CHIEF ENGINEER Vs. V.U. SEEMON

JUDGEMENT

(1.) Heard the learned counsel for the petitioner and also the counsel appearing for the respondent.

(2.) In this petition the challenge is with regard to the order passed by the executing court in coming to the conclusion that the memo of calculation filed by the decree holder calculating the interest as well as the amount payable by the judgment debtor is correct and therefore the judgment debtor is directed to pay the decree holder Rs.14,61,026.30 paisa as on 29/1/2011 by deducting the amount, if any, paid by him and he is also directed to pay upto date interest till the date of paying the entire amount. The main contention of the revision petitioner before this court is that the trial court committed an error in directing the petitioner herein to pay the interest on the interest and learned Judge has accepted the memo of calculation submitted by the respondent as gospel truth and proceeded to pass the order without examining the payments made by the petitioner and also the way in which the calculation is made by the office. By looking into the calculations made by the office coupled with the calculations submitted by the respondent, it is clear that the amount has been calculated by adopting the compounding interest. This court has categorically held in CRP.No.71/2000 and CRP.No.90/2000 dtd. 6/4/2000 that simple interest at the rate of 19.5% to be worked out on the award. In the calculation submitted by the office, it is clear that time and again the petitioner has paid the amount working out the principal interest and deducting the amounts paid by the petitioner and on the remaining amount again interest is calculated. Though principal of adjusting the amount paid by the party towards principal has been paid and that procedure has not been followed. It is contended that this issue was considered in the earlier Civil Revision Petition No.152/2008 c/w Civil Revision Petition No.153/2008 and extracted the earlier order passed in the revision petition and extracting the same contended that in terms of the said order it is confined only with regard to non-payment of interest on security deposit and earnest money deposit and even according to the respondent in their revision petition what was challenged is only that. Therefore, even if it is presumed to be true, it is to be considered only with regard to that aspect of the matter. It is contended that as evident from the records that as against the original claim of for Rs.7.00lakhs and odd, the petitioner has paid Rs.16,91,930.00 as per the record. The petitioner has paid a sum of Rs.7,30,145.00 on 12/12/1995, Rs.2,24,249.00 on 23/8/1996, Rs.1,91,756.00 on 1/7/2000, Rs.3,50,000.00 on 8/8/2005 and Rs.1,95,740.00 on 10/6/2008. Therefore, the petitioner has already paid the entire amount which the respondent is entitled to under the Award and by misinterpreting the whole thing the respondent has continued to claim the amount without any basis.

(3.) Learned counsel vehemently contend that the mode of calculating the interest on interest is not permissible under the law. The counsel in support of her argument also relied upon the order passed by this court in CRP.No.71/2000 c/w CRP.No.90/2000 and contended that wherein also this court awarded interest i.e., on simple interest and not on interest on interest. Learned counsel relied upon the judgment of the Hon'ble Supreme Court in Bharat Heavy Electricals Limited Vs. R.S.Avtar Singh and Company - [(2013) 1 SCC 243], and brought to the notice of this court Para 31, wherein discussion was made that the general rule of appropriation towards a decretal amount was that such an amount was to be adjusted strictly in accordance with the directions contained in the decree and in the absence of such directions adjustments be made, firstly towards payment of interest and costs and thereafter towards payment of the principal amount subject, of course, to any agreement between the parties. The legislative intent in enacting sub-rules (4) and (5) is a clear pointer that interest should cease to run on the deposit made by the judgment-debtor and notice given or on the amount being tendered outside the court in the manner provided in Order 21 Rule 1(1)(b) and also in Para 31.4, held that thereafter, no further interest would run on the sum appropriated towards the principal. In other words if a part of the principal amount has been paid along with interest due thereon as on the date of issuance of notice of deposit, interest on that part of the principal sum will cease to run thereafter. Learned counsel also brought to the notice of this court in Para 36 wherein an observation is made that the courts are not empowered to award interest upon interest.