GOPAL RAO Vs. BABU

JUDGEMENT

(1.) THE plaintiffs-respondents instituted the suit out of which this appeal arises on the basis of a registered mortgage-deed dated 6th January 1914 executed in the name of plaintiff 2 by Govindrao Reshimwale, the deceased father of appellants 2 and 3 and cousin (by adoption) of appellant 1 in consideration of Rs. 5000 advanced by the late Mr. Payarelal Gangoli, Pleader of Khandwa, on the security of Govindrao's eight annas share of certain property mentioned in the deed, with a condition of sale thereof in case of non-payment. The mortgage contains a stipulation for payment of simple interest annually and for compounding the interest in case of default. The principal sum was to fall due on the expiry of tea years from the date of the mortgage. The first Court overruled the several defences-taken and decreed the full claim except as to a small portion which was disallowed on the ground of mistakes in the calculation of interest.

(2.) THE defendants are the appellants before me. Their main contention is that the mortgage is void and against public policy on the ground that the late Mr. Pyarelal, pleader, was the real mortgagee, but that he could not carry on money-lending under rules framed by the High. Court under the Legal Practitioners Act. They also urged absence of legal necessity or benefit and took up a new plea, in the shape of an additional ground that the plaintiffs-respondents were not entitled to compound interest under the terms of the mortgage on the principal sum of Rs. 5000 before it fell due.

(3.) THE plea of legal necessity or benefit would have been material had the property mortgaged been the joint property of defendants and the mortgagor. It is conceded before me that the finding of the lower Court that the eight annas share mortgaged formed the separate and self acquisition of Govindrao, the mortgagor; no question of benefit or legal necessity, therefore, strictly arises in the case. Even assuming that the property was treated by Govindrao as joint property of himself and his sons which, however, is not a fact, the mortgagee is sufficiently protected by the representations made and the reasonable enquiry by which the mortgagee had satisfied himself as to the need for the transaction of the mortgage in suit.