Absent a specific contractual agreement for interest, courts exercise discretion under the civil procedure code to award equitable interest; such an order cannot be reopened in a review petition unless it contains a patent error apparent on the face of the record.

JUDGMENT :

K.R. Surana, J.

Heard Mr. S.P. Roy, learned counsel for the petitioners. Also heard Mr. S. Dutta, learned senior counsel, assisted by Ms. S. Mochahari, learned counsel for the respondents.

2) This petition for review is in respect of order dated 03.11.2022, passed by the Division Bench in W.A. No. 229/2022, by which the direction contained in judgment and order dated 23.02.2022, passed by the learned Single Judge in W.P.(C) No. 4423/ 2018, by which 18% interest was granted to the petitioners against the respondents on further delay on part of the appellants to refund a sum of Rs.1,80,10,000/- (Rupees One Crore eighty lakh ten thousand only), within 45 (forty five) days from the date of the order.

3) In brief, the case of the petitioners is that pursuant to an advertisement for auction sale of a security asset taken over under the SARFAESI Act, they were successful joint bidders for purchasing such property. On 20.06.2016, the petitioners had deposited their bid of Rs.1,80,10,000/- (Rupees One Crore eighty lakh ten thousand only). However, the respondents could not hand over the said property to the petitioners and as such, the petitioners demanded refund of the bid amount. Therefore, the petitioners had approached this Court by filing a writ petition, which was registered and numbered as W.P.(C) No. 4423/2018. The learned Single Judge, by order dated 23.02.2022, directed the respondents to refund the deposited bid amount within 45 (forty five) days from the date of the order along with interest at the prevailing banking rate, by further directing that on further delay on part of the appellants to refund the amount within the period stipulated, interest would be 18% interest per annum on the actual amount. The relevant paragraphs of the said order are quoted below:-

“This Court is also of the considered opinion that the prayer made by the petitioners is only for the refund of the amount with banking rate of interest which appears to be a reasonable one as no citizen would be left with such a situation wherein, a huge amount is lying to the respondent bank without the property in question being handed over to them.

In view of the above, the present writ petition is disposed of by directing the respondent bank to refund the amount in question being Rs. 1,80,10,000/- (Rupees One Crore Eighty Lakhs and Ten Thousand) to the petitioners along with interest at the prevailing banking rate from 04.10.2016 within a period of 45 days from today. It is however directed that in case of further delay from the period stipulated, the interest would be @ 18% p.a. on the actual amount.

Writ petition stands accordingly disposed of.”

4) The respondents preferred an intra-court appeal, which was registered and numbered as W.A. No. 229/2022, challenging only that part of the order, where interest was awarded on the refund amount. This Court, by order dated 20.07.2022, issued notice only for the purpose of considering 18% interest provided in the impugned judgment and order, passed by the learned Single Judge. However, while formulating the question which fell for consideration of the Court, had considered as to whether the respondents are entitled to interest at the rate of 18% per annum, as ordered by the learned Single Judge, is sustainable. Accordingly, by the order that is impugned in this review petition, the Division Bench of this Court had held that there was no contractual rate of interest agreed upon which should match the rate of rate fo interest of nationalized banks in relation to the commercial transactions as provided under Section 34(1) of the Civil