DESAI BHAO Vs. KARVIRAM GOUDA

JUDGEMENT

(1.) THIS is a second appeal in a civil suit. The Munsiff Court, Sindhnoor Taluk, Raichur District, by judgment dated 24th June 1950 dismissed the plaintiff's suit for non -compliance with Section 9 of the Money -Lenders Act, 1349 Fasli. On appeal the District Court, Raichur, reversed this judgment partly on 8th February 1951 by decreeing the principal only. Hence this second appeal by the defendant praying that the entire suit should be dismissed. I heard the arguments of the learned advocates of the parties and record my opinion below.

(2.) THE loan was advanced on 27th Thir 1355 Fasli; 22nd Ardibehisht 1356 Fasli was the date fixed for repayment; the suit was filed on 3rd Meher 1358 Fasli; and the plaintiff obtained the licence on 12th Bahman 1359 Fasli. The Court of first instance held that as the amended Section 9 came into force on 11th Khurdad 1355 Fasli and as the plaintiff was not a licensed money lender at the time of filing the suit it cannot be decreed under the amended S. 9 and, therefore, dismissed it. The learned advocate for the plaintiff -respondent cited the case of 'Gandur Malliah v. Satham Lingiah', 3 Nazaer Osmania 606, where it was held that though the plaintiff had not taken a licence at the time of lending the money; yet as he had obtained it before filing the suit, it was enough. He pointed out that in this suit also though the plaintiff had not obtained the licence at the time of the loan yet he had obtained it before judgment and that should be enough. I am afraid, I cannot agree to this, for in the precedent cited, note was taken of the fact that S. 8 of the Moneylenders Regulation 1347 Fasli contained the provision that failure to take a licence would entail the dismissal of the entire suit; but in the corresponding S. 9 of the Money -lenders Act 1349 Fasli it was provided instead that for failure of taking a licence interest and costs should be disallowed but the Court may in its discretion decree the principal sum. It was held that as the law itself was somewhat lenient inasmuch as it lessened its rigour by allowing a decree of the principal sum, it was enough if the licence was taken before the filing of the suit. Moreover S. 8 (1) (b) of the 1347 Fasli Regulation prescribed that licence should be taken in accordance with the Rules to be framed; and it is a fact that rules were framed in Shehrewar 1350 Fasli. Thus it is clear that in the beginning emphasis could not be laid on taking of licence contemporaneously with the loan. Evidently these were the grounds on which a licence taken not at the time of the loan but at the time of filing the suit was considered sufficient. All this was changed by the amended S. 9 of the Moneylenders Ac; 1349 Fasli by which it is provided that if any money -lender were to fail in obtaining a licence, the entire suit should be dismissed. In the circumstances the above -mentioned precedent stands distinguished. Moreover, there have been other cases decided after that precedent; for example, reference may be given to 'Govindsingh v. Wali Mohd.',, AIR 1951 Hyd 44 and 'Mohd. Bin Salam v. Fakir Mohd.',, ILR (1951) Hyd 349. In both these cases it is held that under S. 3, cl. (2) of the Hyderabad Money -lenders Act it is mandatory for every person to obtain licence 'before' doing money -lending business and failure to do so is made punishable with fine or imprisonment or both; and that consequently the money -lender cannot recover the money lent by invoking the aid of S. 66 of the Hyderabad Contract Act (corresponding to S. 65 of the Indian Contract Act).

(3.) IN the circumstances I accept this appeal, reverse the judgment of the District Court, restore the judgment of the Court of first instance by which the entire suit has been dismissed.