Or. VIII, rule 1 C.P.C.- filing of written statement - time fixed in C.P.C - is only directory not mandatory - extention of time beyond the prescribed period - can be granted on sufficient cause - Rejection of the application is set aside - time granted on costs of Rs. 50,000/- = SANDEEP THAPAR ...APPELLANT VERSUS SME TECHNOLOGIES PRIVATE LIMITED ...RESPONDENTS = Published in judis.nic.in/supremecourt/filename=41128

     Or. VIII, rule 1 C.P.C.- filing of written statement - time fixed in C.P.C - is only directory not mandatory - extention of time beyond the prescribed period - can be granted on sufficient cause - Rejection of the application is set aside - time granted on costs of Rs. 50,000/- =
 The application of the appellant for seeking extension  in
           time for filing the written statement has been rejected with the
           observation that that Order VIII Rule 1 CPC is mandatory and the
           Court cannot permit filing of a written statement beyond the  30
           days from the date of service of summons.  At  best,  the  Court
           has power to permit a period of further 60 days from the date of
           service of summons  upon  the  defendant  to  file  the  written
           statement. But this has to be done for reasons to be recorded in
           writing.  Since the appellant herein has filed  the  application
           beyond the period of 30 days + 60 days, it was  not  permissible
           for the Court  to  allow  the  appellant  to  file  the  written
           statement.  

  The purpose of  providing  the  time  schedule  for
                 filing the written statement under Order VIII,  Rule  1  of
                 CPC is to expedite and not to  scuttle  the  hearing.   The
                 provision spells out a disability  on  the  defendant.   It
                 does not impose an embargo on the power  of  the  Court  to
                 extend the time.  Though, the language of  the  proviso  to
                 Rule 1 of Order VIII of the  CPC  is  couched  in  negative
                 form, it does not specify any  penal  consequences  flowing
                 from the non-compliance.  The provision being in the domain
                 of the Procedural Law, it has to be held directory and  not
                 mandatory. The power of the Court to extend time for filing
                 the written statement beyond the time schedule provided  by
                 Order VIII, Rule 1 of the CPC is not completely taken away.


                 (v)     Though Order VIII, Rule 1 of the CPC is a  part  of
                 Procedural Law and hence directory,  keeping  in  view  the
                 need for expeditious trial of civil causes which  persuaded
                 the Parliament to enact the provision in its present  form,
                 it  is  held that ordinarily the


                  time schedule contained in the provision is to be  followed
                 as a rule and  departure  therefrom  would  be  by  way  of
                 exception.  A prayer for extension  of  time  made  by  the
                 defendant shall not be granted just as a matter of  routine
                 and merely for asking, more so when the period of  90  days
                 has expired.  Extension of time may be allowed by way of an
                 exception, for reasons to be assigned by the defendant  and
                 also be placed on record in writing, howsoever briefly,  by
                 the Court on its being satisfied.  Extension of time may be
                 allowed if it was needed to be given for the  circumstances
                 which are exceptional, occasioned  by  reasons  beyond  the
                 control of the  defendant  and  grave  injustice  would  be
                 occasioned if the time was  not  extended.   Costs  may  be
                 imposed and  affidavit  or  documents  in  support  of  the
                 grounds pleaded by the defendant for extension of time  may
                 be demanded, depending on the facts and circumstances of  a
                 given case.”




           8.    We are satisfied that in the circumstances of  this  case,
           the High Court ought to have permitted  the  appellant  to  file
           written statement, beyond the period prescribed  in  Order  VIII
           rule 1, given the facts and circumstances of this case.


                                                                      ...6/-












                                     :6:


           9.    In  view  of  the  above,  the  appeal  is  allowed.   The
           appellant is permitted to file the written  statement  within  a
           period of two weeks from today on payment of Rs.50,000/- (Rupees
           fifty thousand) as cost.
                                                 

   REPORTABLE
                        IN THE SUPREME COURT OF INDIA


                        CIVIL APPELLATE JURISDICTION


                         CIVIL APPEAL NO. 65 OF 2014
       [Arising out of Special Leave Petition (Civil) No.5951 of 2011]


           SANDEEP THAPAR                         ...APPELLANT


                                 VERSUS


           SME TECHNOLOGIES PRIVATE
           LIMITED                                ...RESPONDENTS


                                    ORDER


           1.    Leave granted.
           2.    This appeal has been  filed  impugning  the  judgment  and
           order dated 12th November,  2010  in  FAO(OS)  NO.607  of  2010,
           whereby the Division Bench of the Delhi High Court dismissed the
           appeal filed by the appellant in I.A.  NO.13902  of  2008  filed
           under Order VIII rule 1 praying for extension of time for filing
           written statement by the defendant  i.e.  the  appellant  herein
           till I.A. No. 11803 of 2008 filed  under  Order  I  rule  10  to
           implead Mr. Sharad Maheshwari as plaintiff.  The  aforesaid  Mr.
           Sharad Maheshwari is the  Managing  Director  of  the  plaintiff
           Company who is privy to the entire cause of action of  the  suit
           filed for recovery of  Rs.39.90  lakhs  based  on  alleged  oral
           agreement/understanding.   The   applications   filed   by   the
           appellant were dismissed by the learned Single Judge of the High
           Court on 3rd August, 2010.
                                                                      ...2/-




                                     :2:
           3.    The aforesaid order was  challenged  before  the  Division
           Bench. The Division Bench after  hearing  the  counsel  for  the
           parties has observed that the learned single judge has correctly
           held that it is not necessary to implead Mr.  Sharad  Maheshwari
           as the plaintiff as the company being a legal entity is entitled
           to  file  a  suit  in  its  own  name  through   an   authorized
           representative.   It  is  also  observed  that  it  is  for  the
           plaintiff to prove its case during the  trial.   Therefore,  non
           impleadment of Mr. Sharad Maheshwari will have consequences only
           for the plaintiff and not for the appellant.  The  plea  of  the
           appellant that since Mr. Sharad Maheshwari  had  not  filed  his
           affidavit, despite the  entire  suit  being  based  on  an  oral
           agreement  alleged  to  have  been  entered  into  between   the
           appellant and Mr. Maheshwari, in case the appellant was to  file
           his written statement that would disclose his defence, has  been
           rejected by the Division Bench.


           4.    The High Court was of the opinion that even if Mr.  Sharad
           Maheshwari  is  impleaded  and  had  filed  an  affidavit,   the
           averments in the plaint could not have been changed.   In  other
           words,  the  character
                                                                      ...3/-




                                     :3:


           of the plaint, the pleadings contained therein  and  the  relief
           claimed would remain the same.


