BAIJNATH PRASAD Vs. BINDA PRASAD SINGH

JUDGEMENT

(1.) These appeals arise out of two suits instituted by the plaintiffs to recover from the defendants, who constitute a Hindu joint family, their dues under a mortgage bond dated 17 August 1913 and four hundis dated 26 October 1930. The mortgage bond as well as the hundis were executed by a deceased member of the defendants family, namely Jang Bahadur who had been given a general power of attorney by all the adult members of the family, about six in number, and who according to the plaintiffs was to all intents and purposes the karta of the family. By this bond (which is the subject-matter of mortgage suit No. 48 of 1933) Jang Bahadur mortgaged certain joint family properties to secure a loan of Rs. 10,000 and agreed to pay compound interest at the rate of Kupees 15 per cent, per annum with annual rests. The hundis (which form the subject-matter of the second suit--Money Suit No. 3 of 1934) had been drawn by him for a sum of Rs. 16,100 to replace three other hundis for Rs. 12,000 which according to the plaintiffs had been signed by Jang Bahadur on 2 August, 1927 to satisfy certain dues other than the dues under the mortgage bond. Both the suits were tried together as the parties were-common and the main defence put forward on behalf of the defendants in them was that Jang Bahadur was not the karta of the family and neither the mortgage bond nor the hundis were binding on the defendants,, inasmuch as there was no legal necessity for the debts contracted by means of these documents. In the mortgage suit the defendants raised two further pleas, viz. (1) that the rate of interest provided in the mortgage bond was exorbitant and it was not at all necessary for Jang Bahadur to contract a loan at that rate and (2) that the debts for which Jang Bahadur is alleged by the plaintiffs to have given the first hundis in 1927 had been paid off prior to that date and these hundis had in fact been drawn in part payment of the dues under the mortgage bond dated 17th August 1913. In support of the last plea the defendants rely on an. endorsement in the mortgage bond itself and it is contended on their behalf that the account given by the plaintiffs in the plaint is incorrect, inasmuch as no credit has been given for the sum of Rs. 12,000 for which the hundis had been drawn by Jang Bahadur on 2 August, 1927. The defendants raised various other pleas in the Court below but none of them was pressed during the hearing of the appeals in this Court.

(2.) In dealing with the appeal in the mortgage suit it will be convenient at this stage to dispose of the defendants criticism of the account put forward by the plaintiffs in respect of the dues under the mortgage-bond. It appears that Jang Bahadur had made certain payments from time to time in connexion with the debt due under the mortgage bond and these payments had been duly endorsed on the back of the bond. The aggregate of the payments which were made before 22nd August 1927 came to Rupees-12,000 and after going through the accounts in presence of Jang Bahadur Baijnath, Prasad, one of the plaintiffs, made the following note on the back of the bond: The principal and interest in respect of the bond comes to Rs. 34,480-4- 0 on adjustment of account,, out of which Rs. 2430-4-0 is remitted; Rs. 12,000 received formerly stands credited as above, the balance Rs. 10,000 has been received today, on account of interest, so there remains due up to this date the balance Rs. 10,000 (rupees ten thousand), on which interest will run according to the terms of the bond, the interest and compound interest from this day will run according to the terms in the bond, etc. A similar note was made by Jang Bahadur on the bond which runs as follows: On calculating interest and compound interest, on setting off the amounts credited above and on paying Rs. 10,000 in cash this day, we paid in full the interest and compound interest up to this date. Now Rs. 10,000 principal, remained due by us, upon which interest and compound interest will run from today in accordance with the stipulations made in the bond.

(3.) These endorsements plainly mean that on 22 August, 1927 a sum of Rs. 10,000 only was found to be due to the plaintiffs under the mortgage bond but this is not what the figures upon which the account is based show. These figures show that out of an aggregate sum of Rs. 34,430-4-0, Rupees 2430-4-0 was remitted and Rs. 10,000 was paid by Jang Bahadur. This leaves a balance of Rs. 22,000 and not Rs. 10,000. The defendants explanation of the discrepancy is that on the very date which the endorsements bear Jang Bahadur had paid off Rs. 1- 2,000 by drawing three hundis for that sum in favour of the plaintiffs which were accepted by Janki Singh, the senior, most member of the defendants family and thus the debt due under the mortgage bond was reduced to Rs. 10,000. The plaintiffs case on the other hand is that the hundis had been drawn by Jang Bahadur to pay off an entirely separate debt (to which I shall have to advert presently) and that by oversight the sum of Rs. 12,000 which had been paid before 22 August, 1927 and which had been already taken into consideration in arriving at the total figure of Rs. 34,430-4-0 was deducted once more from that sum. Their case in short is that on 22 August, 1927 the defendants owed to them Rs. 22,000 and not Rs. 10,000 and the statement in the endorsement that they owed Rs. 10,000 is a mistake.