The appellants companymitted default in payment of instalments and interest due to the Corporation.
123 of 1973 claiming that in view of the default, the entire outstanding loan, interest and companymitment charges amounting to Rs.6,73,390.42 paise had become due and pay able.
Accordingly an order directing the sale of the properties was passed on 8.2.1980.
On the basis of the above companypromise an order was passed on 29.4.1977 by the learned Joint Judge, Baroda before whom the case was pending at that time.
Since under the order dated 29.4.1977, which was described as a decree, the Court had number expressly directed payment of any interest on the decretal amount, the Corporation was number entitled to recover any amount by way of interest due on the principal amount for the period subsequent to the date of the order.
Aggrieved by the order of the Joint Judge, the appellants filed an appeal in First Appeal No.
Before the property companyld be sold the appellants raised an objection regarding the actual amount which companyld be realised by the Corporation by the sale of the properties mortgaged in its favour.
This appeal by special leave is filed against the judgment of the Division Bench of the High Court.
From the Judgment and Order dated 2.1.1985 of the Guja rat High Court in L.P.A. No.
The said objection was overruled by the Joint Judge by his Order dated February 25, 1983.
1474 of 1983 before the High Court of Gujarat.
That appeal was dismissed by the learned Single Judge on February 2, 1984.
He determined that Rs.9,35,547.84 paise was due as on February 8, 1983 and that thereafter interest at the rate of Rs.178.60 paise per day would be accruing.
In the said appeal the Karnataka State Financial Corporation claimed interest on the principal amount due from the date of the application at the rate of 18 per cent per annum.
The objection which related to the amount of interest payable by the appellants was formulated thus.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
94 of 1984 filed by the appellants, a Division Bench of the High Court af firmed the judgment of the learned Single Judge by its decision dated January 2, 1985.
Under the Letters Patent Appeal No.
They also created an equitable mortgage mortgaging the said land and factory building by depositing the original title deeds of the properties with the Corporation by signing the letter evidencing the said deposit of title deeds.
C. Patel for the Respondent.
1446 of 1987.
The appellants were liable to pay interest at 8.5 per cent per annum and that was to be calculated and charged at the end of every half year and was payable on the 31st of March and 30th September in each year.
In the said proceedings the appellants having admitted the claim of the Corporation a companypromise was arrived at under which the 1st Appellant M s. Everest Industrial Corporation undertook to pay a sum of Rs.15,000 every month towards the claim of the Corporation and further agreed that if there was a default in payment of any two instalments at a time, then the Corporation companyld recover the entire out standing amount then due forthwith.
The Judgment of the Court was delivered by VENKATARAMIAH, J. The short question which arises for companysideration in this case is whether the rate of, interest chargeable on the amount payable under an order passed under section 32 of the State Financial Corporations Act, 195 1 63 of 195 1 hereinafter referred to as the Act from the date of the said order is governed by section 34 of the Code of Civil Procedure, 1908 hereinafter referred to as the Code or whether it is payable at the companytractual rate.
N. Bhatt, P.H. Parekh and M.K.S. Menon for the Appellants.
949 of Baroda measuring 1 acre and 3 gunthas and the factory building to be companystructed thereupon and for purchasing plant and addi tional machinery under a deed of hypothecation dated April 24, 1970 hypothecating all machinery and equipment situated at the factory premises situated on Survey number 949.
The Appellant No.1 M s. Everest Industrial Corporation Private Limited, Baroda and its Directors had borrowed from the Gujarat State Financial Corporation hereinafter re ferred to as the Corporation a sum of Rs.6 lakhs for the acquisition of fixed assets, namely, land bearing original Survey No.
163 and number bearing Survey No.
94 of 1984.
Hence the Corporation filed an application on 9th August, 1973 under section 31 of the Act before the District Judge, Baroda in Civil Miscellaneous Application No.