           5.    The application of the appellant for seeking extension  in
           time for filing the written statement has been rejected with the
           observation that that Order VIII Rule 1 CPC is mandatory and the
           Court cannot permit filing of a written statement beyond the  30
           days from the date of service of summons.  At  best,  the  Court
           has power to permit a period of further 60 days from the date of
           service of summons  upon  the  defendant  to  file  the  written
           statement. But this has to be done for reasons to be recorded in
           writing.  Since the appellant herein has filed  the  application
           beyond the period of 30 days + 60 days, it was  not  permissible
           for the Court  to  allow  the  appellant  to  file  the  written
           statement.


           6.    Learned counsel  for  the  appellant  has  submitted  that
           undoubtedly the  limit  under  Order  VIII  rule  1  has  to  be
           observed, but in exceptional circumstances in  order  to  ensure
           that the injustice is not done, the Court will have the power to
           permit the defendant to file the written statement.
                                                                      ...4/-




                                     :4:
           7.    We have considered the  submission  made  by  the  learned
           counsel.  In our opinion, the submission  made  by  the  learned
           counsel is well founded in view of the observations made by this
           Court in
Kailash versus Nanhku and others reported in  (2005)  4  SCC 480],
wherein this Court has observed as follows:
                 46.     We sum up and  briefly  state  our  conclusions  as
                 under:-


                 (i)     ....


                 (ii)    ....


                 (iii)   ....


                 (iv)    The purpose of  providing  the  time  schedule  for
                 filing the written statement under Order VIII,  Rule  1  of
                 CPC is to expedite and not to  scuttle  the  hearing.   The
                 provision spells out a disability  on  the  defendant.   It
                 does not impose an embargo on the power  of  the  Court  to
                 extend the time.  Though, the language of  the  proviso  to
                 Rule 1 of Order VIII of the  CPC  is  couched  in  negative
                 form, it does not specify any  penal  consequences  flowing
                 from the non-compliance.  The provision being in the domain
                 of the Procedural Law, it has to be held directory and  not
                 mandatory. The power of the Court to extend time for filing
                 the written statement beyond the time schedule provided  by
                 Order VIII, Rule 1 of the CPC is not completely taken away.


                 (v)     Though Order VIII, Rule 1 of the CPC is a  part  of
                 Procedural Law and hence directory,  keeping  in  view  the
                 need for expeditious trial of civil causes which  persuaded
                 the Parliament to enact the provision in its present  form,
                 it  is  held that ordinarily the


                                                                      ...5/-














                                     :5:




                 time schedule contained in the provision is to be  followed
                 as a rule and  departure  therefrom  would  be  by  way  of
                 exception.  A prayer for extension  of  time  made  by  the
                 defendant shall not be granted just as a matter of  routine
                 and merely for asking, more so when the period of  90  days
                 has expired.  Extension of time may be allowed by way of an
                 exception, for reasons to be assigned by the defendant  and
                 also be placed on record in writing, howsoever briefly,  by
                 the Court on its being satisfied.  Extension of time may be
                 allowed if it was needed to be given for the  circumstances
                 which are exceptional, occasioned  by  reasons  beyond  the
                 control of the  defendant  and  grave  injustice  would  be
                 occasioned if the time was  not  extended.   Costs  may  be
                 imposed and  affidavit  or  documents  in  support  of  the
                 grounds pleaded by the defendant for extension of time  may
                 be demanded, depending on the facts and circumstances of  a
                 given case.”




           8.    We are satisfied that in the circumstances of  this  case,
           the High Court ought to have permitted  the  appellant  to  file
           written statement, beyond the period prescribed  in  Order  VIII
           rule 1, given the facts and circumstances of this case.


                                                                      ...6/-












                                     :6:


           9.    In  view  of  the  above,  the  appeal  is  allowed.   The
           appellant is permitted to file the written  statement  within  a
           period of two weeks from today on payment of Rs.50,000/- (Rupees
           fifty thousand) as cost.






                                                     ....................,J.
                                                     (SURINDER SINGH NIJJAR)




                                          ...............................,J.
                                          (FAKKIR MOHAMED IBRAHIM KALIFULLA)
           NEW DELHI
           JANUARY 02, 2014

Workmen compensation- Accident – fixation of compensation – payment of interest whether from the date of accident or from the date of award – Apex court held yes – from the date of accident and set aside the High court order and further held that The decisions in Mubasir Ahmed and Mohd. Nasir insofar as they took a contrary view to the earlier decisions in Pratap Narain Singh Deo and Valsala K. do not express the correct view and do not make binding precedents = SABERABIBI YAKUBBHAI SHAIKH & ORS. Petitioner(s) VERSUS NATIONAL INS.CO.LTD.& ORS. Respondent(s)= published in http://judis.nic.in/supremecourt/filename=41127= http://courtnic.nic.in/supremecourt/qrydisp.asp

                                                                  REPORTABLE


                        IN THE SUPREME COURT OF INDIA


                        CIVIL APPELLATE JURISDICTION


                         CIVIL APPEAL NO. 8 OF 2014
       [Arising out of Special Leave Petition (Civil) No.8569 of 2013]




           SABERABIBI YAKUBBHAI SHAIKH
           & ORS.                                 ...APPELLANTS


                                 VERSUS


           NATIONAL INSURANCE CO. LTD.
           & ORS.                                 ...RESPONDENTS


                                    ORDER


           1.    Delay condoned.


           2.    Leave granted.


           3.    The appellants are the wife and the relatives of  deceased
           driver who died in a road  accident.  The  deceased  driver  was
           driving a truck bearing No. GJ-17-T-8607,  which  was  owned  by
           Yunusbhai  Gulambhai  Shaikh,  respondent  No.2   herein.    The
           deceased was 36 years of age at the time of  the  accident.   On
           20th  November,  1996,  the  appellants  raised   a   claim   of
           compensation for a sum of Rs.2,15,280/- and 12% interest therein
           from the date of accident by filing a claim  application  before
           the  Workmen  Compensation  Commissioner/Labour  Court.    After
           passage of more than 16 years, the  wife  and  children  of  the
           deceased driver had still not received any compensation.
                                                                      ...2/-




                                     :2:


           4.    The appellants filed a compensation application before the
           Workmen Compensation Commissioner/Labour Court on 20th November,
           1996. The appellants made a  claim  of  Rs.2,15,280/-  and  also
           penalty to the tune of 50% of the compensation  i.e.  a  sum  of
           Rs.1,07,640/-, thus, making the grand  total  of  Rs.3,22,920/-.
           Respondent  No.1-   the   Insurance   Company,   contested   the
           compensation application.  On 23th December, 2010,  the  learned
           Commissioner awarded compensation on account of death in the sum
           of Rs.2,13,570/- with 12% interest from the  date  of  accident.
           The learned Commissioner also awarded Rs.1,06,785/- as penalty.


           5.    Aggrieved and dissatisfied with the aforesaid judgment and
           award passed by the learned Commissioner, the Insurance  Company
           filed First Appeal before the High Court.


