MADHUSUDANO MOLLANA Vs. KONTARU NAIKO

JUDGEMENT

(1.) This appeal, by special leave, is against the decree of the High Court of Orissa reversing the decree of the Court of the Subordinate Judge, Berhampur and dismissing the plaintiff's suit for recovery of Rs. 8,216 due on a promissory note executed by Kontaru Naiko, defendant No. 1 for Rs. 6,000

(2.) The plaintiff money-lender obtained a registration certificate under S. 5 (4) and R. 5 of the Orissa Money-Lenders Act, 1939 (Act III of 1939), hereinafter called the Act, and the rules thereunder on March 31, 1952. He obtained another registration certificate in 1955 which said that the maximum capital for which the certificate is granted is Rs. 8,000

(3.) The plaintiff advanced the loan to defendant No. 1 on May 19, 1954 and sued for the recovery of the amount due on this loan. It was contended for the defendant that the suit was not maintainable as the maximum capital for which the plaintiff had required the registration certificate in 1952 was Rs. 2,000 and under the provisions of the act and the rules framed thereunder, he could not have advanced loan in excess of that amount and that his doing so made the registration of the appellant as a money-lender void and, therefore, the suit for recovery of Rs. 2,000 even was not maintainable. These contentions were not accepted by the trial Court which decreed the suit against the defendants with the direction that defendants Nos. 2 and 3 sons of defendant No. 1, were not personally liable and were liable to the extent of the assets of their father in their hands. The High Court, however, took a different view, accepted the aforesaid contentions of the defendants and dismissed the suit.