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2018 DIGILAW 2452 (MAD)

S. Purushothaman v. K. Murugesa Mudaliar

2018-08-09

T.RAVINDRAN

body2018
JUDGMENT : In this Second Appeal, challenge is made to the judgment and decree dated 04.03.2005 passed in A.S. No.54 of 2003 on the file of the Subordinate Court, Thiruvannamalai, confirming the judgement and decree dated 26.04.2002 passed in O.S. No.29 of 2002, on the file of the Principal District Munsif Court, Arni. 2. The second appeal has been admitted on the following substantial questions of law: “Whether the Courts below are justified in sustaining the rate of interest at 36% per annum contrary to the provisions of the Usurious Loans Act?” 3. Considering the scope of the issues involved between the parties as regards the subject matter lying in a narrow compass, it is unnecessary to dwell into the facts of the case in detail. 4. Suffice to state that the suit has been laid by the plaintiff for recovery of money based on a promissory note. According to the plaintiff, the defendant borrowed a sum of Rs.30,000/-from him on 07.09.1998, in connection with silk business and family expenses, and in evidence thereof, executed the suit promissory note marked as Ex.A1 agreeing to repay the borrowed sum with interest at the rate of 36% per annum on demand. It is further stated by the plaintiff, on 07.10.2000, the defendant had paid a sum of Rs.10,000/- towards the principal and also paid the interest amount till that date. The endorsement with reference to the same has been marked as Ex.A2. Further according to the Plaintiff, inasmuch as the defendant has failed to repay the further sum due under the promissory note, despite the repeated requests and the issuance of notice on 06.12.2001, marked as Ex.A3, the defendant having neither cared to respond to the notice nor complied with the payment of the borrowed sum as demanded, hence according to the plaintiff, he has been necessitated to lay the suit for appropriate reliefs. 5. In the said suit, the plaintiff has claimed the principal amount of a sum of Rs.20,000/- plus interest on the same at 36% per annum from 08.10.2000 to 25.02.2002 and accordingly, had filed the suit for a sum of Rs.29,340/- with subsequent interest at 36% per annum from the date of the plaint suit till the date of the decree and thereafter at 6% per annum from the date of decree till the date of realisation. 6. 6. The defendant, in the written statement has admitted the borrowal of the suit amount from the plaintiff under Ex.A1 promissory note, further the defendant had also admitted the payment of a sum of Rs.10,000/- on 07.10.2000 towards the principal. According to the defendant, on 07.10.2000, he had paid a sum of Rs.22,500/- towards the interest calculated at the rate of 36% per annum. According to the defendant, the interest claimed by the plaintiff is on the high side and exorbitant and according to him, the interest which the plaintiff could claim would only be 9% per annum and accordingly, it is his case that, he being only the pensioner and not a businessman, accordingly prayed the court to consider his defence and dispose of the suit with a direction that he is liable to pay interest only at 9% per annum and prayed to pass the decree appropriately in the suit. 7. Based on the materials placed on record, considering the defence raised by the defendant with reference to the claim of interest by the plaintiff at 36% per annum is on the high side and holding that the interest claimed by the plaintiff at 36% per annum is excessive and accordingly, further holding that there is no material placed by the defendant to evidence that he had paid a sum of Rs.22,500/- towards the interest on 07.10.2000 worked at the rate of 36% per annum, accordingly, noting that the defendant is only a pensioner and not doing any business, the trial court determined that the plaintiff would be entitled to claim interest only at 12% per annum and on that basis, disposed of the suit by decreeing the suit in favour of the plaintiff for a sum of Rs.20,000/- with interest at 12% per annum from 08.10.2000 till the date of decree and thereafter at 6% per annum till the date of realisation. The abovesaid determination of the plaintiff's suit had been confirmed by the first appellate court and impugning the same, the present second appeal has been preferred by the defendant. 8. The abovesaid determination of the plaintiff's suit had been confirmed by the first appellate court and impugning the same, the present second appeal has been preferred by the defendant. 8. The only point raised by the defendant's counsel is as regards the interest claimed by the plaintiff, it is again reiterated in the second appeal that the interest claimed by the plaintiff at 36% per annum is on the high side and accordingly it is argued that the courts below should have reduced the quantum of interest while disposing of the suit, considering the status of the defendant that he being only a pensioner and not engaged in any business as such and accordingly, it is argued that the interest should have been determined at 9% per annum right from the date of execution of the promissory note and accordingly prayed for the appropriate reliefs in favour of the defendant. 9. As above noted, the borrowal of the suit amount from the plaintiff under Ex.A1 promissory note is not disputed by the defendant. On a reading of the reasons for the borrowal as stated in Ex.A1, it is found that the same had been made for running silk business as well as family expenses. However, it is the case of the defendant that, with the aid of the said amount, he had not carried on any business and according to him, he is only a pensioner and hence it is stated that the interest claimed by the Plaintiff is on the high side. However, when it is found that, as per the contents of Ex.A1 promissory note, the defendant had agreed to repay the borrowed sum with interest at 36% per annum and also according to the defendant, paid the interest at the same rate till 07.10.2000, it is found that the plaintiff as such had come to lay the suit claiming interest at 36% from 08.10.2000 till the date of the suit. However, the courts below, considering the quantum of interest claimed by the plaintiff, being on high side and also noting that the defendant as such had not engaged in any business utilising the borrowed sum and also considering the status of the defendant, he being only a pensioner and also noting the fact that the borrowed sum has also been incurred for family expenses in toto, determined that the plaintiff is entitled to claim interest only at 12% per annum from 08.10.2000 till the date of the decree and subsequent interest at 6% per annum. Thus, it is found that the courts below, had on an overall appreciation of the materials placed on record, in the right perspective, determined the interest amount to which the plaintiff would be entitled to, and considering the reasonings given by the courts below for reducing the interest rate at 12% per annum from 08.10.2000, in my considered opinion, the same does not warrant any interference as such, as the Courts below, had while determining the said interest had taken into consideration all the relevant factors and accordingly, disposed of the suit in favour of the plaintiff. 10. In such view of the matter, the contention of the defendant that the courts should have determined the interest at the rate of 9% per annum right from the date of the execution of the promissory note as such, does not merit acceptance. On the other hand, on an overall analysis of the materials placed on record, considering the rate of interest fixed by the Courts below at 12% per annum, being rightly adjudicated on the facts and circumstances of the case, the same does not warrant any interference. Accordingly, it is found that the Courts had not sustained the rate of interest at 36% per annum from 08.10.2000 and on the other hand, the courts below had only determined the rate of interest at 12% per annum from 08.10.2000 till the date of decree and in such view of the matter, it is found that the abovesaid determination of the rate of interest by the courts below cannot be held to be excessive or unsustainable in the eyes of law. The substantial question of law formulated in the second appeal is accordingly answered. 11. The substantial question of law formulated in the second appeal is accordingly answered. 11. In support of his contentions, the defendant's counsel placed reliance upon the decisions reported in 2010 (10) SCC 640 [Punjab and Sind Bank Vs. Alllied Beverage Company Private Limited and Others] and Civil Appeal No.1317 of 2009 of Supreme Court of India [ C.K.Sasankan Vs. The Dhanalakshmi Bank Ltd] The principles of law outlined in the abovesaid decisions are taken into consideration and followed as applicable to the facts and circumstances of the case at hand. 12. For the reasons aforestated, the second appeal fails and is accordingly dismissed. No costs. Consequently, connected miscellaneous petition, if any, is closed.