M/S. SHAKTI TUBES LTD. versus STATE OF BIHAR & ORS.

M/S. SHAKTI TUBES LTD. versus STATE OF BIHAR & ORS.

Since the supply order was placed prior to the coming into force of the Interest on Delayed Payment to Small Scale Industries Act, 1993, the appellant is not entitled to benefits under Sections 4 and 5 of the Act. The Act cannot be given retrospective effect when such intention is not clear from the Act. Contention...

Source-derived case information.

Parties
Appellant: MIS. Shakti Tubes Ltd.; Respondent: State of Bihar & Ors.
Jurisdiction
India
Judgment Date
07 July 2009
Procedural Posture
Civil Appeal / Appeal From Judgment & Order Dated 20.2.2006 of the Patna High Court in First Appeal No. 8/2000
Outcome
Appeal dismissed
Legal Topics
Interest on Delayed Payments, Retrospectivity of Statutes, Novation and Alteration of Contract
Commercial Law Contract Law Interest on Delayed Payments Retrospectivity of Statutes Novation and Alteration of Contract

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Parties

MIS. Shakti Tubes Ltd.

Appellant

State of Bihar & Ors.

Respondent

Procedural Posture

Civil Appeal / Appeal From Judgment & Order Dated 20.2.2006 of the Patna High Court in First Appeal No. 8/2000

Legal Issues

  1. 1 Whether appellant is entitled to payment of interest compounding at monthly rest at the rate of 24% per annum under Interest on Delayed Payment to Small Scale Industries Act, 1993 and/or under Section 62 of Indian Contract Act, 1872

Ratio Decidendi

Since the supply order was placed prior to the coming into force of the Interest on Delayed Payment to Small Scale Industries Act, 1993, the appellant is not entitled to benefits under Sections 4 and 5 of the Act. The Act cannot be given retrospective effect when such intention is not clear from the Act. Contention regarding alteration or novation of contract giving rise to a new contract after the Act is not supported by evidence and cannot be raised for the first time before this Court.

Court Disposition

Appeal dismissed

Orders

  • Appeal dismissed
  • Parties to bear their own costs