JUDGMENT : ANIL K. NARENDRAN, J. The appellants are the defendants in O.S.No.98/1991 on the file of the Subordinate Judge's Court, Alappuzha, a suit filed by the respondents herein to realise a sum of Rs.1,39,054/- as damages from the defendants jointly and severally, together with interest thereon at the rate of 12% per annum from the date of suit till realization. 2. Going by the plaint averments, on 11.4.1988 the 2nd plaintiff entrusted the defendants, vide Ext.A1 lorry receipt, 1,145.31 kgs of texturised filament yarn in 25 cartons, valued at Rs.1,66,070/- to be transported from Bhiwandi at Mumbai to Alappuzha for delivery to the 2nd plaintiff. The texturised filament yarn was wound on reels, which were covered with polythene sheets, and then packed in paper cartons. By the time the goods reached its destination on 20.4.1988, the consignment was badly damaged due to the negligence of the defendants. The 1st defendant is a common carrier under the Carriers Act, 1865 and the 2nd defendant is its Branch Office at Alappuzha. The 3rd defendant is the Managing Partner of the 1st defendant. The 2nd plaintiff by Ext.A3 letter dated 22.4.1988 requested the defendants to have open delivery of the consignment since the cartons were found opened and the goods were in damaged condition. Ext.A3 letter followed by Ext.A4 letter dated 25.4.1998 informing the defendants about short delivery of 146.64 Kgs. 3. On 22.4.1988 and 23.4.1988 survey was conducted by PW2, a Chartered Engineer cum Surveyor and Loss Assessor, who submitted Ext.A8 survey report dated 1.6.1988, accessing the loss occurred due to short delivery and damage of the consignment at Rs.1,66,069.95/- and the salvage value at Rs.36,200/-. In the survey it was found that, out of 1,145.31 kgs of yarn entrusted to the defendants at Mumbai, only 998.63 kgs reached its destination. Hence, there was short delivery of 114.68 kgs of yarn. Further, in respect of 998.63 kgs of yarn received, all the reels were found damaged with oil stains and dirt. Most of the reels were found soaked in water, which could not be used for the purpose for which it was intended. Ext.A9 series are the photographs of the consignment taken at the time of survey. 4. On 22.4.1988, the defendants issued Ext.A5 open delivery certificate admitting short delivery of 146.7 kgs of yarn and the damage caused to 998.63 kgs in 25 cartons. Ext.A9 series are the photographs of the consignment taken at the time of survey. 4. On 22.4.1988, the defendants issued Ext.A5 open delivery certificate admitting short delivery of 146.7 kgs of yarn and the damage caused to 998.63 kgs in 25 cartons. The 2nd plaintiff by Ext.A6 letter dated 26.4.1988 claimed Rs.1,66,066/- from the defendants being the value of the goods lost and damaged in transit. Though the 2nd defendant acknowledged the said letter on 28.4.1988 vide Ext.A7, the defendants failed to settle the claim. The consignment in question was insured with the 1st plaintiff insurer. Since the defendants did not settle the claim, the 2nd plaintiff in turn claimed the said amount from the insurer vide Ext.A11 claim bill. The 1st plaintiff settled the claim made by disbursing a sum of Rs.1,39,054/- on 1.9.1988, which the 2nd plaintiff acknowledged vide Ext.A12 voucher. Pursuant to such payment, the 1st plaintiff obtained Ext.A14 letter of subrogation and Ext.A15 power of attorney from the 2nd plaintiff on 29.8.1988, to recover the said amount from the defendants. 5. The plaintiffs through Ext.A16 lawyer notice dated 22.2.1989 called upon the 2nd defendant to pay a sum of Rs.1,39,054/- together with interest. To Ext.A16 notice, the Assistant Manager, Claims Section of the 1st defendant issued Ext.A17 reply dated 27.3.1989 stating that Ext.A16 notice has been entrusted to their counsel and the plaintiff would get a reply shortly and that as per Ext.B1 open delivery certificate dated 22.4.1988 the net claim is only Rs.21,269.80/-. The 3rd defendant has also sent Ext.A18 reply dated 10.6.1989 which contains only vague denial of short delivery/damage of the consignment. Thereafter, the 1st plaintiff caused to issue Ext.A19 reply dated 29.7.1989 through its lawyer, which was followed by Ext.A20 lawyer notice dated 12.1.1990 to the 3rd defendant to settle the matter. Since the defendants failed to settle the claim, the plaintiff filed the suit for recovery of damages. 