BIHARI LALL LAHOTY Vs. HARENDRA NATH SHARMA

JUDGEMENT

(1.) This appeal is at the instance of the plaintiff in a suit for declaration that the property to which the documents of title mentioned in the plaint relate was charged with the payment of the loan together with interest and costs thereon amounting to Rs. 43,020/- to the plaintiff and for a decree under Order 34, Rule 4 of the Code of Civil Procedure. The defendants had contested the suit. The learned Subordinate Judge, Second Court, 24 Parganas has decreed the suit in part on contest for a sum of Rs. l,851/-, but has dismissed the rest of the plaintiff's claim.

(2.) It is a common case of both parties that on or about the 14th Sept., 1960 the defendants Nos. 1 to 4 and Jatindra Nath Sharma, the predecessor-in-interests of the defendants Nos. 5 to 14 had entered into an agreement with the plaintiff for sale of their premises No. 39/B, Purna Das Road for a sum of Rs. 1,50,000/-. On the same data they had received from the plaintiff-appellant a sum of Rs. 5,000/- as earnest money and in part payment of the purchase price. On 22nd Sept., 1960 the plaintiff had paid another sum of Rs. 70,000/- to the said vendors as advance and the latter in their turn had deposited with the plaintiff title deeds relating to the aforesaid premises. On 23rd Sept., 1960, Ext. 2, a document was executed by the parties which inter alia recorded the said fact of payment of Rs. 70,000/- made on 22nd Sept., 1960 and also another sum of Rs. 5,000/- previously made on 14th Sept., 1960. The said agreement further recorded that the defendants of the instant suit had deposited their title deeds with the plaintiff with intent to create equitable mortgage or charge upon the aforesaid premises. On tha facts proved in the case we are inclined to hold that on 22nd Sept., 1960 the defendants and their predecessor-in-interest Jatindra had created a mortgage by deposit of title deeds in respect of the suit premises for a sum of Rs. 75,000-, Further upon true construction of the deed dated 23rd Sept., I960 we accept the contention of the learned Advocate for the appellant that the deed, Ext. 2, was in its true nature a memorandum recording the said completed transaction of mortgage of the previous date. In fact Mr. Saktinath Mukherjee, appearing on behalf of the defendant-respondents, did not seriously dispute the said contention. It may be noted that it is the case of the plaintiff himself that on 23rd Sept., 1960 no stipulation was made between the parties for payment or interest in respect of the aforesaid mortgage by deposit of title deeds. Bihari Lall Lahoty, P. W. 1, the plaintiff, in his evidence had inter alia testified when he was ultimately unable to purchase the suit premises he had requested the defendants to return the money. They had asked for time and had entered into an agreement for payment of Rs. 75,000/- by instalments. At that time the defendants had agreed to pay interest and costs as security for payment of Rupees 75,000/-, they had deposited their title deeds of the suit premises with the plaintiff. On 26th August, 1961 the plaintiff and the defendants executed an unregistered agreement which was marked Ext. 3 in the case. The parties by the said agreement declared that the agreement for sale of the premises No. 39/B, Purna Das Road had been cancelled by mutual consent of the parties. The mortgagor by the second clause of the said document agreed to repay to the mortgagee the said principal sum of Rs. 75,000/- by three instalments mentioned in the document and they also agreed to pay interest at the rate of 8% per annum simple and also all costs incurred by reason of having entered into the agreement for sale. Under the said agreement the principal sum with interest was payable in three instalments first of such instalment of Rs. 25,000/- to be paid on or before the 31st August, 1961 and the second instalment of the same amount on or before the 30th Sept., 1961 and the balance of the principal sum and interest and costs were payable on or before the 31st Dec., 1961. In default of payment of any of the instalments the entire balance for the time being due to the mortgagee shall at once fall due and become payable forthwith.

(3.) It is also not disputed that on different dates the defendants had paid a total sum of Rs. 75,000/- to the plaintiff. The plaintiff produced a series of statement of accounts, Ext. 4 series, indicating that he had appropriated the said sum towards the total amount due as principal, interest and costs. After adjusting the said amounts paid by the de- fendants the plaintiff in the instant suit claimed that the balance amount of Rupees 43,020/- had remained due and payable. Principal point in this appeal would be whether or not the plaintiff was entitled to charge interest in respect of the aforesaid sum of Rs. 75,000/- given as loan and in respect of which the defendants had created a mortgage by depositing title deeds of the aforesaid premises as security. The plaintiff's right to claim interest was based upon the deed dated 26th August, 1961, Ext. 3. Therefore, we have to decide whether the said document, Ext. 3, dated 26th August, 1961 was an instrument purporting to operate, to create, declare, assign, limit or extinguish, any right, title or interest whether vested or contingent of the value of one haundred rupees and upwards, to or in immovable property vide Section 17 (1) (b) of the Indian Registration Act.