( 1 ) THE question as to whether the amount deposited by the judgment-debtor in a decree should be adjusted first towards the decretal amount, or the interest that accrued thereon, was the subject matter of several precedents and legislative measures. However, it continues to vex the parties and the courts alike.

( 2 ) THE facts, that gave rise to filing of these revisions, are as under. The parties are referred to, as arrayed in C. R. P. No. 4337 of 2004.

( 3 ) RESPONDENTS 1 to 5 (hereinafter referred to as "the respondent") filed O. P. No. 774 of 1993, before the Motor Accidents Claims tribunal-cum-V Additional District Judge, tirupathi (for short "the Tribunal"), claiming compensation in a sum of Rs. two crores, on account of death of Mr. V. . Raj Kumar, husband of the first respondent, father of respondents 2 and 3 and son of respondents 4 and 5. It was alleged that he dies in an accident, involving a vehicle belonging to the 6th respondent, driven by the 7th respondent, and insured with the petitioner company. Through its judgment dated 29-4-1997, the tribunal awarded a sum of Rs. 98,40,500/-, as compensation, with interest at the rate of 12% from the datp of presentation of the o. P. , viz 25-10-1993.

( 4 ) THE petitioner filed C. M. A. No. 1726 of 1997, before this Court. To comply with the condition in Section 173 of the Motor Vehicles act, the petitioner deposited a sum of rs. 25,000/- on 7-7-1997. This court granted stay of the execution of the decree in the o. P. , on 15-12-1997, on condition that a sum of Rs. 30,00,000/- is deposited. This amount was deposited on 15-12-1997. Thereafter, the respondents filed an application to vacate the interim orders. While making the interim stay absolute, this court directed the petitioner to deposit a further sum of Rs. 30,00,000/-, and it was complied with on 15-7-1998.

( 5 ) THROUGH its judgment dt. 19-12-2001, a division Bench of this Court, partly allowed the C. M. A. , and reduced the compensation to Rs. 56,40,000/ -. The rate of interest at 12% was retained. After this, the petitioner deposited a sum of Rs. 23,27,6357-, on 10-9-2002, claiming to be in full and final satisfaction of the award.

( 6 ) THE respondents filed E. P. No. 11 of 2003, on 6-6-2003, claiming that the petitioner is liable to pay a further sum of rs. 20,16,700/ -. The petitioner insisted that at the most, a sum of Rs. 36,650/- is due, and accordingly deposited the same on 29-7-2003. The executing court, however, took the view that the amounts deposited by the petitioner, from time to time, were liable to be adjusted towards the component of interest first, and thereafter, to the portion of decretal amount. Accordingly, it fixed the liability of the petitioner, as on the date of filing of the e. P. , at Rs. 17,70,657/-, through its order dated 11-8-2004. On this amount also, the tribunal awarded interest at the rate of 12%, from the date of filing of the E. P, till the date of realization.

( 7 ) PETITIONER filed C. R. P. No. 4337 of 2004 assailing this order. Respondents filed c. R. P. No. 6108 of 2004, complaining that the Executing Court adjusted the amount paid by the petitioner as costs, towards the decretal amount.

( 8 ) SMT. A. Anasuya, learned counsel for the petitioner, submits that the petitioner deposited a sum of Rs. 83,89,285/-, from time to time, as against the award of rs. 56,40,000/-, with 12% interest. She contends that all the amounts were deposited into court, with intimation to, or to the knowledge of the respondents, and in view of sub-rule (4) of Rulel of Order 21 C. P. C. , the amounts deposited from time to time, were to have been adjusted towards the decretal amount i. e. principal. Placing reliance upon section 3 of the Interest Act, the learned counsel submits that it is impermissible to award interest on interest, either directly or indirectly. According to her, the judgments relied upon by the respondents, were those in which the purport of sub-rules (4) and (5) of Rule 1 of

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