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Registered Jessore Loan Co. Ltd. Vs. Shailajanath Roy Chaudhuri - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata
Decided On
Reported inAIR1932Cal689
AppellantRegistered Jessore Loan Co. Ltd.
RespondentShailajanath Roy Chaudhuri
Cases ReferredMohammad Ali Mohammad Khan v. Ramzan Ali A.I.R.
Excerpt:
- .....in plaintiffs' favour. the ordering portion of the judgment runs in these words:claim proved and suit decreed ex parte with costs and interest at the contract rates on the respective principal moneys from the date of the institution of the suit until expiration of three months from date or until the date of realization, whichever is earlier. on the defendants' default to pay the decretal money within three months from date the said money with costs of sale shall be realised by sale of the mortgaged properties.2. the decretal amount was not paid within three months from the date of the decree. upon that, the plaintiffs, on 23rd september 1929, preferred the present appeal. the contention of the appellants is that they are entitled to get interest until the date of realization of the.....
Judgment:

Mukerji, J.

1. This is an appeal by the plaintiffs from a decree of the Subordinate Judge of Jessore, dated 23rd July 1929- The plaintiffs' suit, out of which this appeal has arisen, was instituted to enforce two mortgage bonds, dated 7th December 1921 and 21st June 1925, respectively. The suit was instituted on 12th April 1929. No contest having been entered on behalf of the mortgagors, the defendants, the Subordinate Judge, on 23rd July 1929, made a decree in plaintiffs' favour. The ordering portion of the judgment runs in these words:

Claim proved and suit decreed ex parte with costs and interest at the contract rates on the respective principal moneys from the date of the institution of the suit until expiration of three months from date or until the date of realization, whichever is earlier. On the defendants' default to pay the decretal money within three months from date the said money with costs of sale shall be realised by sale of the mortgaged properties.

2. The decretal amount was not paid within three months from the date of the decree. Upon that, the plaintiffs, on 23rd September 1929, preferred the present appeal. The contention of the appellants is that they are entitled to get interest until the date of realization of the money by sale of the mortgaged properties. This contention has been put forward upon the ground that, although the Court is not bound to allow interest after the date fixed for payment at the rate stipulated for in the bond, still it is bound to make a decree for interest at some rate from that date until the date of actual realization; and, on this contention, it has been argued that the plaintiffs should, in this case, as in all cases, be entitled to recover interest at least at the Court rate of interest, viz., 6 per cent per annum, for that period. In our opinion, this contention is not well-founded. We are of opinion that it is not obligatory on the Court to award interest for the period in question and that, in view of the circumstances of this case, the Court below was right in making no decree for interest at all for the said period. So far as interest up to the date of the institution of the suit or up to the date fixed for repayment of the mortgage money is concerned, unless circumstances are made out, which would bring the case within Section 74, Contract Act, or would give rise to considerations arising under the Usurious Loans Act of 1918, the Court would be bound to grant interest at the rate stipulated for in the contract.

3. As regards the interest for a period subsequent to the date fixed for repayment, the Court would ordinarily make a decree for interest, though not at the stipulated rate, but at such rate as the Court may consider fair and proper, and ordinarily such interest should be allowed at the Court rate, viz., 6 per cent per annum. But we are not prepared to hold that there may not in any case be circumstances justifying the Court in refusing interest after the date fixed for repayment. Certain decisions have been brought to our notice as lending support to the argument that has been advanced on behalf of the appellants. The decision of the Judicial Committee, in the case of Maharajah of Bhartpur v. Ram Kanno Dei [1900] 23 All. 181 Sundar Koer v. Sham Krishen [1906] 34 Cal. 150 and Gokuldas v. Ghasiram [1907] 35 Cal. 221 to which our attention has been drawn, do not really touch this question. They are decisions which have laid down that, notwithstanding that no express mention was made in Section 88, T. P. Act, as regards interest for any period subsequent to the date fixed for payment of the mortgage debt, the Court is entitled to make an order granting such interest. Another decision has been brought to our notice, viz., the decision of the Patna High Court in the case of Radhakishun Chamaria v. Zalim Singh A.I.R. 1925 Pat. 455. The learned Chief Justice of the Patna High Court, in that case, allowed interest until actual realization at the rate of 6 per cent per annum; but, at the same time, he said that, with regard to interest for a period after the date fixed for repayment, the matter lies in the discretion of the Court.

4. As we read that decision, we do not find anything there to suggest that such discretion is confined to the question of the rate of interest only. The words 'subsequent interest' in Order 34, Rule 4 of the Code, as it stood prior to its amend-merit by the Transfer of Property (amendment) Supplementary Act, 1929, did not, in our opinion, take away the discretion, which the Court always had in this respect, or make it obligatory on the Court to allow interest in all cases. We think the circumstances in each individual case have got to be considered in order to see whether any, and if so, what interest should be awarded for this period. So far as the present case is concerned the facts are these: The two mortgages, one dated 7th December 1921, and the other the 21st June 1925, ware for loans of Rs. 2,00,000 and Rs. 50,000, respectively. The loans carried interest at the rate of 11 annas 4 pies per cent per mensem, compound, with three-monthly rests. The defendants, the mortgagors, have already paid no less than a sum of Rs. 63,800 as interest on account of these loans. The suit was instituted on 12th April 1929. No contest was entered on behalf of the mortgagors, defendants, and by 23rd July 1929 the suit came to an end, a decree being passed ex parte. The provision in that decree was that interest should run at the bond rate not only for the period prior to the suit but for the period from the date of the institution of the suit until the expiration of three months from the date of the decree or until the date of realization whichever was earlier; and it was further provided that on the defendants' default to pay the decretal money within three months from the date of the decree, the plaintiffs would be entitled to proceed to realize their dues by the sale of the mortgaged properties. The decree drawn up appears to have been put before the pleader, who appeared on behalf of the plaintiffs and he put down his initials on it and did not ask the Court to allow any interest for any further period.

5. After the three months had expired there was nothing to stand in the way of the plaintiffs proceeding to realize their dues by sale of the mortgaged properties. Instead of doing that, the plaintiffs have chosen to come to this Court and preferred an appeal on 23rd September 1929 and have kept it pending for a period of nearly two years, and now they put forward the contention that they should be granted interest at the rate of 6 per cent per annum. If there was any case in which a discretion ought to be exercised in favour of the judgment-debtors, the present case must be a case of that kind. We may mention here that even as regards interest for the period from the date of the institution of the suit to the date fixed for the repayment of the mortgage money, the Judicial Committee refused to allow the mortgagee any interest upon the ground that he had asserted an unwarranted claim to interest and that on account of his persistence the proceedings had been hung up; Mohammad Ali Mohammad Khan v. Ramzan Ali A.I.R. 1921 P.C. 100. That no doubt was a case, in which a decree for redemption was asked for, but even then, having regard to the words of the different rules, we think that the principle may not unreasonably be applied to the present case. For these reasons, we are of opinion that this is not a case, in which we should be justified in making any alteration in the decree of the Court below on the question of interest. The appeal fails and in our opinion should be dismissed with costs, hearing fee being assessed at five gold mohurs.

Guha, J.

6. I agree.


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