1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION FIRST APPEAL NO. 2088 OF 2008 1.Sanjay Hunduroa Warake Age 34 yrs., Occ. Business, Residing at 37, Nale Colony, Kalaamba Road, Kolhapur. 2.Shri Murlidhar dattatraya Killedar, Age 44 yrs., Occ.Agrigulture, Residing at Majare Kasarwada, Tal. Radhanagari, Dist. Kolhapur. 3.Shri Hinduroa Marutroa Warake, Age 60 Yrs., Occ. --do-- Residing at 37, Nale Colony, Kallamba Road, Kolhapur 4.Anandroa Mahadev Warake, Dead through his legal heirs, 4-A Smt.Bharati Anandroa Warake, Age 55 yrs., Occ.Household, Residing at Majare Kasarwada, Tal. Radhanagari, Dist.Kolhapur 4-B Shri.Yuvaraj Anandroa Warake, Age 35 yrs, Occ. Agriculture, Residing at --do-- 4-C Sou. Namrata Ajit Patil, Age 35 yrs, Occ. Household, Residing at --do-- 4-D Rupali Anandroa Warake, Age 25 yrs, Occ. Housework, Residing at --do-- 4-E Savita Anandroa Warake, Age 23 yrs, Occ. Housework, Residing at --do-- 4-F Vidya Anandroa Warake, Age 21 yrs, Occ. Housework, Residing at  do-- 5.Shrimati Banubai Yashawant Warake, 2 Age 50 yrs, Occ. Household, Residing at  do-- ...Appellants V/s. The Ganesh Bank of Kurundwad Ltd., A Body Corporate constituted under the Companies Act, 1913, having it s head office at Kurundwad and one of its Branch Manager and constituted power of Attorney holder Shri Vijaykumar Bhanusaheb Yadav, Age 43 yrs. Occupation : Service, Residing at 24  A, Yashwant Colony, Ichalkaranji, Tal. Hatkanangale, Dist. Kolhapur ...Respondent .... Mr.Siddharth R.Karpe i/by Rupesh Nalavade, for the appellantd. Mr.P.M.Arjunwadkar,Advocate, for respondent no.1. .... CORAM : J.H.BHATIA,J. DATE : 8th September, 2009. ORAL JUDGMENT : 1.With consent of the learned counsel for the parties, the appeal is taken for final hearing and disposal. The appellant has filed the compilation of the oral and documentary evidence. 2.The appeal is preferred against the judgment and decree passed by the Vth Ad-hoc Additional 3 District Judge, Kolhapur for recovery of money in Spl. Suit No.60 of 1999. It is a case of the plaintiff-respondent that it is scheduled bank and the defendant-appellant no.1 Sanjay had taken the loan of Rs.3,00,000/- for purchase of bulldozer. The amount of the loans was to carry interest at the rate of Rs. 16% p.a. with quarterly rests. In case of failure to pay installments, the penal interest of 1% could be charged. Defendant nos.2 and 3 stood guarantors for repayment of loan. Accordingly, defendant nos.1 to 3 executed the necessary documents in favour of the bank on 25th April 1990. Defendant no.1 to 3 acknowledged the balance due on 7th January 1993 and again on 26th December 1995. Defendant no.4 had also joined them in acknowledging the liability. However, he died pending the suit, therefore, his legal heirs were brought on record. The suit was filed on 28th December 1998. It was contended that the 4 period of limitation on the basis of the last acknowledgment had expired on 25th December 1998, when the Civil Court was closed due to Winter vacation. Hence the suit was filed on 28th December 1998, that is the first day after opening of the court after Winter Vacation and therefore the suit was within the period of limitation. At the time of filing of suit the loan of Rs. 5,72,156/- was due from the defendants. The charge was also crated on certain agricultural properties bearing gut nos.206, 249, 541 and 254 of village Kasarwada belonging to defendant no.1. Defendant no.5 had purchased the land gut no. 206 from the defendant no.1 in spite of the knowledge of the charge on the said property. 3.Defendant no.1 contested the suit by filing written statement. He denied to have made any request for loan or to have executed any document. He also contended that the suit is barred by limitation. It was contended that 5 the plaintiff is a co-operative bank registered under Maharashtra Cooperative Societies Act and defendant no.1 is not a shareholder of the plaintiff bank and therefore without proper notice under section 164 of the Maharashtra Co-operative Society Act, the suit could not be filed. 4.On the basis of the pleadings, several issues are framed by the trial court at exhibit 16. After hearing the parties, the trial court held that defendant no.1 had taken the loan and defendant nos.2 & 3 had guaranteed to repay the same. The trial court also found that the suit was within a period of limitation. The trial court passed the decree directing defendant no.1 to 3 to pay the decretal amount of Rs.5,72,156/- jointly with a future interest of Rs.16 p.a. from the date of filing of suit till realization of the amount. The said judgment and decree are challenged in the present appeal. 