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P.SATHASIVAM, RANJAN GOGOI, N.V.RAMANA
V. Kala Bharathi – Appellant
Versus
Oriental Insurance Co. Ltd. , Br. Chitoor – Respondent
Key Points: - The appropriate method of appropriation of deposits made by the judgment debtor under Order XXI Rule 1 CPC when the decree amount is not fully deposited, including whether to first adjust towards interest, costs, or principal (!) (!) (!) - The legislature’s intent behind sub-rules (4) and (5) of Order XXI Rule 1 CPC and the principle that interest cease to run on deposits upon service of notice or payment, and that no interest on interest can be awarded under the stated circumstances (!) (!) (!) (!) - The Court’s holding that, where deposits fall short of the decretal amount, the decree-holder is entitled to appropriation first towards interest, then costs, then principal, and thereafter no further interest on the already appropriated principal (!) (!) (!) (!) - The consistency of this position with Meghraj, Industrial Credit and Development Syndicate, Gurpreet Singh, and Bharath Heavy Electricals Ltd. decisions, including the Privy Council guidance on appropriation and interest (!) (!) (!) (!) (!) (!) - The appellate order restoring the Executing Court’s decree, allowing the claimant to receive the amount awarded with interest only on the unpaid principal after appropriation (!)
2. The facts of the case are – On account of demise of an Engineering Graduate, Mr. V. Raja Kumar on 29.04.1993 in a road accident, his legal heirs, i.e., the appellants herein filed a claim petition being M.V.O.P. 774 of 1993 before the Motor Accident Claims Tribunal (for short, ‘the Tribunal’) claiming -
3. Compensation to the tune of Rs.2 crores. The vehicle involved in the said accident was insured by the respondent – Insurance Company. The Tribunal vide its Award dated 29.04.1997 awarded an amount of Rs.98,40,500/- as compensation with interest @ 12% p.a. from the date of the petition, i.e., 25.10.1993 till the date of realization, apart from costs quantified at Rs.99,443/-.
4. Being aggrieved, the respondent – Insurance Company filed an appeal under Section 173 of the Motor Vehicles Act, 1988 (for short, ‘the Act’) and to comply with the provisions contained therein, deposited a sum of Rs.25,000/-. On 15.12.1997, the High Court in C.M.A. No. 1726 of 1997 granted stay o
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