DWARAKADAS Vs. HABIB MOHAMMAD JAFFER

JUDGEMENT

(1.) The point that falls to be determined in this case is within a very brief compass, and I have had the advantage of an able argument. The appellant !in this Second Appeal executed a promissory note on the 6th of November, 1950 (Exhibit P-i) in favour of the respondent, for a sum of Rs. 5,000. He also executed Exhibit P-2 acknowledging the receipt of the money paid under Exhibit P-i. The promissory note expressly provided that it should carry no interest. The plaintiff, the promisee under Exhibit P-i, called in for the money.

(2.) Not having obtained compliance with his demand, he instituted the suit (O.S. No. 219/1 of 1952), on the file of the Fourth Judge, City Civil Court, Hyderabad, for the recovery of the money due under Exhibit P-1. The defendant (appellant herein) raised various defences including the denial of the execution of the promissory note and the receipt. By a decree, dated 23rd September, 1953, the Fourth Judge, City Civil Court, allowed the claim of the plaintiff in terms of the plaint. The defendant carried the matter in appeal to the Court of the First Judge, City Civil Court, Hyderabad (Appellate Side). The appeal was allowed by the learned Judge on the ground that the promissory note was not duly stamped. The plaintiff, thereupon, preferred an appeal to the Hyderabad High Court. Manohar Pershad and Bilgrami, JJ., in their judgment, dated gth August, 1955 set aside the judgment of the Appellate Court and remanded the case to that Court to "dispose of the appeal on the other points after recording the evidence of the parties relating to whether the plaintiff is a money-lender ". After remand, the First Judge, City Civil Court, took evidence and held that the plaintiff was doing money-lending business. The learned Judge also held that section 9 of the Hyderabad Money-lenders Act, was not applicable to this case and, therefore, the suit was sustainable even without the production of a money-lending licence. The appellate Court agreed also with the finding of the trial Court that Exhibit P-i is true and that the defendant received consideration thereunder. Upon those findings, the decree of the trial Court was confirmed. This Second Appeal is filed by the defendant.

(3.) Before me Mr. Vaidya, the learned counsel for the appellant, has contended: (i) that in the instant case the appellate Court was wrong in holding that the advance made under Exhibit P-i is not a loan ; and (ii) that in view of the finding that the plaintiff is a money-lender and the admitted fact that he produced no licence, the suit should have been dismissed. These two contentions will have to be considered in the context of the provisions of the Hyderabad Money-lenders Act (Act V of 1349-F). The purpose of the Act, as can be gathered from the Preamble, is to regulate inter alia the transactions of money-lending in the Dominions of H.E.H. the Nizam. A money-lender is defined in section 2 (7) as,