P.K. Balasubramanyan, J.

The appellant herein is the petitioner in O.P. 7764 of 1995. The appellant had acquired the right under the Abkari Act to run a number of arrack shops in Mattannur Range during the abkari year 1981-82. The appellant defaulted in paying the kist agreed upon. Disputes were raised. Finally the Supreme Court of India in Assistant Excise Commissioner v. Issac Peter (1994 (1) K.L.T. 698 (SC)) held that licencees like the appellant are not entitled to any remission of the kist or abatement in the licence fee and other amounts payable by them under the contract. The Supreme Court also held that contractors like the appellant were not entitled to get out of the obligation undertaken by them under the contract entered into with the State in accordance with the Kerala Abkari Act and the Kerala Abkari Shops (Disposal in auction) Rules. Thereafter recovery proceedings were initiated against the appellant. It is then that the appellant filed the Original Petition before this court invoking Art.226 of the Constitution of India praying for the issue of a writ of certiorari and to quash the notice issued under the Revenue Recovery Act concerning interest, in between the period 24.8.1981 and 22.2.1994 on the kist payable by the appellant and others in terms of the contract and the concerned Rules. The ground raised was that the liability to pay interest arises only in case there was default in payment of kist. Since there was an interim order of court staying the recovery, there will be no liability to pay interest. Thus the only ground raised was that since there was an intervention by the court regarding the payment alleged to be due from the appellant and others, the liability to pay interest had not been incurred and hence the revenue recovery could not be for the interest. Pending the Original Petition the appellant and others also filed C.M.P. 32643 of 1998 praying for an amendment of the Original Petition by seeking a declaration that the State Government was bound to adjust the payments made pursuant to the interim order of the Supreme Court and payments made subsequent to the order of this court in an interim application, towards the kist arrears and then only towards interest on the kist dues. The learned Single Judge relying on the decisions of the Supreme Court in Kerala State Electricity Board v. M.R.F. Ltd. (1996) 1 S.C.C. 597, in Kanoria Chemicals and Industries Ltd. v. U.P. State Electricity board (1997) 5 S.C.C. 772 and in Gurusharan Singh v. New Delhi Municipal Committee (1996) 2 S.C.C. 459 held that the fact that a stay was granted pending a challenge would not exonerate a party like the appellant from paying interest on the amount due in terms of the contract and in terms of the relevant rules. This part of the finding rendered by the learned judge was in fact not seriously disputed before us by learned Senior Counsel appearing for the appellant.

2. The learned Single Judge also held that the appellant cannot insist on appropriation of the amount paid first towards the kist amount due and not towards the interest due on the kist amount. It is the entitlement of every creditor to appropriate payments made first towards the liability for interest and then only towards the principal due. The appellant and others have not made available any material before this court to show that they had made the payments by insisting that it should be first appropriated towards the kist amount. The fact that in the interim order the appellant and others were directed to pay 50% of the kist amount due as a condition for stay does not amount to a direction that the payments made must be credited towards the kist amount first and not towards the interest due. The only pleading in that regard in the application for amendment is the following:

"The remittance was towards the principal sum. No part of the payment was intended towards interest on kist dues. In the view of the common order of the Supreme Court and of