1. This is an application for leave to appeal to. His Majesty in Council against the decree and judgment of this Court which reversed the decree of the Subordinate Judge of Coimbatore.
2. Being a reversing judgment the applicant will be entitled to the leave asked for if the value of the subject-matter of the suit and of the subject-matter in dispute in appeal to His Majesty in Council are both of the value of Rs. 10,000 or upwards. In the Court below the suit valuation was Rs. 10,000 and, therefore, the first requisite is satisfied. The only question is whether the second condition is also satisfied. The lower Court gave a decree for a sum of Rs. 4,000 for principal, Rs. 5,625 for interest and Rs. 1,060-3-0 for costs, in all making up Rs. 10,685-3-0, calculated up to 3rd February, 1938. The sixth defendant appealed to this Court. He valued the appeal at Rs. 9,665 made up of Rs, 9,625 decreed for principal and interest up to the 3rd February, 1938 plus Rs. 40 further interest up to the 25th February, 1938, the date of the presentation of the appeal. The amount of costs decreed was not included in the valuation of the appeal and no court-fee was paid thereon as it is not necessary to include costs in the value of the appeal. If the appeal succeeds, the direction as to costs made by the trial Court will automatically be set aside.
3. The contention on behalf of the respondent is that the value of the subject-matter involved in the appeal to His Majesty in Council is net Rs. 10,000 and upwards because the valuation of the appeal is only Rs. 9,665. His contention is that the interest accruing subsequent (to the date of the decree of the lower Court cannot be calculated in arriving at the amount. The appeal was disposed of on the 26th February, 1941. By that time apart from costs, the amount due as per the decree of the lower Court amounted to over Rs. 11,000 because the amount decreed carried interest at six per cent, per annum from the date fixed for payment, that is the 3rd February, 1938.
4. If the suit had been dismissed by the trial Court and had been decreed by the appellate Court, it is undoubted and it is not disputed--that for a defendant's further appeal the value of the claim as it stood on the date of the decree of the High Court would be the sum to be taken into consideration for this purpose. That is the decree which he would appeal against. Is there any reason to apply a different rule in the case of a plaintiff-appellant? The real loss to the plaintiff which he seeks to restore by appealing to His Majesty in Council is the amount which he was deprived of by the decree in appeal as on the date of its decree. On the date when the High Court passed its decree, he was entitled to over Rs. 11,000 apart from costs. If this is the crucial date even for the plaintiff seeking leave to appeal, then the applicant must succeed.
5. But the respondent contends that the question has been concluded by various decisions of the Judicial Committee, and of this and-the other High Courts and it is urged that the effect of those decisions is that in the ease of a plaintiff whose suit is dismissed by the High Court on appeal, the value for the purposes of leave to appeal to His Majesty in Council is the amount calculated up to the date of the decree of the lower Court -and that further interest cannot be added. Now, the reason underlying the decisions which take this view is that the grant of subsequent interest is within the discretion of the Court and that therefore the further interest which may or may not be allowed is not part of the claim for the purpose of Section 110, Civil Procedure Code. In the case of suits where the plaint valuation is in question, it has been held by the Judicial Committee in Manganna v. Mahalakshmamma 'that subsequent interest or subsequent mesne profits will not be calculated. Prior to 1874, appeals to the Privy Council were governed by the Order in Council of the 10th April, 1838. The words then were:
Amount or value of the subject-matter in dispute in appeals to Her Majesty in Council.
The other requisite that the plaint also must involve a like sum was not there. On the wording of the Order in Council of the 10th April, 1838, there are several decisions the effect of which is summarised by the Judicial Committee in Manganna v. Mahalakshmamma thus:
Up to 1874, appeals to the Privy Council were governed by the Order in Council of the 10th April, 1838. The words then were 'amount or value of the subject-matter in dispute in appeals to Her Majesty in Council'. Upon that there were decisions of the Privy Council that interest on money claims and mesne profits of immovable property subsequent to the date of the suit, but awarded by the decree, might be reckoned, but none subsequent to that date.
