TaxTMI 
TaxTMI 
2009 (7) TMI 1033
X X X X Extracts X X X X
X X X X Extracts X X X X
....decree for payment for Rs. 38,13,480/- reversed it to the extent of directing for payment of 9% interest per annum instead of 24% interest per annum, the present appeal is preferred by the appellant-plaintiff. 4. In order to effectively deal with the rival contentions raised by the parties herein it would be necessary to state a few facts leading to the filing of the aforesaid suit by the appellant-plaintiff before the trial court. 5. In the plaint filed by the appellant-plaintiff it was stated that the plaintiff is a company incorporated under the Indian Companies Act and registered as a Small Scale Industry in the Industries Department, Government of Bihar and that it entered into an agreement with the State of Bihar for supply of pipes at the rate of Rs. 174.95 paise. per metre subject to the terms and conditions mentioned in the tender paper. A supply order was placed by the respondent through Chief Engineer's letter No. 8956 dated 16.07.1992 with the appellant-plaintiff for making supply of the aforesaid pipes. It was mentioned in the said letter that 90% of the total value of the material received was to be paid after receipt of the material and the balance 10% of the v....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r the appellant-plaintiff is entitled to a direction for payment of interest compounding at monthly rest at the rate of 24% per annum. According to the appellant-plaintff, the said interest has been claimed by the appellant-plaintiff since it is entitled to so claim in terms of the provisions of the Interest on Delayed Payment to Small Scale Industries Act, 1993 (hereinafter referred to as 'the Act'). 9. Mr. G.C. Bharuka, learned senior counsel appearing for the appellant plaintiff drew our attention to the provisions of the Act and to the decision of this Court in Assam Small Scale Industries Development Corporation Ltd. & Ors. v. J.D. Pharmaceuticals & Anr. [2005 (13) SCC 19]. In support of his contention that the transaction in the instant case came to an end with the appellant-plaintiff supplying the goods after coming into force of the Act he has taken us through the relevant sections of the Act as also the Statements of Objects and Reasons of the Act. According to him, the appellant-plaintiff is entitled to be paid in terms of the provisions of the Act. He contended that the earlier supply order which was issued on 16.07.1992 came to be materially altered and substituted b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ods or the rendering of services, the day on which such objection is removed by the supplier; (ii) "the day of deemed acceptance" means, where no objection is made in writing by the buyer regarding acceptance of goods or services within thirty days from the day of the delivery of goods or the rendering of services, the day of the actual delivery of goods or the rendering of services; (c) "buyer" means whoever buys any goods or receives any services from a supplier for consideration; (d) "goods" means every kind of movable property other than actionable claims and money; (e) "small scale industrial undertaking" has the meaning assigned to it by clause (j) of section 3 of the Industries (Development and Regulation) Act, 1951 (65 of 1951); (f) "supplier" means an ancillary industrial undertaking or a small scale industrial undertaking holding a permanent registration certificate issued by the Directorate of Industries of a State 1*[or Union territory and includes,- (i) the National Small Industries Corporation, being a company, registered under the Companies Act, 1956 (1 of 1956); (ii) the Small Industries Development Corporation of a State or a Union territory, by whatever name calle....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng manner: "Applicability of the 1993 Act 37. We have held hereinbefore that clause 8 of the terms and conditions relates to the payments of balance 10%. It is not in dispute that the plaintiff had demanded both the principal amount as also the interest from the Corporation. Section 3 of the 1993 Act imposes a statutory liability upon the buyer to make payment for the supplies of any goods either on or before the agreed date or where there is no agreement before the appointed day. Only when payments are not made in terms of Section 3, Section 4 would apply. The 1993 Act came into effect from 23-9-1992 and will not apply to transactions which took place prior to that date. We find that out of the 71 suit transactions, Sl. Nos. 1 to 26 (referred to in the penultimate para of the trial court judgment), that is supply orders between 5-6-1991 to 28-7-1992, were prior to the date of the 1993 Act coming into force. Only the transactions at Sl. Nos. 27 to 71 (that is supply orders between 22-10-1992 to 19-6-1993), will attract the provisions of the 1993 Act. 38. The 1993 Act, thus, will have no application in relation to the transactions entered into between June 1991 and 23-9-199....
