LAWS(APH)-1997-2-70

RAGHAVARAPU ANJANEYULU Vs. REBBA VENKATA RAMANAMMA

Decided On February 27, 1997
RAGHAVARAPU ANJANEYULU Appellant
V/S
REBBA VENKATA RAMANAMMA Respondents

JUDGEMENT

(1.) This appeal is preferred by the plaintiff being aggrieved by the judgment and decree dated 26/10/1984 in O.S.No.191/82 so far as the decree relates to scaling down of the interest on the loan amount.

(2.) The learned Counsel appearing for the appellant contended that even though the loan was advanced for agricultural purposes, but in view of Section 21A of the Banking Laws (Amendment) Act, 1983 such a scaling down is not permissible. He further submitted that Section 4(c) of A.P. (Andhra Area) Agriculturist Relief Act, 1938 does not apply to the facts of this case. In view of Section 21A of the Banking Laws (Amendment) Act, 1983 (for short the Act) the defendant would not be entitled for benefit of Section 4(e) regarding the scaling down of the interest. He further submitted that the Court below has erred in relying upon the judgment of a Division Bench of mis Court reported in Indian Bank Alamuru v. Muddana Krishna Murthy, AIR 1983 AP 347 since the same has already been overruled by the Supreme Court in Bank of India v. Ms. Vijay Transport, AIR 1988 SC 151. He further submitted that the Court below has erred in relying upon the judgment in M. Satyanarayanav. Andhra Bank Ltd., 1984 (2) APLJ (SH) 21 since the same has also been overruled by a full bench of this Court in State Bank of Hyderabad v. Advalh Sakru, AIR 1994 AP 170 (FB). Therefore, he submitted that the impugned judgment and decree insofar as it denies the plaintiff the interest, as per the rate claimed in the suit, is illegal and without jurisdiction and contrary to law. On the other hand the learned Counsel appearing for the respondents strenuously supported the impugned judgment and decree.

(3.) In order to appreciate the rival contentions, I have to note the facts of this case in brief. The plaintiff-appellant filed a suit for recover)' of Rs.21,184.00 contending that the defendants obtained a loan on the basis of a registered mortgage deed dated 19-3-1974 for a sum of Rs.12,000.00. Thereafter, the defendants again obtained a loan of Rs. 12,000.00 on 16-9-1975 executing a pronote in favour of the plaintiff. The second defendant has also executed a document as a coobligant. It is further alleged in the plaint that as per the document executed, the defendants undertook to repay the said amount to the plaintiff an order, on demand, together with interest at 5% above the Reserve Bank of India rate with a minimum of 14% per annum with quarterly rests. On the same day they also executed a separate letter stating that they would pay the entire amounts with interest before 31-5-1976 and incase of default they also undertook to repay the amount with interest at 15% per annum. But the defendants 1 and 2 failed to discharge the debt by 31-5-1976 inspite of repeated requests made by the plaintiff-Bank, However, the defendants executed a debt acknowledgment letter on 5-7-1978 and 22-6-1981 acknowledging the debt for the purpose of Section 18 of the Limitation Act. Meanwhile the defendants paid an amount of Rs.5,720.00 on 23-2-1977. The balance was not paid and thus, the principal amount of Rs.10,172,40 and the interest together worked out to Rs.21,184.00 as on the date of filing of the suit, and on that basis the plaintiff filed a suit for recovery of Rs.21,184.