SATISH SETHI Vs. MEHTA SHIV DASS KOHLI

JUDGEMENT

(1.) THE Letters patent appeal arises out of the judgment and decree passed by a Single Judge of this Court in Civil Suit No : 16 of 1969 on October 30, 1978 decreeing the suit in favour of respondent No; 1 for the recovery of a sum of Rs. 18, 050/ -

(2.) A brief resume of the facts will show that respondents 1 and 2 brought a suit for the recovery of Rs. 20, 250/ - against the appellant & prayed for the sale of one building with saw mill & furniture of the factory, etc., for the payment of the amount indicated hereinabove alleged to have been mortgaged with respondent No ; 2. Respondent No ; 2 herein was a registered private limited company in the name & style of M/s Rashtriya Loan and Chit Fund Pvt. Ltd., Jammu. Respondent No ; 1 happens1 to be the Chairman of the said company. It is stated that the appellant is related to respondent No 1, who in the beginning of 1966 approached him with a request to advance a loan of Rs. 15, OOO/ - as he was in the need of money for advancing his business. Appellant in his turn offered to mortgage his property with respondent No ; 1. Respondent No ; 1 on his part advanced Rs. 5, OOO/ - out of his own money and took Rs. 10, 000/ - as advance from Respondent No ; 2, which was paid to him for payment to the appellant by means of two cheques of Rs. 5000/ - each drawn in favour of respondent No; 1 from National Bank of Lahore Limited. This way the said money was paid to the appellant by respondent No; 1, however, a mortgage deed was executed to secure the said money by the appellant in favour of respondent No ; 2. It is further stated that the appellant agreed to pay interest on the borrowed money at the rate of 1 per cent per annum. It is alleged that respondent No ; 1 returned the sum of Rs. 10, OOO/ -, which was advanced to him to respondent No ; 2 - the Company. Since the appellant failed to pay the loan advanced to him of Rs. 15, OOO/ - as indicated hereinabove, the present suit was filed for the recovery of Rs. 15, OOO/ - as the principal and Rs. 5, 250/ - towards interest as stipulated claiming total sum of Rs; 20, 250/ - on behalf of both the respondents against the appellant.

(3.) THE appellant defended the suit though did not deny the receipt of Rs. 15,000/ - before the Sub -Registrar at the time of registration of the mortgage deed on September 3, 1966, but pleaded that Rs. 5,000/ - was returned by him to respondent No; 1 on the very day as he represented to him that the same will be adjusted towards the interest. However, he further pleaded that out of the sum of Rs. 15000/ - on deduction of Rs. 5,000/ - as indicated hereinabove Rs. 10,000/ -was paid to him by way of two cheques endorsed in his favour by respondent No ; 1 in his capacity as Chairman of the Board of Directors of Respondent No; 2 the Company. Regarding mortgage deed, it was contended that the same was executed under duress without consideration, which is not binding on him. The appellant also claimed to have made a payment of Rs. 6, OOO/ - to respondent No; 2, out of which it is alleged that Rs. 1200/ - were paid through its Director -Yash Paul Kapoor, Rs. 1,000/ - through its chairman -Respondent No ;1 and Rs. 3, 800/ - through another Director of the Company. Thus leaving the total -of Rs. 4,000/ - to be paid by him. Learned Single Judge on the pleadings of the parties framed the following issues on 7 -1 -1970: -