IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE P.S.GOPINATHAN MONDAY, THE 25TH JANUARY 2010 / 5TH MAGHA 1931 WA.No. 2869 of 2009() --------------------- AGAINST THE JUDGEMENT/ORDER IN WPC.32463/2009 Dated 13/11/2009 .................... APPELLANT(S): -------------- A.LEELA, W/O.KUNHIRAMAN NAIR, VELAZHI HOUSE, BEDADKA P.O., CHENGALA VIA, KASARAGOD DISTRICT. BY ADV. SRI.T.SETHUMADHAVAN SRI.PUSHPARAJAN KODOTH SRI.K.JAYESH MOHANKUMAR RESPONDENT(S): --------------- 1. STATE OF KERALA REPRESENTED BY THE SECRETARY, CO-OPERATIVE DEPARTMENT, THIRUVANANTHAPURAM. 2. THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES, KASARAGOD. 3. ASSISTANT REGISTRAR/ARBITRATOR-CUM- SALE OFFICER, KASARAGOD DISTRICT CO-OPERATIVE BANK LTD., KASARAGOD. 4. THE KASARAGOD DISTRICT CO-OPERATIVE BANK LTD., REPRESENTED BY THE GENERAL MANAGER, KASARAGOD. R1 TO R3 BY G.P. SRI. T.K. VIPINDAS R4 BY ADV. SRI.M.SASINDRAN,SC,KASARGOD DIST.CO.BAN THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 25/01/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C .N. RAMACHANDRAN NAIR & P.S. GOPINATHAN, JJ. -------------------------------------------- W. A. No. 2869 OF 2009 -------------------------------------------- Dated this the 25th day of January, 2010 JUDGMENT Ramachandran Nair, J. Writ Appeal is filed against the judgment of the learned single Judge declining to interfere in the matter because the appellant's liability due to the Bank is covered by Ext.P2 award of the Arbitrator which was not challenged in appeal before the Tribunal, nor before this Court in the Writ Petition. We have heard counsel for the appellant and standing counsel appearing for the fourth respondent-Bank. Since the appellant's case is that demand of penal interest is arbitrary and similar others were granted benefit by the Adalat, we called for the details of collection of interest by the Bank from the appellant. Counsel has produced statement of accounts as on 22.1.2010. On going through the statement of accounts produced by the Bank we notice that contract rate of interest for the House Building loan availed 2 by the appellant itself was at high rate of 16%. The loan was availed in the year 2001 and disbursements were made only by the end of 2001. Even though there was default by 17.8.2009, appellant has settled the entire liability in terms of the demand by the Bank . Considering the several defaulters' case settled by the Bank by granting incentives, we do not find any justification for denying the incentives to the appellant, more so when the contract rate of interest itself is at high rate of 16% that too for House Building loan which is a priority loan under Government norms. In fact at present, even Nationalised Banks are giving House Building loans at an interest rate of 8 to 8.5 per cent which is only 50 per cent of the interest charged on the appellant. On equitable consideration, we feel the appellant should be granted incentives granted in similar cases. From the statement of accounts furnished by the Bank we notice that 19% interest is charged, which includes three per cent penal rate from 1.12.2004 to 16.8.2009 that is for 1720 days on the principal amount of Rs. 98320/-. We therefore allow the Writ Appeal by vacating the judgment of the learned single Judge and direct the Bank to waive three per cent of penal interest for 3 the period above stated and grant refund of 3% collected on the principal amount of Rs. 98320/- within a period of one month from the date of production of a copy of this judgment by the appellant. (C.N.RAMACHANDRAN NAIR) Judge. (P.S. GOPINATHAN) Judge. kk 4