PUNJAB NATIONAL BANK Vs. VIDYA HATCHERY

JUDGEMENT

(1.) These appeals (R.F. As. No. 26/91, 183/91, 224/91, 173/92, 174/92, 175/92, 270/92, 304/92, 314/92, 380/92 and 21 of 1966) are being disposed of by a common judgment as these pertain to the same questions of law. However, on facts each appeal will be dealt with separately. The common questions of law are as under :

(2.) In order to reply these questions of law, reference to Section 34 of the Code of Civil Procedure as well as the judgments of the Supreme Court and Division Benches of this Court in respect thereof is necessary, Section 34, C.P.C. empowers :

(3.) From the language of section 34 (1), it is clear that the Court has been given powers to award interest at reasonable rate on the principal sum adjudged for the period (i) prior to the institution of the suit (ii) during the pendency of the suit : and at the rate not exceeding 6% per annum and (iii) from the date of decree to the date of payment or to such earlier date as the Court thinks fit. By adding the proviso and Explanation-I, in commercial transactions the maximum rate of interest for the post-decretal period has been fixed as the contractual rate of interest, and where there is no contractual rate, at the rate at which loans are advanced by the Nationalized banks.