           6.    By judgment and order, dated 24th January, 2012, the  High
           Court has partly allowed  the  First  Appeal.   The  High  Court
           directed the respondent No.1 - Insurance Company to pay interest
           on the amount   of   compensation   from   the   date   of
                                                                      ...3/-






                                     :3:


           adjudication of claim application i.e. 23th December,  2010  and
           not from one month after from the date  of  accident  i.e.  21st
           August, 1996.  A further direction was issued  that  the  excess
           amount towards interest, if any,  deposited  by  the  respondent
           No.1 – Insurance Company be refunded to it.   The  judgment  and
           order of the Commissioner for Workmen Compensation was  modified
           to that extent.


           7.    In coming to the aforesaid  conclusion,  the  High   Court
           relied upon the judgment of this Court reported in Uttar Pradesh
           State  Road  Transport  Corporation  now  Uttarakhand  Transport
           Corporation versus Satnam Singh, (2011) 14 SCC 758,  wherein  it
           has been held that the interest was payable  under  the  Workmen
           Compensation Act from the date of the Award  and  not  from  the
           date of accident.


           8.    Aggrieved by the aforesaid judgment of the Hgh Court,  the
           appellants have filed the present appeal.
                                                                      ...4/-








                                     :4:
           9.    Learned counsel for the appellants has submitted that  the
           aforesaid judgment of the High Court is contrary to the law laid
           down by this Court in the case  of  Oriental  Insurance  Company
           Limited versus Siby George and others [(2012) 12 SCC 540].


           10.   We have perused the aforesaid judgment.   We  are  of  the
           considered opinion that the aforesaid judgment  relied  upon  by
           the learned counsel for the appellants is  fully  applicable  to
           the facts and circumstances of this case.  This Court considered
           the earlier judgment relied upon by the High Court and  observed
           that the judgments in the case of National Insurance Co. Ltd. v.
           Mubasir Ahmed [(2007) 2 SCC 349] and Oriental Insurance Co. Ltd.
           v. Mohd. Nasir [(2009) 6 SCC 280] were per incuriam having  been
           rendered without considering the  earlier  decision   in  Pratap
           Narain Singh Deo v. Srinivas Sabata [(1976) 1 SCC 289].  In  the
           aforesaid judgment, upon consideration of the entire  matter,  a
           four-judge Bench of this Court had held  that  the  compensation
           has to be paid from the date of the accident.
                                                                      ...5/-








                                     :5:


           11.   Following the aforesaid judgments, this Court in  Oriental
           Insurance Company Limited versus Siby George and others  (supra)
           reiterated the legal position and held as follows:


                 “11.    The Court then referred to a Full  Bench  decision
                of the Kerala High Court in United India Insurance Co. Ltd.
                v. Alavi  and  approved  it  insofar  as  it  followed  the
                decision in Pratap Narain Singh Deo.


                 12.     The decision in  Pratap Narain Singh Deo was by  a
                four-judge Bench and in Valsala K. by a  three-judge  Bench
                of this  Court.   Both  the  decisions  were,  thus,  fully
                binding on the Court in Mubasir Ahmed and Mohd. Nasir, each
                of  which  was  heard  by  two  Judges.   But  the  earlier
                decisions in  Pratap Narain Singh Deo and Valsala  K.  were
                not brought to the notice of the Court  in  the  two  later
                decisions in Mubasir Ahmed and Mohd. Nasir.


                 13.     In the light of the decisions  in   Pratap  Narain
                Singh Deo and Valsala K., it is not open  to  contend  that
                the payment of compensation would fall due only  after  the
                Commissioner's order or with reference to the date on which
                the claim application is made.  The  decisions  in  Mubasir
                Ahmed and Mohd. Nasir insofar as they took a contrary  view
                to the earlier decisions in  Pratap Narain  Singh  Deo  and
                Valsala K. do not express the correct view and do not  make
                binding precedents.”


                                                                      ...6/-








                                     :6:


           12.   In view of the aforesaid settled proposition of  law,  the
           appeal is allowed and the judgment and order of the  High  Court
           is set aside.  The appellants shall be entitled to  interest  at
           the rate of 12% from the date of the accident.


           13.   No cost.






                                                     ....................,J.
                                                     (SURINDER SINGH NIJJAR)




                                          ...............................,J.
                                          (FAKKIR MOHAMED IBRAHIM KALIFULLA)
           NEW DELHI
           JANUARY 02, 2014

Workmen compensation- Accident - fixation of compensation - payment of interest whether from the date of accident or from the date of award - Apex court held yes and set aside the High court order and further held that The decisions in Mubasir Ahmed and Mohd. Nasir insofar as they took a contrary view to the earlier decisions in Pratap Narain Singh Deo and Valsala K. do not express the correct view and do not make binding precedents = SABERABIBI YAKUBBHAI SHAIKH & ORS. Petitioner(s) VERSUS NATIONAL INS.CO.LTD.& ORS. Respondent(s)= published in http://courtnic.nic.in/supremecourt/qrydisp.asp

Workmen compensation- Accident - fixation of compensation - payment of interest whether from the date of accident or from the date of award -   Apex court held yes and set aside the High court order and further held that  The decisions in Mubasir Ahmed and Mohd. Nasir insofar as they took a contrary view to the earlier decisions in Pratap Narain Singh Deo and Valsala K. do not express the correct view and do not make binding precedents  = 
We have perused the aforesaid judgment. We are of the
considered opinion that the aforesaid judgment relied upon by
the learned counsel for the appellants is fully applicable to
the facts and circumstances of this case. 
This Court considered
the earlier judgment relied upon by the High Court and observed
that the judgments in the case of National Insurance Co. Ltd. v.
Mubasir Ahmed [(2007) 2 SCC 349] and Oriental Insurance Co. Ltd.
v. Mohd. Nasir [(2009) 6 SCC 280] were per incuriam having been
rendered without considering the earlier decision in Pratap
Narain Singh Deo v. Srinivas Sabata [(1976) 1 SCC 289]. 
In the
aforesaid judgment, upon consideration of the entire matter, a
four-judge Bench of this Court had held that the compensation
has to be paid from the date of the accident.
11. Following the aforesaid judgments, this Court in Oriental
Insurance Company Limited versus Siby George and others (supra)
reiterated the legal position and held as follows:
"11. The Court then referred to a Full Bench decision
of the Kerala High Court in United India Insurance Co. Ltd.
v. Alavi and approved it insofar as it followed the
decision in Pratap Narain Singh Deo.
12. The decision in Pratap Narain Singh Deo was by a
four-judge Bench and in Valsala K. by a three-judge Bench
of this Court. Both the decisions were, thus, fully
binding on the Court in Mubasir Ahmed and Mohd. Nasir, each
of which was heard by two Judges. But the earlier
decisions in Pratap Narain Singh Deo and Valsala K. were
not brought to the notice of the Court in the two later
decisions in Mubasir Ahmed and Mohd. Nasir.
13. In the light of the decisions in Pratap Narain
Singh Deo and Valsala K., it is not open to contend that
the payment of compensation would fall due only after the
Commissioner's order or with reference to the date on which
the claim application is made. The decisions in Mubasir
Ahmed and Mohd. Nasir insofar as they took a contrary view
to the earlier decisions in Pratap Narain Singh Deo and
Valsala K. do not express the correct view and do not make
binding precedents."
12. In view of the aforesaid settled proposition of law, the
appeal is allowed and the judgment and order of the High Court
is set aside. The appellants shall be entitled to interest at
the rate of 12% from the date of the accident.

