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Gogineni Ankamma Vs. Alluri Sri Venkata Seshachalapathi and Two ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1935Mad783; (1935)69MLJ84
AppellantGogineni Ankamma
RespondentAlluri Sri Venkata Seshachalapathi and Two ors.
Cases ReferredJai Barham v. Kedarnath Marwari
Excerpt:
- - he appealed to the district court against the official receiver's decision without success. but as both parties have failed in part we make no order as to the costs......interest to be paid on the sum ordered to be refunded. a mortgagor having become insolvent the official receiver made a payment to a first mortgagee, who is the appellant before us, on account of his mortgage debt. the second mortgagee, who is third respondent in this appeal, objected to the rate of interest allowed by the official receiver to the prior mortgagee on his debt. he appealed to the district court against the official receiver's decision without success. he then carried his appeal to the high court with the result that the lower court's order was modified by directing that the interest due should be recalculated at the rate of re. 1 per cent, per mensem instead of re. 1-9-0 per mensem. the excess payment made on this account amounted to rs. 1,746 odd. on the petition of.....
Judgment:

Cornish, J.

1. The appeal is against the part of a restitution order directing interest to be paid on the sum ordered to be refunded. A mortgagor having become insolvent the Official Receiver made a payment to a first mortgagee, who is the appellant before us, on account of his mortgage debt. The second mortgagee, who is third Respondent in this appeal, objected to the rate of interest allowed by the Official Receiver to the prior mortgagee on his debt. He appealed to the District Court against the Official Receiver's decision without success. He then carried his appeal to the High Court with the result that the lower Court's order was modified by directing that the interest due should be recalculated at the rate of Re. 1 per cent, per mensem instead of Re. 1-9-0 per mensem. The excess payment made on this account amounted to Rs. 1,746 odd. On the petition of the present third respondent the lower Court has ordered this sum to be refunded to the third respondent with interest at 6 per cent, per annum. The appeal is against this order for payment of interest, the appellant's contention being that the Court had no jurisdiction to give interest.

2. The High Court's order on appeal varying the order of the lower Court by directing that the interest paid by the Official Receiver to the present appellant on this mortgage debt should be recalculated at a lower rate was not a variation of a decree within the terms of Section 144, Civil Procedure Code. It was a variation of an order in an appeal under Section 75 of the Provincial Insolvency Act. Section 144 of the Civil Procedure Code however, is not exhaustive of the power of the Court to order restitution. Section 151 saves the inherent power of the Court to make such orders as may be necessary for the ends of justice. As was said by their Lordships in Jai Barham v. Kedarnath Marwari the duty imposed on the Court by Section 144, Civil Procedure Code to restore the parties to the position which they would have occupied but for such decree as has been varied or reversed does not arise merely under that section. 'It is inherent in the general jurisdiction of the Court to act rightly and fairly according to the circumstances towards all parties involved'.

3. The High Court on appeal having ordered that the interest paid to the first mortgagee by the Official Receiver under the sanction of the insolvency Court should be recalculated at a lower rate, it followed that the mortgagee was bound to refund the excess which he had received in payment of interest at the higher rate. That money was not his, but should have been paid to the second mortgagee. We think that the learned District Judge was right in directing the appellant to pay interest on the excess payment for the long period, more than six years, during which he has had the benefit of this over paid amount. For unless third respondent is repaid the money, of which he has been wrongfully deprived, with interest, he will not be fully restored to the position which he would have occupied but for the order of the Court which was later varied on appeal.

4. There is a memorandum of objections to the 6 per cent, rate fixed by the lower Court. But we see no reason to interfere with this. The appeal and memorandum are dismissed. But as both parties have failed in part we make no order as to the costs.


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