HON’BLE SRI JUSTICE N.R.L. NAGESWARA RAO APPEAL SUIT No.212 OF 1990 JUDGMENT: The appeal is filed by the plaintiff-bank against the ex parte judgment and decree in O.S.No.461 of 1987 on the file of the Principal Subordinate Judge, Visakhapatnam. 2. The suit was one filed for recovery of loan amount, which was taken by the defendants by hypothecating the properties and a preliminary decree was passed as prayed for. Though the defendants have filed a written statement they did not appear. Therefore, the defendants were set ex parte on 01.08.1989 and a preliminary decree was passed for a sum of Rs.9,73,267.55 ps., with subsequent interest at 6% per annum from the date of plaint till the date of realisation on the principal sum of Rs.5,00,000/- and costs. 3. The learned counsel for the appellant contends that the amount was borrowed for commercial purpose and the contractual rate of interest was 18% per annum and the lower Court has granted only 6% interest and as such, the appellant claims that 18% interest should be granted. Evidently, this is a suit for enforcement of the mortgage, which is covered under Order XXXIV of the Civil Procedure Code (for short, ‘C.P.C.’. So far as Section 34 C.P.C., is concerned, with regard to the commercial transactions, the Court can grant the contractual rate of interest, but so far as the suit covered under Order 34 C.P.C., it is the discretion of the Court to grant subsequent interest even if it is the commercial transaction. Therefore, in view of the above circumstances, it cannot be said that the plaintiff in all cases is entitled for contractual rate of interest. Order XXXIV Rule 11 C.P.C. deals with the grant of interest in cases covered by mortgage decrees. Therefore, in view of the above circumstances, I feel that though the contractual rate of interest claimed at 18% per annum appears to be on higher side since the money was borrowed for business purpose, I feel the ends of justice would meet if interest is granted at 12% per annum from the date of suit till the date of redemption and with subsequent interest at 6% from the date of redemption till the realisation. With the above modification, the appeal is allowed in part. There shall be no order as to costs. _________________________ N.R.L. NAGESWARA RAO, J Date: 24.08.2011 INL