ITEM NO.65 COURT NO.8 SECTION XV


S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS

Petition(s) for Special Leave to Appeal (Civil) No(s).8569/2013
(From the judgment and order dated 24/01/2012 in FA No.197/2012 of the
HIGH COURT OF GUJARAT AT AHMEDABAD)

SABERABIBI YAKUBBHAI SHAIKH & ORS. Petitioner(s)

VERSUS

NATIONAL INS.CO.LTD.& ORS. Respondent(s)

(With appln(s) for c/delay in filing SLP and office report)

Date: 02/01/2014 This Petition was called on for hearing today.

CORAM :
HON'BLE MR. JUSTICE SURINDER SINGH NIJJAR
HON'BLE MR. JUSTICE FAKKIR MOHAMED IBRAHIM KALIFULLA

For Petitioner(s) Mr. O.P. Bhadani, Adv.
Mr. Ashok Anand, Adv.
Mr. Rakesh Kumar Singh, Adv.
Mr. Fazal Ahmad, Adv.

For Respondent(s) Mr. S.L. Gupta, Adv.
Mr. Ram Ashray, Adv.
Mr. D.P. Singh Yadav, Adv.
Mr. J.P. Jayant, Adv.
Ms. Shalu Sharma, Adv.

UPON hearing counsel the Court made the following
O R D E R

Delay condoned.
Leave granted.
The appeal is allowed in terms of the signed reportable
order.


|(VINOD LAKHINA) | |(INDU BALA KAPUR) |
|COURT MASTER | |COURT MASTER |



(SIGNED REPORTABLE ORDER IS PLACED ON THE FILE)

REPORTABLE


IN THE SUPREME COURT OF INDIA


CIVIL APPELLATE JURISDICTION


CIVIL APPEAL NO. 8 OF 2014
[Arising out of Special Leave Petition (Civil) No.8569 of 2013]




SABERABIBI YAKUBBHAI SHAIKH
& ORS. ...APPELLANTS


VERSUS


NATIONAL INSURANCE CO. LTD.
& ORS. ...RESPONDENTS


ORDER


1. Delay condoned.


2. Leave granted.


3. The appellants are the wife and the relatives of deceased
driver who died in a road accident. The deceased driver was
driving a truck bearing No. GJ-17-T-8607, which was owned by
Yunusbhai Gulambhai Shaikh, respondent No.2 herein. The
deceased was 36 years of age at the time of the accident. On
20th November, 1996, the appellants raised a claim of
compensation for a sum of Rs.2,15,280/- and 12% interest therein
from the date of accident by filing a claim application before
the Workmen Compensation Commissioner/Labour Court. After
passage of more than 16 years, the wife and children of the
deceased driver had still not received any compensation.
...2/-




:2:


4. The appellants filed a compensation application before the
Workmen Compensation Commissioner/Labour Court on 20th November,
1996. The appellants made a claim of Rs.2,15,280/- and also
penalty to the tune of 50% of the compensation i.e. a sum of
Rs.1,07,640/-, thus, making the grand total of Rs.3,22,920/-.
Respondent No.1- the Insurance Company, contested the
compensation application. 
On 23th December, 2010, the learned
Commissioner awarded compensation on account of death in the sum
of Rs.2,13,570/- with 12% interest from the date of accident.
The learned Commissioner also awarded Rs.1,06,785/- as penalty.


5. Aggrieved and dissatisfied with the aforesaid judgment and
award passed by the learned Commissioner, the Insurance Company
filed First Appeal before the High Court.


6. By judgment and order, dated 24th January, 2012, the High
Court has partly allowed the First Appeal. The High Court
directed the respondent No.1 - Insurance Company to pay interest
on the amount of compensation from the date of
...3/-






:3:


adjudication of claim application i.e. 23th December, 2010 and
not from one month after from the date of accident i.e. 21st
August, 1996. A further direction was issued that the excess
amount towards interest, if any, deposited by the respondent
No.1 - Insurance Company be refunded to it. The judgment and
order of the Commissioner for Workmen Compensation was modified
to that extent.


7. In coming to the aforesaid conclusion, the High Court
relied upon the judgment of this Court reported 
in Uttar Pradesh
State Road Transport Corporation now Uttarakhand Transport
Corporation versus Satnam Singh, (2011) 14 SCC 758, 
wherein it
has been held that the interest was payable under the Workmen
Compensation Act from the date of the Award and not from the
date of accident.


8. Aggrieved by the aforesaid judgment of the Hgh Court, the
appellants have filed the present appeal.
...4/-








:4:
9. Learned counsel for the appellants has submitted that the
aforesaid judgment of the High Court is contrary to the law laid
down by this Court 
in the case of Oriental Insurance Company
Limited versus Siby George and others [(2012) 12 SCC 540].


10. We have perused the aforesaid judgment. We are of the
considered opinion that the aforesaid judgment relied upon by
the learned counsel for the appellants is fully applicable to
the facts and circumstances of this case. 
This Court considered
the earlier judgment relied upon by the High Court and observed
that the judgments in the case of National Insurance Co. Ltd. v.
Mubasir Ahmed [(2007) 2 SCC 349] and Oriental Insurance Co. Ltd.
v. Mohd. Nasir [(2009) 6 SCC 280] were per incuriam having been
rendered without considering the earlier decision in Pratap
Narain Singh Deo v. Srinivas Sabata [(1976) 1 SCC 289]. 
In the
aforesaid judgment, upon consideration of the entire matter, a
four-judge Bench of this Court had held that the compensation
has to be paid from the date of the accident.
...5/-








:5:


11. Following the aforesaid judgments, this Court in Oriental
Insurance Company Limited versus Siby George and others (supra)
reiterated the legal position and held as follows:


"11. The Court then referred to a Full Bench decision
of the Kerala High Court in United India Insurance Co. Ltd.
v. Alavi and approved it insofar as it followed the
decision in Pratap Narain Singh Deo.


12. The decision in Pratap Narain Singh Deo was by a
four-judge Bench and in Valsala K. by a three-judge Bench
of this Court. Both the decisions were, thus, fully
binding on the Court in Mubasir Ahmed and Mohd. Nasir, each
of which was heard by two Judges. But the earlier
decisions in Pratap Narain Singh Deo and Valsala K. were
not brought to the notice of the Court in the two later
decisions in Mubasir Ahmed and Mohd. Nasir.


