Gurdit Singh vs State Bank of India

V.K. Jhanji, J.—State Bank of India filed a suit for recovery of amount. The suit was decreed for a sum of Rs. 99,120 with future interest at the rate of 12 and a half per cent. per annum with effect from June 12, 1986, till realisation of the decretal amount. When the judgment-debtor, namely, Gurdit Singh (petitioner herein) failed to make payment of the decretal amount. State Bank of India preferred execution application. It is during the course of execution proceedings that the petitioner filed objections with regard to charging of interest more than what has been provided u/s 34 of the Civil Procedure Code, 1908. The executing court, vide detailed order dated May 27, 1993, dismissed the objection application. Hence this civil revision.

Learned counsel appearing on behalf of the petitioner has contended that the executing court has completely erred in law in not noticing that the petitioner was an agriculturist as defined u/s 2(b) of the Haryana Relief of Agricultural Indebtedness Act, 1989 (hereinafter referred to as "the Act") and, therefore, the decree which comprised principal as well as interest accrued thereon, is inexecutable. It is contended that as per the provisions of section 34 of the Civil Procedure Code, the decree-holder was not entitled to recover interest at a rate exceeding 6 per cent. per annum.

Against this, learned counsel appearing on behalf of the decree-holder has contended that the interest claimed in the suit was in terms of the agreement entered into between the parties and cannot be questioned or reopened in execution proceedings.

After hearing learned counsel and on going through the record, I do not find any merit in this petition.

Section 21A of the Banking Regulation Act (No. 10 of 1949), which was inserted by the Banking Laws (Amendment) (Act No. 1 of 1984), provides that "notwithstanding anything contained in the Usurious Loans Act, 1918, or any other law relating to indebtedness in force in any State, a transaction between a banking company and its debtor shall not be reopened by any court on the ground that the rate of interest charged by the banking company in respect of such transaction is excessive".

A reading of section 21A of the Banking Regulation Act clearly shows that it forbids the court from reopening or questioning the rate of interest. In State Bank of India Vs. Yasangi Venkateswara Rao, , their Lordships of the Supreme Court held that section 21A applies to all types of loans which are granted by a banking company whether to an agriculturist or non-agriculturist and, therefore, the court cannot interfere with the agreement entered into between the parties and reduce the amount of interest agreed to be paid on the loan so taken. In view of the law settled by the Supreme Court, the provisions of the Act cannot be invoked for questioning the rate of interest which was to be paid as per the agreement executed between the parties. Even otherwise, the decree having been passed by a court of competent jurisdiction, the executing court cannot amend the same. In case the judgment-debtor was aggrieved by the decree, his only remedy was to get the decree modified in appeal. The judgment and decree having become final cannot be questioned on the merits.

Consequently, this civil revision is dismissed being devoid of any merit. No costs.