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Chelikani Lakshmi Venkayamma Vs. Mandapati Venkatapathiraju and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1941Mad382; (1941)1MLJ25
AppellantChelikani Lakshmi Venkayamma
RespondentMandapati Venkatapathiraju and ors.
Cases ReferredRam Shah v. Lal Chand
Excerpt:
- .....who is the petitioner that the whole of the process laid down in this portion of section 9 is a process in reduction of the debt for interest and that it does not contemplate any reduction of the amount due for principal. the process is firstly to calculate the interest which would have been due at the rate of 5 per cent., then give credit for any payments actually made* towards interest, then give a decree for interest on the basis of this calculation together with the amount due for principal. it is contended that if the scaling down process results in a smaller amount of interest than what has actually been paid as interest there is no provision in section 9 for carrying over this excess interest in reduction of principal. on the other hand, it is contended for the respondent that.....
Judgment:

Wadsworth, J.

1. This Civil Revision Petition raises a question of the interpretation of Section 9 of Madras Act IV of 1938. The petitioner here was the plaintiff in the Court below. She sued on a promissory note for Rs. 600 dated 20th March, 1935, which carried interest at 15 per cent. per annum. The plaint alleged a series of payments totalling Rs. 165 towards interest and thereafter a payment of Rs. 212 towards interest and principal on 15th March, 1938. The lower Court assumed the truth of the assertion in the plaint that the payments were towards interest without recording any finding on the subject and concluded that the balance left over after crediting these payments towards the interest as scaled down under Section 9(1) of the Act would be available in reduction of the principal amount. It is contended that this interpretation of the section is wrong.

2. Section 9(1) stipulates that interest shall be calculated up to the commencement of the Act at the contract rate or at 5 per cent. whichever is less, that credit shall be given for all sums paid towards interest and that only such amount as is found outstanding, if any, for interest thus calculated shall be deemed payable together with the principal amount or such portion of it as is due, It is contended for the plaintiff who is the petitioner that the whole of the process laid down in this portion of Section 9 is a process in reduction of the debt for interest and that it does not contemplate any reduction of the amount due for principal. The process is firstly to calculate the interest which would have been due at the rate of 5 per cent., then give credit for any payments actually made* towards interest, then give a decree for interest on the basis of this calculation together with the amount due for principal. It is contended that if the scaling down process results in a smaller amount of interest than what has actually been paid as interest there is no provision in Section 9 for carrying over this excess interest in reduction of principal. On the other hand, it is contended for the respondent that the words ' credit shall be given for all sums paid towards interest' must be read as if they were 'credit shall be given in reduction of the debt for all sums paid towards interest' and that the final words 'or such portion of it as is due' contemplate the reduction of principal by the process of carrying over the excess amount paid towards interest. It seems to us that the interpretation of the respondent involves not only the addition to the section of words which are not in it, but also entails the solution of an ambiguity by giving the benefit of the doubt to the expropriator, which, as we have frequently held, is not permissible in interpreting an act of this nature. The view for which the petitioner contends is in accordance with the plain language of the section. It is also the view adopted by Horwill, J., in Muhammad Sahib v. Kunthanmal Sowcar : AIR1940Mad807 and we are of opinion that it is the correct view. It results in the conclusion that if the payments made towards interest are in excess of the amount of interest as scaled down, that excess amount will be retained by the creditor and will not be adjusted in reduction of principal; but there is nothing contrary to general principles in allowing a creditor to retain that which has been willingly paid to him.

3. It follows that a finding is necessary on the correctness of the averments of fact in the plaint regarding the nature of these payments totalling Rs. 165 alleged to have been made towards interest. It is pointed out for the respondent that the result of the finding of fact regarding the nature of these payments may be to enable him to put forward a plea of limitation based on the decision of the Privy Council in Ram Shah v. Lal Chand (1940) 1 M.L.J. 895 : L.R. 67 IndAp 160 : I.L.R. (1940) Lah. 470 That is a matter which the lower Court will have to take into consideration.

4. In the result therefore the petition is allowed and the suit is remanded to the trial Court for fresh disposal in the light of this judgment. Parties will be permitted to adduce fresh evidence. Costs will abide the result.


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