13. In the light of the decisions in Pratap Narain
Singh Deo and Valsala K., it is not open to contend that
the payment of compensation would fall due only after the
Commissioner's order or with reference to the date on which
the claim application is made. The decisions in Mubasir
Ahmed and Mohd. Nasir insofar as they took a contrary view
to the earlier decisions in Pratap Narain Singh Deo and
Valsala K. do not express the correct view and do not make
binding precedents."

...6/-








:6:


12. In view of the aforesaid settled proposition of law, the
appeal is allowed and the judgment and order of the High Court
is set aside. The appellants shall be entitled to interest at
the rate of 12% from the date of the accident.

13. No cost.






....................,J.
(SURINDER SINGH NIJJAR)




...............................,J.
(FAKKIR MOHAMED IBRAHIM KALIFULLA)
NEW DELHI
JANUARY 02, 2014

Mortgage suit Or. 34 Rule 11 C.P.C.- Banker's Book Evidence Act - Appeal against preliminary decree after passing final decree - Reduction of suit claim by wrongly rejecting statement of account as per Banker's Book Evidence Act -Court has got jurisdiction to scaled down the interest of Plaintiff's Bank - Bank can maintain appeal over the preliminary decree even after passing of final decree - High court partly allowed the Appeal = State Bank of India Settipalle Branch, Tirupati, Chittoor District, Rep. by its Chief Manager...... Appellant P. Veeranarayana, S/o.P.Veeraswamy Naidu, Hindu, aged about 49 years, Occ: Business, Managing Director o M/s.Siubar Auto Parts Limited, Sattipalle, Tirupati...... Respondent = Published in judis.nic.in/judis_andhra/filename=10295

 Mortgage suit Or. 34 Rule 11 C.P.C.- Banker's Book Evidence Act - Appeal against preliminary decree after passing final decree - Reduction of suit claim by wrongly rejecting statement of account as per Banker's Book Evidence Act -Court has got jurisdiction to scaled down the interest of Plaintiff's Bank - Bank can maintain appeal over the preliminary decree even after passing of final decree - High court partly allowed the Appeal =

Sections 2(3) and 4 of the Banker's Book Evidence Act provides as follows:

"2(3). "banker's books" include ledgers, day-books, cash-books, account-books,
and all other records used in the ordinary business of a bank, whether these
record are kept in the written form or stored in a micro film, magnetic tape or
in any other form of mechanical or electronic date retrieval mechanism, either
onsite or at any offsite location including a back-up or disaster recovery site
of both"
...

4. Mode of proof of entries in banker's books.- Subject to the provisions of
this Act, a certified copy of any entry in a banker's book shall, in all legal
proceedings, be received as prima facie evidence of the existence of such entry,
and shall be admitted as evidence of the matters, transactions, and accounts
therein recorded in every case where, and to the same extent as, the original
entry itself is now by law admissible, but not further or otherwise."=

State Bank of India (for short 'the Bank') filed the aforesaid suit based
on mortgage against the respondent (hereinafter referred to as 'Borrower'),
relating to housing loan of Rs.5.5 lakhs granted to the borrower. 
Claiming that the borrower is due and liable to pay a sum of Rs.7,12,889.41 ps. together with
interest at 13.77% per annum with quarterly rests from the date of suit
(23.07.2000), the bank filed the aforesaid suit. The said suit had been decreed
by the trial Court for a suit claim of Rs.4,14,337/- and it also granted simple
interest at 12% per annum from the date of suit. The trial Court, however,
did not accept the entries shown in Exs.A6 and A13, which are certified copies
of loan ledger extract and extract of arrears of account respectively and found
that Rs.2,74,051.97 ps. has been wrongly not given credit to and consequently,
reduced the suit claim to Rs.4,14,337.44 ps. and granted simple interest at 12%
per annum on the said amount. Thus, the bank is, in appeal, aggrieved by order
of the trial Court disallowing part of the suit claim and denying the
contractual rate of interest.
Thus, aggrieved by the
disallowed suit claim as well as granting simple interest at 12% per annum as
against the contractual rate claimed in the suit, this appeal is preferred by
the bank.=
After passing of final decree also ,  an Appeal is maintainable over the preliminary decree =

From the above, it would be clear that there is no rebuttal evidence on
behalf of the borrower to rebut the statutory presumption of correctness
attached to Exs.A6 and A13. 

21.     As noted above, both Exs.A6 and A13 are certified as required under the
aforesaid provision. I, therefore, see no impediment to accept the outstanding
amount shown thereunder as correct. The trial Court, therefore, was not
justified in reducing the suit claim than what is mentioned in the said
document. The finding of the trial Court on the said issue No.4 reducing the
suit claim of the bank is, therefore, liable to be set aside and is accordingly
set aside. It is, however, to be noted, as per P.W.1's statement extracted
above, that a sum of Rs.24,500/- paid by the defendant subsequent to Ex.A6 is
required to be given credit to in the suit claim. Hence, in modification of the
decree of the trial Court, the suit claim shall stand decreed for
Rs.7,12,889.41/- - Rs.24,500/- = Rs.6,88,389.41/-.
Undoubtedly, the Supreme Court in N.M. VEERAPPA's case     
(3 supra) categorically held that the civil Court has discretion under Order 34
Rule 11 CPC to reduce the rate of interest depending on the facts and
circumstances of each case. The circumstances, as pointed out by the learned
counsel for the borrower, being not in dispute,
I am not inclined to interfere with the discretion exercised by the trial Court
and as such, the interest at 12% granted by the trial Court is affirmed.

        Point No.2 is accordingly answered against the appellant-bank.


25.     In the result, the decree of the trial Court stands modified as under:

1. The suit claim of Rs.6,88,389.41 ps. shall carry simple interest at 12% from
the date of suit till realization.

2. The appellant - bank shall also give due credit to the amounts, if any, paid
by the borrower subsequent to the final decree dated 07.08.2003.

3. The trial Court is directed to pass a fresh final decree in terms of this
decree and such final decree to be passed by the trial Court would stand
substituted for the final decree passed by the trial Court in I.A.No.1478 of
2002 dated 07.08.2003. 

The appeal is accordingly allowed in part.

