9911796707
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Issues:
1. Liability of respondent to pay interest on surplus amount. Analysis: The judgment pertains to a revision filed against the order of dismissal in a case involving the deposit of surplus amount with accrued interest. The debtor defaulted on a loan, leading to an auction of hypothecated property by the respondent, a financial institution. The petitioner sought the deposit of surplus funds into the Court as per an undertaking. The key issue was whether the respondent was liable to pay interest on the surplus amount. The petitioner argued that the respondent failed to deposit the amount post-auction despite an undertaking, thus should pay interest. The respondent, a State-sponsored entity, contended it had no statutory obligation to pay interest and highlighted its role in financial assistance and debt recovery. The respondent relied on a Supreme Court case to support its stance on interest payment. The judgment analyzed the relevant sections of the State Financial Corporation Act and the Transfer of Property Act. It emphasized the trust nature of surplus money and the duty to invest it for better returns. The Court noted the absence of a valid reason for the respondent's failure to deposit the surplus amount despite the undertaking, establishing a concluded contract. The Court distinguished the cited Supreme Court case, emphasizing the respondent's wrongful retention of the amount, justifying the liability to pay interest. Consequently, the impugned order was set aside, directing the respondent to pay interest at 9% per annum from the date of receipt of sale proceeds to the Court within two months. In conclusion, the judgment clarified the legal obligations concerning surplus funds, upheld the petitioner's claim for interest, and provided a directive for the respondent to comply with the payment within a specified timeframe to ensure justice for all creditors involved.
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