JANKI BAI CHUNNILAL Vs. RATAN MELU

JUDGEMENT

(1.) ON a reference made by Tare, J. , the question referred to the Full Bench is : "whether the suit of a plaintiff money lender is liable to be dismissed if he does not hold a registration certificate relating to the period when the money lending transactions were entered into or whether it is sufficient if the plaintiff-money lender produces during the pendency of the suit a registration certificate relating to a period subsequent to the moneylending transactions. "

(2.) THE facts of the case are simple and may be stated in a few words. On the foot of a promissory note dated 19 March 1956, the applicant, who is a moneylender, advanced to the non-applicants a ban of:rs. 850. When the applicant subsequently filed a suit to recover the amount with interest from the non-applicants they resisted it. The Small Cause Court dismissed the suit on two grounds. The applicant did not produce her certificate of registration required to be taken under Section 11-B of the Central Provinces and Berar Moneylenders Act, 1934 (hereinafter called the Act ). She did not prove that the non-applicants executed the promissory note or that there was any consideration for it. Thereupon, the applicant filed a revision and subsequently produced her registration certificate, which she had applied for and obtained during the pendency of the suit, with an application for receiving the certificate as additional evidence under Order 41 Rule 27 Civil Procedure Code. On the evidence led in the case, Tare J. , who heard the revision, took the view that the exception of the promissory note and the consideration paid therefor were duly established. He was also inclined to admi the registration certificate as additioual evidence. But he felt that the question involved should be referred to a larger Bench for reasons which may be given in his own words : "the case of Shamshir Ali v. Ratanji, AIR 1952 Hyd 58 (FB), relied on by a Division Bench of this Court in Patiram v. Baliram, ILR (1953) Nag 997 : (AIR 1954 Nag 44), was subsequently overruled by another Full bench of the Hyderabad High Cuurt consisting of 5 Judges in Mahomed salem v. Umaji, (S) AIR 1955 Hyd 113 (FB ). A Division Bench of the nagpur Bench of the Bombay High Court consisting of Mudholkar T. (as he then was) and Datar J. in Wasudco Bhairulal v. Ramchandrarao, 1958 nag LJ 294, expressed the opinion that the Division Bench view of the nagpur High Court did not correctly represent the legal position in view of the fact that the former Full Bench view of the Hyderabad High Court had been overruled by the later Full Bench of the same High Court. As such, the Division Bench of the Bombay High Court cast a doubt on the correctness of the Division Bench view of the Nagpur High Court, although the reasons for the decision were based on the earlier view iavolving particular provisions of the Bombay Act. On account of this fact, I feel it necessary that this High Court should express its opinion in view of the fact that the very basis of the earlier view of a Division Bench of the Nagpur High Court disappeared on account of the later Full Bench view of the Hyderabad High Court, and particularly when a doubt is cast on the correctness of the decision of this Court by a Division Bench of the Bombay High Court with reference to Section 11-H of the C. P. Moneylenders Act, 1934. "

(3.) IT would appear from the order of reference that this Court considered the question how before us in several cases. The cursus curiae of the Court is expressed in ILR. (1953) Nag 997 : (AIR 1934 Nag 44), in the following words : "it will be clear from all this discussion that Section 11-F applies to the business of moneylending and not to an individual itransaction of leading money and that the condition is attached and the penalty is imposed for the convenience of collection of the revenue, and the legislature did not declare an individual transaction of moneylending made by the moneylender who had not obtained a registralion certificate invalid. It is nor necessary for the validity of the contract of loan that the moneylender must be registered on the date of the transaction. He, however, cannot obtain a decree on his loan unless he possesses a valid registration certificate on the date on which the decree is to be passed. Though the transactions of money-lending are not affected for want of a registration certificate a moneylender is exposed to the penalty provided by Section 11-F of the Act for carrying on the business without a valid registration certificate. " (Page 1008 of ILR Nag): (p. 48 of AIR)Both before and after Patiram's case, ILR (1953) Nag 997 : 'air 1954 Nag 44), the same view hag been consistently taken by this Gouit by Bose J, (as he then was) in Laxman v. Yogaji, Civil Revn. No. 770 of 1941, D/-2-12-1942 (Nag.), by hidayitullah J. (as he then was) in Sukbdias v. Pundahk, Civil Kevn. No. 744 of 1949 (Nag, by V. R. Sen, J. in Nilkanth Naik v Sonya, Civil Revn. No. 403 of 1951, d/- 27-2-'952 (Nag), by Sinha C. J. (as he then was) in Ganujal v. Mahadeo, Civil revn. No 41 of 1952, DA 6-11-1952 (Nag), by R. K. Rao J. in Vishwanathrao v. Mahadeo Civil Revn. No. 543 of 1952, D/- 30-9-1953 (Nag), by Naik J. in Hiralal v. Sudarsban, Second Appeal No. 81 of 1952, D/- 30-8-1957 (MP), and bv T. C. Shrivastava J. in Lallooram v. Rameshwarprasad, Civil Revn. No. 29 of 1957, D/5-12-1957 (MP ). I should hesitate to depart from the view taken in these decisions which is not manifestly erroneous or mischievous and which has stood for many years because, from its very nature, it may be supposed to have affected the conduct of numerous persons in matters relating to their property. Again, these decisions proceed upon the basis that a loan advanced by an unregistered moneylender, which is not expressly prohibited or declared to be void by Section 11-F of the Act, ought not to be nullified. This is in accord with the principle indicated by Lord Wright in Vita Food Products incorporated v. Unus Shipping Co. , 1939 AC 277, at p. 293 : "nor must it be forgotten that the rule by which contracts not expressly forbidden by statute or declared to be void are in proper cases nullified for disobedience to a statute is a rule of public policy only, and public policy understood in a wider sense may at times be better served by refusing to nullify a bargain save on serious and sufficient grounds. " that the view hitherto taken by this Court is supportable on the principle of stare decisis and the rule of public policy indicated by Lord Wright is obvious. However, I would not rest my opinion only on these principles.