Writ petition filed by Bank for reducing rate of interest maintainable.

V. Ramasubramanian, J.

The respondents 1 and 2 availed a loan of Rs.9,00,000/- from the petitioner Bank in the year 1994. According to the petitioner Bank the respondents 1 and 2 promptly paid the interest upto the year 2000. Thereafter, there was on outstanding and the petitioner raised arbitration in ARC.No.78 of 2001-2002. On 19. 2001, an award was passed by the Arbitrator directing the respondents 1 and 2 to pay a sum of Rs.11,23,700.50 together with interest at 21% p.a. from 19. 2001 till the date of realization.

2. Challenging the said award, the respondents 1 and 2 filed an appeal before the Principal District Court, Erode (Special Tribunal for Co-operative cases) in C.M.A.No.88 of 2001. By an order dated 24. 2005, the said appeal was allowed in part and the award of the arbitrator was modified to the limited extent of reducing the rate of interest from 21% to 6% payable with effect from 19. 2001 on the award amount of Rs.11,23,700.50. Challenging the said order of the appellate tribunal, the petitioner-Bank has filed the present writ petition.

3. I have heard Ms. G. Thilakavathy, learned counsel for the petitioner and Mr. V. Manokaran, learned counsel appearing for the respondents 1 and 2 and Mr. V. Arun, learned Government Advocate for the 3rd respondent.

4. The grievance of the petitioner-Bank is actually two fold, viz.

a) that the contractual rate of interest ought not to have been reduced by the appellate Tribunal and

b) that at any rate, the Tribunal ought not to have reduced the rate of interest upto the date of the award passed by the Arbitrator.

5. Mr. N. Manokaran, learned counsel for the respondents 1 and 2 opposed the writ petition first on the ground of maintainability, by relying upon the Judgment of this Court in The Special Deputy Collector (Stamps) v. Chemicals and Plastics Limited 2004 1 L.W. 788. In the said case which arose out of the proceedings under Section 47-A of the Indian Stamp Act, this Court held that the revision petition filed by the Special Deputy Collector against the order the Principal Sub Judge (appellate authority under the Act) was not maintainable on the ground that the Special Deputy Collector (Stamp) had exercised quasi-judicial function under Section 47-A of the Indian Stamp Act. But I am unable to agree with the said submission of the learned-counsel appearing for the respondents 1 and 2. In the judgment relied upon by him, the revision petitioner was the Special Deputy Collector (Stamp), who acted as a quasi-judicial authority under Section 47-A of the Indian Stamp Act. But, in this case, the Arbitrator who acted as the quasi-judicial authority did not file the present writ petition. On the other hand, one of the parties to the arbitration namely the petitioner Bank had filed the present writ petition. The petitioner Bank is a person aggrieved against the order of the Co-operative appellate Tribunal, since, the rate of interest awarded by the Arbitrator in favour of the petitioner had been reduced by the appellate Tribunal. Therefore, the writ petition filed by the petitioner Bank is maintainable in law.

.6. Mr. N. Manokaran, learned counsel for the respondents 1 and 2 contended that the Court had discretionary power to award interest at the rate of 6% p.a. from the date of the decree despite the contractual rate of interest being incorporated in the agreements. The learned counsel relied upon the decision of the Supreme Court in N.M. Veerappa v. Canara Bank and Others AIR 1998 SC 1101 : (1998) 2 SCC 317, which was also followed by the Division Bench off this Court in A.S. Ramakrishnan v. Bank of Baroda, Madurai 2001 (1) CTC 662 : (2001) 1 MLJ 665.

7. On a perusal of the aforesaid Judgments of the Supreme Court and the Division Bench of this Court, it is clear that the Civil Courts jurisdiction to restrict the rate of interest to 6% p.a. from the date of the plaint or the date of the award is not actually curtailed by any prohibition in the contract. The appella