Karnataka & ANR Vs. G R Nadagouda (Dead) by LRS & ANR.  INSC 9 (5
SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL Nos.2547-2548
OF 1998 STATE OF KARNATAKA & ANR. ....APPELLANTS VERSUS GOPAL RAMACHANDRA
NADAGOUDA (D) BY LRs. & ANR. ....
This is an old litigation carried on by the State of Karnataka and
the dispute centers around a long history of sixty years. But it is unnecessary
for this Court, as rightly pointed out by the High Court in the impugned
Judgment, to recount the various developments and the manner in which the
present position has arisen as now it is confined within a very narrow ambit.
From the arguments advanced by Mr. Sanjay R. Hegde, learned 1 counsel appearing
on behalf of State of Karnataka, the appellant herein, we only need to consider
the penultimate directions in the impugned order.
for the proper disposal of the present appeals, that portion of the impugned
Judgment of the High Court may be reproduced as under :- "The State
authorities are accordingly directed to deposit the amount in question in the
trial Court within an outer limit of three months from today. The petitioners
would undoubtedly be required to pay the requisite court fees on the amount in
question, but the trial Court will have to take note of the fact that under
normal circumstances, the Court fee is payable on the date when the suit is
filed or in those of the cases, where for any reason, the Court fee is directed
to be paid when the decree is passed, then, it is these two dates that have
been taken into consideration. In this case, the suit was filed in the year
1955, the decree came to be passed in the year 1957 and it is therefore, on the
basis of Court fees that would have been payable as on that date, that the
petitioners would be liable. The Trial Court shall accordingly this factor into
account. It shall be open to the petitioners to either tender the Court fee
separately or to pray to the trial Court to adjust the same while 2 releasing
the payments to them. It is made clear however, that if the State commits any
default in depositing the amounts within the prescribed period of time, which I
have deliberately kept sufficiently long, that in the event of any such
default, the State shall be liable to pay interest quantified at the rate of
15% p.a. to the petitioners from the date of this order namely, 15.11.1996 upto
the date on which the amount is actually tendered in Court." (Emphasis
Before us, the only submission that was raised by Mr. Sanjay R.
Hegde, learned counsel appearing for the State of Karnataka is whether the
judgment of the High Court directing the State to pay interest at the rate of
15 per cent per annum to the respondents from the date of its order i.e. 15th
of November, 1996 up to the date on which the amount was actually tendered in
the Court, was justified.
In view of the aforesaid stand taken by the learned counsel
appearing for the 3 appellants, we need not go into the facts of these appeals
in detail nor are we concerned with any other ground except the ground
of the appellants, Mr. Hegde contended that in view of the nature of the claim
and in view of the fact that the State of Karnataka had diligently pursued
these litigations all through, it was improper on the part of the High Court to
hold that the State was liable to pay interest at the rate of 15% P.A. as the
said rate of interest if accepted and if the State is directed to pay it to the
respondents, would have the effect of nearly tripling the decretal amount.
Accordingly, it was submitted that the rate of interest may be modified to 6%
On the question of rate of interest, we have also heard Mr. S.K.
Kulkarni, learned counsel appearing for the respondents, who duly contested the
submission of Mr. Hegde. According 4 to him, the High Court in its discretion
was fully justified in granting interest at the rate of 15% P.A. from the date
mentioned in the impugned judgment. It was further submitted by Mr. Kulkarni,
learned counsel appearing on behalf of the respondent, that the entire
litigation carried on by the State against the respondent was fictitious and
therefore, it was justified for the High Court to award interest at the rate
mentioned above. Mr. Kulkarni further submitted that in view of the admitted
facts of the present case, the question of reducing the interest from 15% to 6%
does not arise at all. Accordingly, he submitted that the appeals shall be
dismissed with exemplary costs in favour of the respondents.
Having heard the learned counsel appearing for the parties and
after going through the impugned judgment and the directions to the State to
pay interest at the rate of 15% P.A.
15th of November, 1996, we are of the view that the impugned judgment of the
High Court may be modified to the extent that the respondents be paid interest
at the rate of 10 per cent per annum and not 15 per cent from the date
mentioned in the impugned judgment of the High Court. Accordingly, we dispose
of these appeals with the above modification and we further direct that in the
event, the amount, as directed above, is not paid by the State within six
months from the date of supply of a copy of this order to it by the
respondents, the State shall be liable to pay interest at the rate of 15 per
cent per annum as directed by the High Court.
With this modification, these appeals are disposed of with no
order as to costs.
..................J. [TARUN CHATTERJEE]