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AN interest of a pana and a quarter per month per cent is just. Five panas per month per cent is commercial interest (vyávaháriki). Ten panas per month per cent prevails among forests. Twenty panas per month per cent prevails among sea-traders (sámudránám). Persons exceeding, or causing to exceed the above rate of interest shall be punished with the first amercement; and hearers of such transactions shall each pay half of the above fine.

The nature of the transactions between creditors and debtors, on which the welfare of the kingdom depends, shall always be scrutinised. Interest in grains in seasons of good harvest shall not exceed more than half when valued in money. Interest on stocks (prakshepa) shall be one-half of the profit and be regularly paid as each year expires. If it is allowed to accumulate owing either to the intention or to the absence abroad (of the receiver or payer), the amount payable shall be equal to twice the share or principal (múlyadvigunah). A person claiming interest when it is not due, or representing as principal the total amount of his original principal and the interest thereon shall pay a fine of four times the amount under dispute (bandhachaturgunah).

A creditor who sues for four times the amount lent by him shall pay a fine of four times the unjust amount.

Of this fine, the creditor shall pay ¾ths and the debtor ¼th. Interest on debts due from persons who are engaged in sacrifices taking a long time (dírghasatra), or who are suffering from disease, or who are detained in the houses of their teachers (for learning), or who are either minors or too poor, shall not accumulate.

A creditor refusing to receive the payment of his debt shall pay a fine of 12 panas. If the refusal is due to some (reasonable) cause, then the amount free from interest (for subsequent time) shall be kept in the safe custody of others. Debts neglected for ten years, except in the case of minors, aged persons, diseased persons, persons involved in calamities, or persons who are sojourning abroad or have fled the country and except in the case of disturbances in the kingdom (rájyavibhrama), shall not be received back.

Sons of a deceased debtor shall pay the principal with interest (kusí dam). (In the absence of sons), kinsmen claiming the share of the dead man or sureties, such as joint partners of the debt, (sahagráhinah pratibhuvo vá) shall pay the same. No other kind of surety is valid (na prátibhávyamanyat); a minor, as surety, is inefficient (bálaprátibhavyam asáram = surety of a minor is not strong).

A debt, the payment of which is not limited by time or place or both (asamkhyáta-desakálam), shall be paid by the sons, grandsons or any other heirs of the dead debtor. Any debt, the payment of which is not limited by time or place or both and for which life, marriage, or land is pledged, shall be borne by sons or grandsons.

(Regarding many debts against one.)

Excepting the case of a debtor going abroad, no debtor shall simultaneously be sued for more than one debt by one or two creditors. Even in the case of a debtor going abroad, he shall pay his debts in the order in which he borrowed them or shall first pay his debts due to the king or a learned Bráhman.

Debts contracted from each other by either a husband or wife, either a son or a father, or by any one among brothers of undivided interests shall be irrecoverable.

Cultivators or government servants shall not be caught hold of for debts while they are engaged in their duties (or at work).

A wife, though she has (not) heard of the debt (pratisrávaní), shall not be caught hold of for the debt contracted by her husband, excepting in the case of herdsmen and joint cultivators (gopálakárdhasítikebhyah). But a husband may be caught for the debt contracted by his wife. If it is admitted that a man fled the country without providing for the debt contracted by his wife, the highest amercement shall be meted out; if not admitted, witnesses shall be depended upon.

(Witnesses.)

It is obligatory to produce three witnesses who are reliable, honest and respected. At least two witnesses acceptable to the parties are necessary; never one witness in the case of debts.

Wife's brothers, copartners, prisoners (ábaddha), creditors, debtors, enemies, maintained persons, or persons once punished by the Government shall not be taken as witnesses. Likewise persons legally unfit to carry on transactions, the king, persons learned in the Vedas, persons depending for their maintenance on villages (grámabhritaka), lepers, persons suffering from bodily erruptions, outcast persons, persons of mean avocation, the blind, the deaf, the dumb, egotistic persons, females, or government servants shall not be taken as witnesses excepting in the case of transactions in one's own community. In dispute concerning assault, theft, or abduction, persons other than wife's brothers, enemies, and co-partners, can be witnesses. In secret dealings, a single woman or a single man who has stealthily heard or seen them can be a witness, with the exception of the king or an ascetic. On the side of prosecution masters against servants, priests or teachers against their disciples, and parents against their sons can be witnesses (nigrahanasákshyam kuryuh); Persons other than these may also be witnesses in criminal cases. If the above persons (masters and servants, etc.) sue each other (parasparábhiyoge), they shall be punished with the highest amercement. Creditors guilty of parokta shall pay a fine of 10 times the amount (dasabandha) but if incapable to pay so much, they shall at least pay five times the amount sued for (panchabandham); thus the section on witnesses is dealt with.

(Taking oaths.)

Witness shall be taken before Bráhmans, vessels of water and fire. A Bráhman witness shall be told ‘Tell the truth’; a Kshatriya or a Vaisya witness shall be told thus:--‘If thou utterest falsehood, thou, do not attain the fruit of thy sacrificial and charitable deeds; but having broken the array of thy enemies in war, thou, do go a beggar with a skull in thy hand.’

A Súdra witness thus:--‘Whatever thy merits are, in thy former birth or after thy death, shall they go to the king and whatever sins the king may have committed, shall they go to thee, if thou utterest falsehood; fines also shall be levied on thee, for facts as they have been heard or seen will certainly be subsequently revealed.’

If in the course of seven nights, witnesses are found to have unanimously made a false consert among themselves, a fine of 12 panas shall be levied. If they are thus found in the course of three fortnights, they shall pay the amount sued for (abhiyogam dadyuh).

If witnesses differ, judgment may be given in accordance with the statements of a majority of pure and respectable witnesses; or the mean of their statements may be followed; or the amount under dispute may be taken by the king. If witnesses give testimony for a less amount, the plaintiff shall pay a fine proportional to the increased amount; if they attest to a greater amount, the excess shall go to the king. In cases where the plaintiff proves himself stupid, or where bad hearing (on the part of witnesses at the time of the transaction) or bad writing is the cause of difficulty, or where the debtor is dead, the evidence of witnesses alone shall be depended on (sákshipratyayameva syát).

"Only," say the followers of Usanas, "in those cases where witnesses prove themselves to have been stupid or senseless and where the investigation of the place, time or nature of the transaction is of no avail, the three amercements shall be levied."

"False witnesses," say the followers of Manu, "shall be fined ten times the amount which, no matter whether it is true or false, they cause to be lost."

"If," say the followers of Brihaspati, "owing to their having been stupid, they render a case suspicious, they shall be tortured to death."

"No" says Kautilya:--It is the truth that witnesses have to hear (when they are called to attest to any transaction); if they have not minded it, they shall be fined 24 panas; if they have attested to a false case (without scrutinising), they shall be fined half of the above fine.

 Parties shall themselves produce witnesses who are not far removed either by time or place; witnesses who are very far removed either by time or place; witnesses who are very far, or who will not, stir out, shall be made to present themselves by the order of the judges.

[Thus ends Chapter XI, “Recovery of debts” in Book III, “Concerning Law” of the Arthasástra of Kautilya. End of the sixty-eighth chapter from the beginning.]