( 1 ) THE respondents herein availed an amount of Rs. 25,000/- as term loan sometime in the year 1980. At a later point of time, they also availed another amount of Rs. 50,000/- towards term loan. Both these loans carry interest at the rate of 11. 85% per annum compoundable quarterly. Apart from these loans, the respondents also availed Open Cash Credit (OCC) with a limit of Rs. 75,000/- carrying same rate of interest compoundable quarterly. The loan was sanctioned by the appellant bank on obtaining security, which was given by creating equitable mortgage by deposit of title deeds. In spite of several demands, the loan amounts were not repaid. Therefore, the appellant bank, which is a Nationalized Bank, filed suit being O. S. No. 50 of 1998 on the file of the court of the Subordinate Judge, Vikarabad, for recovery of suit amount in a sum of rs. 3,66,230/ -. The plaintiff/appellant bank also claimed subsequent interest on contractual rate of interest at 11. 85% per annum.

( 2 ) DEFENDANTS 1 and 3 remained ex pane. Defendants 2,4 and 5 filed a common written statement opposing the suit. They, inter alia, contended that Defendant No. 1 is not a registered partnership firm and that Defendant No. 3 was not authorized to secure loans from others. They also contended that the contesting defendants are not liable for the loans secured by the third defendant.

( 3 ) THE Trial Court framed two issues, namely, (1) Whether the plaintiff is entitled to recover the suit claim as prayed for ? and (2) To what relief ? On behalf of andhra Bank, the Manager was examined as P. W. 1 and Exs. A. 1 to A. 16 were marked. Second defendant was examined as d. W. 1, but no documentary evidence was produced. On consideration of the evidence on record, the Trial Court by judgment and decree dated 5. 8. 1993 decreed the suit with costs, passing a preliminary decree for an amount of Rs. 3,66,230/ -. The Trial court also awarded interest at 6% per annum from the date of the suit till the date of realization and the defendants were granted three months time for redemption of the mortgage. Aggrieved by the judgment and decree insofar as awarding interest only at 6% per annum from the date of the suit till the date of realization, Andhra bank has filed present appeal.

( 4 ) LEARNED Counsel for the appellant bank, Sri S. P. Sarveswara Murthy, placed strong reliance on Section 34 read with order XXXIV Rule 11 of Code of Civil procedure, 1908 (CPC) and contends that in relation to a commercial transaction the discretion vested in the Civil Court in the matter of awarding interest has to be within the parameters of proviso to Section 34 cpc and therefore the Trial Court erred in restricting interest pendente lite and post decree at 6% per annum. He placed reliance on the judgment of the Supreme court in Central Bank of India v. Ravindra, 2002 (2) ALD 97 (SC) = (2002) 1 SCC 367 = AIR 2001 SC 3095, as well as decision of this Court in Indian Bank, madras v. N. Munisankar, 2000 (3) ALD 701 (DB) and Sri Panduranga Traders v. State Bank of India, Vatluru Branch, W. G. Dist. , 2000 (3) ALD 134 (DB ).

( 5 ) LEARNED Counsel for Respondents 2, 4 and 5, Sri A. Ananda Rao, supports the impugned judgment of the Trial Court. His submissions are as follows. Even if the loan availed from a Nationalized Bank, is in the nature of a commercial transaction, in a mortgage suit, it is always permissible for the Court to exercise discretion under Order XXXIV Rule 11 read with section 34 CPC and reduce rate of interest from the date of the suit till the date of the decree and from the date of the decree till the date of realization or redemption. He would further submit that in a mortgage suit, the suit is always filed capitalizing interest and when the Court adjudicates the amount of principal payable by the defendant, it also includes the component of interest and therefore if the interest at more than 6% per annum is awarded pendente lite and post decree, it would amoun