Verse 8.152

Sanskrit text, Unicode transliteration and English translation by Ganganath Jha:

कृतानुसारादधिका व्यतिरिक्ता न सिध्यति ।
कुसीदपथमाहुस्तं पञ्चकं शतमर्हति ॥ १५२ ॥

kṛtānusārādadhikā vyatiriktā na sidhyati |
kusīdapathamāhustaṃ pañcakaṃ śatamarhati || 152 ||

Interest, stipulated in contravention of the law, being excessive, is not payable. They declare this to be the usurer’s way. It is only five per cent. to which the man is entitled.—(152)

 

Medhātithi’s commentary (manubhāṣya):

‘Anusāra’ is that which is followed in all matters; i.e., the law laid down by the scriptures. The law in relation to interests is diverse: one lays down the rate as the eightieth part of the hundred, and another as five per cent, if the rate of interest is stipulated ‘in contravention of’— in excess of—these sanctioned rates,—it is ‘not payable’—by the debtor to the creditor.—Why?—Because it is ‘excessive’—i.e., against the law.

In support of this the text puts forward a commendatory declaration—‘this they declare to be the usurer’s way.’ The term ‘kusīda’—means that which is followed by evil persons; and then the persons themselves. This ‘way’—path, conduct—is of evil persons, and not of good men. This is a deprecation of the act referred to.

If the lender is anxious to make as much money as possible out of the transaction, under the impression that the borrower is going to carry on extensive business with the help of the capital he is going to lend, then he may obtain five per cent., irrespectively of the caste of the borrower. What is meant is that this is all that he should seek to obtain.

Another reading is ‘kṛtā tu sārādadhikā’; and the meaning of the text would in that case he that—‘if, at the outset, on account of the man’s poverty, a low rate of interest is fixed, but subsequently, the man having acquired much wealth, if, on account of his opulence—‘sārāt’—a large rate is demanded, this cannot he payable, since all that the man is entitled to is five per cent.—(152)

 

Explanatory notes by Ganganath Jha

This verse in quoted in Vivādaratnākara (p. 14), which adds the following explanations:—Any interest, over and above what has been prescribed in the scriptures,—such as

2 per cent and so forth,—cannot be permitted, even though agreed to by the debtor;—why?—because they declare this to be the ‘usurious way’. If, under the stress of business, the creditor wishes to reap a large profit out of the debtor, then the utmost that he can recover is 5 per cent,—and not more, even though the debtor may have agreed to it;—and in Kṛtyakalpataru (p. 68b).

 

Comparative notes by various authors

Bṛhaspati (11.9, 10-12).—‘That interest has always to be paid which has been stipulated by the debtor himself, over and above the ordinary rate of interest, and has been promised in times of distress; when such special interest has been stipulated in any other manner, it must not be paid by any means. The use of a pledge after twice the principal has been realised from it, compound interest, and the exaction of the principal and interest together (as principal) are usury and are reprehensible.’