Unilateral invoice without acknowledgment does not extend limitation for contract payment claims; warranty period does not postpone cause of action.

JUDGMENT :

P. VELMURUGAN, J.

This Appeal Suit has been filed by the appellant/defendant challenging the judgment and decree dated 08.10.2025 passed in C.O.S. No.501 of 2022 on the file of the learned Additional Commercial Court, Egmore, Chennai, whereby the suit filed by the respondent/plaintiff for recovery of money was partly decreed. Originally, the suit was instituted as C.S. No.296 of 2015 on the file of this Court. Subsequently, the suit was transferred and renumbered as O.S.No.3621 of 2019 on the file of the learned VII Additional City Civil Court, Chennai. Thereafter, upon constitution of the Commercial Court and having regard to the commercial nature of the dispute, the matter was again transferred and renumbered as C.O.S. No.501 of 2022 on the file of the learned Additional Commercial Court, Egmore, Chennai.

2. The brief facts leading to the filing of the suit, as stated by the respondent/plaintiff, are that the appellant/defendant had placed a work order in connection with the supply, erection, testing and commissioning of elevator equipment for a project. According to the respondent/plaintiff, the work entrusted to it was carried out and completed in accordance with the contract and the elevators were installed and commissioned. The respondent/plaintiff states that for the work executed, invoices were raised from time to time and a substantial portion of the contract value had already been paid by the appellant/defendant through a Letter of Credit. However, according to the respondent/plaintiff, a balance amount of Rs.22,00,000/- remained due and payable by the appellant/defendant. It is the further case of the respondent/plaintiff that despite repeated requests and demands for payment, the appellant/defendant failed to settle the outstanding amount. Therefore, the respondent/plaintiff filed the suit seeking recovery of the said sum of Rs.22,00,000/- together with interest and costs.

3. The appellant/defendant contested the suit by filing a written statement denying the claim made by the respondent/plaintiff. The appellant contended that the suit claim is not maintainable and is barred by limitation. According to the appellant, the work relating to erection, testing and commissioning of the elevator was completed on 05.02.2010 and the respondent/plaintiff had encashed the Letter of Credit amounting to Rs.50,00,000/- on 08.02.2010. It was therefore contended that if any balance amount was due, the respondent/plaintiff ought to have initiated legal proceedings within a period of three years from the said date. However, the suit was filed only after several years and therefore the claim is clearly barred by limitation. The appellant further contended that the invoice dated 30.03.2012 relied upon by the respondent/plaintiff was never acknowledged by the appellant and the same does not contain the signature or seal of the appellant. According to the appellant, the said invoice was unilaterally created by the respondent/plaintiff only to bring the suit within the period of limitation.

4. The appellant also contended that there was considerable delay in the completion of the work by the respondent/plaintiff and due to such delay, the Tamil Nadu Electricity Board (TNEB) imposed liquidated damages in connection with the project. According to the appellant, the respondent/plaintiff had agreed that any liquidated damages imposed due to delay would be borne by the respondent/plaintiff and therefore the appellant was justified in withholding the balance amount claimed by the respondent/plaintiff. The appellant further contended that the re