Vishvambhar Dayal vs Nathulal and others

Shinde, J.—This petition for revision is by the plaintiff against the order of the District Judge, Guna. The plaintiff brought a suit against the defendants for the recovery of Rs. 550 due from the defendants on account of the price of goods supplied to them from 17-6-1941 to 5-12-1942. The trial Court decreed the suit. The first appellate Court disallowed Rs. 100.7 0 which were decreed by the first Court as interest. On second appeal the District Judge deducted a further sum of Rs. 83-8-0 on account of interest allowed by the lower Courts. Against this judgment the plaintiff has filed this petition.

The only question for consideration in the case is whether interest can be allowed as damages. The learned counsel for the petitioner admits that there is not agreement to pay interest between the parties. He also admits that no mercantile usage allowing interest has been proved in this case. He contends that as money was due to the plaintiff from the defendants on account of the price of goods supplied to the defendants the plaintiff is entitled to interest by way of damages.

It would be well, at the outset, to examine the position of law with regard to payment of interest. As a general rule interest is allowable where there is express or implied agreement to pay interest between the parties. Interest can also be awarded when any statute or mercantile usage allows it. Vide AIR 1938 67 (Privy Council); AIR 1936 285 (Nagpur) . Interest can also be allowed in cases of breach of contract where loss or damage is proved. In Chhajamaldas v. Brijbhukanlal, 17 ALL. 511: (22 I.A. 199 P.C .), their Lordships of the Privy Council observed that if there is an express covenant to repay a debt on a certain date and it is not repaid then that amounts to a breach of contract to pay on that date and interest can be* awarded by way of damages under the ordinary law of contract. A mere detention of a debt does not, however, entitle the creditor to interest by way of damages. In AIR 1936 285 (Nagpur) : (I.L.R. (1937) Nag. 61) Bose J. reviewing the position in law with regard to the award of interest at length has observed as follows:

When the loans in this ease were made no time was fixed for repayment. They were, therefore, payable on demand and consequently there could have been no breach unless and until demand was made.

This view has been followed in AIR 1942 311 (Oudh) , District Local Board, Nawabshah v. Bulchand Chandiram, AIR 1942 Sind 165: (I.L.R. 1942) Kar. 288 ), Thakurani Jamuna Kunwar Vs. Thakur Arjun Singh, . To the same effect has been the pronouncement of their Lordships of the Privy Council in the case of AIR 1938 67 (Privy Council) .

AS stated above the suit is for the recovery of price of goods supplied to the defendants. There is nothing on record to show that any definite rate was fixed for the payment of money; nor is there anything to indicate that any demand for money was made. Consequently there can be no breach of any contract to pay. Interest, therefore, by way of damages cannot be awarded.

The result is that the revision is dismissed with costs.