FAUJMUL Vs. MOTILAL

JUDGEMENT

(1.) These two appeals arise out of judgment and decree of the Second Additional Judge city civil court, Shalibanda, Hyderabad, delivered in a suit for recovery of money by sale of hypotheca brought by the appellant in CCCA. No. 29/1961 against the appellant-defendant in CCCA, No. 46 of 1961, on the basis of a mortgage deed.

(2.) The patties are mutually related to each other. Defendant is the plaintiff "?s uncle "?s adopted son and also happens to be Motilal "?s mother's sister "?s son. Motilal is plaintiffs sister's husband. The defendant borrowed from the plaintiff a sum of Rs 12,000 (O S ) on the basis of a registered mortgage deed hypothecating his house No. 141 together with mulgies on 7th Amardad, 1355 Fasli (12th June, 1946). The mortgage deed was executed at Hyderabad and the amount was advanced at Hyderabad. The plaintiff's case is that he was a mortgagee with possession, the possession having been given in lieu of interest; that the defendant agreed to pay rent at the rate of Rs 60/-per moth as his tenant in the said house and executed a rental deed on the same day; that thereafter in another agreement executed on 11-7-1946 he admitted all the facts relating to the transaction, viz, that he had received a sum of Rs. 12,000/- after executing a registered mortgage deed; that interest was agreed to be paid at the rate of 8 annas katmiti; that he had executed a rental deed agreeing to pay a rent of Rs. 60/-per month and authorised the plaintiff to appropriate the said rent towards interest and whatever rents he may receive from Abdur Razak and brothers, who will execute a rental deed in favour of the plaintiff on the coming Diwali, he may appropriate towards principal. His further case is that the defendant was confirming the balance due from him from time to time through letters, Exs. P-4 to P-7 and he, the plaintiff, had received O.S. Rs. 8265/- in all by way of rent besides cash payment of O.S. Rs, 3,000/-, The defendant was still due to him a sum of Rs. 9.000/- (O.S.), equivalent to I.G. Rs. 7714-29 P. for which the action was laid. It is also his case that he is not a money lender within the meaning of the Hyderabad Money Lenders Act as the amount was sent to the defendant on account of blood relationship; and that it was in the nature of a loan advanced by one trader to another trader in the regular course of business in accordance with the practise of trade.

(3.) The defendant in his written statement, while admitting the execution of the mortgage deed and receipt of Rs. 12,000/- denied that there was any agreement with regard to interest. He denied also the truth and binding nature of the rental agreement and the letters relied on by the plaintiff. He claims that the debt due under the mortgage deed has already been paid off as admittedly the plaintiff received in the shape of rent a sum of Rs. 8,205/- in all besides a cash payment of Rs. 3,000/- He further stated that besides the above amounts Rs. 500/- and Rs. 200/- were paid by draft dated 10- 11-1952 and 4-11-1953 to the plaintiff and that these amounts were paid in full satisfaction of the mortgage deed. His case is that by reason of relationship between the parties, there was no agreement to pay interest and the amounts paid by way of rents must be appropriated towards the mortgage amount. It was further averred that the plaintiff cannot set up an agreement to pay interest against the terms embodied in the registered deed; that the plaintiff being a mortgagee with possession has to comply with the provisions of Section 76 of the Transfer of Property Act and render account for the amounts received; and that at any rate, he being a money-lender within the meaning of the Money Lenders Act cannot maintain his suit as he neither obtained licence nor complied with the provisions of that Act. That apart as a usufructuary mortgagee, his present action for mortgage amount by sale of property is misconceived. In any event the mortgage debt having been completely liquidated, the suit is liable to be dismissed.