(1.) THE appellant--the State of Orissa--advanced small loans to several agriculturists of Khatiar Circle in Kalahandi district in the year 1944. One dinabandhu Defendant No. 1--in the suit and not a party to the present appeal-was then the agricultural overseer in Khariar Circle. Without any authority to realise the loans so advanced, he realised Rs. 13,000/- and odd from several loanees and credited in all Rs. 9,000/- and odd from the amounts realised by him, into the State Treasury. There was a balance of Rs. 4095-1-0 in his hand. He kept the said money, in July 1945, with one Netrananda defendant No. 2, another agricultural overseer under the State of Orissa, then working at Nawapara circle, the said Netrananda being a close associate and friend of Dinabandhu. According to Dinabandhu, he kept the said amount with Netrananda for being credited by Netrananda into the State Treasury, whereas, according to Netrananda, Dinabandhu could not credit the amount into the treasury because of certain defects in the chalans and kept the money with him to be later on taken back by Dinabandhu for being credited into treasury. Incidentally it may be noted here that the trial Court accepted the stand taken by defendant No. 1, whereas the first appellate Court came to no finding on this point, and no finding on this point is actually necessary for the determination of the present appeal, though it may be stated that if a finding would have been necessary, we would have been prepared to accept the stand taken by defendant no. 2 in view of the fact that his evidence is consonant with his plea in the written statement, whereas defendant No. 1's stand in the evidence stage is not supported by his written statement. In the third week of July 1945, there was a theft committed at the place of netrananda and it was alleged that the money kept by Dinabandhu together with netrananda's own money was the subject matter of the said theft. On this background, the State of Orissa sued both Dinabandhu and Netrananda for recovery of Rs. 4117-5-0 (corrected amount according to accounts is Rs. 4095-90 ). The trial Court decreed the plaintiff's suit against both of them. In the first appeal, preferred by Netrananda alone, the suit was dismissed as against him and so the plaintiff has come up in the present second appeal.
(2.) IN the present appeal we are not concerned with the decree passed against dinabandhu. So far Netrananda is concerned, the trial court was of the view that netrananda, being a Government servant, should not have kept the money in an unauthorised manner from Dinabandhu, and if. he did so, he should have soon after credited the amount into the treasury, for which purpose the money had been entrusted to him by Dinabandhu and that in keeping the money at his place, which was a broken and unsafe house, and leaving the key of the box, in which the money had been kept, in charge of his wife, Netrananda had acted negligently, and so Netrananda was liable to pay the Government money although there was theft of the said money together with Netrananda's own money. The first appellate Court took the view that the money paid by the loanees to dinabandhu, who had no authority to realise them, was the money of loanees and not of the Government, and there was no subsequent ratification by the State of orissa, expressed or implied of the act of Dinabandhu in discharging the loanees from the liability to the State of Orissa, and so the State of Orissa had no cause of action against either of the defendants. The appellate Court, however, gave no relief to Dinabandhu, presumably because he had not preferred any appeal against the decree. It may be incidentally noted that according to the finding of the trial court, dinabandhu had realised the loans from the loanees as the agent of the State though he had no authority for the purpose, whereas, according to the first appellate Court, Dinabandhu had been entrusted with the different amounts realised from different lonees for being credited on their behalf by Dinabandhu into the State treasury, since the loanees were living at a far away place from the head-quarters and were not in a convenient position to credit the amounts into the state Treasury directly.
(3.) THOUGH in the plaint it is not specifically stated as to on what basis the cause of action has been laid against Netrananda, the learned counsel for the State sought to urge that the same was based on Section 63 of the Indian Trusts Act. According to him, the money had been entrusted by the loanees to Dinabandhu for being paid to the Government, and so Dinabandhu was a trustee and the Government was the beneficiary, and as such since the said trust money had come into the hands of Netrananda inconsistently with the trust, the State could proceed against netrananda for realisation of the amount. In the plaint, it is not the plaintiff's case that Dinabandhu had been entrusted by the loanees with their respective amounts for being credited on their accounts by dinabandhu into the State Treasury. On the contrary, the plaint case is that dinabandhu realised loans from the loanees on behalf of the State, while he had no authority to do so. That is not only the plaint case, but that is also the case for the plaintiff in the evidence as deposed by P. Ws. 1 to 3 some of the loanees, who have stated that they repaid their loans to Dinabandhu on demand made by him on behalf of the State, after getting Kacha receipts from Dinabandhu towards repayment of loans to be replaced by Pucca receipts subsequently. It was Dinabandhu's plea before the trial court that he had collected the amounts from the loanees, not towards discharge of their loans, but because the loanees wanted him to credit those amounts on their behalf into the treasury, since they could not personally do so, residing at far away places, and the appellate court accepted this plea of defendant No. I to be correct as against the plaintiff's case that Dinabandhu had demanded and realised loans from the loanees. The appellate Court observes,