IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.13883 of 2005 Jawahar Singh son of Late Bindeswari Singh., resident of Village- Malhipur, P.S. Sahabpur Kamal, District-Begusarai. ..Petitioner. Versus 1. The State of Bihar. 2. Managing Director, Bihar State Co-operative Land Development Bank Limited, Patna. 3. The Regional Manager, Land Development Bank, Begusarai. 4. The District Certificate Officer, Begusarai Land Development Bank, Begusarai. 5. The Branch Manager, Land Development Bank, Begusarai. 6. The Collector, Begusarai. …Respondents. For the petitioner:- 1. Mr. Ram Bilash Mahto, Advocate. 2. Mr. Manoj Kumar Singh, Advocate. 3. Mr. Brajesh Kumar Pandey, Advocate. For the respondent-Mr. Rajesh Prasad Choudhary, Advocate No-2 to 4 For the State of Bihar:-Mr. Shivam Singh- AC to AAG No. 1. ----------- 3. 15.09.2011 Heard learned counsel for the petitioner and learned counsel for the respondents. 2. This writ petition has been filed by the petitioner for issuance of a writ in the nature of prohibitio restraining the respondents from charging compound interest on agricultural loan advanced to the petitioner and from charging interest more than double of the principal amount and further for restraining the respondents from arresting him without following the established procedure of law. 3. So far as the last part of the relief of petitioner is concerned this writ petition has been filed more than six years back and there is no allegation that in the meantime the petitioner had been arrested or any coercive action was taken against him. Furthermore it is needless to say that any action taken by the respondents authorities had to be in accordance 2 with the established procedures of law. 4. So far as the first two reliefs claimed by the petitioner is concerned, learned counsel for the petitioner submits that the petitioner is Junior Engineer posted in Zila Parishad and there was diversion of fund on the direction of the District Magistrate vide order dated 07.01.2000 and the note dated 08.01.2000. Hence he claims that the petitioner cannot be held liable for that. 5. Learned counsel for the petitioner has claimed that agricultural loan cannot be treated as commercial loan and hence compound interest cannot be charged on agricultural loans. The second claim raised by the petitioner is that rate of interest to be charged on such loan should not be more than 6.5% per annum. On this point he relies upon a decision of a Bench of this Court in the case of Jahuri Yadav and ors. Vs. The Bank of India & ors. reported in 1998 (3) PLJR 214. 5. On the other hand, learned counsel for the respondents vehemently opposes the contentions of learned counsel for the petitioner and submits that the decision cited by learned counsel for the petitioner in case of Jahuri Yadav & ors.(supra) has already been held by a bench of this Court in case of Jainath Prasad Vs. State of Bihar & Others reported in 1999 (3) PLJR-227 to be per incuriam as it did not consider the decisions of the Apex Court in case of Corporation Bank Vs. D.S.Gowda and Another, reported in (1994) 5 SCC-213 and in 3 case of State Bank of India Vs. Yasangi Venkateswara Rao reported in 1999(2) SCC 375. 6. From a bare perusal of the aforesaid decision of this Court in case of Jainath Prasad and the decision of the Apex Court of in Corporation Bank (Supra) and in case of State Bank of India (Supra) it is clear that entering into the mortgage is a matter of contract between the parties in respect of the amount advanced for which compound interest will be paid and the Court cannot possibly interfere and reduce the amount of interest. It has only been held that Bank cannot charge compound interest with quarterly rests on agricultural advances. 7. Hence in these circumstances, this Court can not interfere and reduce the amount of interest agreed by the parties and only quarterly rests on agricultural advances were held to be not legal and hence it can be yearly rests. 8. Considering the aforesaid facts and position in law, the petitioner cannot shy away from the terms of the agreement and he will have to pay the interests at the rate as prescribed in the agricultural loan agreement, I do not find any merit in this case and accordingly, this writ petition is dismissed. Kamlesh (S.N. Hussain, J.)