- (1.) Plaintiff Food Corporation of India (FCI for short) filed a suit for recovery against the rice mill-Defendant.
(2.) The case of the FCI, in brief, was that a policy had been framed by the Central Government and under the said policy, the FCI used to purchase paddy from the market and give it to the millers for shelling. Defendant had agreed to shell the paddy as per its storage capacity. The paddy stored under the mill was to remain in joint custody of the FCI and the mill. As per the policy of the Central Government, 67 % of superfine rice was required to be delivered out of the paddy supplied to the Defendant. The Defendant had agreed to abide by the terms and conditions of the said agreement. The Defendant had furnished the requisite security in terms of the agreement. The Defendant was also responsible for the safe custody of paddy supplied to it for milling and delivery of rice as per the agreement. Losses, if any, incurred during the transit or storage were to be made good by the Defendant @ 1 time of economic costs of the variety of paddy/rice. The Defendant was required to deliver the rice within ten days of issuance of supply of paddy at regular intervals. As per schedule, 20% of rice was to be delivered in the months of October/November 1994, 26% in December 1994, 26% in the month of January 1995 and 28% in the month of February 1995. The Defendant had, however, failed to shell the paddy and as such it became liable to pay 1 time of economic costs of paddy supplied to it. The total paddy stored in the premises of the Defendant was 11840 bags weighing 769.6 quintals of superfine paddy. Since the Defendant had failed to shell the paddy, the Plaintiff dispatched 10880 bags weighing 6852.10 quintals of paddy before 31.5.1995. Cost of the remaining paddy was assessed at 876.21 per quintal @ 1 time of the economic cost i.e. 7,39,437/- on 1.6.1995. Out of the remaining paddy, 960 bags weighing 587.05 quintals were retrieved and their value was assessed at 395/- per quintal amounting to 2,32,063/- and an expenditure of 5,760/- was incurred for retrieving the paddy. As such the Plaintiff was entitled to recover 5,13,134/-. As the Defendant failed to pay the said amount so it was liable to pay interest @ 18% per annum w.e.f. 1.6.1995 to 31.1.1998 i.e. 2,38,605/-. Hence, the FCI was entitled to recover a total sum of from the Defendant.
(3.) Defendant, in its written statement, averred that the paddy was stored in the premises of the Defendant on rental basis. The execution of agreement to shell the paddy between the parties was denied. Rest of the contentions made in the plaint have been denied.;