JIWANLAL ACHARIYA Vs. RAMESHWARLAL AGARWALLA

JUDGEMENT

(1.) Two questions of law arise in this appeal by special leave against the judgment of the Patna High Court. The facts which have been found by the High Court and which are necessary for our purposes may be briefly narrated. The appellant was the defendant in a suit filed by the plaintiff-respondent for recovery of money on the basis of a promissory note for Rs. 10,000 executed on February 4, 1954 by the defendant-appellant in favour of the plaintiff-respondent. 12 per cent per annum interest was to run on the promissory note which was payable on demand or to the order of the plaintiff-respondent. The suit was filed on February 22, 1957 and was thus obviously beyond time from February 4, 1954. The plaintiff-respondent relied on a payment by cheque on February 25, 1954 to bring the suit within time.

(2.) The two questions raised by the defendant-appellant which now survive for decision arose in this way. The appellant claimed that no money was in fact advanced on February 4, 1954 and that the promissory note executed on that date was to pay by renewal a loan for Rs. 4,000 which had been taken as far back as October 1946. The sum of Rs. 10,000 included the principal amount of Rs. 4,000 and the remainder was towards interest. The defendant-appellant therefore claimed that the suit was barred by S. 4 of the Bihar Money-Lenders (Regulation of Transactions) Act, No. 7 of 1939 (hereinafter referred to as the 1939-Act) which lays down that

(3.) Thus two main questions arose for decision of the High Court, namely, (i) whether the suit was not maintainable in view of S. 4 of the 1939-Act, and (ii) whether the suit was barred by limitation. On the first question the High Court held that S. 4 was not a bar to the maintainability of the suit. On the facts the High Court held that there was no actual advance of money on February 4, 1954 and that the promissory note for Rs. 10,000 executed on that date was in lieu of an earlier promissory note for Rs. 8,000 executed on February 21, 1951. Even so the High Court held that the suit was maintainable as it was based on a loan alleged to have been advanced in 1954 which was long after the respondent's family was registered as a money-lender. The High Court was of the view that the maintainability of the suit depended upon the pleadings on which the plaintiff came to Court and on the pleadings of the case, S. 4 had no application. On the question of limitation the High Court held that the case of the plaintiff-respondent that the cheque for Rs. 1,000, dated February 25, 1954 was given on that date was not correct. The High Court was of the view that the cheque for Rs. 1,000 was given in fact on February 4, 1954, though it was post-dated to February 25, 1954 and was actually realised sometime after February 25, 1954. Even so the High Court held that the delivery of the post-dated cheque on February 4, 1954 could not be treated as an unconditional payment and that for the purpose of S. 20 of the Indian Limitation Act, No. 9 of 1908, the payment must be held to have been made at the earliest on February 25, 1954 for the cheque could not possibly have been paid before that date. The High Court, therefore, held that S. 20 applied as part payment had been made on 25-2-1954 and the cheque itself was an acknowledgment of the payment and was in the handwriting of the appellant. The High Court, therefore, overruled both the contentions of the defendant-appellant and after going into the accounts decreed the suit for an amount which was slightly less than that claimed by the plaintiff-respondent.