VIJAYA BANK CHILAKALURIPET Vs. JASTIOBAIAH

JUDGEMENT

(1.) IN all these matters, the claim is made by the Banks, seeking recovery of the loans advanced on the basis of the security created by way of mortgage. The common question involved is the scaling down of interest under Act 4 of 1938 in view of the amendment to Section 21-A of the Banking Regulation Act.

(2.) I have already considered this question in a batch of cases reported in Union Bank of India vs. Koduri Veera Raghavayya and held that the interest charged in pursuance of mortgage transactions is valid and the amendment to Section 21-A of the Banking Regulation Act applies to all transactions after the amendment coming into force and also to the suits pending or the appeals challenging the decrees and accordingly the interest in respect of agricultural transactions has to be calculated only on the basis of yearly rests and not on quarterly or half yearly rests and whereas in commercial transactions, charging of interest with quarterly or any such longer rests is admissible. Following the said decision of mine, I pass the order as under:- All the appeals, are allowed and remanded to trial Court to pass fresh decrees and the Court fee paid on the memorandum of appeal may be returned. No costs.