1. Suit for preliminary decree for sale of mortgaged properties and personal decree — dispute over award of future interest on the decretal amount. (Para 3 )
Back
Next 
1994 Supreme(SC) 352
SUPREME COURT OF INDIA
(BEFORE K. RAMASWAMY AND N. VENKATACHALA, JJ.)
B. SHIVANANDA v. ANDHRA BANK LTD. AND ANOTHER
Civil Appeal No. 3695 of 1994, decided on March 18, 1994
Advocates who appeared in this case :
A. Subba Rao and A.D.N. Rao, Advocates, for the Appellant;
V.R. Reddy, Additional Solicitor General (P.P. Singh, Advocate, with him) for the Respondent 1.
Important Points
The court affirmed that Section 152 CPC permits correcting accidental omissions in decrees. Additionally, for commercial transactions, the court may exercise discretion under Section 34 CPC to award interest from the date of the decree until realization, consistent with the contracted rate claimed in the suit.
Subject
Civil Law - Contract
Act Referred
Headnote
Civil Procedure Code,1908 - Sections 152 and 34 - Seeking a preliminary decree - Sale of properties - Respondent filed OS No. on the file of Additional Subordinate Judge seeking a preliminary decree for sale of properties covered by two simple mortgages and a charge on the hypothecated moveables and immovables, moveables have been mentioned in Schedule B and a personal decree against appellant and others was sought for decretal amount with future interest and costs - Suit was decreed ex parte on two applications were filed - One by respondent-Bank claiming interest at rate of 16 1/2% on decretal amount and another by the appellant- Appellant contended that no interest can be granted since the judgment did not specify the liability relating to payment of future interest - Trial court allowed the application of the appellant and dismissed – Held, Loan was for a commercial transaction facts and circumstances of this case – Court consider it just and proper appellant should pay simple interest at rate of 16 1/2% per annum on the principal amount claimed in suit from the date of the decree till of realisation. This should be confined to this case only, on peculiar facts of this case - It is stated in appellants written arguments that as on date, a sum of had already been paid and the appellant shall pay balance amount along with future interest within six months from today event any default is committed by appellant, the benefit of this judgment will not be available to the appellant - Appeal is allowed
Legal Category Hierarchy
Advocates:
A.D.N.Rao, A.SUBBA RAO, P.P.SINGH, V.R.REDDY
A.D.N.Rao, A.SUBBA RAO, P.P.SINGH, V.R.REDDY
Table of Contents
2. Bank claimed contracted interest rate on decretal amount — Appellant contended no interest could be granted as the judgment did not specify future interest liability. (Para 3 )
3. Section 152 CPC permits correction of clerical errors or accidental omissions without requiring a formal appeal or review; commercial loans justify discretionary interest under Section 34 CPC. (Para 4 )
4. Contracted interest rates in commercial transactions may be awarded from the date of decree till realization under the court's discretion pursuant to Section 34 CPC. (Para 4 )
5. Appeal allowed to the extent of awarding simple interest at the contracted rate from the date of decree until realization, subject to payment timelines. (Para 4 )
6. Can a court correct clerical or arithmetical mistakes in a judgment or decree without a formal appeal or review?
Yes, Section 152 CPC empowers the court to correct clerical or arithmetical mistakes, or errors arising from any accidental slip or omission, either on its own motion or upon application by any party, without the necessity of filing an appeal or review. (Para 4 )
7. Does the court have the discretion to award interest on a loan taken for a commercial transaction?
Yes, under Section 34 CPC, the court has the discretion to award interest. In commercial transactions, the court may consider it just and proper to award simple interest at the contracted rate from the date of the decree until the date of realisation. (Para 4 )
ORDER
1. Leave granted.
2. We have heard both counsel.
3. The respondent filed OS No. 74 of 1979 on the file of the Additional Subordinate Judge, Ananthpur, Andhra Pradesh on 11 -6-1979 seeking a preliminary decree for sale of properties covered by two simple mortgages, dated 3-7-1976 and 13-12-1976 and a charge on the hypothecated moveables and immovables, moveables have been mentioned in Schedule B and a personal decree against appellant and others was sought for the decretal amount with future interest and costs. The suit was decreed ex parte on 13-3-1986. Thereafter, two applications were filed - one by the respondent-Bank claiming interest at the rate of 16 1/2% on the decretal amount and another by the appellant. The appellant contended that no interest can be granted since the judgment did not specify the liability relating to payment of future interest. The trial court allowed the application of the appellant and dismissed the application of the respondent-Bank. On revision filed by the Bank, the High Court, by its order dated 23-9-1989 allowed the revision of the Bank and dismissed the application of the appellant. Thus, this appeal by special leave.
4. We need not go, in depth, into the controversy, raised in the case but suffice to state that Bank sought a relief in the plaint for payment of an amount specified and interest on the principal amount of Rs 5,25,000. With interest accrued thereon till date of suit, the amount came to Rs 6,89,917.79 P. Section 152 CPC, clearly gives power to the court to amend clerical or arithmetical mistakes in the judgment and decree or order or any errors arising therein from any accidental slip or omission. The same may, at any time, be corrected by the court either of its own motion or on the application of any of the parties to the suit. Therefore, it is not necessary that the aggrieved party should necessarily file an appeal or review for effecting correction of the judgment or decree or order. But in this case, as seen, that the claim for future interest at 16 1/2% was made in the suit itself which admittedly, is the contracted rate of interest. Therefore, the Bank is entitled to claim interest in terms of the contract at 16 1/2% from the date of lending till the date of filing of the suit. However, the court has discretion under Section 34 CPC to award interest. Admittedly, the loan was taken for construction of theatre. In other words, the loan was for a commercial transaction. In the facts and circumstances of this case, we consider it just and proper that the appellant should pay simple interest at the rate of 16 1/2% per annum on the principal amount claimed in this suit from the date of the decree till the date of realisation. This should be confined to this case only, on the peculiar facts of this case. It is stated in the appellants written arguments that as on date, a sum of Rs 2,53,000 had already been paid and the appellant shall pay the balance amount along with future interest within six months from today. We permit him to make payment accordingly. In the event any default is committed by the appellant, the benefit of this judgment will not be available to the appellant. The appeal isaccordingly allowed to the above extent but in the circumstances, without costs.
For Citation : (1994) 4 SCC 368
