The main legal point established in the judgment is that the Court has the discretion to award interest at a rate it deems fit, and in this case, the trial Court's decision to award 24% simple interest per annum was upheld.

JUDGMENT :

VENUTHURUMALLI GOPALA KRISHNA RAO, J.

1. This Appeal, under Section 96 of the Code of Civil Procedure [for short ‘the C.P.C.’], is filed by the Appellant/plaintiff challenging the Decree and Judgment, dated 11.03.2008, in O.S.No. 167 of 2006 passed by the learned X Additional District & Sessions Judge, (Fast Track Court), Visakhapatnam at Anakapalle [for short ‘the trial Court’]. The Respondents herein are the defendants in the said Suit.

2. The Plaintiff filed the above said suit for passing Preliminary Decree against the defendants directing them to pay a sum of Rs.13,35,004/- being the principle and compound interest due on a mortgage deed dated 06.05.1995 from the defendants.

3. Both the parties in the Appeal will be referred to as they are arrayed before the trial Court.

4. The brief averments of the plaint, in O.S. No. 167 of 2006, are as under:

The first defendant is the father of defendants 2 and 3 and they all have jointly borrowed an amount of Rs.70,000/- from the plaintiff on 06.05.1995 in cash at Anakapalle for their business investment and all the defendants executed registered mortgage deed in favour of plaintiff on the same day agreeing to repay the same with interest at 24% p.a. on monthly rests i.e., 5th of every month and further agreed to pay the principle amount within three years from the date of mortgage deed, failing which they further agreed to pay compound interest at 30% p.a. from the date of default of payment of interest. They mortgaged the plaint schedule property, which is in the name of first defendant. The defendants did not pay even single pie towards the principle or interest to the plaintiff inspite of demands by the plaintiff and they postponed the payment on some pretest or other. The plaintiff issued legal notice on 28.01.2006 demanding debt due under the mortgage deed. Defendants received the same but they did not give any reply or make any payment. Hence, the plaintiff is constrained to file the suit.

5. The defendants 1 to 3 filed common written statement by denying the averments of the plaint and further contended as follows:

The defendants never borrowed Rs.70,000/- from the plaintiff and executed registered mortgage deed for their business purpose. But the plaintiff approached the defendants for purchase of the schedule property at a cheaper price, for which they did not want to sell away the same to the plaintiff, due to that differences and ill feelings arose and the plaintiff bore grudge against the defendants and created the suit mortgage deed dated 06.05.1995 with the help of attestors and scribe who are his henchmen and filed this suit with false and baseless allegations with a view to grab the schedule property and prayed the Court to dismiss the suit.

6. Based on the above pleadings, the trial Court framed the following issues:

(i) Whether the defendants 1 to 3 borrowed Rs.70,000/- from the plaintiff on 06.05.1995 and executed registered mortgage deed in his favour and the same is true, valid and binding on the defendants?

(ii) Whether the defendants are entitled to the benefits Act of 4 of 1938 and interest is to be scaled down?

(iii) Whether the plaintiff is entitled for preliminary decree for the suit amount as prayed for?

(iv) To what relief?

7. During the course of trial in the trial Court, on behalf of the Plaintiff, PW1 and PW2 were examined and Ex.A1 to Ex.A7 were marked. On behalf of the Defendants DW1 was examined and Ex.B1 and Ex.B2 were marked.

8. After completion of the trial and on hearing the arguments of both sides, the trial Court partly decreed the Suit vide its judgment, dated 11.03.2008, against which the present appeal is preferred by the appellant/ plaintiff in the Suit, questioning the Decree and Judgment passed by the trial Court.

9. Heard Smt M.Sarada, learned counsel, representing Sri G.L.Nageswara Rao, learned counsel for appellant/plaintiff and Ms.Sireesha Rani Vallabhaneni, learned counsel, representing Sri Sreenivasa Rao Valivela, learned counsel for