Case Note & Summary
The plaintiff, M/s. Offshore Industrial Construction Pvt. Ltd., filed a suit for recovery of Rs.12,55,965.21 with interest at 18% p.a. against the defendant, Rosma Engineering Construction. The plaintiff had entered into an agreement with Karnataka Water Supply and Drainage Board for laying a water pipeline from Taranagar to Sandur, and sub-contracted the labour work to the defendant. The defendant submitted seven estimated bills totaling Rs.59,00,650, which the plaintiff certified for Rs.46,64,371. The plaintiff paid Rs.39,86,116 to the defendant. However, the defendant failed to complete the work and left the site, forcing the plaintiff to engage another agency at extra cost. The plaintiff alleged that only Rs.27,30,151 was payable for the work done, and the excess payment of Rs.12,55,965.21 was made due to fabricated bills. The defendant did not appear in the suit, and it was transferred to the undefended list. The plaintiff adduced evidence through its Account Officer, Mr. G.B. Mallikarjunaiah, who deposed in support of the claim and produced six documents. The court found that the plaintiff had proved its case on a preponderance of probabilities and was entitled to recover the excess amount. However, the court reduced the interest rate from 18% to 6% per annum from the date of suit till realization, exercising discretion under Section 34 of the Code of Civil Procedure, 1908. The suit was decreed ex-parte with costs.
Headnote
A) Civil Procedure - Ex-parte Decree - Undefended Suit - Order 8 Rule 10 CPC - Suit transferred to undefended list after defendant failed to appear - Court permitted plaintiff to lead evidence and passed ex-parte decree - Held that plaintiff must prove its case even in ex-parte proceedings (Paras 7-9). B) Contract Law - Recovery of Excess Payment - Sub-Contract - Plaintiff claimed defendant fabricated bills and was paid in excess - Plaintiff's witness deposed that only Rs.27,30,151/- was payable but Rs.39,86,116/- was paid - Court found plaintiff proved its case on preponderance of probabilities - Held that plaintiff is entitled to recover the excess amount (Paras 8-9). C) Interest - Discretionary Power - Section 34 CPC - Plaintiff claimed 18% p.a. interest - Court reduced to 6% p.a. from date of suit till realization - Held that interest rate must be reasonable and not usurious (Para 9).
Issue of Consideration
Whether the plaintiff is entitled to a decree for recovery of the alleged excess payment made to the defendant in the absence of the defendant's appearance and evidence.
Final Decision
Suit decreed ex-parte. Defendant ordered to pay plaintiff Rs.12,55,965.21 with interest at 6% p.a. from date of suit till realization, with costs.
Law Points
- Ex-parte decree
- recovery of excess payment
- burden of proof on plaintiff
- fabrication of bills
- interest rate discretion
