NANDA LAL ROY Vs. DHIRENDRA NATH CHAKRAVARTI

JUDGEMENT

(1.) THIS is a matter which relates to what is known as the rule of damdupat. The rule applies to Hindus dealing with one another, and is one of equity and good, sense. It is that the amount of interest a creditor can recover against his debtor shall not exceed the amount of principal. The present application arises in a mortgage suit, and arises under these circumstances. The question is, does this rule of damdupat apply to cases where default is made by the mortgagor in payment of the principal, interest and costs after the day appointed for payment by the Court. The decisions in this Court on that point are contradictory. The first decision that has been referred to is that of Mr. Justice Sale in Ram Kanye Audhicary v. Cally Churn Dey (1894) I.L.R. 21 Calc. 840. A decision to the contrary effect was given by Mr. Justice Woodroffe in an Insolvency case in the matter of Hari Lal Mullick (1906) I.L.R. 23 Calc. 1269. In my opinion, so far as the general principle applies, the decision of Mr. Justice Woodroffe seems to me to be correct in principle. THIS rule of damdupat applies as a matter of contract when Hindus are contracting with one another. It has nothing to do with the decrees of the Courts after the matter has passed from the realm of contract into that of judgment. It seems to me, on the decision of the Privy Council (which did not turn on the matter of damdupat, but on the question of rate of interest) in Sundar Koer v. Sham Krishen (1906) I.L.R. 34 Calc. 150; L. R. 34 I. A. 9. that matter is not open to doubt. The only question in the present case is, what does this decree say? Is this interest to be computed and allowed, if the mortgager makes default in repayment on the day fixed, subject to the rule of damdupat, or not? It seems to me quite clear on the wording of the decree that the rule of damdupat is only to be observed until the rights of parties pass from contract into that of judgment. I cannot in this decree read the words "subject to rule of damdupat if the same should be applicable" in the portion of the decree, as having application to the interest other than the interest due at the end of six months from the date on which the certificate should be signed. It seems to me quite clear what the decree says: "thereafter the principal and interest are to become an aggregate amount, and interest is to be computed on the aggregate amount at the rate of six per cent, per annum, such aggregate amount with interest "computed and allowed as aforesaid being hereinafter mentioned as the amount payable to the plaintiff under the decree." It cannot be that the words "computed and allowed as aforesaid subject to the rule of damdupat" are to apply to this decree after the date fixed for repayment. Moreover, it is to be noticed that these words, on which much reliance has been placed, appear in parenthesis in a definition clause as to what is thereinafter referred to as "the amount payable to the plaintiff." It is quite impossible on a definition clause like that to say that the Court was going to make the rule of damdupat applicable under this decree to interest payable, not by virtue of the contract, but by virtue of the decree itself. I think that the application by the plaintiff in this case to have the balance order, and to recover the amount of interest asked for, must go. The defendants must pay to the plaintiffs their costs of this application. The balance order will be for Rs. 2,799-15-6.