(1.) THIS second appeal arises out of a suit instituted by a registered public Trust against the appellant for the recovery of Rs. 1123 -3 -0. It was alleged in the plaint that the defendant was one of Trustees of the plaintiff Trust. In spite of a resolution of the Trust that no trustee was to enter into any personal transaction with the Trust funds without a specific sanction of the Board of Trustees, the defendant entered into two transactions with the collusion of Brij Mohandas Maheshwari, another Secretary of the Trust. On September 6, 1949, the defendant borrowed Rs. 2,725/ - and pledged a gold belt (Kardhoni) weighing 291/4 tolas. Only Rs. 300 -were paid towards this loan. Then on September 12, 1952, the defendant borrowed a sum of Rs. 3,173 -for discharging the previous loan (Rs 2,725 -as principal and Rs. 448 -as interest). He again pledged the ornament. It was alleged that the rate of gold was going down and the belt was hardly a security for the amount borrowed. Later on notices were given to the defendant and eventually the pledged article was sold for Rs. 2,451. The suit was for the recovery of the balance due i. e. Rs. 959 -7 -6 together with Rs. 163 -11 -6 by way of interest, total Rs. 1123 -3 -0. The main pleas in the defence were that the money was borrowed really for one Kishen Chand to whom the belt belonged; that the suit was barred by time; that the plaintiff was a money -lender and since it did not comply with the provisions of the Money Lenders Act, the suit was not maintainable. The trial Judge passed a decree in favour of the plaintiff for the entire claim, together with interest and costs of the suit. The defendant's appeal has been dismissed by the First Additional District Judge, Saugor.
(2.) THE only question which I am called upon to decide is whether the provisions of the C. P. & Berar Money Lenders Act are applicable to the suit claimed. The learned trial Judge held that the provisions were not applicable. The first appellate Court found that the plaintiff Trust was exempt from the application of the Act.
(3.) IT is now to be seen whether the suit transactions are loans within the meaning of the Act. Section 2 (vii) of the Act defines 'loan' as follows: -