In a case where a suit was dismissed by the trial Court but de-creed on appeal, it is the amount calculated up to the date of the appellate decree that determines the question.
6. In Gooroopershad Khaond v. Juggutchunder (1860) 8 M.I.A. 166 the Judicial Committee dealt with a case where on the date of the decree of the High Court, the sum decreed against the defendant was over Rs. 10,000. Their Lordships said this on page 168:
Now, where the appeal is from the whole decree, and the decree has given an amount, including interest up to the date of the decree which exceeds Its. 10,000, it is clear, that the matter which is in dispute in the appeal must exceed the sum of Rs. 10,000; for the question to be tried upon the appeal must be whether the decree is or is not right, that is to say, whether the decree has or has not properly ordered payment of a sum exceeding Rs. 10,000. Where, therefore, at the date of the judgment the sum which is recoverable under the decree of the Sudder Court is an amount exceeding Rs. 10,000, there, in their Lordships' judgment, the case clearly falls within the terms of the Order in Council.
Then on page 169 (they said:
Their Lordships must not, of course, be understood to intimate that the Sudder Courts ought to give leave to appeal in cases in which the specified amount of Rs. 10,000 can only be reached by the addition of interest subsequent to the decree.
Here it is laid down that the amount decreed by the appellate Court including interest up to the date of its decree is the amount to be taken for the purpose of granting leave to appeal. to His Majesty in Council. Interest subsequent to the date of the High Court decree should not be calculated. Mr. Muthiah Mudaliar argues that if this is the rule laid down for the defendant-appellant, the same rule ought to apply to a case of a plaintiff-appellant.
7. We think there is considerable force in this argument and if the matter rested upon principle, we should be inclined to hold in favour of the applicant.
8. The respondent's argument that the matter is set at rest by the subsequent decisions of the Judicial Committee and of this and other High Courts has now to be examined.
9. The first decision relied upon is that of the Privy Council in Manganna v. Mahalakshmammai . That was a case dealing with the question whether 'the amount of value of the subject-matter of the suit in dispute in the Court of first instance must be ten thousand rupees or upwards'. It was urged that interest subsequent to the date of suit should be included for calculating the value of the subject-matter of the suit. The plaintiff got a decree in the trial Court but lost on appeal. She was the applicant and it was clear that unless interest between the date of the plaint up to the date of the decree of the trial Court was added, the sum of Rs. 10,000 would not be reached. The Judicial Committee held that this cannot be done, and approved the decision of this Court in Subramanya Aiyar v. Sellammal (1915) 30 M.L.J. 317 : I.L.R. Mad. 843.
10. There is nothing in this decision that touches the question with which we are dealing. As stated already, the plaint in this case asked for a decree for Rs. 10,000.
11. The next decision relied upon is that of this Court in Venkatathinsami v. Appaswami : AIR1933Mad401 . In that case the plaintiff filed a suit for over Rs. 10,000; but the trial Court gave a decree for a sum less than Rs. 10,000. The defendant appealed and the plaintiff preferred a memorandum of cross-objections. The whole suit was dismissed by the High Court. The plaintiff filed an application for leave to appeal to His Majesty in Council. The value of both the appeal and the memorandum of cross-objections as on the date of the trial Court's decree was less than Rs. 10,000, but if to this was added interest from the date of the decree of the trial Court up to the date of the decree of the High Court, the value was over Rs. 10,000. The question was whether he was entitled to do so. The learned Judges held that he was not and pointed out the difference between a case of a defendant seeking to file an appeal against the decree of the High Court and that of a plaintiff seeking to do so. The view expressed is that interest subsequent to. the date of the plaint is within the discretion of the Court under Section 34 of the Code of Civil Procedure and that therefore interest subsequent to the date of the plaint cannot be deemed (to be part of his claim against the defendant, or, to employ the language of Section 110, Civil Procedure Code part of '(the subject-matter in dispute on appeal to His Majesty in Council'. Then they say:
If the plaintiff's suit is dismissed by this Court on appeal, the maximum value to be attached to his appeal to the Privy Council is the value of his suit as stated in the plaint and accepted by the trial Court; and it can make no difference whether that Court allowed the claim in whole or in part, or dismissed it altogether.
