GOVINDA NAIK GURUNATH NAIK Vs. GURURAO PUTTANBHAT KADEKAR

JUDGEMENT

(1.) This is a defendant's appeal. The defendant became the owner of the suit schedule properties by virtue of his adoption to his adoptive father Gurunath Naik in 1933. Even prior to the adoption, the Plaintiff was a tenant of a portion of the left wing of the property situated in Durgada Bail in Hubli Town belonging to Defendant's adoptive father. When- the Defendant was about 18 years of age he began to manage the properties and thereafter also the plaintiff continued to be a tenant of a portion in the left wing of the plaint schedule properties. In about the year 1945-46 the Defendant thought of demolishing both the left and right wings of the building as it had developed serious cracks in the walls and putting up a new construction. As the Defendant was in need of money he borrowed from the plaintiff on Promissory Notes Exts.94 to 97 a sum of Rs. 35,000 in all at six per cent interest per annum. Then on 17-6-1949 the Defendant executed a deed of simple mortgage, Ext. 82, in favour of the plaintiff with a period of three years for repayment with interest at) six per cent per annum, the consideration amount being the Promissory Notes amounts mentioned above. The properties mortgaged were CTS.289 to 284, fully described in paragraph 2 of the plaint. As mentioned in paragraph 2 of the plaint the Defendant made some payments towards the principal and interest to the plaintiff and after taking into account such payments the Defendant became due in a sum of Rs.26,000 towards principal and Rs. 7,583-45 towards interest, as on the date of suit, 18-6-1959. As the Defendant had agreed to pay the amount in three years' time as stipulated in the mortgage deed, but did not pay the same, the Plaintiff issued several notices to him calling upon him to discharge the mortgage debt. As the Defendant failed to pay the amount, the Plaintiff ultimately filed the suit out of which this appeal arises for recovery of Rs. 33,583-45 towards principal and interest. The defendant has admitted the execution of the mortgage deed and also the consideration. He has also admitted that the rate of interest as mentioned in the deed is six per cent per annum. While admitting these facts, he has stated that the plaintiff was Irs adviser from 1934 and he was young the plaintiff tcok advantage of his inexperience and dominated on him; that he persuaded him to demolish the old building and erect a new building thereon and promised him to pay a lakh of rupees for the construction of the new structure by way of loan. Taking advantage of his dominating position he got into an agreement as per Ext. 104 dated 20th May 1948, under which the plaintiff had to shift to the newly constructed right wing on the same rent of Rs. 64 per month that he was paying for the' portion that he was occupying in the left wing till then, and that after the defendant constructed the new building on the left wing, the defendant had to let out that portion to the Plaintiff on an annual rent of Rs. 6800 for a period of 25 years. Accordingly, the plaintiff shifted to the portion of the right wing, but went on paying rent at the rate of Rs.64 per month, even though according to the Defendant, the portion so occupied by, the Plaintiff would have fetched Rs. 600 per month.

(2.) As could be seen from the material available in the case, the Defendant did not put up any building on the left wing. On the other hand he sold that portion to his partner in the jewellery business, Chipade, as per Ext. 86 dated 21-5-51 with a condition to re-purchase the same. As the Defendant did not put up any new building on the left wing as agreed to between him and the Plaintiff, the Defendant agreed to the Plaintiff remaining as tenant in the portion of the right wing that was occupied by him in addition to two more rooms in the first floor under Ext. 113 dated 13-8-1953, paying a rent of Rs. 250 per month, for a period of 20 years.

(3.) The defendant has contended that the Plantiff took the mortgage deed referred to above exercising undue influence. According to him, the Plaintiff got the lease deed of 1953 for a low rent of Rs. 250 per month when in fact it would have fetched Rs. 600 per month. His case was that the Plaintiff in order to secure interest at the rate of 18 per cent on the mortgage took the lease deed of 1953 stipulating a rent of Rs. 250 only per month. Therefore, according to him, the mortgage deed is vitiated by fraud and undue influence and is unenforceable and that in any event, account should be taken on the footing that the Plaintiff had to pay Rs. 350 more per month towards rent and that amount should be adjusted towards the principal and interest under the mortgage and that if so done nothing was due to the Plaintiff.: On these contentions the Mowing issues were raised by the trial Court:-