Judgment :- The appellant is the second defendant in O.S.No.171 of 1996. The first respondent filed the above suit for recovery of Rs.7,76,497.76 comprising of Rs.5,10015.10, being the principal amount and Rs.2,66,482.66, being the interest payable at 18% per annum for 34 months and 25 days. 2. According to the first respondent, the second respondent herein purchased cotton lint in the year 1992 and 1993 from the first respondent. As per the books of account maintained in regular course of business by the first respondent, a sum of Rs.5.10,015.10/- was found due and payable by the second respondent as on 19.6.93. The second respondent is a unit of appellant. Therefore, both are liable to pay the said sum of Rs.5.10,015.10/- together with interest at 18% as per the trade practice. Thus, the first respondent filed the above suit for recovery of Rs.7,76,497.76 against the second respondent and appellant herein. 3. The appellant filed written statement stating that the second respondent was taken over by the appellant and General Managers appointed by Director of Handloom and Textiles were managing the affairs. The second respondent incurred heavy loss to the tune of Rs.5 lakhs per month. The second respondent was declared as sick industry. The claim of the first respondent is barred by limitation and prayed for dismissal of suit. 4. The appellant and the second respondent filed additional written statement stating that the claim of first respondent is frivolous, vexatious and the first respondent is not entitled to any amount. The suit is not properly framed and therefore, not maintainable. 5. Before the trial Court, the first respondent examined his Special Officer T.Sakthivel as P.W.1, marked 5 documents as Exs.A.1 to A.5. The appellant and the second respondent examined one Saravana Sundaram, Assistant Manager (Accounts), Tamil Nadu Textile Corporation and marked one document as Ex.B.1. 6. The learned Judge considering the pleadings and evidence, decreed the suit for principal amount of Rs.5.10,015.10/- together with simple interest at 12% per annum from 19.06.1993 to 25.04.1996 and thereafter, at 6% per annum till repayment in full. The learned Judge also held that the decree may by executed subject to the order of Government if any under the provisions of Tamil Nadu Relief Undertakings (Special Provisions) Act, 1969 (TN Act 21 of 1969). Against the said Judgment and decree, the present appeal has been filed. 7. The learned Judge also held that the decree may by executed subject to the order of Government if any under the provisions of Tamil Nadu Relief Undertakings (Special Provisions) Act, 1969 (TN Act 21 of 1969). Against the said Judgment and decree, the present appeal has been filed. 7. The learned counsel for the appellant contended that the second respondent was taken over by the appellant with the object of reviving sick industry. In spite of best efforts, the second respondent could not be revived. The total liability of second respondent is Rs.7,22,13,352/-. The learned counsel for the appellant submitted that the Court below erred in passing the judgment and decree fixing liability jointly and severally on both appellant and second respondent. In any event taking into consideration the parties are Government undertaking and that second respondent is a sick industry and also relief undertaking, the interest portion ought to have been waived. 8. The learned counsel for the first respondent submitted that the first respondent is a Co-operative Marketing Society and proved his claim by cogent evidence and there is no error in the Judgment of the trial Court, and prayed for dismissal of the appeal. 9. The points for consideration in this appeal are, (i) Whether the first respondent has proved their claim by evidence both oral and documentary; and (ii) Whether the appellant and second respondent are entitled to waiver of interest; 10. I have carefully considered the evidence both oral and documentary, the Judgement of trial Court and also the arguments of learned counsel for appellant and the first respondent. 11. By the evidence let in before the trial Court, the first respondent has categorically proved their claim. The appellant and the first respondent except filing G.O.(2D)No.1, HHT & K Department, dated 06.1.2003, has not let in any evidence to disprove the claim of the first respondent. Therefore, the Judgment and decree of trial Court is confirmed with regard to the claim of principal amount. 12. As far as the question as to whether the appellant and second respondent are entitled to waiver of interest is concerned, the trial Court took into consideration the sick nature of second respondent and granted simple interest at 12% per annum from 19.06.1993 to 25.04.1996, the date of filing of suit. From 26.04.1996, the trial Court has granted 6% interest till repayment. From 26.04.1996, the trial Court has granted 6% interest till repayment. Taking into consideration that the appellant and respondents are all Government undertaking, I am inclined to exercise the discretion as per Section 34(1) of CPC. The said section reads as follows: "34. Interest (1) Where and in so far as a decree is for the payment of money, the Court may, in the decree, order interest at such rate as the Court deems reasonable to be paid on the principal sum adjudged, from the date of the suit to the date of the decree, in addition to any interest adjudged on such principal sum for any period prior to the institution of the suit, [with further interest at such rate not exceeding six per cent, per annum as the Court deems reasonable on such principal sum from] the date of the decree to the date of payment, or to such earlier date as the Court thinks fit: [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." 13. It is no doubt the suit transaction is a commercial transaction. Therefore, interest as charged by Nationalised Banks can be granted, reducing even contractual rates, if any. As per discretion, the Court has power to grant lesser rate of interest in the circumstances of each case. Admittedly, the appellant and the first respondent are Government undertaking and the second respondent is a sick industry. In view of this special circumstances, I modify the Judgment of the trial Court with regard to rate of interest. The Judgment is modified granting 3% interest from 19.06.1993 till repayment. The cost granted by trial Court is set aside. 14. In the result, the first appeal is partly allowed, modifying the Judgment and decree of trial Court by granting 3% interest from 19.06.1993 till repayment and the parties to bear their own costs. Consequently, connected miscellaneous petition is closed.