X X X X Extracts X X X X
X X X X Extracts X X X X
....visions of the Act. Therefore, those supply orders which were issued by the Corporation between 22.10.1992 to 19.06.1993 were held to be the transactions which would be entitled to get the benefit of the provisions of the Act. 16. In our considered opinion, the ratio of the aforesaid decision is clearly applicable and would squarely govern the facts of the present case as well. The said decision was rendered by this Court after appreciating the entire facts as also all the relevant laws on the issue and, therefore, we do not find any reason to take a different view than what was taken by this Court in the aforesaid judgment. Thus, we respectfully agree with the aforesaid decision of this Court which is found to be rightly arrived at after appreciating all the facts and circumstances of the case. 17. Now coming to the facts of the present case we find that there is no dispute with regard to the fact that the supply order was placed with the respondents on 16.07.1992 for supply of the pipes which date is admittedly prior to the date on which this Act came into effect. 18. Being faced with the aforesaid situation, the learned senior counsel appearing for the appellant-plainti....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n is a beneficial legislation and, therefore, a liberal interpretation and wider meaning is to be given to such a beneficial and welfare legislation so as to protect the interest of the supplier who is being kept on a higher pedestal by giving a higher benefit in the Act. 24. Generally, an Act should always be regarded as prospective in nature unless the legislature has clearly intended the provisions of the said Act to be made applicable with retrospective effect. It is a cardinal principle of construction that every statute is prima facie prospective unless it is expressly or by necessary implication made to have a retrospective operation. The aforesaid rule in general is applicable where the object of the statute is to affect vested rights or to impose new burdens or to impair existing obligations. Unless there are words in the statute sufficient to show the intention of the legislature to affect existing rights, it is deemed to be prospective only - "nova constitutio futuris formam imponere debet non praeteritis" - a new law ought to regulate what is to follow, not the past. (See Principles of Statutory Interpretation by Justice G.P. Singh, 9th Edn., 2004 at p. 438.). It is ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gment for the Attorney General, said: (ER p. 134) "The duty in this instance was, in fact, imposed by the first Act; but the gross mistake of the omission of the weight, for which the sum expressed was to have been payable, occasioned the amendment made by the subsequent Act: but that had reference to the former statute as soon as it passed, and they must be taken together as if they were one and the same Act;" (Price at p. 392)" 25 There is no dispute with regard to the fact that the Act in question is a welfare legislation which was enacted to protect the interest of the suppliers especially suppliers of the nature of a small scale industry. But, at the same time, the intention and the purpose of the Act cannot be lost sight of and the Act in question cannot be given a retrospective effect so long as such an intention is not clearly made out and derived from the Act itself. 26 It was next submitted by the learned senior counsel appearing for the appellant-plaintiff that there was a novation and alteration of the contract giving rise to a new contract between the parties due to alteration of terms and conditions of the contract and, therefore, Section 62 of the Indian Con....
X X X X Extracts X X X X
X X X X Extracts X X X X
....as to be regarded in law as a new agreement. What would be the position if the parties agree to sell property A and at a later stage they agree that not property A but property B should be sold? Clearly this would be a new agreement notwithstanding the fact that all other terms regarding rate for payment etc. may also be similar. So also payment of price or the rate of payment is a material part of the agreement for sale. Both the subject-matter and the rate of payment are material parts of any agreement for sale and change in either of these terms brings about a new agreement. In our case therefore the correspondence of 1983 brought about an entirely new agreement -- between new parties, new property (so far a F.S.I. is concerned), and new rates." 28. In order to appreciate the aforesaid contention, we have looked into the documents available on records and considered the same. On analyzing the same we find that in none of the courts below any such issue was raised by the appellant-plaintiff. Neither any issue was framed by the courts below in respect of such a submission nor any ground to that effect was taken earlier. Even in the memorandum of appeal filed in this Court no su....