In absence of any written instrument or any other agreement or usage regarding payment of interest, no pre-suit interest is payable

P.K. Misra, J.

The present appeal has been filed by the defendants against the decree of the learned single Judge in C.S.No.664 of 1995 dated 12.4.2000.

2. The plaintiff / respondent filed the aforesaid suit for realization of a sum of Rs.54,87,973/- with interest at the rate of 24% on the principal sum of Rs.54,87,973/- from the date of the suit till payment.

3. The plaintiff, a private limited company, is a registered Small Scale Industry manufacturing domestic/industrial/agricultural monoblock electric motor pump sets under the brand name ‘BEACON’ under the licencee Agreement from Best & Crompton, who are the owners of such trademark. The first defendant is a commercial trader engaged in selling and distributing various goods. The first defendant was the dealer of the plaintiff in respect of the aforesaid pump sets throughout India during the period from 1985 to 1993. On the basis of the comprehensive orders placed by the first defendant, the plaintiff used to despatch the goods to various branches and at times the various branches are directly placing orders with the plaintiff. The plaintiff under the advice of the first defendant used to raise the invoices in the name of the concerned branches and the original invoices along with the Hundis were being sent to the second defendant for payment. As per the instruction of the first defendant, all payments were to be made by the second defendant, namely, the Madras Branch of the first defendant. Initially, the Hundi was raised in favour of the second defendant giving 45 days time. Subsequently, such time limit was revised to 60 days and ultimately to 75 days. “On many occasions the second Defendant honoured the Hundi after the due dates, for which they have duly paid proportionate interest at the rate charged by the Nationalized Bank.” The plaintiff had been availing bill discounting facility from the Bankers for which the plaintiff was required to pay interest to the bank at the rate of 24% per annum. All the payments made by the second defendant in respect of total supplies received by all the branches of the first defendant had been fully given credit as and when such amounts have been realised by the plaintiff. During the year 1993, the second defendant found it difficult to make payments and became irregular and delayed in making payments to the plaintiff and, consequently the plaintiff was forced to stop supplying the goods to the first defendant. The last consignment was on 11.9.1993, after which the plaintiff stopped supplying the goods because of the poor and irregular payment from the second defendant. Since the second defendant found it difficult to make payments, the first defendant issued directions to all the branches to return the unsold goods to the plaintiff. As a gesture of the goodwill, the plaintiff accepted the goods from the branches, which were returned between September 1993 and March 1994. The first defendant raised consolidated invoices to the tune of Rs.25.49 lakhs, being the value of the returned goods. The plaintiff had to pay the freight charges while taking delivery of the returned goods. It was also found that many of the goods were damaged and the plaintiff had to rectify the damages by incurring expenditure of Rs.3.03 lakhs and the freight charges paid by the plaintiff was to the tune of Rs.78,327/-. According to the plaintiff, the aforesaid amount is payable by the defendants. Besides the aforesaid amounts, the plaintiff is entitled to receive various amounts from the defendants and on reconciliation of accounts, the defendants were liable to pay Rs.80,01.956/- as on 30.9.1993. The value for the returned goods fixed at Rs.25,49,409/- had been given credit to by the plaintiff. The first defendant by letter dated 15.4.1994 acknowledged the liability at Rs.80,01,956/- as on 30.9.1993 and also admitted the credit of Rs.25,49,409/-. Subsequently the defendants had paid Rs.10,29,599/- on 25.4.1994, which was credited in the books of acc