Report No. 63
Constitutional Position and Territorial Extent
We propose to discuss, in this Chapter, the constitutional position as to the Interest Act, with reference to legislative competence as regards its subject-matter, and the connected question of the territorial extent of the Act. At the outset, we should state that from the point of view of legislative competence, it is difficult to place the subject-matter of the Interest Act, 1839, within one particular legislative entry. In so far as interest is to be awarded on a contractual obligation, it could be said that the Act comes within the Concurrent List, entry 7, "Contracts " In so far as the award of interest concerns the procedure of the Court, the Concurrent List, entry 13, relating to "Civil Procedure" may be noted. As the Act stands at present, interest on damages is not allowed; but, if any amendment in that regard is proposed 1then the Concurrent List, entry 7, "actionable wrongs" would also be relevant.
Then, there are entries in the Constitution having incidental relevance-e.g. Concurrent List, entry 9-"bankruptcy and insolvency", and others. By and large, however, it can be stated that the subject-matter of the Interest Act and of amendments germane thereto, would come within the Concurrent List in part, and within the residuary entry as regards the rest. It should be pointed out that the Act is not confined2 to money-lending and, therefore, State List, entry 30, relating to money-lending and money-lenders, and the relief of agricultural indebtedness, would not be directly relevant.
1. See discussion as to amount on which interest can be awarded, Chapter 5, infra.
2. See para. 3.2, supra.