Judgment :- NARAYANA KURUP, J. The plaintiff in O.S. NQ. 431 of 1986 in the court of the Subordinate Judge, Kottayam is the appellant. 2. The first respondent-first defendant is a partnership firm carrying on the business in manufacturing and sale of rubber goods and job works including mixing and mastication. The second respondent-second defendant is the managing partner and the third respondent-third defendant the other partner of the first respondent-first defendant firm. 3. The defendants had availed credit facilities on the plaintiff-Bank to do their business. The loan transactions were secured by executing various demand promissory notes along with hypothecation of the plant and machineries and also by an equitable mortgage in respect of the properties scheduled to the plaint. The defendants having failed to settle their liabilities to the-plaintiff, the later filed O.S. 431 of 1986 before the court of Subordinate Judge, Kottayam for a decree directing the respondent-defendants jointly and severally to pay the appellant plaintiff an amount of Rs. 14, 62, 494.00 with the interest at the rate of 16% per annum from the date of suit till realisation and charged on the scheduled properties. . The appellant plaintiff also specifically prayed for a decree for future interest at the rate of 16% per annum on the principal amount of Rs. 14, 62, 494.00. The respondent-defendants filed a statement in the court below admitting the plaint claim. Thereupon the court below came to the conclusion that the appellant plaintiff is entitled to the reliefs prayed for. In the result, the learned Subordinate Judge decreed the suit allowing the plaintiff to recover a sum of Rs. 14, 62, 494.00 with interest thereon at 16% per annum from the date of suit till the date of decree. The learned Subordinate Judge further granted a decree for future interest from the date of suit till date of realisation only at the rate of 12% per annum. The appellant-plaintiff is aggrieved by the decree of the court below to the extent of restricting future interest at the rate of 12% per annum instead of 16% per annum as prayed for. Hence this appeal. 4. The main argument of the learned counsel for the appellant-plaintiff is that the plaintiff is entitled to 16% interest from the date of decree till date of receipt as prayed for. Hence this appeal. 4. The main argument of the learned counsel for the appellant-plaintiff is that the plaintiff is entitled to 16% interest from the date of decree till date of receipt as prayed for. Strong reliance was placed on the Proviso to Section 34 of the Code of Civil Procedure the said proviso provides as follows: "Provided that where the liability in relation to the sum so adjudged had arisen out of a commercial transaction, the rate of such further interest may exceed six per cent per annum, but shall not exceed the contractual rate of interest or where there is no contractual rate, the rate at which moneys are lent or advanced by nationalised banks in relation to commercial transactions." From a reading of the proviso it is clear that it carves out an exception to the general rule to award future interest at the rate not exceeding 6% per annum in the case of decrees pertaining to claims arising out of commercial transactions. Going by the proviso to Section 34, C.P.C. where the liability ip relation to the sum decreed had arisen out of a commercial transaction, the rate of such further interest may exceed 6% per annum, but shall not exceed the contractual rate of interest or where there is no contractual rate, the rate at which moneys are lent or advanced by nationalised banks in relation to commercial transactions. Evidently, the transaction in question is a commercial transaction and being a commercial transaction we are of the view that the appellant-plaintiff is entitled to interest at 16% per annum on the sum of Rs. 14, 62, 494.00 which is the contractual rate of interest from the date of suit till date of realisation. The respondents-defendants having filed a statement admitting the plaint claim the court below ought to have granted interest at the contractual rate of 16% per annum instead of 12% per annum as provided in the proviso to Section 34 of the Code of Civil Procedure. 5. The Supreme Court in B. Shivananda v. Andhra Bank Ltd., dealing with a commercial transaction held that it was just and proper that the defendant should pay simple interest at the rate of 16.5% per annum on the principal amount claimed in the suit from the date of decree till the date of realisation. 5. The Supreme Court in B. Shivananda v. Andhra Bank Ltd., dealing with a commercial transaction held that it was just and proper that the defendant should pay simple interest at the rate of 16.5% per annum on the principal amount claimed in the suit from the date of decree till the date of realisation. This court in the decision reported in Catholic Syrian Bank Ltd. v. N. V. Varkey, (1987) 2 Ker LT 789 (DB) held as follows: "Even now the ordinary rule is to award future interest at a rate not exceeding 6 per cent per annum. The proviso contains an exception in the case of decrees to be passed in relation to claims arising out of commercial transactions. According to the proviso in such a case rate of future interest may exceed 6 per cent per annum but shall not exceed the contractual rate of interest or in the absence of contractual rate, the rate at which moneys are lent or advanced by nationalised banks in relation to commercial transactions. The proviso thus gives a discretion to the court."* In the result, the judgment and decree of the court below in so far as it restricts the future interest to 12% from the date of suit till the date of realisation is modified to 16% per annum and the appeal will stand allowed as above, but in the circumstances we make no order as to costs. Appeal allowed.