6. The defendants filed a common written statement admitting that, the consignment in question was entrusted to the 1st defendant on 11.4.1988 for transportation from Bhiwandi at Mumbai to the 2nd plaintiff's godown at Alappuzha. However, they denied the allegation that their employees were negligent in transporting the consignment in question. Though the consignment reached the 2nd plaintiff's godown on 20.4.1988 the matter was informed to the 2nd defendant only on 22.4.1988. However, they denied the allegation that their employees were negligent in transporting the consignment in question. Though the consignment reached the 2nd plaintiff's godown on 20.4.1988 the matter was informed to the 2nd defendant only on 22.4.1988. The defendants have no knowledge regarding the survey of the damaged goods. The alleged survey was not conducted in their presence and hence they are unaware of the volume of damages as alleged by the plaintiffs. However, after open delivery, the Branch Manager of the 2nd defendant issued Ext.B1 open delivery certificate dated 22.4.1988. The defendants contended that, Ext.A5 open delivery certificate produced by the plaintiffs is not genuine and it is a concocted document. In Ext.B1 open delivery certificate the value of damage is entered as Rs.21,269.90/-, as against Rs.1,66,069.95/- shown in Ext.A5 certificate. Though Ext.A8 survey report was issued only on 1.6.1988, the 2nd plaintiff made the claim even prior to that. 7. The defendants have also contended that, the settlement between the 1st and 2nd plaintiffs is without the knowledge of the defendants. So the defendants are not liable for the damages claimed by the plaintiffs. In the written statement the defendants have also disputed the quantum of damages claimed by the plaintiffs and contended that the actual damage is only Rs.21,269.80/-, as certified in Ext.B1 open delivery certificate. On 12.1.1990, the defendants were issued with Ext.A20 lawyer notice on behalf of the 1st plaintiff, stating that the 1st plaintiff is ready and willing to settle the matter for 33% of the amount claimed. Ext.A20 lawyer notice would indicate that the value of damages claimed by the plaintiffs is not fully correct and the plaintiffs have no right to claim the entire amount as damages. Therefore the defendants contended that the suit is liable to be dismissed with costs. 8. On the side of the plaintiffs Pws.1 and 2 were examined and Exts.A1 to A20 were marked. On the side of the defendants the Branch Manager of the 1st defendant at Alappuzha was examined as DW1 and Ext.B1 was marked. 9. After considering the pleadings and evidence on record, the trial court found that Ext.A5 open delivery certificate is a genuine document and that the defendants are liable for short delivery and damage of goods. On the side of the defendants the Branch Manager of the 1st defendant at Alappuzha was examined as DW1 and Ext.B1 was marked. 9. After considering the pleadings and evidence on record, the trial court found that Ext.A5 open delivery certificate is a genuine document and that the defendants are liable for short delivery and damage of goods. From the oral evidence of DW1, the trial court found the defendants had knowledge of the survey conducted by the surveyor, who assessed the damages in Ext.A8 report. Further, nothing could be brought out during the cross examination of the surveyor, who was examined as PW2, to discredit his version. It was on an overall evaluation of the evidence on record, that the trial court came to the conclusion that the 1st plaintiff is entitled to recover a sum of Rs.1,29,870/- from the 1st defendant together with interest at the rate of 12% per annum from 20.3.1991 till realisation, and the suit was decreed accordingly. 10. Feeling aggrieved by the judgment and decree of the trial court dated 30.11.1992 the defendants are before this court in this appeal suit. 11. We heard the arguments of the learned counsel for the appellants/defendants and also the learned counsel for the respondents/plaintiffs. 12. The consignment in question was transported from Bhiwandi at Mumbai to Alappuzha vide Ext.A1 lorry receipt issued by the 1st defendant. As per Ext.A3 request, the consignment reached the 2nd plaintiff's godown on 22.4.1998. Since the cartons were found opened and the goods were in damaged condition, the 2nd plaintiff made Ext.A3 request to have open delivery of the consignment. The said request was followed by Ext.A4 letter by which the defendants were informed about short delivery of 146.64 Kgs of yarn. According to the plaintiffs, the defendants had issued Ext.A5 open delivery certificate admitting short delivery of 146.7 Kgs. of yarn and also the damage caused to 998.83 Kgs. On 22.4.1988 and 23.4.1988, survey was conducted by PW2, who submitted Ext.A8 survey report dated 1.6.1988, assessing the loss occurred due to short delivery and damage of the goods at Rs.1,66,069.95/- and the salvage value was fixed at Rs.36,200/-. In the said report, it was found that there was short delivery of 114.68 Kgs. On 22.4.1988 and 23.4.1988, survey was conducted by PW2, who submitted Ext.A8 survey report dated 1.6.1988, assessing the loss occurred due to short delivery and damage of the goods at Rs.1,66,069.95/- and the salvage value was fixed at Rs.36,200/-. In the said report, it was found that there was short delivery of 114.68 Kgs. Ext.A9 series are the photographs of the goods taken at the time of survey, which would show that all the reels were found damaged with oil stains and dirt and also soaked in water. 