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TMI Blog1969 (4) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... s dismissed subject to a slight modification to be presently noticed. An appeal was carried against the decree to this Court. During the pendency of the appeal to this Court, nine out of ten members of Seth Haroon and Sons migrated to Pakistan and were declared evacuees. By an order passed by this Court on March 28, 1958, the Custodian of Evacuee Property was impleaded as a party respondent in the appeal filed by the mortgagors. This Court dismissed the appeal on August 8, 1958. Thereafter the 6th plaintiff Mohammad Ayyub-the only member of the firm who had not migrated, for himself and as agent of the evacuees under a general power of attorney applied for a decree absolute for sale. The Custodian of Evacuee Property resisted the applicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncipal, it would be found that the mortgage dues had been overpaid. Now, the learned Trial Judge observed that Exts. 44 to 55 relied upon by the mortgagors were silent as to any specific directions that the amounts paid in Court were to be appropriated only towards the principal. Counsel for the appellant has invited our attention to certain applications made at the; time of making deposits in Court, in which it was recited that the amounts were being deposited towards the principal. Relying upon these recitals it was urged that the Trial Court was in error in holding that there were no directions for appropriation of payments towards the principal. We have not thought it necessary to ascertain the total number of applications in which reci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest due, the ordinary rule with regard to payments by the debtor unappropriated either to principal or interest is that they are first to be applied to the discharge of interest. Lord Buchmaster delivering the judgment of the Board observed "There is a debt due that carries interest. There are moneys that are received without a definite appropriation on the one, side or on the other, and the rule which is well established in ordinary cases is that in those circumstances the money is first applied in payment of interest and then when that is satisfied in payment of the capital. That rule is referred to by Rigby, L. J., in the, case of Parr's Barking Co. v. Yates-[1898 2 O.B. 460] in these words : "The defendant's counsel relie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the amounts were deposited. But the account submitted by the mortgagees shows clearly that they had given credit for the amounts deposited towards the interest and costs in the first instance and the balance only towards the principal. The account submitted by the mortgagees clearly negatives the plea of the mortgagors. An argument somewhat faintly suggested before us that it is the privilege of the debtor to impose conditions subject to which any payment is to be made by the mortgagor, and the mortgagee is bound to accept the, condition needs no serious consideration. It was next urged that the decree was passed by the Trial Court awarding interest at the rate of 3% per annum and the order of the High Court in appeal modifying the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the amount of Rs. 35,299-1-6 ",as principal. The High Court observed that it was not relevant to consider whether that decision was right, because there was no application for review of judgment. They then directed that "the interest will accordingly be -calculated on Rs. 35,299-1-6 at 3% from October 5, 1936 till August 11, 1941 and at 4% from August 12, 1941 till November 10, 1946. This Comes to Rs. 50,810-4-6. The decree will be amended accordingly." Relying upon this direction, counsel for the appellants contended that the High Court by order dated March 31, 1947, restored for the period after November 10, 1946, the rate of interest as originally awarded by the Court of First Instance. We are unable to hold that the direction is capa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s from awarding interest exceeding the principal of the loan. Counsel for the appellants contends that if all the amounts deposited from time to time by the debtors be aggregated, it will appear that an amount exceeding the loan was paid. But the prohibition of the statute is against the making of a decree for arrears of interest exceeding the amount of loan. In the present case the decree awards interest amounting to Rs. 746-30, whereas the principal is Rs. 33,866-51. Finally, it was contended that the Custodian of Evacuee Property is not entitled to claim a decree absolute for sale, and only Mohammad Ayyub--one of the partners in the firm of Seth Haroon and Sons-may alone be given a decree absolute in respect of his share. That contentio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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