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Law Dictionary Home Dictionary Definition interest

Interest, an interest for the purposes of the regula-tion was not limited to a direct financial interest and included membership of a panel such as the panel of which the claimant's solicitors were members that, therefore, the Claimant's Solicitors had had an interest in recommending the insurance which they recommend to her; that, in the circumstances, there had not been sufficient disclosure of that interest; and that, accordingly, there had been a material breach of regulation 4(2)(e)(ii) and the conditional fee agreement was unenforceable [See (English) Conditional Fee Agreements Regulation, 2000 (SI 2000/692), reg. 4(2)(c)(e)(ii)], Garrett v. Halton BC, (2007) 1 WLR 554 CA Cir. Interest, inter alia as the compensation fixed by agreement or allowed by law for the use or detention of money, or for the loss of money by one who is entitled to its use; especially, the amount owed to a lender in return for the use of the borrowed money [Black's Law Dictionary (7th Edn.) pp. 393-94 para 37]. Interest, is the accretion on capital, Amin Chand Payarelal v. Inspecting Assistant Commissioner, Income Tax, (2006) 7 SCC 483: 2006 (8) JT 373: 2006 (9) SCALE 10: (2006) 6 Supreme 752: (2006) 9 SCJD 492: (2006) 285 ITR 546 [Income Tax Rules, 1962, r. 271(1)(a)]. Interest, means inter alia, compensation paid by the borrower to the lender for deprivation of the use of his money, Stroud's Judicial Dictionary of Words and Phrases (5th Edn.) see also Ghaziabad Development Authority v. Balbir Singh, (2004) 5 SCC 65. Interest. 1. Money paid at a fixed rate per cent. for the loan or use of some other sum, called the principal. It is distinguished into simple and compound. (a) Simple interest is that which is paid for the principal or sum lent, at a certain rate or allowance made by law, or agreement of parties. (b) Compound interest is when the arrears of interest of one year are added to the principal and the interest for the following year is calculated on that accumulation. By the (English) Law Reform (Miscellaneous Pro-visions) Act, 1934 (24 & 25 Geo. 5, c. 41), s. 3(1): 'In any proceedings tried in any court of record for the recovery of any debt or damages, the court may, if it thinks fit, order that there shall be included in the sum for which judgment is given, interest at such rate as it thinks fit on the whole or any part of the debt or damages for thwhole or any part of the period between the date when the cause of action arose and the date of the judgment. 'Provided that nothing in this section-- (a) shall authorise the giving of interest upon interest; or (b) shall apply in relation to any debt upon which interest is payable as of right whether by virtue of any agreement or otherwise; or (c) shall effect the damages recoverable for the dishonour of a bill of exchange.' 2. Sects. 28 and 29 of the (English) Civil Procedure Act, 1933, shall cease to have effect. For the law on these repealed ss. 28 and 29, see L.C. & D. Ry. Co. v. S.E. Ry. Co., (1892) 1 CH, p. 146; Re Edwards, (1891) 61 LJ Ch 22; and London, Chatham & Dover Rail Co. v. South Eastern Rail Co., 1893 AC 429. Judgments and, under the (English) Arbitration Act, 1934 (24 & 25 Geo. 5, c. 14), s. 11, sums due under arbitrators' awards carry interest at four per cent.: (1 & 2 Vict. c. 110), s. 17. By the (English) Solicitors Act, 1932 (22 & 23 Geo. 5, c. 37), s. 63(3), (1), the taxing officer may allow interest on moneys disbursed by a solicitor for his client, and on moneys of the client in the hands of the solicitor and improperly retained by him. And see r. 7 of the G.O. under the Solicitors Remunera-tion Act, 1881 (44 & 45 Vict. c. 44). See also MORTGAGE; PAWNBROKER; USURY. 