Rani Sundar Koer vs Rai Sham Krishen on 14 December, 1906
This view is also supported by the provisions of Section 209 of the Civil Procedure Code, which is regarded by their Lordships of the Judicial Committee in Rani Sunder Koer v. Rai Sham Krishen 34 C. 150 : 5 C.L.J. 106 : 11 C.W.N. 249 : 4 A.L.J. 109 : 17 M.L.J. 43 : 9 Bom. L.R. 304 : 2 M.L.T. 75 as a possible source of the power of this Court to allow interest after the date fixed for re-payment. But although we hold that the Subordinate Judge ought to have allowed interest, if any, upon the aggregate sum due on the date fixed for re-payment, the respondents are not necessarily benefited, because, as was conceded by the learned Vakil for the respondents, it is open to the Court not to allow interest at all upon the aggregate sum and that in any event it is open to the Court to determine the rate at which interest should be allowed. No doubt, according to the usual practice (upon which the rules framed by this Court under Section 104 of the Transfer of Property Act for cases on the original side are based), interest is allowed at 6 per cent. The rules in question, however, do not of their own force, apply to the mofussil. But although the Court would hesitate in any ordinary case to depart from what has been the well-settled practice as to the rate of interest in mortgage suits after the date fixed in the decree for re-payment, there can be no question that in any special case where the circumstances justify a reduction in the rate of interest, the Court would be prepared to make the necessary order in the interests of justice. In the case before us, the rate of interest agreed upon by the parties in the mortgage contract was sixteen and a half per cent, compound interest with annual rests. In the course of six years, inspite of the payment of a considerable amount by the mortgagors, the amount decreed to mortgagees exceeds double the amount of principal advanced under the mortgage security. Under these circumstances, we are of opinion that this is a case in which interest after the date fixed in the decree for payment should not be allowed at the rate of six per cent. We, therefore, direct that the decree of the Court below be modified to this extent, namely, that the interest after the date fixed for payment, be calculated upon the aggregate sum payable on that date under the decree, but at the rate of three per cent, per annum.