RSA No. 2143 of 2009 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH RSA No. 2143 of 2009 (O&M) Date of decision: September 20, 2010 Balbir Singh ...Appellant Versus Avtar Singh ...Respondent CORAM:- HON'BLE MR. JUSTICE GURDEV SINGH Present: Ms. JK Gurna, Advocate, for the appellant. GURDEV SINGH, J. Heard. Appellant/defendant Balbir Singh has preferred this second appeal against the judgment and decree dated 17.10.2008 passed by the Additional District Judge (Fast Track Court), Bathinda, vide which he dismissed the appeal preferred by the defendant against the judgment and decree dated 7.12.2007 passed by the Civil Judge (Senior Division), Bathinda, vide which he decreed the suit of the respondent/plaintiff-Avtar Singh for recovery of ` 1 lakh as principal amount and ` 66,000/- as interest @ 2% per month from the date of execution of the pronote and receipt and pendente lite and future interest @ 6% per annum. The plaintiff filed the suit on the basis of the pronote dated 26.1.2000, which was executed in his favour by the defendant for a sum of ` 1 lakh and the defendant agreed to pay interest on the borrowed amount at the rate of 2% per month. That pronote was proved on the record as Ex. P1, in which the same rate of interest is mentioned. RSA No. 2143 of 2009 2 Notice of motion was issued regarding the rate of interest. In the order dated 27.4.2010 passed by this court, it was observed that the court is prima facie of the opinion that 9% simple interest should be suffice and would meet the interest of justice as well. Learned counsel for the appellant had sought time to seek instructions from her client regarding the payment of the amount in respect of which the decree was passed, alongwith interest. No such amount was paid. It has been submitted by the learned counsel for the appellant that the interest allowed by the trial court and the appellate court @ 2% per month from the date of the filing of the suit till the date of decree is on the higher side and that it should not have been more than 9% per annum, as has already been observed by this court in the order dated 27.4.2010. She prayed that the decree of the trial court be modified to that extent. It was just an opinion, which was expressed by this court in the above said order. According to Section 34 of the CPC, where a decree is for the payment of money, the court may allow the interest at such a rate as it deems reasonable on the principal amount so adjudged, from the date of the suit to the date of the decree with further interest at such rate not exceeding 6% per annum. The interest can be separated in three parts, (i) the interest which is allowed prior to the filing of the suit; (ii) the pendente lite interest; and (iii) the future interest. The future interest cannot exceed 6% per annum, unless the transaction between the parties arises out of a commercial transaction. The pendente lite and future interest in the present case has been awarded at the said rate. The dispute is only regarding the interest for the period prior to the filing of the suit, which has been awarded @ 2% per month. RSA No. 2143 of 2009 3 According to Section 79 of the Negotiable Instruments Act, 1881, the plaintiff was entitled to the interest at the rate agreed between the parties, which was 2% per month. However, a discretion has been left with the court to allow the pendente lite interest at such a rate as it deems fit. The pendente lite interest has already been allowed @ 6% per annum. There is no ground for upsetting the finding of the trial court, which was affirmed in the first appeal, allowing the pre-suit interest @ 2% per month. Appeal is dismissed accordingly. September 20, 2010 (GURDEV SINGH ) prem JUDGE