Interest
Section 34 of the Code of Civil Procedure, 1908 deals with interest. Where and in so far as a decree is for the payment of money, the Court may, in the decree, order interest at such rate as the Court deems reasonable to be paid on the principal sum adjudged, from the date of the suit to the date of the decree, in addition to any interest adjudged on such principal s The Act came into force on 01 Jan 1909.
(1) Where and in so far as a decree is for the payment of money, the Court may, in the decree, order interest at such rate as the Court deems reasonable to be paid on the principal sum adjudged, from the date of the suit to the date of the decree, in addition to any interest adjudged on such principal sum for any period prior to the institution of the suit, 1 [with further interest at such rate not exceeding six per cent. per annum as the Court deems reasonable on such principal sum], from the date of the decree to the date of payment, or to such earlier date as the Court thinks fit :
2[Provided that where the liability in relation to the sum so adjudged had arisen out of a commercial transaction, the rate of such further interest may exceed six per cent. per annum, but shall not exceed the contractual rate of interest or where there is no contractual rate, the rate at which moneys are lent or advanced by nationalised banks in relation to commercial transactions.
Explanation I.--In this Sub-section, "nationalised bank" means a corresponding new bank as defined in the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970).
Explanation II.-- For the purposes of this section, a transaction is a commercial transaction, if it is connected with the industry, trade or business of the party incurring the liability.]
(2) Where such a decree is silent with respect to the payment of further interest 3[on such principal sum] from the date of the decree to the date of payment or other earlier date, the Court shall be deemed to have refused such interest, and a separate suit therefor shall not lie.
Section 34, The Code of Civil Procedure, 1908 (Act 5 of 1908).
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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C.K. Sasankan v. Dhanalakshmi Bank Ltd.
Court's Decision & Legal Precedent
Judgment of Main Case order-4.pdf 2009-02-27. CA 1317/2009 (SLP(C) 30832/2008). Sharma/Sinha. DATE-CHECK flagged 2008-07-17 HC / 1980-10-30 / 2001-08-10 trial dates (false positive); body is the named 27 Feb 2009 reportable. Pendente lite and future interest under CPC 34 must be reasonable; contractual 25%/19.4% reduced to 9%. Cites Clariant. Map cpc 34 only. Do not pad CPC 35 (filled) or Clariant SEBI interest.
On this section: Pendente lite and future interest under CPC 34 must be reasonable; a contractual 25%/19.4% rate was reduced to 9% (C.K. Sasankan).
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Shakti Tubes LTD vs State of Bihar
Court's Decision & Legal Precedent
The Interest on Delayed Payment to Small Scale Industries Act, 1993, applies only to supply orders placed on or after the date the Act came into force (23rd September, 1992), and not to supply orders placed prior to that date, regardless of when the actual supply of goods was completed. The relevant 'transaction' for determining applicability is the placement of the supply order (initiation of transaction), not the completion of transaction which occurs only when payment is made. Therefore, a small scale industry supplier cannot claim the benefit of the Act's higher interest rates (1.5 times Prime Lending Rate, compounded monthly) for delayed payments on supply orders placed before the Act came into force, and is limited to the simple interest prescribed under Section 34 of the Civil Procedure Code, 1908.
On this section: Section 34 of CPC was applied to determine the applicable rate of interest in cases of delayed payment where the Interest on Delayed Payment Act, 1993 does not apply. The Court held that for supply orders placed before 23rd September, 1992, the interest would be governed by Section 34 of CPC, which typically provides for simple interest at prescribed rates.
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Purbanchal Cables & Conductors P. LTD vs Assam State Electricity Board
Court's Decision & Legal Precedent
The Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993, is a substantive law creating new vested rights and liabilities. Being substantive law, it operates prospectively from its commencement date of 23.09.1992 and does not apply to contracts/supply orders entered into prior to this date, even if supplies were made after the Act came into force. The Act does not have retrospective operation absent express legislative language indicating such intention. However, a suit for recovery of interest alone (without principal) is maintainable under Section 6 of the Act when interest has accrued due to delayed payment after the Act's commencement.
On this section: Court noted that prior to 1993 Act, Section 34 of CPC allowed courts discretion to award interest along with principal in delayed payment cases. Court distinguished this discretionary interest from the mandatory interest under the 1993 Act.
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NAIDU DORABABU vs SURABHI SRINIVASA RAO
Court's Decision & Legal Precedent
When a defendant denies execution of a promissory note but fails to provide evidence for forgery or seek expert comparison while his admitted signatures in court records match the document, the court is justified in finding the document genuine.
On this section: Award of pendente lite and future interest.
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… aforesaid Act, it attracts the provisions of the Code of Civil Procedure[2]( page-5-0) also to a limited extent namely insofar as award of <span id="page-5-0"></span><sup>2</sup> hereinafter referred to as "CPC" interest is concerned and for the execution of the decree drawn pursuant to the award. - 17. Section 34 of the CPC provides that where the decree is for payment of money, the court may order interest at such rate as the court deems reasonable to be paid on the principal sum adjudged. Again, the reading of the aforesaid Sub-Section (1) of Section 34 CPC would reveal that the interest is payable on the principal sum …
Made under this section, and citing it
1 instrument names this provision in its title or its text without being made under it.
Questions about Section 34
What have the courts held on Section 34 of the Code of Civil Procedure?
C.K. Sasankan v. Dhanalakshmi Bank Ltd. (27 Feb 2009) is the leading judgment on this section among those set out below: Pendente lite and future interest under CPC 34 must be reasonable; a contractual 25%/19.4% rate was reduced to 9% (C.K. Sasankan). Another 3 judgments on this section are set out below, 3 of them from the Supreme Court. They run from 2009 to 2023.
How do I find court cases under Section 34 of the Code of Civil Procedure?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: CPC 34, section 34 CPC, section 34 of the Code of Civil Procedure. People searching for it also type cpc 34 38. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 4 reported judgments on this section are set out on this page, beginning with C.K. Sasankan v. Dhanalakshmi Bank Ltd. (27 Feb 2009).
What should I read with Section 34 of the Code of Civil Procedure, and has it changed?
One instrument names it without being made under it, most recently APPENDIX D. DECREES (1908).
When did Section 34 of the Code of Civil Procedure come into force?
Section 34 of the Code of Civil Procedure, cited as CPC 34, came into force on 01 Jan 1909, having been enacted on 21 Mar 1908. It is in force as at the date shown on this page.
Other sections of this Act
- 115. Revision2475 words
- 60. Property liable to attachment and sale in execution of decree1869 words
- 2. Definitions890 words
- 9. Courts to try all civil suits unless barred714 words
- 42. Powers of Court in executing transferred decree653 words
- 92. Public charities610 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.