SYNDICATE BANK CHICKMAGALUR Vs. A K AHMED BAWA

JUDGEMENT

(1.) At the stage of admission the respondent is notified. Accordingly, he has put in appearance through a counsel. As the appeal involves short question as to awarding of interest from the date of suit till the date of realisation and as lhat question can be decided on the basis of the finding recorded by the trial Court. We do not consider it necessary to call for the records. Accordingly the appeal is admitted. The production of paper books is dispensed with. The appeal is heard for final disposal.

(2.) The only point that arises for consideration is as to whether the trial Court is justified in law and on facts in awarding interest at 6% on the sum of Rs. 10,09,69170 from the dale of the suit till the date of realisation.

(3.) The facts necessary for the purpose of deciding the aforesaid point are no morein dispute. The defendant-respondent raised a loan of Rs. 7,40,000/- from the appellant-plaintiff bank on 3-8-19S5 mortgaging the suit schedule properties for purchasing the coffee estate described in B-Schedule to Ihc plaint which is as follows: "Schedulel B (Description of the properties mortgaged) All those pieces and parcels of land-Coffee Estate situated in Chickinagalur Taluk comprising of the following Survey Numbers: <FRM>JUDGEMENT_498_KANTLJ2_1992Html1.htm</FRM> Item No. 1: Bounded on the East, North and South by Government land West by road leading to Pandaravalii. Item No. 2: Bounded on the east by north by Gomala, land west by estate of Kesarimal Mohanlal and South by Estate of B.N. Nagabhushana. Item No. 3: Bounded on the west by road leading to Pandaravalii, West by Gomala land and Sannalhola, north/and south by road. Item No. 4: Bounded on the east by South by road, west by Government road and North by estate called Bharath Coffee Estate." After purchasing the Schcdulc-B properly, the defendant mortgaged the same to the plaintiff-bank for the aforesaid sum of Rs. 7,40,000/-. As the defendant did not pay the amount according to the terms of Ihe mortgage, the plaintiff- bank filed O.S. No. 107/1987 in the Court of Civil Judge at Chikmagalur on 24-6-1987 for recovery of sum of Rs. 10,41,122-55. The plaintiff claimed interest on the sum of Rs. 7,40,000/- as per the terms of the mortgage deed which varied from 17.5% to 18.5% as and when the rate of interest went on increasing as per the circulars issued by the Reserve Bank of India from time lo lime. However, on consideration of several circular issued by the Reserve Bank of India, the trial Court came lo the conclusion that the plaintiff was entitled to interest at the rate of 16.5% p.a. from the date of suit till 1-4-1987 and at the rate ofl8.5%p.a.from 1-4-1987 till the dale of filing of the suit, compounded annually. It also further held that the plaintiff WHS entitled to penal interest ai the rate of 2.5% p.a. over and above the aforesaid rate of interest. Accordingly, it came lo the conclusion that the defendant was liable to pay as on the date of suit a sum of Rs. 10,09,691-70 to the plaintiff. This amount is not disputed before us.