BHANWARLAL Vs. PUROHIT GOPILAL

JUDGEMENT

(1.) THIS is the defendant's second appeal. The plaintiff filed a suit for the redemption of certain ornaments pledged by his mother. The plaintiff's case was that the ornaments were pledged for Rs. 50/ -. The defendants however, contended that they were pledged for a sum of Rs. 150/6/ -. Both the lower courts have held that the ornaments were in fact, pledged for Rs. 150/6/. In this court, there is no dispute about the principal amount. The dispute is however, with respect to interest awarded by the court. The first court allowed interest at the rate of 18-3/4% per annum and held that the defendant was entitled to the said rate up to the date of realisation. It, therefore, decreed the redemption on payment of Rs. 150/6/- principal, together with interest at the rate of 18-3/4% per annum up to the date of realisation. On an appeal, the District Judges, Kotah has reduced the rate of interest to 12% per annum and applying the rule of Damdupat has held that the defendant gap pot get more than Rs. 150/6/- by way of interest.

(2.) IT has been argued by the learned counsel for the appellant that the rule of Damdupat applies only upto the date of suit and not thereafter. Interest can be awarded under sec. 34 of the Code of Civil Procedure at a rate considered proper by the court, even though including that interest, the amount of interest exceeds the principal. I have been referred to Mulla's Hindu Law, 1946 Edition, P. 599 and to Dhondshet vs. Raoji and others (I. L. R. 22 Bombay P. 86) and Nand Lal Roy and others vs. Dhirendra Nath Chakrawarti (XXI Indian Cases P.) IT was held in the last mentioned ruling that the rule of Damdupat, by which the amount of interest which a creditor can, recover against his debtor, is not to exceed the amount of principal, applies as a matter of contract when Hindus are contracting with each other. IT has nothing to do with the decrees of courts after the matter has passed from the realm of contract into that of judgment. In I. L. R. 22, Bombay, it was held that the discretionary power as to awarding interest conferred on the courts by sec. 209 of the Code of Civil Procedure may be exercised without reference to the law of Damdupat. Mulla in his Hindu Law says that where a suit has been instituted to recover a loan, the rule of Dampupat ceases to operate. The result is that though the court is bound to apply the rule of Damdupat up to the date of the suit, it is free to award interest to the creditor at such rate as is thinks proper from the date of the suit upto the date of decree or payment, upon the total amount that may be found due to him after applying that rule. The law is, therefore, established that the rule of Damdupat can be applied only up to the date of the suit and the court is free under sec. 34 of the Code of Civil Procedure to award interest at a suitable rate after the date of the suit at such rate as it thinks proper even though such interest might make the total sum of interest exceed the amount of principal. Sec. 34 is however discretionary and the court may or may not award pendente lite or future interest. The appellate court has not said clearly in its judgment whether the defendant will be entitled to pendente lite or future interest or not. The only thing that it has said is that the defendant will not get any sum on account of interest which might exceed the principal. If these remarks are meant only for the interest upto the date of the suit, I can find no fault with them. If however, the learned appellate court meant by them that they apply also to pendente lite and future interest, the learned court's view is against law. The learned counsel for the respondent says that the lower appellate court awarded interest only up to the date of the suit and did not award any pendente lite and future interest. For this it had perfect discretion. The learned counsel for the appellant, however, says that the lower appellate court means that by the rule of Damdupat, the defendant is not entitled to any sum on account of interest exceeding the amount of principal, whether that interest be past, pendente lite or future. Reading the judgment of the lower appellate court carefully, I find that although it is not as clear as it might be excepted, yet it means that the defendant was not entitled to a sum on account of interest exceeding the principal up to the date of the suit. This order was perfectly legal. As regards pendente lite and future interest, it can at best be said that the judgment of the lower appellate court is silent and the lower appellate court, under these circumstances will be considered to have refused any pendente lite or future interest. IT has given some reasons for awarding a total sum of interest up to the date of the suit, equivalent to principal and for not awarding any sum in excess thereof. The lower appellate court had a discretion to do so and I do not think that there are any reasons for interfering with that discretion.