According to this judgment, if the suit is for Rs. 10,000 and the decree is for Rs. 8,000 it is Rs. 8,000 which is the value of the subject-matter of the dispute in appeal to His Majesty in Council. They do not even allow the interest from the date of suit up to the date of the first Court's decree to be added because the grant of interest subsequent to the date of the plaint is discretionary.
12. This decision appears to go too far. The respondent does not urge that interest from the date of the plaint to the date of the first Court's decree should be excluded. Suppose the suit is for Rs. 12,000 with interest at six per cent, from the date of plaint and the Court gave a decree two years after the plaint for Rs. 9,500 with interest at six per cent, thereon from the date of suit so that the amount decreed on the date of the decree is over Rs. 10,000; would the case satisfy the requirements if (that decree is reversed on appeal?
13. The next decision relied upon is that of the Patna High Court in Brijmohan Singh v. Chowdhury Bhuneswar Prasad Singh I.L.R.(1941) Pat. 481 The Judges follow the reasoning of the Judges in Venkatathirisami Naidu v. Appaswami : AIR1933Mad401 , and there is nothing further by way of independent reasoning. They dissented from a decision of Dawson Miller, C.J., and Coutts, J., in Ramyad Singh v. Rambilas Singh (1921) 2 P.L.T. 463 and held that where the Court is not bound to grant post plaint interest under some statute (as in the case of Bank of New South Wales v. Owston (1879) 4 A.C. 270 subsequent interest cannot be included where the plaintiff seeks to prefer an appeal to His Majesty in Council.
14. The respondent relies on another decision of the Judicial Committee in Doorga Doss Chowdry v. Ramanauth Chow dry (1860) 8 M.I.A. 262 .That was an application for leave to appeal from a decree of the Sudder Court, dated 23rd October, 1857 which reversed that of the Zillah Court. The plaintiff lost on appeal and he sought leave to appeal from the decree of the Sudder Court which corresponds to the High Court. Prom the facts it appears that the suit claim was as laid in the plaint for recovery of Rs. 9,274-6-0 including interest due, up to that date. The decree of the trial Court was that the defendant should pay the plaintiff the total sum of Rs. 9,274-6-0 and interest on the principal sum during the period when the suit was pending trial and for costs together with interest on the consolidated sum from that day to the date of realisation. The Sudder Court reversed the decree of the Zillah Court on the 29th February, 1860. In dealing with the plaintiffs application, the Judicial Committee said this:
The amount absolutely decreed by the Court is Its. 9,274.-6-0, the interest added to that for the time specified at 8 per cent, would, according to the petitioner's calculation, raise the sum due to Rs. 9,31.0; that is under the appealable sum. it has been determined a short time ago by their Lordships, in the case of Maharajah Sutteeschunder Roy v. Guneschunden (1860) 8 M.I.A. 164 that the Sudder Courts have no authority under the Order in Council of the 10th April, 1838, to add the interest accruing subsequent to the decree to the capital sum decreed for the purpose of reaching the appealable amount; here, the interest, under any circumstances, would not be sufficient, for, to arrive at the necessary amount, you must add, as you seek to do, the costs. Now, the costs of a suit are no part of the subject-matter in dispute, and cannot be used for the purpose.... Their Lordships are clearly of opinion that the sum in issue in this suit is not sufficient to bring the case within the Order in Council.
This seems to lay down that it is the amount calculated up to date of the decree of the trial Court that determines the question as regards the plaintiff who lost on appeal. This decision seems to be in point though it is difficult to sec how this decision is reached from a consideration of the earlier decision on pages 164 to 168 of the same report. If the earlier decision is to be applied, the sum calculated up to the date of the decree of the High, Court should determine the question. But apparently they took Rs. 9,274-6-0, the sum mentioned in the plaint plus interest up to the date of the decree of the trial Court; and the sum on that date was only Rs. 9,310-0-0 (see page 264). This sum is stated to determine the question. Though this decision is referred to in the later decisions and in the textbooks as an authority for the proposition that costs should not be included, we are bound to follow this decision.