3. Interest is vulgarly taken for a term or chattel real and more particularly for a future termed or, in pleading, interesse termini. Ex vi termini, it extended to estates, rights and titles that a man hath of, in, to or out of lands, 1 Inst. 345 b. 4. Equitable interests, all estates, interests, and charges in or over land or in the proceeds of sale thereof not being legal estates. An equitable interest 'capable of subsisting as a legal estate' means such as could validly subsist or be created as a legal estate under the Law of Property Act, 1925; see s. 205 (x), ibid. 4. Such a personal advantage derivable from his judgment as disqualifies a judge from hearing the cause by virtue of the rule: 'Nemo debet judex esse in causa sua propria,' as where the judge is a shareholder in a company which is plaintiff or defendant in an action; thus, in Dimes v. Grand Junction Canal Co., (1852) 3 HLC 759, in which Lord Chancellor Cottenham, a shareholder in the defen-dant company, had given judgment in its favour, the judgment was on that account see aside by the House of Lords. See also Reg. v. London County Council, (1892) 1 QB 190; and other cases in Mew's Digest, tit., 'Public Officer.' The right to take objection to hearing by a judge on the ground of interest is often waived by counsel on the judge announcing his interest; see, e.g., Law Times newspaper of June 30, 1906, at p. 222. The Companies, the Railways [see Wakefield Local Board v. West Riding and Grimsby Ry. Co., (1865) LR 1 QB 84], and the (English) Lands Clauses Acts, by their definition of 'Justices,' express the implied disqualification by interest; so, with an extension and an exception, does s. 40 of the (English) Licensing (Consolidation) Act, 1910 (10 Edw. 7 & 1 Geo. 5, c. 24) [see A.-G. v. Cozens, (1934) 50 TLR 320]; and so, with a positive injunction upon the Railway Commissioners to sell railway stock, etc., does s. 5 of the Regulation of Railways Act, 1873; but the (English) Jurisdiction in Rating Act, 1877 (40 & 41 Vict. c. 11), and the (English) Public Health Act, 1936, s. 304, remove the disqualification from judges of the High Court or Court of Appeal. It is also provided by many statutes [see, e.g., the (English) Municipal Corporations Act, 1882, s. 12, as extended by Local Government Act, 1894. See now (English) Local Government Act, 1933 (23 & 24 Geo. 5, c. 51), s. 76, that members of local authorities shall be disqualified from voting, etc., at meetings if they be interested in any contract which is the subject for consideration. See BIAS. (5) Interest is compensatory in character and is imposed on an assesses who has withheld payment of any tax as and when it is due and payable. The levy of interest is geared to actual amount of tax withheld and the extent of the delay in paying the tax on the due date. Essentially, it is compensatory and different from penalty which is penal in character, Pratibha Processors v. Union of India, AIR 1997 SC 138: (1996) 11 SCC 101. As observed by this Court in Dr. Sham Lal v.. Commissioner of Income-tax, Punjab, (53 ITR 151: AIR 1964 SC 1878: (1964) 7 SCR 668: (1964) 2 SCJ 345: (1964) 1 SCWR 689.) the interest is a payment to be made by the debtor to the creditor when money was due to the creditor but was not paid or in other words was withheld from the creditor by the debtor after the time when the payment should have been made. Proceeding further, this Court observed in that case that interest whether it was statutory or contractual represented the profit the creditor would have made if he had the use of the money to which he was entitled to, S.R.Y. Sivaram Prasad Bahadur v. Commissioner of Income Tax, AIR 1972 SC 260: (1971) 3 SCC 726: (1972) 1 SCR 320. Strictly speaking, the word 'interest' would apply only to two cases where there is a relationship of debtor and creditor. A lender of money who allows the borrower to use certain funds deprives himself of the use of those funds. He does so because he charges interest which may be described as a kind of rent for the use of the funds. For example, a bank or a lender lending out money on payment of interest. Even a case of wrongful detention of money cannot arise. In this case, as already noted, there is no relationship of debtor and creditor, Ferro Alloys Corpn. Ltd. v. A.P. State Electricity Board, AIR 1993 SC 2005: 1993 Supp (4) SCC 136. Interest is compensation for forbearance or detention of money, Abati Bezbaruah v. DY D.G., AIR 2003 SC 1817 (1819): (2003) 3 SCC 148. (Motor Vehicles Act, 1988, s. 171)

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