L NARAIN DAS Vs. MANNOO LAL

JUDGEMENT

(1.) This is an application in civil revision by a plaintiff whose suit was dismissed by a Small Cause Court on the ground of limitation. The plaintiff sued to recover a sum of money on a bond executed by defendant on 23 April 1928. The bond contained the following terms: Dar soorat na ada karne sood mahawari kisi mah kai ya guzar jane miad muayam bala ek sal he har do surat me dain ko ikhtaiyar hai ki kul rupaya apne asal mai sood wa balai sood mujhse wa mere zat wa jaidad manqoola wa ghair manqoola se ba sarye nalizh adalat ek musht wasul kar lan.

(2.) This is a very usual term and it provides that if the monthly interest is not paid or if the principal money; lent is not paid at the end of the year, in either case the creditor may sue. The finding of facts is not clear, but the judgment indicates that the monthly interest was not paid and that the cause of action arose before the expiry of the year under Art. 68, Schedule 1, Limitation Act. The suit was actually brought on 1 April 1932, on the allegation in the plaint that the cause of action arose on 23 April 1929, when the period of one year stipulated in the bond for payment of principal expired. The lower Court held however that the cause of action had arisen more than three yeans before the date on which the suit was brought. The lower Court then considered whether certain payments totaling Rupees 198 in the cash book of the creditor would save limitation under Art. 20, Limitation Act, and it held that as the payments wore not in the handwriting of the defendant limitation would not be saved by these payments. We arc not now concerned with this matter.

(3.) The case for the applicant is that the suit is within limitation on the basis of certain rulings which lay down that even though there is a breach of the condition for payment of interest still that is a matter over which the creditor has a right of waiver and limitation will only begin to run from the period stipulated in the bond for payment. This was a simple money bond. The ruling on which reliance is placed in the main is a ruling of their Lordships of the Privy Council reported in Lasa Din V/s. Gulab Kunwar 1932 P.C. 207. That ruling was on a mortgage-deed for which the period of limitation is under Art. 132, Schedule 1. The ruling proceeded on the ground that a proviso of the nature quoted in the mortgage-deed was exclusively for the benefit of the mortgagee arid that the proviso purported to give them an option either to enforce the security at once or if the security was ample to stand by their investment for the full term of the mortgage. If the contrary view were taken, and it was held that the breach of the condition for payment of interest rendered the mortgage money immediately due, the mortgagor would have a right to sue for redemption. Learned Counsel for respondent argues that this particular line of reasoning is peculiar to a mortgage-deed, and that as there is no redemption in the case of a simple money bond the reasoning ought not to be applied. I consider however that an analogous reasoning does apply in the case of a simple money bond. On the theory of the lower Court it would have been open to the debtor in the present case to pay back the principal when the first default was made which was apparently when the first month's interest became due. To allow a debtor such an option for his own default might be highly inconvenient to a creditor. A creditor places money at interest on a bond in which he fixes a period for repayment and it may well be that he desires that arrangement to stand until the period has elapsed. On the other hand, a debtor might suddenly find himself in possession of funds and desire to break the contract and make repayment at an earlier date. It does not follow that the creditor should be forced to accept such (repayment ? before the date stipulated contrary to the principles laid down in the case of mortgages that a debtor should be allowed to pay off a simple money bond by means of making a default. I think therefore that the reasoning in the Privy Council ruling in question will apply also in the present case.