15. The next question argued is that in the ease of mortgage decrees like the present case, the Court is bound to grant interest and that therefore the decisions just referred to do not apply and that this ease is governed by the decision of the Judicial Commitee in Bank of New South Wales v. Owston (1879) 4 A.C. 270. If the grant of interest is obligatory, then it seems to us that the decision just cited would apply. So, this takes us to the next question whether the award of interest is compulsory after the date fixed for payment by the lower Court. The decision of the Judicial Committee in Thakurain Kusum Kumari v. Debi Prosad Dhandhania dearly lays down that the grant of interest subsequent to the date fixed for payment in a mortgage suit is not obligatory. Mr. Venkatachariar goes further and argues that the Court is not bound to grant interest at the contract rate even from the date of the plaint and relies upon the observations of the Federal Court in Jai Gobind Singh v. Lachmi Narain Ram (1940) 1 M.L.J. Suppl. 14 but we consider it unnecessary to go into that question. It is enough to point out that prior to the enactment of the Code of Civil Procedure in 1908, there was no provision in the old Transfer of Property Act for grant of interest subsequent to the date fixed for payment. When the Civil Procedure Code was enacted, in 1908, the provisions regulating procedure in mortgage suits were transferred from the Transfer of Property Act to the Civil Procedure Code. Order 34, Rule 4 which provides for a preliminary decree in a suit for sale ran thus:
In a suit for sale, if the plaintiff succeeds, the Court shall pass a preliminary decree to the effect mentioned in Clauses (a), (6) and (c) (i) of Sub-rule (1) of Rule 2, and further directing that the mortgaged property or a sufficient part thereof, and the proceeds of the sale (after deduction therefrom of the expenses of the sale) be paid into Court and applied in payment of what has been found or declared under or by the preliminary decree due to the plaintiff, together with such amount as may have been adjudged due in respect of subsequent costs, charges, expenses, and interest and the balance, if any, be paid to, the defendant or other persons entitled to receive the same.
Though the grant of subsequent interest was not provided for in Rule 2, this rule recognised that subsequent interest may also be granted because it makes a provision for paying to the mortgagee the amount of subsequent interest when the sale proceeds come in. There has been a subsequent amendment in 1929 which made further changes with which we are not now concerned. The Judicial Committee pointed out in Thakurain, Kusum Kumari v. Debi Prosad Dhandhania that before the amendment in 1929, grant of subsequent interest, i.e., grant of interest subsequent to the date fixed for payment, was made under Section 34 of the Civil Procedure Code and that the law is the same even after 1929. This decision is conclusive on the question and we cannot hold that the grant of interest subsequent to the date fixed for payment is obligatory. We hold that the grant of such interest is only under Section 34, Civil Procedure Code, which leaves it to the discretion of the Court to grant it or not. If this is so, the case falls within the principle of Verikatathirisami Naidu v. Appaswami : AIR1933Mad401 and Brijmohan Singh v. Chowdhmry Bhuneshwar Prosad Singh I.L.R.(1941) Pat. 481 and of the Judicial Committee in Doorga Das v. Ramanauth (1860) 8 M.I.A. 262 .
16. To sum up, the grant of interest subsequent to the date fixed for payment is 'discretionary and it was grantable under Section 34, Civil Procedure Code prior to 1929; in this respect the law is the same even after 1929. Therefore even if the Judicial Committee in this case reverses the decision of this Court, it might, having regard to the facts of this case, refuse to award interest from the date fixed for payment in the lower Court. Therefore, what may or may not be awardable is not to be included in the claim. It is not part of the claim as held in Verikatathirisami v. Appaswami : AIR1933Mad401 . The question might arise whether after the amendment of 1929 even interest after the date of suit does not come within S; 34, Civil Procedure Code and whether the grant of interest at the contract rate up to the date fixed for payment is obligatory but we do not wish to go into that question.
17. We therefore hold that the applicant is not entitled to the leave asked for and dismiss the petition with costs.