13. Regarding the survey conducted by PW2, the defendants contended that the survey was without notice to them and as such, the findings in Ext.A8 report should not be the basis for assessment of damages. The Branch Manager of the 1st defendant at Alappuzha, who was examined as DW2, has admitted that on 22.4.1988, he had gone to the godown of the 2nd plaintiff and issued open delivery certificate. He left the godown by about 1.30 p.m. and at that time the survey has not commenced. The testimony of DW1 would make it explicitly clear that the defendants were aware of the survey scheduled to be held on 22.4.1988. Though no notice was given to the defendants, DW1 was aware of the survey and he left the godown just before the survey. 14. Relying on the judgment of a Division Bench of this Court in Associated Transport Corporation (P) Ltd. v. National Insurance Company Ltd. (1989 (1) KLT 386), the learned counsel for the appellants would contend that Ext.A8 survey report prepared by the 1st plaintiff insurer without notice to the defendants cannot bind them. In the said case, the Division Bench of this Court was dealing with a case in which the survey was conducted without notice to the carrier. The principle laid down in the said decision has no application to the factual matrix of the case on hand, since going by the testimony of DW1, the Branch Manager of the carrier, he was aware of the survey to be held on 22.4.1988, who left the godown just before the survey. 15. As per Ext.A5 open delivery certificate issued by DW1, there is short delivery of 146.7 Kgs. of yarn. Further 998.6 Kgs. of yarn were found in severely damaged condition. In Ext.A5 open delivery certificate issued by the 2nd defendant, the total damage was assessed at Rs.1,66,069.95/-. 15. As per Ext.A5 open delivery certificate issued by DW1, there is short delivery of 146.7 Kgs. of yarn. Further 998.6 Kgs. of yarn were found in severely damaged condition. In Ext.A5 open delivery certificate issued by the 2nd defendant, the total damage was assessed at Rs.1,66,069.95/-. The defendants disputed Ext.A5 certificate by contending that it is not a genuine document. According to the defendants, Ext.B1 is the carbon copy of the original open delivery certificate issued by the 2nd defendant, in which, the damage has been assessed at Rs.21,269.90/-. The Branch Manager of the 2nd defendant, who was examined as DW1, has admitted his signature in Ext.A5 open delivery certificate. In the witness box, DW1 set up a case that the 2nd plaintiff managed to obtain his signature in Ext.A5 certificate on 23.4.1988. As rightly noticed by the trial court, the defendants have no such case in their written statement. The trial court has also noticed that as per the stand taken by the defendants in their written statement, the consignee and the Branch Manager has to put their full signature in the open delivery certificate. Ext.B1 open delivery certificate does not contain the full signature of DW1, or the signature or initial of any Officer/staff of the 2nd plaintiff consignee. On the other hand, Ext.A5 open delivery certificate contains the full signature of DW1 and also that on behalf of the 1st plaintiff. Further, a mere perusal of Ext.B1 would show that it is a cancelled document. It was after considering the oral and documentary evidence on record, the trial court arrived at a conclusion that Ext.A5 certificate is a genuine document. The said finding is perfectly legal, which warrants no interference in this appeal. 16. Now regarding the quantum of damages claimed, we find that short delivery of 146.7 Kgs and damage to 998.6 Kgs of yarn has been admitted in Ext.A5 open delivery certificate. In Ext.A5, the net claim is assessed at Rs.1,66,069.95/-. The said certificate would also show that the goods were in completely damaged condition and the cartons were also damaged. In Ext.A8 report, the surveyor assessed the total loss at Rs.1,66,069.95/-. Regarding 998.63 Kgs. of salvage materials, it has been stated in Ext.A8 that it would fetch around Rs.36,200/-. The consignee had agreed to accept the salvage for Rs.28,961/-. The said certificate would also show that the goods were in completely damaged condition and the cartons were also damaged. In Ext.A8 report, the surveyor assessed the total loss at Rs.1,66,069.95/-. Regarding 998.63 Kgs. of salvage materials, it has been stated in Ext.A8 that it would fetch around Rs.36,200/-. The consignee had agreed to accept the salvage for Rs.28,961/-. As there were not enough people who require this type of material, it has been recommended in Ext.A8 report to give the salvage to the consignee for the offered amount. 