| The appellants were mortgagees of properties including a house on the basis of a mortgage bond executed in 1928. |
| The interest provided in the bond was 9 % per annum compoundable annually. |
| In 1937 the house above referred to was sold to B subject to the earlier mortgage. |
| In 1939 the appellants filed a suit against the original mortgagors and others including B for the, amount due under the mortgage. |
| Certain amounts towards the discharge of the liability under the mortgage were received by the appellants before as well as after the filing of the suit. |
| A preliminary decree was passed in favour of the appellants in 1942 and the final decree in 1945. |
| In 1949, B was declared an evacuee. |
| When in 1952 the appellants put their decree in execution the property was treated as "composite property" and the Custodian of Evacuee Property contended before the Competent Officer that the appellants were not entitled to any interest higher than five per cent per annum simple from the date of the mortgage under section 9(1) of the Evacuee Interest (Separation) Act, 64 of 1951. |
| The Custodian accordingly claimed that the entire transaction should be rib opened from the date of the mortgage and if more than five per cent simple interest had been received by the appellants the excess should be credited towards the principal amount. |
| The Competent Officer held that the limit of five per cent could not apply before the Act came into force. |
| The Appellate Officer however upheld the contention of the Custodian. |
| The appellants thereupon filed a writ petition in the High Court which was dismissed in limine. |
| By special leave they appealed to this Court. |
| HELD:Section 9(1) only deals with the liability of the mortgaged property which may still be due when the claim is made before the competent officer. |
| Though the provision is retrospective in the sense that where the liability is still there, interest has to be calculated at five per cent per annum simple, there is nothing in the Words of section 9(1) which authorises the reopening of the accounts ,and utilising the excess over five per cent per annum simple. |
| towards reduction of principal provided the payment of interest al ready made in within the contractual rate. |
| [61 F] On the above view the maximum rite of interest laid down in s.(1) was not applicable before the date of the suit. |
| But under section 8(3) the decree of the Court was subject. |
| to section 9 and therefore after the date of the suit the said rate was applicable. |
| Directions 'given accordingly [61 H] L/S5SCI 6 56 |
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