Report No. 55
33. Guidelines proposed.-
We are, therefore, of the view that:
(a) Where the principal sum adjudged exceeds five thousand rupees, and
(b) the liability in respect of which the decree is passed arose out of a commercial transaction, the court should have a discretion to order that the rate of further interest may exceed six per cent. per annum.
For this purpose, a transaction is a commercial transaction, if it is connected with the industry, trade or business of the party incurring the liability. The possibility of exploitation of the debtor by the creditor would be non¬existent in such cases. The monetary liability being connected with the industry, trade or business of the debtor, and the principal amount being high enough, one can reasonably assume that the parties would be dealing with each other on an equal footing, and that independent advice would have been within easy reach of the person liable.
The minimum monetary limit which we propose will also eliminate the possibility that petty debtors will be exploited. In the particular situation which we have referred to, considerations of economic justice require rather that a higher rate of interest should be permissible, than that the discretion of the Court should be rigidly controlled.