The central legal point established in the judgment is the interpretation of the term 'principal' and its application to the calculation of interest under the Kerala Agriculturists Debt Relief Act.

1. The debtor-respondent in a petition under S.S, 6 and 8 of the Kerala Agriculturists Debt Relief Act, 31 of 1958, has preferred this appeal from the order of the court below, dated 12th March 1962, fixing the amount of the debt.

2. The appellant had borrowed money from the respondent - a banking company - under an overdraft agreement (Ex. P-3) dated 23rd April 1953 with a limit of Rs. 10,000. Interest at 9 per cent per annum with quarterly rests was agreed to be paid by the debtor. Ex. P-3 was executed in renewal of an earlier agreement dated 29th May 1947. According to the bank, the debtor had acknowledged the balance due on 2nd July 1958 as Rs. 10,192.52 p. and he was liable to pay a sum of Rs. 10,178.19 p. inclusive of interest on the date of the petition, i. e., 27th June 1961. Each instalment payable was stated to be Rs. 1,272.27 p. The debtor contended that interest was to be calculated on each item of debt and not on the consolidated balance and that Rs. 6,858 alone was the principal, all entries after 30th June 1949 being interest. He further contended that a sum of Rs. 1,600 had been paid after 14th July 1958, the date on which Act 31 of 1958 came into force. He filed supplementary objection on 6th November 1961 stating that the amounts under certain cheques which he had handed over to the bank for collection had on dishonour been debited against him without a corresponding credit entry when the cheques were accepted for collection and that these sums also should be deducted from the amount claimed. The court below rejected all the objections and allowed the petition of the bank.

3. The first point raised on behalf of the appellant is that the question raised in the supplementary objections should have been investigated. As stated earlier, the supplementary objections were filed on 6th November 1961 with an application No. 7853 of 1961 to permit him to raise the same. This application was allowed only on 12th March 1962, the date on which the court below decided the main petition. The main petition had been posted for evidence to 5th February 1962. The court had no time to take up the case that day, but it was posted for hearing to 22nd February 1962 on which date it was heard without even examining the parties. The court below has, no doubt, stated that the supplementary objections were vague. The truth of the allegations could have been ascertained by looking at the copy of the accounts filed by the bank. This was not done and the disposal of the petition cannot, in the circumstances, be considered satisfactory.

4. The second point is that interest should have been calculated on sums debited from the respective dates and not on a consolidated amount. This argument cannot be accepted. It was held by a Division Bench in Oomman v. Kottayam Orient Bank Limited 1963 KLT.1150 that in a case of borrowing on an overdraft agreement, the debtor is not entitled to contend that each item borrowed was to be treated as a separate debt. We are in agreement with this view. This point must therefore be overruled.

5. The third and the most important point is that notwithstanding the contract, interest should be calculated only on the principal, i.e., the amount borrowed and not on an amount made up of such principal and interest. The court below disposed of this question on the short ground that the confirmation forms signed by the debtor were conclusive and that "he has also not gone into the box to swear that these confirmation slips do not estop him from disputing the correctness of the amounts in these proceedings". We have already pointed out that the court did not give an opportunity to the debtor to adduce evidence or to examine himself. The question as to what the principal for the purpose of computation of interest is, will depend on the applicability of Act 31 of 1958 to the debt.

6. "Debt" has been defined in S.2 (c) as

"any liability in cash or kind, whether secured or unsecured, due from or incurred by an agricul