V. Kala Bharathi & Ors vs The Oriental Ins.Co.Ltd.,Br.Chitoor

The Supreme Court addressed the issue of whether amounts deposited by a judgment debtor should be adjusted first towards interest or principal in the context of Motor Vehicles Act, 1988. The Court held that part payments should be adjusted towards the principal decretal amount rather than the interest accrued, thereby overturning the lower court's decision which favored interest adjustment first. The ruling clarifies the method of adjusting payments in execution proceedings under the Act, ensuring that the principal amount is prioritized in such adjustments.