NARSING PRASAD SINGH Vs. RAMCHARITAR SINGH

JUDGEMENT

(1.) This is a defendant's second appeal from the decision of the learned Subordinate Judge of Monghyr reversing that of the" Munsif of Begusarai in a suit for money. The suit was based on a handnote bearing date 3l March, 1934, for Rs. 1829, made up of Rs. 1150 principal with interest on a previously executed handnote dated 2 May, 1931, and of Rs. 679 advanced in cash at the time of the execution of the handnote in suit. After giving credit to the defendants for payments of Rs. 700 on 20 November 1935, and of Rs. 80 on 7 November 1938, the plaintiff claimed a decree for Rs. 2800 after remitting a sum of over Rs. 100 in favour of the defendants. The defence was that Rs. 700 had been paid not on account of principal and interest but only on account of principal, and secondly, that the accounts should be re-opened and the hand-note of 2 May, 1981 should be the starting point of the accounting between the parties. The trial Court gave effect in part to the defence by re-opening the account between the parties not under the Money-Lenders Act but under the Usurious Loans Act. On appeal by the plaintiff, and cross-objection by the defendants, the lower appellate Court has granted the plaintiff a full decree holding that neither the Bihar Money-Lenders Act nor the Usurious Loans Act could be applicable to the facts and circumstances of the present case. As regards Rs. 700 the lower appellate Court, also held that it was both on account of principal and interest. Hence this second appeal by the defendants.

(2.) It was contended in the first place by Mr. D. C. Varma in support of the appeal that in view of the Full Bench decision of this Court reported in Deonandan Prasad V/s. Ram Prasad A. I. R. 1944 Pat. 303, the Bihar Money-Lenders Act applies to suits on hand-note also-that decision of the Full Bench was more or less in consonance with the decision of the Calcutta High Court referred to therein. But that very decision of the Calcutta High Court has been reversed by their Lordships of the Federal Court. Their decision is reported in Bank of Commerce Ltd., Khulna v. Kunja Behari Kar . It must, therefore, be held that the Bihar Money-Lenders Act does not apply to suits based on promissory notes. That being so, it must be held that the appellant is not entitled to any benefit under the Bihar Money-Lenders Act. It was then contended that the appellant should be granted some relief under the Usurious Loans Act. But clearly a stipulation for payment of interest at 15 per cent, per annum cannot be said to attract the provisions of that Act. As regards the question of how the payment of Rs. 700 should be adjusted we have had the endorsement on the handnote read out to us, and, in our opinion, the construction placed upon that endorsement by the Courts below is entirely correct. As a result of these considerations it must be held that there are no merits in this appeal which is dismissed. In view of the conflict of decisions in this Court on the question of the applicability of the Money-Lenders Act to suits on handnotes, it is directed that the parties will bear their own. costs in this Court. Fazl Ali, C.J.

(3.) I agree.