Research › Search › Judgment

Madhya Pradesh High Court · body

2016 DIGILAW 709 (MP)

Oriental Insurance Co. Ltd. v. Deva Bai

2016-08-17

VIVEK AGARWAL

body2016
ORDER 1. This civil revision has been filed against the order dated 3.5.2008 passed by 5th Motor Accidents Claims Tribunal, Gwalior, in Execution Case No.108/00×03. 2. The issue which is involved in the present civil revision is whether the amounts deposited by the Insurance Company will be first adjusted towards interest and subsequently towards principal or will they be first adjusted towards principal and then towards interest. 3. The contention of the Insurance Company is that in view of the law laid-down by the Supreme Court in the case of Gurpreet Singh v. Union of India, as reported in (2006)8 SCC 457 and also in the case of Bharat Heavy Electricals Ltd. (BHEL) v. R.S. Avtar Singh and Co., as reported in (2013)1 SCC 243 , the amounts deposited by the Insurance Company shall be first appropriated towards principal and then towards interest. Learned counsel has also placed reliance on the judgment of Supreme Court in the case of V. Kalabharti and others v. Oriental Insurance Co. Ltd. as reported in 2014(4) MPLJ 290, and submitted that in case of a money decree with interest and cost amount will first be appropriated towards the principal and later on towards the interest. Learned counsel has also placed reliance on the judgment of Himachal Pradesh High Court in the case of Ved Prakash v. Bhupia and others, as reported in 2007 ACJ 1874 , to bring home the issue that if any amount is deposited in terms of an interim award passed under section 140 of the Motor Vehicles Act, then the interest will not be payable on the amount deposited by the Insurance Company towards interim award. 4. Learned counsel for the respondents submits that he is also placing reliance on the judgment in the case of V. Kalabharti (supra), and submits that the ratio of the judgment passed by the Supreme Court is very clear and categorical that in absence of direction regarding mode of appropriation, decree-holder is entitled to appropriate amount deposited by judgment debtor first towards interest, then cost and thereafter towards principal and after such appropriation, decree holder is entitled to interest only to the extent of unpaid principal amount. 5. 5. There is no quarrel to this proposition inasmuch as the judgment in the case of Gurpreet Singh (supra), is in relation to a matter pertaining to land acquisition where the facts are that once Collector passes an award and the amount of award is deposited with the Collector and notice of such deposition is issued to the beneficiary, then he is not entitled to interest after deposition of said amount before the Land Acquisition Authority/ Collector. It is further held that if after such process if completed and any amount is enhanced in reference petition or in appeal, then further interest will be payable only on the amount so enhanced in reference petition or appeal. 6. Facts in the present case are different inasmuch as it is not the case of the Insurance Company that it had deposited the complete amount in terms of the award passed by the Tribunal and thereafter it is liable to pay interest only on the amount enhanced in the appeal preferred by the claimant. 7. It is apparent from the judgment passed in appeal that is available on record as Annexure A-5 that interest @6% has been awarded on the enhanced amount from the date of filing of the appeal and here the controversy involved is different and it involves the question as to whether the amount deposited by the Insurance Company in various installments, will be first appropriated towards the satisfaction of interest accrued till date and then towards the principal or first they will be applied to the satisfaction of principal amount and thereafter towards interest. 8. As far as amount of interim award passed under section 140 of the Motor Vehicle Act is concerned, there is no dispute that the amount so deposited under interim award passed under section 140 of the Motor Vehicles Act, shall not carry any interest from the date on which it was deposited. 9. Similarly, in the case of BHEL (supra), it has been held that it is the decree which is to be executed in letter and spirit to find out whether stipulation therein were duly fulfilled by the judgment debtor. There the issue was pertaining to an arbitration award and therefore, the context was pertaining to the terms of construction of the arbitration award. There the issue was pertaining to an arbitration award and therefore, the context was pertaining to the terms of construction of the arbitration award. In this regard, decision in the case of V. Kalabharti (supra), is relevant to the present controversy inasmuch as the Supreme Court has categorically held that in case there is no direction regarding mode of appropriation which is the case in the present award, then the decree-holder is entitled to appropriate amounts deposited by a judgment debtor, first towards interest, then cost and thereafter towards principal. 10. This issue has since already been settled by the Supreme Court, wherein it has been held that the decree passed by the trial Court or the appellate Court does not contain the mode of appropriation and in absence of any such direction, the decree holder is entitled to appropriate amount deposited by the judgment debtor first towards interest, then cost and thereafter towards principal. 11. Same is the ratio of the law laid down in the case of Gurpreet Singh (supra), therefore, in terms of the aforesaid judgments of Supreme Court, it is held that there is no illegality or arbitrariness in the order dated 3.5.2008 passed by 5th Motor Accidents Claims Tribunal. 12. This civil revision is disposed of with a clarification that the interim award passed in terms of section 140 of the Motor Vehicles Act, shall carry interest only up to the date on which the said amount was deposited before the Tribunal. S. S. Bansal for petitioner; Arun Sharma for respondents.