6 5.Heard the learned counsel for the parties. Following two points are pressed in the present appeal. Firstly, as to whether the suit was barred by limitation and secondly, whether the future interest granted by the trial court at the rate of Rs.16 p.a. is justified. 6.The record reveals that on behalf of the plaintiff/appellant, two witnesses were examined to prove all the documents and the acknowledgments which were executed by defendant nos.1 to 3 from time to time. The witnesses were not even cross-examined on behalf of defendants. Defendants did not enter into witnesses box to depose on oath that those documents were not executed by them. In view of this, the trial court rightly came to the conclusion that defendant no.1 had taken loan of Rs.3,00,000/- for purchasing bulldozer and defendant nos.2 & 3 had guaranteed the repayment of the loan. 7 Accordingly, they had executed necessary document in favour of the plaintiff-bank. From the facts and the evidence on record, it is clear that the loan was taken on 25th April 1990 and the amount was to be repaid within three years in quarterly installments of Rs. 60,000/-. The loan amount was to carry interest at the rate of 16% p.a. If the installments were not paid on the stipulated dates, the bank could charge penal interest of 1% p.a. The record reveals that defendant nos.1 to 3 had acknowledged liability on 17th April 1993 by executing letter of acknowledgment of the of debts and dues. As this acknowledgment was made before the expiry of the three yeas from the date of loan, the fresh period of limitation would begin to run from 7th January 1993. Thereafter on 26th December 1995, they executed letter of acknowledgment of debts and dues. This acknowledgment was also within the period of 8 three years, from earlier date of acknowledgment and therefore, fresh period of limitation would begin to run on 26th December 1995. The period of limitation came to and end on 26th December 1998. The plaintiff-bank has explained that on the last day of the period of limitation, suit could not be filed because, the Civil Court was closed due to Winter Vacation and on opening of the Courts after vacation immediately on 28th December 1998, suit was filed. Thus, it is clearly within limitation. 7.Taking into consideration, the oral and documentary evidence lead by the bank it is difficult to find any fault in the findings of that the trial court that defendant nos.1 to 3 were liable to repay the loan amount. 8.The next question is about the interest. The trial court held that as per the agreement between the parties, the interest was to be paid @ 16% p.a. with quarterly rests and 9 accordingly, the amount claimed by the bank was found to be Rs.5,72,156/- at the time of filing the suit. Now that amount becomes principal for the purpose of future interest and therefore, the trial court has also granted future interest at the rate of Rs.16% p.a. on the decretal amount. The learned counsel for the appellant contends that this rate of interest is very heavy. Taking into consideration, the rates of interest in the market, judicial notice can be taken that in the year 1994, when loan was advanced the interest rates on deposits and loan were really high and therefore it was fixed at the rate of 16% p.a.. The rates of interests continued to be high up to 1999. Thereafter, from the year 2000 and particularly from the year 2001, the rates of interest have substantially come down. Prior to 2001, on the fixed deposits the nationalized banks used to give interest @ 10% to 11 % p.a., but now the 10 rates have come down to about 5% to 6% p.a. On the National Savings Certificates the interest used to be 12% p.a. but now it has come down to about 8% p.a. It is material to note that the loan was taken to purchase bulldozer as an agricultural equipment. It is possible that said bulldozer could not have been used by the defendant-appellant only for his own agricultural works and possibly he was using it for other business also but it appears that the loan was advanced to purchase the bulldozer as an agricultural equipment. Anyhow, taking into consideration, overall reduction in rates of interest on loan, in my considered opinion, the future interest could not be more than 10% per annum. Therefore, to that extent, the appeal deserves to be allowed. 9.For the aforesaid reasons, the appeal is partly allowed only in respect of the future interest and it is hereby directed that 11 defendant nos.1 to 3 shall jointly pay the decretal amount of Rs.5,72,156/- with future interest at the rate of Rs.10% p.a.from the date of the institution of the suit till realization of the amount. Remaining part of the decree is confirmed. Parties shall bear their own costs in the appeal. (J.H.BHATIA,J.)