THE HON'BLE SRI JUSTICE VILAS V. AFZULPURKAR        

APPEAL SUIT No.176 OF 2004    

Dated :04-09-2013

State Bank of India Settipalle Branch, Tirupati, Chittoor District, Rep. by its
Chief Manager...... Appellant

P. Veeranarayana, S/o.P.Veeraswamy Naidu, Hindu, aged about 49 years, Occ:  
Business, Managing Director o M/s.Siubar Auto Parts Limited, Sattipalle,
Tirupati...... Respondent

Counsel for Appellant:  Mr. M. Narender Reddy

Counsel for Respondent:Mr. T.V.L. Narasimha Rao

<GIST   :

>HEAD NOTE :  

?Cases referred :
1. AIR 1967 SC 1236
2. AIR 1999 SC 896
3. (1998) 2 SCC 317


The Court made the following: -

JUDGMENT:  


        State Bank of India, which is plaintiff in O.S.No.25 of 2000 on the file
of the III Additional District Judge, Tirupati, has filed this appeal to the
extent of disallowed claim by the trial Court under judgment dated 22.03.2002.

2.      State Bank of India (for short 'the Bank') filed the aforesaid suit based
on mortgage against the respondent (hereinafter referred to as 'Borrower'),
relating to housing loan of Rs.5.5 lakhs granted to the borrower. 
Claiming that
the borrower is due and liable to pay a sum of Rs.7,12,889.41 ps. together with
interest at 13.77% per annum with quarterly rests from the date of suit
(23.07.2000), the bank filed the aforesaid suit. The said suit had been decreed
by the trial Court for a suit claim of Rs.4,14,337/- and it also granted simple
interest at 12% per annum from the date of suit. Thus, aggrieved by the
disallowed suit claim as well as granting simple interest at 12% per annum as
against the contractual rate claimed in the suit, this appeal is preferred by
the bank.

3.      I have heard Mr. M. Narender Reddy, learned counsel for the bank and Mr.
T.V.L. Narasimha Rao, learned counsel for the borrower. Both the learned counsel
have elaborately made submissions with reference to their respective claim on
the basis of documents,
which primarily comprise of statement of accounts, exhibited in the suit. The
bank as well as the borrower have produced additional documents requesting to
receive them as additional evidence, reference to which would made at an
appropriate place.
4.      Before going into the merits of the claim of the bank in the appeal, it is
necessary to deal with a preliminary objection of maintainability of the appeal
raised by the borrower.

PRELIMINARY OBJECTION:    


5.      Mr. T.V.L. Narasimha Rao, learned counsel for the borrower, contended that
the present appeal is filed against the preliminary decree granted by the trial
Court on 22.03.2002 in the mortgage suit aforesaid. Based on the said
preliminary decree the bank has filed an application for grant of final decree
in I.A.No.1478 of 2002 on 07.10.2002 requesting the trial Court to pass a final
decree in terms of the said preliminary decree on the ground that the redemption
was not availed by the borrower. The said final decree application was allowed
by the trial Court by passing a final decree dated 07.08.2003. Learned counsel,
therefore, states that, in the meanwhile, the bank had filed the present appeal
on 24.06.2002 questioning the preliminary decree and that the filing of the
final decree application and passing of the final decree was never disclosed
while filing the present appeal. Learned counsel also submits that though this
appeal was filed on 24.06.2002, it was retuned with certain office objections on
06.08.2002 but was not represented within time and the application seeking
condonation of delay of 1196 days in representing the appeal in CMP.No.22784 of
2003 was ordered only on 07.01.2004 and it is only thereafter the appeal was
numbered and admitted on 28.06.2004 and only thereafter notice in this appeal
was served on the borrower.

6.      Learned counsel for the borrower, therefore, submits that having accepted
the preliminary decree, which is impugned herein and having sought a final
decree to be passed in pursuance thereafter and having secured a final decree as
early as on 07.08.2003, the bank is estopped from pursuing this appeal against
the preliminary decree,
as it cannot be allowed to blow hot and cold. Learned counsel, further, submits
that the filing and prosecution of this appeal by the bank is also not bonafide,
as they never disclosed filing of this appeal in the application filed by them
for final decree. Thus, in view of passing of the final decree, the preliminary
decree merges in the later decree and on that ground also the present appeal is
not maintainable.

7.      Mr. M. Narender Reddy, learned counsel for the bank, submits that there is
no impediment for maintainability of the present appeal inasmuch as this appeal
was presented on 24.06.2002 long before the final decree application was filed.
Learned counsel submits that,
no doubt, there was delay in representing the appeal when the office raised
objections but since the said delay was condoned, the time for representation
stands extended and thereafter, the appeal has been duly numbered and admitted.
Learned counsel submits that even though the bank is aggrieved to the extent
disallowing of its suit claim in entirety, while passing the preliminary decree,
to the extent of the decreed suit claim there was no impediment for the bank in
seeking final decree. Learned counsel also submits that if the bank waited for
the result of this appeal, it could not have recovered even the suit claim
covered by the preliminary decree and there was no reason,
in law, disabling the bank from seeking final decree on the basis of preliminary
decree pending appeal against the preliminary decree.  Learned counsel relied
upon a decision of the Supreme Court in
SITAL PERSHAD v. KISHORI LAL1 which has considered similar question and held  
that, in such circumstances, the appeal is maintainable.

8.      In order to decide the said preliminary objection, it would be appropriate
to notice the relevant facts in the aforesaid decision.
The appellant before the Supreme Court suffered a preliminary decree in a
mortgage suit. However, the interest, as claimed by the respondent, was not
decreed and to that extent, the respondent had filed an appeal before the High
Court. Meanwhile, the respondent applied for passing of final decree, which
application was allowed and thereafter, the respondent took out the execution of
the said final decree. Meanwhile, the appeal filed by the respondent to the
extent of disallowed claim, was allowed by the High Court. Based on the said
subsequent event, the appellant objected to the execution of final decree
earlier passed in view of subsequent modification of preliminary decree. The
executing Court, however, rejected the said objection and out of that the matter
reached the Supreme Court. The Supreme Court held at para 5 as under: 

The question before us in the present appeal therefore is which of these two
views is correct. Before we consider this question   we may state certain well-
settled propositions with respect to preliminary and final decrees in mortgage
suits and the effect of an appellate decree in general on the decree of the
trial court. Generally speaking, the decree of the appellate court supersedes
the decree of the trial court even when it confirms that decree and therefore it
is well-settled that only the appellate court can amend the decree thereafter:
[see Muhammad Sulaiman Khan v. Muhammad Yar Khan (1888) ILR All 267 (FB)]. It is    
equally well-settled that where an appeal has been taken from a preliminary
mortgage decree and is decided, the time for preparation of final decree is
three years from the date of the appellate decree even though the appellate
court may not have extended the time for payment provided in the        preliminary
decree, where no final decree has been prepared in between :    see Jowad 
Hussain v. Gendan Singh, 53 Ind App 197 : (AIR 1926 PC 93). This applies even to
a case where the decree of the appellate court is made more than three years
after the time fixed for payment in the preliminary decree :
[see Fitzholmes v.
Bank of Upper India, 54 Ind App 52 : (AIR 1927 PC 25). Further it is well-
settled that the mere fact      that there is an appeal from a preliminary decree
does not oust the jurisdiction of the trial court to prepare a final decree even
while the appeal is pending unless there is a stay order :
[see Sat Prakash v.
Bahal Rai ILR 53 All 282 : (AIR 1931 All 386 (FB)]. Even if a final decree has
been passed an appeal from a preliminary decree is not incompetent and it is not
necessary for a party to appeal both from the preliminary decree and the final
decree in order to maintain his appeal against the preliminary decree.
In such a case where the preliminary decree is set aside the final decree is
superseded whether the appeal is brought before or after the passing of the
final decree : 
[see Talebali v. Abdul Aziz, ILR 57 Cal 1013 : (AIR 1929 Cal 689
(FB)]. Further it was observed in the last case that where an appellate court
sets aside or varies a preliminary decree it can, and indeed could, give
        direction for the setting aside or varying of the final decree, if the
existence of the final decree is brought to its notice as in all cases it ought
to be."

