials to the plaintiff and raised invoices for Rs.19,298/- on 27.11.2018 and 13.02.2019. That the defendants had made a total payment of Rs.58,59,407/- towards the dues payable to the plaintiff. Hence, after adjusting the amounts received from the defendants, they were due and payable to the plaintiff in a total sum of Rs.42,54,223.28. It was further averred by the plaintiff that it had paid statutory GST returns (GSRT-1) on the invoices raised and that the defendants were eligible to claim input credit on the same. That the claim of input credit is reflected in the GST portal (GSTR-2A & 2B), which can be accessed only by the defendants. Hence, the plaintiff filed the suit claiming the following amounts:

4. The defendants entered appearance and filed their written statement, whereunder the defendants have admitted that they were doing business along with the plaintiff for many years. However, the defendants have specifically contended that the suit is barred by limitation, inasmuch as, the suit claim was with respect of invoices for the period from 18.9.2017 to 21.3.2020, while the suit was filed on 30.6.2023.

4.1. The defendants have further denied that they are liable to pay the plaintiff the suit claim amount. It was further contended that the plaintiff supplied Kraft papers and insisted on issue of post dated cheques bill-wise. Defendant No.2 used to have the system of keeping signed cheques with the office staff of defendant No.1 - company for emergency use and that the plaintiff managed to get the said cheques from the staff of defendant N