Directors of the Company have not given any personal guarantee so they are not personally liable.

A. C. ARUMUGAPERUMAL ADITYAN, J.

This suit is for a sum of Rs. 27,43,373.50 with interest at the rate of 20% per annum from the date of plaint till the date of decree and 6% per annum from the date of decree till realisation and to pay the costs.

2.2(a) The plaintiff Electronics Corporation of Tamil Nadu Ltd., is a company wholly owned by the Government of Tamil Nadu, formed to carry on the business of promotion of Electronics Industries and Manufacture and marketing of electronic goods. The plaintiff states that the first defendant, Hi-Fi Electronics Industry Ltd., is carrying on the business of selling TV sets and components. The plaintiff appointed the first defendant, as one of the dealers, to sell and service Sears Elcot Televisions in Tamil Nadu. The first defendant approached the plaintiff company for appointment as an authorised seller to sell the Sears Elcot televisions. The plaintiff by their Proceedings in ref. No. MKT/MM/83/90, dated 17.12.1990, appointed the first defendant as one of the authorised dealers and the relevant terms and conditions thereof being as hereunder:

1) You will be paying a security deposit of Rs. 10,000/- (Rupees Ten Thousand Only), which does not carry any interest. This security deposit is repayable at the time of discontinuance of the dealership arrangement.

2) Your area of operation will be the State of Tamil Nadu.

3) You will be appointing suitable sales force to promote the sale of the products in the assigned territory.

4) Price will be communicated time-to- time.

5) The materials will be supplied normally against payment only. Any specific credit facility is to be approved by us based on written request from you.

6) You will ensure that you will be providing after sale service to the customer directly.

7) The TVs are guaranteed for one year from the date of sale to the customer against any manufacturing defect faulty workmanship. During this guarantee period, the service obligation to the customer is to be borne by you.

8) This arrangement is valid till 31.3.1991. Based on your performance, this will be extended for a further period of 3 years.

9) During the tenure of this arrangement, you will not sell any similar product of this nature without our written permission.

10) In the event of any disputes arising out of this arrangement, the same will be settled through the Courts in Madras City only.

2(b) The plaintiff states that in pursuance of the dealership appointment, the defendant placed orders, on the plaintiff on various dates, for the purchase of 200 sets if AVET Black and white televisions, 200 sets of Sears Elcot colour televisions ‘Sigma‘ Model and 100 sets of 4 VOX Black and white televisions. A statement containing details of the purchases made by the first defendant is annexed to the plaint. The plaintiff had supplied the following goods, which were accepted and acknowledged by the first defendant between October 1990 and March 1991:

Date Invoice No. Amount

31.10.1990 162 Rs. 7,31,500.00

30.11.1990 183 Rs. 13,58,500.00

31.12.1990 210 Rs. 7,64,417.50

20.2.1991 283 Rs. 14,19,632.50

31.3.1991 350 Rs. 12,21,500.00

As per the agreement, the defendant has to settle the dues in respect of the invoices, within 90 days from the date of delivery of the goods. Failure to do so would entail liability to pay interest at 20% per annum. Out of the sales referred to above, the amount due under Invoice No. 283, dated 20.2.1991, for 150 sets of Sears Elcot Colour Televisions (Sigma Model), against the total sum of Rs. 14,19,632.50 due and payable by the defendant, it has paid only a sum of Rs. 4,90,000/-between 30.7.1991 to 6.11.1991, leaving a balance of Rs. 9,29,632.50. In respect of Invoice No. 350, dated 31.3.1991, for 300 sets black and white televisions, no payment has been effected so far and the defendant is liable to pay a sum of Rs. 12,21,500/-. So under Invoice Nos.283 and 350, the first defendant is due and liable to pay the plaintiff a sum of Rs. 21,51