[Emphasis supplied]

        The legal position, therefore, is conclusively answered by the aforesaid
passage, particularly, the emphasized portion and in view of that the
preliminary objection raised by the learned counsel for the borrower is liable
to be rejected and is accordingly rejected.

9.      The brief facts of the case are as follows:

        (a) As stated above, the bank had sanctioned a housing loan for Rs.7 lakhs
to the borrower but the actual amount disbursed was
Rs.5.5 lakhs. The said amount was repayable in 168 monthly installments at
equated monthly installments (EMI) of Rs.7,150/- per month with effect from
31.03.1996. It is pleaded in the plaint that to secure such loan with interest
at 17.25% with quarterly rests, agreed upon, the borrower created an equitable
mortgage by deposit of title deeds. As per the terms of the loan, when the
outstanding against loan was not paid in spite of repeated demands, a legal
notice, Ex.A7 dated 16.06.2000, was issued and served on the borrower under
acknowledgment, Ex.A8 and thereafter, the present suit was filed on 23.07.2000.

        (b) The borrower filed a written statement denying the suit claim and
disputed the amount claimed, as outstanding. It was also stated that the EMI's
were paid by the borrower and recovered and
in fact, from October 1998 onwards the borrower paid ad hoc amounts of
Rs.14,000/- per month to clear off the loan at an early date.
It is also stated that though the legal notice was replied under reply dated
03.07.2000, the suit is filed without referring thereto.
The borrower had also claimed that he had paid excess amount on Rs.1.04 lakhs,
as such, the suit claim is not tenable and there is no cause of action for the
suit.

10.     On the aforesaid pleadings, the trial Court framed the following issues:
1. Whether the defendant availed loan of Rs.5,50,000/- from the plaintiff bank
and agreed to pay the amount in 180 equal monthly installments and executed term
loan agreement on 31.3.95 and a letter dt.31.3.95?

2. Whether the defendant deposited title deed and created an equitable mortgage
and executed From A letter of deposit of title deed on 3.4.95 in favour of
Plaintiff Bank?

3. Whether the defendant executed a revival letter on 28.1.98 acknowledging his
liability and whether the suit is within limitation?

4. Whether the defendant paid the amount to the plaintiff as per the E.M.I fixed
by the Plaintiff?

5. To what relief?

11.     On behalf of the bank, P.W.1, Assistant Manager of the Bank was examined
whereas the borrower examined himself as D.W.1.
On behalf of the bank, the loan documents were marked as Exs.A1 to A13 whereas
no documentary evidence is produced and marked on behalf of the borrower.

12.     While answering issues 1, 2 and 3 in favour of the bank,
the trial Court has recasted issue No.4. The trial Court, however,
did not accept the entries shown in Exs.A6 and A13, which are certified copies
of loan ledger extract and extract of arrears of account respectively and found
that Rs.2,74,051.97 ps. has been wrongly not given credit to and consequently,
reduced the suit claim to Rs.4,14,337.44 ps. and granted simple interest at 12%
per annum on the said amount. Thus, the bank is, in appeal, aggrieved by order
of the trial Court disallowing part of the suit claim and denying the
contractual rate of interest.

13.     Based on the aforesaid, the points for consideration in the appeal are:

1. Whether the finding of the trial Court in not accepting Exs.A6 and A13 is
justified?

2. Whether denying contractual rate of interest in a suit for mortgage is
justified?

14.     Before answering the questions, as above, it is necessary to deal with
ASMP.No.1685 of 2013, filed by the borrower, requesting this Court to receive
the Recalculated Housing Loan Account Statement; Recast Notional Housing Loan  
Arrears Account and Letter dated 23.04.2013, as additional evidence. The
documents filed along with the said application and letter received by the
borrower under the Right to Information Act, are, therefore, sought to be filed
as additional evidence.  So far as the account statement calculated by the
borrower is concerned, apparently, it is a self-serving document,
for the statement is signed by the borrower and his counsel. In law, therefore,
such self-serving calculation sheet, as against the claim of the bank based on
certified account statement cannot be sustained.  The said statement of accounts
described as recalculated housing loan account statement and recast notional
housing loan arrears account have no evidentiary value and cannot be received in
evidence.
Further, the letter of the bank issued to the borrower counsel under RTI Act
merely gives details of loan disbursed date-wise and the payment made by the
borrower date-wise are of no assistance, as all those aspects are not in
controversy. I am, therefore, not inclined to order the said application and the
same is accordingly dismissed.

15.     Similarly, the appellant-bank had filed ASMP.No.2343 of 2004 requesting
the Court to receive the consolidated statement of account as additional
evidence. It is stated that the said consolidated statement is prepared merging
Exs.A6 and A13 and the said statement is signed by the Chief Manager of the
Bank.  Firstly, the said document is prepared by, allegedly, consolidating
Exs.A6 and A13 and as such, the said document is not a statement of account
maintained by the bank in usual course of business nor the said document is
certified as required under Section 3 of the Banker's Books Evidence Act and as
such, the said document is also not admissible. The miscellaneous petition is
accordingly rejected.

POINT No.1:


16.     A look at the pleadings of the parties would show that there is no
controversy with regard to raising of the loan, its quantum, equitable mortgage
and the terms and conditions of the said loan.  Ex.A12 filed on behalf of the
bank contains the terms and conditions of the said loan dated 22.05.1995 and
under Ex.A5, admittedly,
the borrower has given letter of revival of the said loan on 21.01.1998.
Further, the said claim is based on Ex.A6, ledger extract and Ex.A13, copies of
arrears account. I have seen the original documents, both of which have been
certified as required under the Bankers Book of Evidence Act. In the absence of
any rebuttal evidence, therefore,
a statutory presumption arises in support of the said two documents with respect
to the correctness of entries therein.

