The main legal point established in the judgment is that written acknowledgments of a time-barred debt can extend the period of limitation and constitute a valid contract to pay the debt, but claims for interest on the outstanding amount must be supported by a written agreement and are subject to the period of limitation.

S.P. Garg, J.:--

1. The plaintiff – Nepal Airlines Corporation formerly known as Royal Nepal Airlines Corporation has instituted the instant suit for recovery of Rs. 80,18,000/- with interest pendente-lite and future.

2. As per averments in the plaint, the plaintiff carries on its business in India having its principal office at 44, Janpath, New Delhi. The defendant established an enterprise known as Nepal Travel Information Centre, based in Bombay. Subsequently, offices were established in other cities including Delhi at 13/29, East Patel Nagar, New Delhi. The plaintiff is an international airline carrying on its business operations in India. In December, 1995, the defendant became its Passenger Sales Agent for expansion of selling of air tickets in its operating routes by an agreement dated 15.12.1999 on the terms and conditions described therein. Under the agreement, the defendant collected tickets from the plaintiff for sale on different operating routes of the plaintiff in India. In May, 2000, the defendant defaulted in submitting the Periodic Sales Return (PSR) and remitting payments against tickets sold. Vide letter dated 19.05.2000, the defendant admitted that the net amount payable to the plaintiff was Rs. 40,76,506/-. By another letter dated 08.06.2000, the defendant stated that he had used all the tickets and confirmed the amount payable to the plaintiff at Rs. 38,54,811/-. He requested the plaintiff to give him some time to arrange the funds for payment. In confirmation to the assurances, the defendant signed and delivered a personal bond undertaking to pay Rs. 38,54,811/- ‘on account’ of payments against Passengers Sales Report. He also signed, issued and delivered a blank and undated cheque No. 775601 in the name of the plaintiff. The defendant vide letter dated 22.06.2000, requested to keep the validity of his engagement. On 27.09.2000, the defendant submitted an undertaking that the amount would be paid in installments at regular intervals. In view of the defendant’s undertaking, the legal action was deferred and the defendant was allowed to transact business during the validity period of agreement dated 15.12.1999 till 30.06.2003 to enable it to clear the dues.

3. Grievance of the plaintiff is that the defendant failed to pay the outstanding dues despite various assurances given. The defendant even stopped carrying on business under the name and style of Nepal Travel Information Centre and started a new business ‘Indo Nepal Travel Group’. He also started a travel agency by the name of M/s. Fun Plannet Tours in Indore. With great difficulty, the defendant was contacted in June, 2005. He faxed a letter dated 20.10.2005 confirming that he would pay the entire outstanding amount. On 20.12.2006 finally a Memorandum Of Understanding was executed between the parties and a sum of Rs. 1,000/- was paid by the defendant. He promised to pay the remaining balance in installments. However, no further payment was made by the defendant. Hence, the present suit.

4. The defendant could be served only by way of publication under Order V Rule 20 CPC. None appeared on behalf of the defendant despite service by publication and he was proceeded ex-parte by an order dated 03.01.2014.

5. The plaintiff examined PW-1 (Bashu Dev Pandey) in its evidence. I have heard the learned counsel for the plaintiff and have examined the file. PW-1 (Bashu Dev Pandey) proved the averments of the plaint by filing evidence by way of affidavit (Ex.PW-1/A). He also relied upon various documents (Ex.PW-1/1 to Ex.PW-1/15). Adverse inference is to be drawn against the defendant for not appearing and contesting the present suit. The testimony of PW-1 (Bashu Dev Pandey) has remained unchallenged and unrebutted. Genuineness and validity of various documents whereby the defendant promised to pay the outstanding amount have not been questioned. Ex.PW-1/3 is the copy of the agreement; Ex.PW-1/5 and Ex.PW-1/6 are the letters dated 13.05.2000 and 19.05.2000 wri