( 1 ) THIS appeal is directed against the judgment and decree dt. 13-8-1998 in Civil Suit No. 2-B/86 by Third Additional District Judge, Chhatarpur, decreeing a sum of Rs. 27,401. 60 P. with interest thereon, from the date of suit, till payment thereof @ 6% per annum.

( 2 ) THE plaintiff /appellant filed a suit for recovery of Rs. 27,401. 60 p. According to the plaintiff/appellant a loan of Rs. 20,000/- was obtained by defendants/respondents Nos. 1 and 2 on 19-12-1981 from plainitiff/ Bank. Respondents Nos. 3 and 4 were their guarantors. The parties had agreed that rate of interest payable on the above loan would be 3. 5% above the rate fixed by Reserve Bank of India and minimum 13. 5% per annum with quarterly rests. Since the defendants /respondents Nos. 1 and 2 failed to repay the loan amount as per terms agreed to between the parties, hence the suit for recovery of Rs. 27,401. 60p. , including interest till the date of suit. The suit was resisted by defendants /respondents.

( 3 ) THE trial court decreed the suit for Rs. 27,401. 60p. , as claimed by the appellant. It also granted interest on the said amount @ 6% p. a. from the date of suit, till repayment of the said amount.

( 4 ) THE only submission of the learned counsel for the plaintiff /appellant is that as the agreement between the parties was that the interest payable would be 3. 5% above the rate fixed by the Reserve Bank of India, subject to minimum of 13. 5% per annum, the trial Court erred in awarding interest at the rate of 6% per annum from the date of suit till realisation of the amount. It was submitted that, since the liability has arisen out of a commercial transaction, interest on the decretal amount from the date of suit should have been awarded at the agreed rate as mentioned above.

( 5 ) A cross-objection under Order 41, rule 22 of C. P. C. registered as M. (C ). P. No. 4040/2001 has been filed on behalf of respondents Nos. 1 and 2 for modification in the decree. It has been stated in the said cross-objection that the loan amount was Rs. 20,000/- only and that as per statement of accounts of plaintiff/appellant itself, the total amount outstanding as on 16-9-1982 was Rs. 16,164. 85 P. Therefore the principal amount due on the date of suit i. e. 25-6-1986 could not exceed the aforesaid amount of Rs. 16,164. 85p. It was therefore prayed that future interest would be payable on the said amount of Rs. 16,164. 85p. only, and not on Rs. 27,401. 60p. as has been ordered by the trial Court.

( 6 ) LEARNED counsel for respondents Nos. 1 and 2 in the above context submitted that the loan amount was admittedly Rs. 20,000/- and was thus lower than decretal amount of Rs. 27,401. 60p. which was claimed by the plaintiff /appellant in the suit. It was submitted that as the loan amount stood reduced to Rs. 16,164. 85p. , on 16-9-1982 the interest pendente lite and future interest should have been granted on the said amount and not on the decretal amount of Rs. 27,401. 60 P. It was further submitted that the trial Court in exercise of its discretion granted interest at the rate lower than agreed rate of interest from the date of suit. the discretion as above does not call for any interference in appeal.

( 7 ) THE first submission as above of the learned counsel for respondents Nos. 1 and 2 in substance is that under S. 34 of the C. P. C. interest pendente lite i. e. interest from the date of suit till decree as also future interest i. e. interest from the date of decree till realisation could only be awarded on the 'principal sum adjudged'. Therefore interest pendente lite and future interest could not have been awarded on the whole of the decretal amount, which fell due in the respondents loan account on the date of suit, because the said sum included component of interest also. In other words the objection regarding the direction for payment of interest being paid on the whole of decretal amount of Rs. 27, 401. 60p. , which fell due on the date of suit,