1973 (8) TMI 168 - HC - Indian Laws

Appellants' Arguments Dismissed, Trial Court Judgment Upheld

The court dismissed all contentions raised by the appellants and upheld the trial court's judgment and decree, affirming the plaintiff's entitlement to ... - Issues Involved:1. Entitlement to debit trunk call charges.2. Entitlement to claim watchman's salary.3. Interest claimed contrary to the contract.4. Interest charged being usurious.5. Awarding interest at 10% per annum from the date of suit till the date of decree.Issue-wise Detailed Analysis:1. Entitlement to Debit Trunk Call Charges:The appellants contended that the plaintiff was not entitled to debit the trunk call charges to the account of the firm. However, it was noted that the defendants had given up their contest regarding trunk call charges in the lower court. The court held that it was not open to them to raise this question in the appeal, as both counsel appearing for the defendants had expressly confined their defense to the question of interest and watchman's salary. Consequently, this point was rejected.2. Entitlement to Claim Watchman's Salary:The appellants argued that the plaintiff was not entitled to claim the charges incurred by the bank towards the watchman's salary as it was not covered by the terms of the contract. The lower court upheld the plaintiff's claim on the ground that watchman's charges were being debited every month since the beginning of the transactions, and no objection was raised by the defendants. The court found that the appointment of the watchman was to safeguard the goods pledged and to confer certain flexibility of trade to the defendants. The continuous course of conduct showed that the defendants acquiesced in the debiting of watchman's charges. Therefore, the court held that the defendants were liable to pay the watchman's charges.3. Interest Claimed Contrary to the Contract:The appellants contended that the interest debited to the account of the firm at the rate of 8 1/4% per annum with monthly rests was not covered by the terms of the agreement. The court found this contention untenable based on the clear language of the relevant terms of the contract. Clause (7) of the agreements provided for calculating interest on the daily balance of the account and charging it on the last working day of each month, implying compound interest. The defendants' subsequent conduct confirmed their acceptance of the compound interest. The court held that the agreements provided for charging compound interest, and the defendants had agreed to pay the same.4. Interest Charged Being Usurious:The appellants argued that the interest charged was usurious. The court referred to the provisions of the Usurious Loans Act and relevant case law, noting that the burden of establishing that the interest was excessive lay on the debtor. The court found no evidence to support the claim that the interest was excessive. The interest charged came to about 8.84% per annum with monthly rests at 8 1/2% per annum, which was not deemed excessive. The court held that the defendants failed to establish that the interest was usurious or that the transaction was substantially unfair.5. Awarding Interest at 10% Per Annum from the Date of Suit Till the Date of Decree:The appellants contended that the lower court erred in awarding interest at 10% per annum from the date of the suit till the date of the decree. The court noted that under Order 34, Rule 11, Civil P. C., interest could be awarded at the contract rate till the period of redemption expires, and the provisions of Section 34, Civil P. C., were not applicable to cases of mortgages. The court found this contention devoid of merit and upheld the award of interest at 10% per annum.Conclusion:In conclusion, the court dismissed all the contentions raised by the appellants and upheld the judgment and decree of the trial court, affirming the plaintiff's entitlement to the claimed amount, interest, and costs. The appeal was dismissed with costs.