PAKALA NARAYAN RAO NAIDU Vs. GURUNATH PADHI

JUDGEMENT

(1.) THIS is an appeal against an order of the Subordinate Judge of Berhampur scaling down the decretal amount payable by the respondents -judgment -debtors to the appellants -decree -holders, in exercise of the powers conferred by Section 10 of the Orissa Money Lenders Act.

(2.) THE original loan that was advanced to the respondents' predecessor -in -interest was only Rs. 2,000 based on two promissory notes for Rs. 1,000 each dated 1 -9 -28 and 5 -10 -28. In due course, fresh promissory notes for the principal and interest due were executed by the debtor on 1 -9 -31 and 21 -7 -34. The last promissory note was for a sum of Rs. 3,647 -3 -4. Two payments of Rs. 100 on 19 -7 -37 and Rs. 800 on 12 -7 -40 were made by the debtor and then the creditor instituted a suit (O. S. 48 of 1942) in the Court of the Subordinate Judge, Berhampur for the realisation of the balance of the debt with interest. The suit was eventually compromised and a compromise decree for Rs. 7,000 was passed directing the payment of the decretal amount in three following instalments : On 12 -5 -44 - - Rs. 1,250. On 13 -3 -45 - - Rs. 3,000. On 30 -12 -46 - - Rs. 2,750. The first instalment was paid in due course, but as there was a default in paying the succeeding instalments, the decree -holders applied for execution of the decree. The judgment -debtors thereupon filed an objection urging that the decretal amount should be scaled down, under Section 10 of the Orissa Money Lenders Act and that they were not bound to pay more than double the original loan, viz., Rs. 4,000 towards principal and interest. This objection was allowed by the learned lower Court and the decree was scaled down accordingly.

(3.) SUB -section (1) embodies the well known rule of 'Damdupat' and prohibits absolutely a Court from passing a decree for an amount of interest, in excess of the original principal. Sub -section (2) contains consequential directions for appropriating towards payment of the original principal, that portion of the interest paid which is in excess of an amount equal to the original principal. Sub -section (3) confers on an executing Court the powers specified in Sub -section (2), in respect of decrees passed after the 1st April, 1936, and remaining unsatisfied on the date on which the amending Act of 1947 was brought into force.