Sree Pandian Extro Chemicals Private Limited vs The Tamil Nadu Industrial Investment Corporation Ltd. and Others

D. Raju, J.—In the above matter, while passing an order in W.P. No. 5843 of 1994, one of us (AR. Lakshmanan J) has passed orders

which almost settled the area of controversy raised except the controversy relating to the rate of interest payable. With reference to the said

aspect, it has been stated in the order dated 3.5.1994 as hereunder:

Post the matter after re-opening of the court for orders in regard to fixation of rate of interest"".

subsequent to the orders, the petitioner also appears to have performed his obligations otherwise as stipulated in the order referred to supra and

got possession of the unit.

When the matter was taken up today, with reference to the direction about the fixation of rate of interest, Mr. A.L. Somayaji, Learned Senior

Counsel appearing for the respondent-Corporation, placed reliance upon an unreported decision of a Division Bench of this Court dt. 31.3.1993

(The Coimbatore Textiles Rep. by its Proprietor K. Palanisamy v. The Tamil Nadu Industrial Investment Corporation Ltd. rep. by Its Managing

Director, Madras-14 and Ors.) wherein it has been held, while affirming the view taken by a learned single Judge of this court, that the increase in

the rate of interest is a matter governed by the contract between the parties and cannot be interfered with by the court, exercising jurisdiction under

Article 226 of the Constitution as an appellate court over the decision of the Tamil Nadu Industrial Investment Corporation. That was a case

wherein the sanction letter under which the loan was sanctioned contained an annexure with Clause (c) which stipulate that the Tamil Nadu

Industrial Investment Corporation Ltd. had reserved the right for any alteration of interest rate and repayment schedule from time to time. It is in

that context, the controversy before the Division Bench rose.

Mr. T.R. Mani, learned Senior Counsel appearing for the petitioner, would contend that inasmuch as on an earlier occasion this Court proposed

to decide about the issue relating to the rate of interest due in respect of the transaction in question, there could be no impediment for this court,

exercising jurisdiction under Article 226 of the Constitution of India also to adjudicate on the issue with reference to the rate of interest payable in

respect of the transaction over the moneys due to the Corporation. It is also contended by the learned counsel that unlike the case which was

under the consideration of the learned judges of the Division Bench of this Court referred to supra, in this case, there is no actual stipulation as

such, and, therefore, the said judgment will not stand in the way of this court adjudicating on the issue relating to the rate of interest.

We have carefully considered the submissions of the learned Senior Counsel appearing on either side. In our view, the objection taken on behalf

of the respondent-corporation is well merited and deserves to be sustained. The factual difference sought to be made between the case on hand

before us and the case which was under the consideration of the Division Bench in the unreported decision referred to supra, does not, in our view,

really matter for the legal principal involved. Even in the latest decision of the Supreme Court reported in U.P. Financial Corporation and Others

Vs. Naini Oxygen and Acetylene Gas Ltd. and Another, , the apex court observed that the High Courts exercising Jurisdiction under Article 226

of the Constitution of India should not interfere in commercial matters and risk their judgments, we are also of the view that whether there be any

term binding on the parties or not, any dispute arising out of a commercial contract has to be adjudicated in an appropriate forum as is permissible

in law and it is not for the writ court to substitute even any vacuum in the stipulations in a contract and thereby declare the position or rights of the

respective parties to the contract in respect of matters pertaining to the said contract. That, in our view, is wholly outside the purview of the

jurisdiction under Article 226 of the Constitution of India. On that view alone and without expressing any view on the actual rate of interest, we

reject that claim of the petitioner in this regard. The petitioner is at liberty to vindicate his rights before the appropriate forum or court as is

permissible in law and all contentions of both parties in respect of the respective claims in this regard are left open to be so agitated. No costs.