17. Ext.A9 series are the photographs of the goods which would show the extent of damage caused. Though PW2 was cross-examined at length, nothing could be brought out to discredit his version and also his findings in Ext.A8 report. Regarding the quantum of damage, we notice that on 22.2.1989, the plaintiff caused to issue Ext.A16 notice to the defendants stating that the goods were in a damaged condition which could not be used for any purpose and has to be discarded. On receipt of Ext.A16 notice, the Assistant Manager, Claims Section of the 1st defendant sent Ext.A17 reply stating that Ext.A16 notice has been entrusted to their counsel and the plaintiffs would get a reply shortly. None of the allegations in Ext.A16 notice are denied in Ext.A17 reply. Thereafter, after a lapse of nearly 8 months, the defendants caused to issue Ext.A18 reply notice to Ext.A16 notice issued by the plaintiff, which contains only a vague denial of short delivery/damage of the goods in question. Therefore, the available materials on record would prove that the goods in question were damaged at the time of delivery and there is short delivery of goods as well, which has to be compensated by the defendants. 18. Regarding the quantum of damage to which the plaintiffs are entitled to, the trial court noticed that the goods were purchased by the 2nd plaintiff from M/s. Simoo Chemotex Pvt. Ltd. vide Ext.A2 invoice at a rate of 145/- per Kg. Before the trial court, the defendants have no case that the rate shown in Ext.A2 does not reflect the real price. Ext.A2 invoice was dated 17.3.1988. There was no suggestion or evidence that there was fluctuation in the price of the yarn as on the date of delivery of goods. Before the trial court, the defendants have no case that the rate shown in Ext.A2 does not reflect the real price. Ext.A2 invoice was dated 17.3.1988. There was no suggestion or evidence that there was fluctuation in the price of the yarn as on the date of delivery of goods. It was in such circumstances that, the trial court found it proper to award damages to the plaintiff at the rate shown in Ext.A2 invoice. 19. In Ext.A8 survey report, PW2 has fixed the salvage value of the goods at Rs.36,200/-. In the said report, PW2 has stated that there were no buyers for the salvaged goods in the local area. During cross-examination, PW2 has deposed that he made enquiries at Kottayam, Ernakulam and Coimbatore to ascertain whether anyone could purchase the salvaged goods. After considering the materials on record, the trial court came to the conclusion that fixation of value for the salvaged goods appears to be reasonable and the plaintiffs are entitled to damage at the rate Rs.145/- per Kg. The trial court has also found that the value fixed by PW2 for the salvaged goods, i.e., Rs.36,200/- has to be deducted from the total damage of Rs.1,66,066/- assessed in Ext.A8 report and accordingly, decreed the suit entitling the 1st plaintiff to recover a sum of Rs.1,29,870/- from the defendants. The finding of the trial court in this regard is perfectly legal, which warrants no interference in this appeal. 20. By the impugned judgment, the trial court awarded interest for the decreed amount at the rate of 12% per annum from 23.3.1991 till realisation, on the ground that the transaction in question is a commercial transaction. 21. Section 3 of the Interest Act, 1978 deals with the power of the Court to allow interest. As per sub-section (1) of Section 3 of the said Act, in any proceedings for the recovery of any debt or damages or in any proceedings in which a claim for interest in respect of any debt or damages already paid is made, the Court may, if it thinks fit, allow interest to the person entitled to the debt or damages or to the person making such claim, as the case may be, at a rate not exceeding the current rate of interest, for the whole or part of the periods enumerated in clauses (a) and (b) of that sub-section. 22. 22. In M/s. MSK Projects (I) (JV) Ltd. v. State of Rajasthan ( 2011 (10) SCC 573 ) the Apex Court held that, the provisions in Section 3 of the Interest Act empower the Court to award interest at the rate prevailing in the banking transactions. Thus, impliedly, the Court has a power to vary the rate of interest agreed by the parties. 23. In the instant case, the trial court decreed the suit granting interest at the rate of 12% per annum from 23.3.1991 till realisation. The rate of interest granted by the trial court is on a higher side, considering the rate of interest prevailing at that point of time in the banking transactions. Considering the facts and circumstances of the case, we deem it appropriate to scale down the rate of interest from 12% per annum to 9% per annum from 23.3.1991 till the date of decree and thereafter at the rate of 6% per annum till realisation. 24. In the result, this Appeal Suit is disposed of modifying the judgment and decree of the trial court to the extent of reducing the rate of interest from 23.3.1991 till the date of decree as 9% per annum, as against interest at the rate of 12% per annum awarded by the trial court and thereafter at the rate of 6% per annum till realisation. The judgment and decree of the trial court is confirmed in all other respects. No order as to costs.