SANJEEVINI ANANDA AWATE Vs. M D HIRANYAKESHI SAHAKARI

JUDGEMENT

(1.) THIS appeal was heard by a Division Bench comprising Hon'ble h. N. Tilhari and T. N. Vallinayagam, JJ. The judgment granted a certain enhancement in the amount of compensation payable to the claimants-appellants herein. As regards the rate of interest awardable on the amount of compensation, there was a difference of opinion between the Judges comprising the Bench. While Tilhari, J. held the claimants entitled to interest at the rate of 9 per cent per annum from the date of the claim petition till the date of payment, Vallinayagam, J. took a contrary view holding that the claimants were not entitled to anything more than 6 per cent per annum from the date of the claim petition till payment. Both the learned Judges relied upon decisions of the Apex Court and those delivered by this court in support of the views taken by them and eventually recommended to the Hon'ble Chief Justice to refer the issue as to the rate of interest to a Full Bench for an authoritative pronouncement. The Hon'ble Chief Justice, however, viewed the difference of opinion between the two Judges as a case calling for a reference to only a third Judge for resolving the conflict under section 98 (2)of the Code of Civil Procedure. The matter was accordingly placed before Hon'ble r. V. Raveendran, J. to resolve the conflict. The judgment delivered by brother Raveendran, J. , which is also reported in 2002 acj 1814 (Karnataka), held that the rate of interest to be awarded in motor accidents claim cases had been linked by the Apex court to the prevailing bank rates. Relying upon the decision of the Supreme Court in kaushnuma Begum v. New India Assurance Co. Ltd. , 2001 ACJ 428 (SC), the court observed that the rate of interest to be awarded should be normally related to the rate of interest paid by nationalised banks on term deposits for one year. The court also held that the rate of interest prevalent in the banks when the Apex Court delivered its decision was 9 per cent per annum for fixed deposits for a period of one year which having been reduced in recent times, the proper rate of interest to be awarded in favour of the claimants would be 8 per cent per annum. It is after the third Judge has expressed his opinion on the issue referred to him that the appeal has come up for disposal before us.

(2.) SECTION 98 of the Code of Civil Procedure, inter alia, provides that where an appeal is heard by a Bench of two or more judges, the appeal shall be decided in accordance with the opinion of such Judges or of the majority (if any) of such Judges. Sub-section (2) of section 98 deals with a situation where there is no such majority, in which case the decree appealed from, shall have to be confirmed. Proviso to subsection (2), however, goes on to provide that where the Bench hearing the appeal is comprised of two or other even number of Judges belonging to a court consisting of more Judges than those constituting the Bench and the Judges composing the bench differ in their opinion on a point of la, they may state the point of law upon which they differ and the appeal shall then be heard upon that point only by one or more of the other Judges. Such point shall then be decided according to the opinion of the majority (if any) of the Judges who have heard the appeal including those who first heard it.

(3.) THE appeal in the instant case was heard by a Bench comprising two Judges. There was as noticed earlier a difference of opinion between the said two Judges on a question of law relating to the rate of interest to be awarded. That question was referred to a third Judge as envisaged by the proviso to section 98 (2 ). The third judge has delivered his opinion which incidentally does not entirely agree either with one or the other opinion expressed by the judges comprising the Bench that heard the appeal initially. That is because while tilhari, J. , had awarded 9 per cent interest, T. N. Vallinayagam, J. , found 6 per cent to be the appropriate rate at which interest could be granted. The third Judge has agreed neither with the rate granted by tilhari, J. , nor that awarded by Vallinayagam, J. His Lordship has found 8 per cent to be the most appropriate rate to be awarded having regard to the prevailing rate of interest in the case of bank deposits. One could perhaps say that there was no real majority opinion on the precise rate of interest that could be awarded in motor vehicle cases. A more realistic and accurate statement may, however, be that the view expressed by Raveendran, J. , taking 8 per cent to be the appropriate rate of interest constitutes the majority opinion at least insofar as 8 per cent per annum as a rate is concerned. The views expressed by tilhari, J. and Raveendran, J. , concur as regards 8 per cent being the proper rate of interest to be awarded. Vallinayagam, J. , was, therefore, in minority in holding that it was only 6 per cent that could be awarded. Suffice it to say that in accordance with the provisions of section 98 of the code of Civil Procedure and the majority decision of Tilhari and Raveendran, JJ. , the claimants-appellants shall be entitled to interest at the rate of 8 per cent per annum from the date of the claim petition till deposit. M. F. A. No. 552 of 1993 shall stand disposed of accordingly leaving the parties to bear their own costs. Orders accordingly.