Punjab-Haryana High Court
Ishwar Singh vs United Commercial Bank on 10 July, 1995
Equivalent citations: (1995)111PLR528
Author: Ashok Bhan
Bench: Ashok Bhan
JUDGMENT Ashok Bhan, J.
1. Ishwar Singh, Judgment-debtor (hereinafter referred to as 'the Judgment-debtor') obtained a loan of Rs. 42,000/-from the United Commercial Bank Limited, respondent-decree-holder (hereinafter referred to as 'the decree-holder'). Some of the loan amount was deposited. After the Judgment-debtor defaulted in payment of instalments, the decree-holder filed a suit for recovery of the decretal amount plus the interest which has accrued till the date of filing of the suit alongwith future interest. Suit was decreed for Rs. 64,981.82 with future interest at the rate of 12-1/2% per annum. Judgment-debtor failed to deposit the money and, thereafter, the decree-holder filed an execution application, Judgment-debtor filed objections in the execution and claimed that grant of interest more than 6% per annum on the principal amount was illegal and, therefore, the decree could not be executed. Another argument raised was that the Judgment-debtor was liable to pay interest on the principal amount alone and not on the interest which had become due at the time of filing of the suit. Both the contentions raised by the Judgment-debtor were rejected. It was held that the Judgment-debtor was liable to pay the agreed rate of interest on the amount which had be come payable on the date of filing of the suit after adding interest on the principal amount.
2. Counsel for the parties have been heard.
3. In Chanan Singh v. Punjab National Bank Ghanaur and Anr., (1992-1) 101 P.L.R. 647, it was held that in a mortgage suit, the judgment-debtor is liable to pay interest as agreed upon between the parties as the suit would be governed under Order 34 Rule 11, Code of Civil Procedure and not by the provisions of Section 34, Code of Civil Procedure. It was held as under-
" Admittedly, the present suit was filed for the recovery of the amount due on the basis of the mortgage deed under Order 34 Rules 4 and 11 of the Code of Civil Procedure. Rules 4 and 11 of the Order 34 provide that in any decree passed in suit for foreclosure sale of redemption, where interest is legally recoverable, the Court may order payment of interest to the mortgagee as provided therein. Thus, the provisions of Section 34 of the Code of Civil Procedure are not attracted to such a suit and court had rightly determined the principal amount and the amount of interest payable thereupon as agreed to between the parties."
4. For taking this view, reliance was placed on Makhan Singh v. Union of India and Ors., (1989-1)95 P.L.R. 703.
5. There is not merit in this revision petition and the same is dismissed with no order as to costs.