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2004 DIGILAW 655 (PNJ)

Ram Rakha v. Sudesh Kumari

2004-07-03

HEMANT GUPTA

body2004
JUDGMENT Hemant Gupta, J. - This order shall dispose of Regular Second Appeal Nos. 4733 of 2001 and 320 of 2002 both arising out of suit for specific performance of agreement dated 10.11.1990. RSA No. 4733 of 2001 is filed by the defendant whereas RSA No. 320 of 2002 is by the plaintiff. 2. The plaintiff filed a suit for specific performance of agreement dated 10.11.1990 alleging therein that the defendant agreed to sell the house for a total consideration of Rs. 1,00,000/- and on the said date received a sum of Rs. 90,000/- as earnest money. The sale deed was to be executed upto 15.10.1993 after receipt of balance consideration. Since the defendant failed to execute the sale deed, the plaintiff sought a decree for specific performance of the agreement. The defendant contested the suit and denied having executed and agreement to sell but alleged that the plaintiff in connivance with some other persons got blank papers signed from him. 3. Learned trial court found that on the basis of appreciation of evidence produced by the parties that the agreement to sell Exhibit P-1 has come up as collateral security for repayment of loan or debt and, thus, granted a decree for recovery of Rs. 90,000/- alongwith pendente lite and future interest at the rate of 12% per annum. In appeal by the defendant, the judgment and decree passed by the learned trial court was modified only to the extent of interest as the learned first Appellate Court granted interest at the rate of 6% per annum from the date of institution of the suit till realisation of the entire amount. Aggrieved against the said judgment, the plaintiff and the defendant are in appeal as mentioned above. 4. Learned counsel for the defendant has argued that in fact there was no intention of the parties to sell the house but it was only an agreement to secure the loan of Rs. 90,000/- and, therefore, it is only a transaction of loan and in terms of Section 34 of Code of Civil Procedure the civil Court could not grant interest at the rate exceeding 6% per annum. However, on the other hand, learned counsel for the plaintiff argued that the learned trial court has exercised its discretion in granting of interest at the rate of 12% per annum being the current market rate. However, on the other hand, learned counsel for the plaintiff argued that the learned trial court has exercised its discretion in granting of interest at the rate of 12% per annum being the current market rate. The learned first Appellate Court has not given any reason to interfere in the discretion exercised by the learned trial Court. It has further been found by the learned courts below that the amount of Rs. 90,000/- was advanced to the defendant as the defendant failed to pay the amount of committee. It has been found that the defendant wants to wriggle out as neither he wants to pay the amount agreed nor he intends to sell the house. 5. In terms of the provisions of Section 34 of the Code of Civil Procedure, the Court in exercise of its discretion can grant future interest at the rate of 6% per annum except in the cases of commercial transaction where the rate of interest can be either as per the contract or the rate at which the moneys are let or advanced by nationalised banks in relation to commercial transactions. 6. Keeping in view the nature of transaction between the parties, the money was advanced to the defendant for commercial purposes, it was not a loan for meeting the expenditure of marriage or such like household necessity. It was a commercial transaction. The defendant has taken the loan in the year 1990 but has chosen to deny the execution of the agreement itself. He has not come forward to make payment of the loan amount. The learned first Appellate Court has not given any reason to modify the rate of interest awarded by the learned trial Court. The reasoning given by the learned trial Court to award 12% pendente lite interest and future interest does not suffer from any patent illegality or material irregularity. 7. Consequently, I do not find that the learned first appellate court was justified in law in modifying the judgment and decree of the learned trial court in respect of interest. The judgment and decree passed by the learned first appellate court is set aside. Consequently, Regular Second Appeal No. 4733 of 2001 filed by the plaintiff is dismissed whereas Regular Second Appeal No. 320 of 2002 is allowed and the decree passed by the trial Court is restored with costs. Appeal dismissed.