1997 1 MPWN 160 ; 1997 0 Supreme(MP) 1073

IN THE HIGH COURT OF MADHYA PRADESH
TEJ SHANKAR, J.
Kok Singh - Appellant
Versus
Punjab and Sindh Bank - Respondent
F.A. No. 27 of 1986 (G)
Decided On : 10-03-1997

(1) Civil Procedure Code, 1908 – – S. 34 – – interest pendente lite and future interest – cannot exceed 6% per annum. .

       (2) Civil Procedure Code, 1908 – – O. 22 R. 4 (4) – – defendant not filing written statement – – his LRs need not be substituted – – decree against him also may be passed.

       (3) Civil Procedure Code, 1908 – – O. 34 R. 5 – – mortgage amount determined as Rs. 52,000/ – – – no final decree need be passed – – some time to pay the amount should be given to the judgment debtor.

        Short Note

       1. The learned counsel for the loanee Koksingh contended that the interest has wrongly been calculated. It being agricultural land it should have been calculated as held by the Apex Court after allowing annual rest. The other argument of the learned counsel is that the learned trial Court has wrongly allowed pendente lite interest at 10 1/2% which should have been at the rate of 6% per annum. Learned counsel for defendant No.2 and 5 contended that the case has not been proved against them and the learned Court has rightly refused. Learned counsel for the Bank contended that the Court below has committed an error in not passing the decree on the mortgage property though mortgage was proved. He also urged that cost has wrongly been refused and a decree should have been passed against defendant No.3 who did not put any defence. The Court is not proceeded under O.22 R. 4 (4) CPC. The learned counsel also contended that now the Bank has filed a revised account before this Court in accordance with the latest law of the Apex Court calculating the interest on annual rest amounting to Rs. 52,850/ – .

       Held: Before entering into the arguments I must mention that the accounts submitted today by the learned counsel for the Bank showing a total sum of Rs.52,850/ – has not been challenged. It is, therefore, to be taken as the sum due against the loanee instead of the amount decreed i.e. Rs. 53127.73./ – Now the next question is as to whether any decree can be passed against defendant No.3, who has died and who did not put any contest. The learned counsel for the Bank pressed into service the provisions of O. 22 R. 4 (4) CPC. A perusal of this provision shows that it authorises the Court, whenever it thinks fit, to exempt the plaintiff from the necessity of substituting the legal representative of any such defendant who has failed to file a written statement or who, having filed it, has failed to appear and contest the suit at the hearing. The Court can pass a judgment against such defendant notwithstanding the death of such defendant. Admittedly defendant No.3 did not put any contest and as such the learned trial Court should have passed the decree by exercising powers conferred under the aforesaid provision. I think the prayer of the learned counsel for the Bank is correct and the decree can be passed by this Court as well against defendant No.3 under this provision. Thus, the decree has to be amended accordingly. As far as the argument relating to the non – passing of the decree for the sale of mortgaged property is concerned, I think this prayer too is correct because the mortgage has been amply proved and it has not been challenged. As the determined amount is Rs. 52,850/ – no preliminary decree need be passed. However, some time has to be given to the judgment – debtor to payoff the amount and in case the amount is not paid within that time final decree has to be prepared in accordance with O.34 R. 5 CPC. on the application of the decree – holder. As far as the argument relating to the payment of cost is concerned, I think the defendants put in hot contest. There was no justification for refusing costs of the suit. The decree has to be amended to that extent. The learned counsel for the loanee contended that pendente lite and future interest awarded at the rate of 10 1/2%, it should have been 6% per annum. A perusal of section 34 CPC shows that it gives discretion to the Court in respect of the interest pendente lite and future to the rate agreed so far as it related to commercial transactions. The present transaction was admittedly an agricultural transaction and as such the rate should be 6% per annum. It has also been held by this Court in 1995 Vol. II, MPWN Note 235 (Laxminarain v. Bank of India). In this way the pendente lite and future interest has to be reduced to 6%.

       2. Appeals are partly allowed. The judgment and decree passed by the trial Court is modified to the extent that the suit is decreed for Rs. 52,850/ – with costs and pendente lite and future interest on the principal sum at 6% per annum till recovery against defendant No.1, 3 and 4. The suit is dismissed against defendant No.2 and 5. The amount shall be paid within three months. In case it is not paid a final decree in accordance with the provisions of O.34 R. 5 CPC be prepared for the sale of mortgaged property of defendant No. 1 on the application of the decree – holder.

Act Referred :
CIVIL PROCEDURE CODE : S.34, O.22 R.4(4), O.34 R.5

Advocates Appeared :
For the Appellant : S.K. Jain
For the Respondents : O.P. Sharma and K.K. Lahoti