* The Hon’ble Sri Justice C.V.Nagarjuna Reddy
+ A.S.No.20 of 2005
Dated 23.07.2014
% Between:
# Smt.Botla Nagamani …Petitioner And $ United India Insurance Company Ltd., Rep. by its Divisional Manager, Kakinada, East Godavari District.
…Respondent ! Counsel for the petitioner: Mr.A.K.Kishore Reddy Counsel for the respondent: Mrs.SAV.Ratnam < Gist:
> Head Note ? Cases referred:
[1] (2009) 7 Supreme Court Cases 372 The Hon’ble Sri Justice C.V.Nagarjuna Reddy AS.No.20 of 2005
Dated 23.07.2014
Between:
Smt.Botla Nagamani …Petitioner And United India Insurance Company Ltd., Rep. by its Divisional Manager, Kakinada, East Godavari District …Respondent Counsel for the petitioner: Mr.A.K.Kishore Reddy Counsel for the respondent: Mrs.SAV.Ratnam The Court made the following:
Order:
This Appeal arises out of Judgment and Decree, dated 15-04-2004, in OS.No.34 of 2000, on the file of the Court of the learned IV Additional District Judge, Kakinada.
The limited aspect raised in this Appeal pertains to non-award of pendentelite interest on the decretal amount.
The husband of the appellant obtained an insurance policy covering the risk of accident. On his death, the appellant made a claim for payment of insurance amount. The claim was repudiated by the respondent- Insurance Company on the ground that the death of the policy holder has not occurred on account of accident but due to suicide. The appellant has, therefore, filed the abovementioned suit for payment of insurance amount of Rs.10 lakhs along with interest @ 12% p.a., from the date it has fallen due till the date of realization. The lower Court, by its Judgment and Decree, dated 15-04-2004, decreed the suit directing payment of the insurance amount of Rs.10 lakhs within three months therefrom, failing which, interest @ 9% p.a., was directed to be paid from the date of expiry of three months till the payment. Feeling aggrieved by the non-award of interest from the date of filing the suit till the date of decree, the appellant has filed this appeal.
Award of pendentelite and post decree interest is covered by Section 34 of the Code of Civil Procedure, 1908 (CPC). A perusal of the said provision shows that discretion is vested in the Court for award of interest. Section 34 CPC fell for judicial interpretation in many a case. It is not necessary for this Court to refer to all the precedents. It will suffice to take note of the judgment of the Supreme Court in Thazhathe
[1]
Purayil Sarabi and others vs. Union of India wherein, on consideration of the relevant case law, the Supreme Court has summarized the legal position as under:
“As has been frequently explained by this Court and various High Courts, interest is essentially a compensation payable on account of denial of the right to utilize the money due, which has been, in fact, utilized by the person withholding the same. Accordingly, payment of interest follows as a matter of course when a money decree is passed.”
The appellant has claimed interest @ 12% before the lower Court. However, the lower Court has not given any reasons for denying the same. I am, therefore, of the opinion that the lower Court has not exercised its discretion properly by denying interest without assigning any reasons. Therefore, on the facts and in the circumstances of the case, this Court is of the opinion that interests of justice would be met, if the appellant is awarded interest @ 6% p.a., from the date of filing of the suit till the date of the decree.
The Appeal is, accordingly, partly allowed to the extent indicated above.
As a sequel, ASMP.No.1027 of 2014, filed by the appellant to expedite the hearing of the appeal, is dismissed as infructuous.
(C.V.Nagarjuna Reddy, J) Dt: 23rd July, 2014
Note:
LR copies
B/o LUR
[1] (2009) 7 Supreme Court Cases 372