THE BENARES BANK, LTD Vs. HARI NARAIN

JUDGEMENT

(1.) This appeal involves questions which frequently arise in suits to enforce a mortgage against property which belongs to a Hindu joint family governed by the Mitakshara where the mortgage is executed by the father for himself and for his minor sons as their guardian. The family in this case consisted of two brothers, Jagdish Narain and Raghubir Narain and their respective sons. Jagdish Narain had five sons, two of them, Suraj Narain and Dip Narain, being adults, and the other three minors, Raghubir Narain had three sons, all of whom were minors. On 1 September 1911, the adult members of the family borrowed Rs. 28,000 from the Benares Bank, Ltd., the appellants before this Board, and executed a deed whereby they mortgaged six properties belonging to the family, one situated at Allahabad, another at Manjhiari, and the rest in the Fatehpur District, to secure the debt and interest, each father signing as guardian of his minor sons. The mortgage deed recited that the mortgagors were in need of money to pay off two previous mortgages, one for Rs. 7,000 in favour of Dwarka Bibi, and the other for Rs. 11,000 in favour of Kishun Narain, and to entry on the mortgagors' business. In 1913 the mortgagors paid Rs. 4,128 to the bank. In 1919 they sold one of the Fatehpur properties, and paid a further sum of Rs. 29,700. Jagdish Narain died in 1921. The balance not having been paid, the bank brought the present, suit in the Court of the Subordinate Judge of Allahabad on 27 April 1923, against the surviving members of the family, who are respondents in this appeal, to enforce the mortgage against the remaining five properties.

(2.) The adult members of the family who had executed the mortgage did not defend the suit, but a written statement was filed on behalf of such of the sons of the two brothers as were minors at the date of the mortgage. The defence was that there was no consideration for the mortgage and no necessity for the loan. As to the business referred to in the mortgage deed, their case was that Jagdish Narain started a theka business in 1902 or 1903 and took building contracts from the Public Works Department at Benares, and that the business was the personal busmen of Jagdish Narain, and not a joint family business. It would appeal from the bank's books and other documents produced at the trial that Rs. 18,000 was paid in cash by the bank to the mortgagors, and that the balance of Rs. 10,000 was credited to the account of Suraj Narain pursuant to a letter dated 24 September 1911, addressed by the four adult members to the hank. It would also appear that Rs. 6,342 out of the Rs. 10,000 was transferred by the bank to the account of Bhagwati Prashad on the instructions of Suraj Narain, and the balance of Rs. 3,658 was withdrawn by cheques drawn by Suraj Narain in favour of Ambika Prashad who attended to the theka business.

(3.) The Subordinate Judge found that the whole consideration was paid by the bank, that Rs. 18,000 was applied in discharging the two previous mortgages, that Rs. 6,342 was paid to Bhagwati Prashad to whom the family owed that amount, and that the balance of Rs. 3,658 was used for the theka business which he held was a family business. He also held on some evidence given in the case (to be presently referred to) that the Allahabad and Manjhiari properties belonged to Jagdish Narain and Suraj Narain, and not to the joint family, On these finding? he passed a preliminary mortgage decree for the whole debt and for costs. On appeal to the High Court at Allahabad, the judgment of the Subordinate Judge was reversed on all points except us to Rs. 18,000 which the defendants did not contest at the hearing of the appeal. As to Rs. 6,342 the High Court decided that there was no evidence on the record to show that the family owed that amount to Bhagwati Prashad. As regards Rs. 3,658 used in the theka business they held that the business was not a family business, but the personal business of some adult member of the family, and that even if it was a family business, it was not ancestral so as to render the minors' shares liable for that debt. As to the Allahabad and Manjhiari properties they took the view that they belonged to the joint family, and not to the two brothers. Their conclusion therefore was that the mortgage was valid to the extent only of Rs. 18,000, and after taking certain accounts they passed a decree, on 8 August 1928, in modification of the decree of the trial Judge in the following terms : "It is ordered and decreed that this appeal be allowed in part, that in modification of the decree of the Subordinate Judge of Allahabad, the plaintiff's claim to the extent of Rs 18,000 with interest thereon, for which the mortgage in suit was valid and which has been paid up by the defendants, be dismissed as against the appellants and the mortgaged property, and that a simple money decree be and it hereby is passed in favour of the plaintiff-respondent as against Raghubir Narain, Dip Narain and Suraj Narain personally and as against the heirs of Jagdish Narain, deceased, to the extent of the personal assets of the said deceased in their hands other than the mortgaged property, for recovery of Rs. 24,794-8-0 (twenty-four thousand seven hundred and ninety-four and annas eight), viz., Rs. 10,000 principal and Rs. 15,242-8-0 interest at As. 12 per cent per mensem simple from the date of the bond up to 8 August 1928, the date of this Court's decree, in all Rs. 25,242-8-0 minus Rs. 448 excess amount paid by defendants, and that the sum of Rs. 10,000 shall carry future interest at As. 12 per cent per mensem until realization. It is further ordered that the parties shall bear their own costs throughout."