[Special Leave to Appeal (Civil) No. 1118 of 2011]. Petitioner - Kerala Financial Corporation (for short "Corporation") sanctioned a loan of Rs.2,65,000/- to the respondent and the order was communicated to the respondent by the Sanctioning Letter No. C1/646/2245/75dated 29.12.1975 (Annexure P/1). Corporation submits as per Clause 31 of the Sanctioning letter, the Corporation has a right to make enhancement of rate of interest on loan from time to time. According to the Corporation, the respondent committed default in making regular payment of the loan amount, consequently, the Corporation enhanced the rate of interest to11.75% per annum. Notice of enhancement of the rate of interest was also issued and served on the respondent. Aggrieved by the said notice, respondent filed a suit being O.S. No.479 of 1995 before the Munsif Court at Trichur, for an order of declaration that the respondent is liable to pay interest only at the rate of 5.5% perannum. Learned Munsif Court decreed the suit as prayed for. Corporation, aggrieved by the said judgment of the Munsif Court, preferred an appeal being A.S. No.123 of 1991 before the District Court and the District Court also dismissed the appeal.
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