17.     Learned counsel for the respondent, however, disputed the very document
Ex.A13 by contending that the said document was not referred to in the pleadings
nor filed along with plaint but has been filed subsequently when P.W.1 was being
examined. According to the learned counsel, there cannot be two separate
accounts maintained by the bank and according to him, Ex.A6 alone reflects the
true accounts position and no reliance can be placed on Ex.A13.

18.     Learned counsel for the bank, however, submits that both the said accounts
are required to be maintained by the bank as per instructions of the Reserve
Bank of India and for every loan account, the arrears account and the ledger
account are separately maintained and he submits that though the plaint, by
mistake, does not refer to Ex.A13, that by itself is no ground to reject the
said document.

19.     It is not in dispute that the suit claim of the bank is based upon Exs.A6
and A13 and P.W.1 states in his evidence that 'Each loan account of our bank
will be maintained under two separate heads,
for the convenience of computer processing. Under the first head all the
disbursements made to the borrower by the Bank will be shown.
In the other head, amounts due by the borrower, monthly installments due and
interest accrued thereon will be shown ... The amount shown under Ex.A13 is
reflected under Ex.A6 already. In Ex.A6 the schedule repayable amounts are only
shown by way of installment. But they are not actual payments, made by the
defendant. In Ex.A6, the actual amount due on 23.07.2000 (date of suit) is
shown. Subsequent to, the filing of the suit defendant paid an amount of
Rs.24,500/- in two installments and plaintiff has no objection for deducting
that amount from the suit amount". A suggestion given to P.W.1 may also be
noticed, which says, "It is not true to say that Ex.A13 does not reflect true
facts as we have not produced the original ledgers before the Court." In this
context, defendant, D.W.1, states in cross-examination dated 17.04.2011 as
follows: "The payment made by me mentioned in the ledger, are correct. A6 is the
ledger extract". Regarding Ex.A3, however, he did not make any statement.

20.     Sections 2(3) and 4 of the Banker's Book Evidence Act provides as follows:

"2(3). "banker's books" include ledgers, day-books, cash-books, account-books,
and all other records used in the ordinary business of a bank, whether these
record are kept in the written form or stored in a micro film, magnetic tape or
in any other form of mechanical or electronic date retrieval mechanism, either
onsite or at any offsite location including a back-up or disaster recovery site
of both"
...

4. Mode of proof of entries in banker's books.- Subject to the provisions of
this Act, a certified copy of any entry in a banker's book shall, in all legal
proceedings, be received as prima facie evidence of the existence of such entry,
and shall be admitted as evidence of the matters, transactions, and accounts
therein recorded in every case where, and to the same extent as, the original
entry itself is now by law admissible, but not further or otherwise."

        From the above, it would be clear that there is no rebuttal evidence on
behalf of the borrower to rebut the statutory presumption of correctness
attached to Exs.A6 and A13. 

21.     As noted above, both Exs.A6 and A13 are certified as required under the
aforesaid provision. I, therefore, see no impediment to accept the outstanding
amount shown thereunder as correct. The trial Court, therefore, was not
justified in reducing the suit claim than what is mentioned in the said
document. The finding of the trial Court on the said issue No.4 reducing the
suit claim of the bank is, therefore, liable to be set aside and is accordingly
set aside. It is, however, to be noted, as per P.W.1's statement extracted
above, that a sum of Rs.24,500/- paid by the defendant subsequent to Ex.A6 is
required to be given credit to in the suit claim. Hence, in modification of the
decree of the trial Court, the suit claim shall stand decreed for
Rs.7,12,889.41/- - Rs.24,500/- = Rs.6,88,389.41/-.

        Point No.1 is accordingly answered in favour of the appellant.


Point No.2:


22.     With regard to the claim for interest by the bank, as per the contractual
rate, as claimed in the suit is concerned, Mr. M. Narender Reddy, learned
counsel for the bank, placed reliance upon a decision of the Supreme Court in
STATE BANK OF INDIA v. YASANGI VENKATESWARA RAO2 and it is contended that          
entering into a mortgage is a matter of contract between the parties and if the
parties agree that in respect of the amount advanced against a mortgage compound
interest will be paid, the Court cannot interfere and reduce the amount of
interest agreed to be paid on the loan so taken.  Learned counsel, therefore,
submits that considering Section 21-A of the Banking Regulation Act, the Supreme
Court held that charging compound interest as per the agreement cannot be said
to be excessive and cannot be reduced.

23.     Per contra, learned counsel for the borrower placed strong reliance upon a
decision of the Supreme Court in N.M. VEERAPPA V. CANARA BANK3,  which held        
that the Court has discretion under Order 34 Rule 11 of the Code of Civil
Procedure, 1908, to order payment of interest at a rate lower than the
contractual rate.
The provisions of Section 21-A of the Banking Regulation Act were also
considered in the aforesaid decision but it was held that the said provision
does not intend to override CPC and particularly, Order 34 Rule 11 CPC.  Hence,
the power of the civil Court to reduce the rate of interest from the date of
suit is not affected. 
In furtherance of the said proposition, the learned
counsel submits that the borrower has been bonafide and he had paid EMI's
regularly from 01.04.1996 to 01.05.2000, as admitted by P.W.1. In addition, the
borrower paid Rs.1,28,900/- between 20.10.1997 and 04.05.2000 and in addition
thereto, further sum of Rs.24,500/- was paid after filing of the suit.
All this, therefore, shows that the borrower has been fair while dealing with
the bank but the appellant-bank has not been equally fair to the borrower.
Learned counsel, therefore, submits that the trial Court exercised discretion
under Order 34 Rule 11 CPC and granted simple interest at 12%. He, therefore,
urges that this Court would not interfere with that part of the discretion
exercised by the trial Court looking at the bonafides of the borrower.

24.     Undoubtedly, the Supreme Court in N.M. VEERAPPA's case    
(3 supra) categorically held that the civil Court has discretion under Order 34
Rule 11 CPC to reduce the rate of interest depending on the facts and
circumstances of each case. The circumstances, as pointed out by the learned
counsel for the borrower, being not in dispute,
I am not inclined to interfere with the discretion exercised by the trial Court
and as such, the interest at 12% granted by the trial Court is affirmed.

        Point No.2 is accordingly answered against the appellant-bank.


25.     In the result, the decree of the trial Court stands modified as under:

1. The suit claim of Rs.6,88,389.41 ps. shall carry simple interest at 12% from
the date of suit till realization.

2. The appellant - bank shall also give due credit to the amounts, if any, paid
by the borrower subsequent to the final decree dated 07.08.2003.

3. The trial Court is directed to pass a fresh final decree in terms of this
decree and such final decree to be passed by the trial Court would stand
substituted for the final decree passed by the trial Court in I.A.No.1478 of
2002 dated 07.08.2003. 

The appeal is accordingly allowed in part. As a sequel,
the miscellaneous applications, if any, shall stand dismissed.
There shall be no order as to costs.
____________________  
VILAS V. AFZULPURKR, J  
September 4, 2013