MT BIBI SHAIMA Vs. BANK OF BIHAR LTD

JUDGEMENT

(1.) Two points are raised by the appellant who is the mortgagor in this case: one is as to her liability for the mortgage moneys, and the other is as regards the rate of interest. As regards the first point the circumstances are as follows: The mortgagor purchased the property in question from the mortgagee. Not having the money to finance the transaction but only Rs. 500 of the Rs. 4000, the amount of consideration, Rs. 3500 remained on mortgage, which of course is a very common form of transaction. In other words, having had the property conveyed to her she mortgaged it back to her vendor for the unpaid balance of the purchase money. It appears that litigation ensued at the suit of another person in which litigation both the mortgagee and the mortgagor were parties, and in which it was decided that the mortgagee vendor had not 16 annas inter, est in the property but only 8 annas odd. The actual interest is immaterial for the purposes of the decision of this point. Now, having found that in this action the mortgagor wanted some sort of set-off or reduction in the mortgage moneys, it may be a somewhat hard case; but in my judgment it is impossible to give any relief to the mortgagor in this action. If the consideration has failed in any sense of the word in the transaction which is the subject matter of the appeal, it is a consideration which moving from the mortgagor has failed, and the mortgagee has suffered and not the mortgagor.

(2.) It is impossible to accept the contention that (although the transactions are so intermixed) they are anything but separate transactions, that is to say, the sale on the one hand and the mortgage on the other. Even supposing that some sort of right could be established, it is quite clear from the argument of the learned advocate on behalf of the appellant that the mortgagor does not seek to set aside the contract but merely to have some sort of abatement of the consideration of the mortgage; and that would undoubtedly be an unliquidated claim, and by Order 8, Rule 6 a set off of an unliquidated or unascertained amount is not liable. That disposes of that point.

(3.) I would add that if the mortgagor had any right in this respect I am afraid that in the state of law as it exists in India at this moment it must be the subject, matter of another action as no counter claim can be brought. As regards the question of the rate of interest, Mr. Sinha who appears on behalf of the appellant relies upon Section 12 of the recent Act (3 of 1938) known as the Bihar Money Lenders Act. Section 12 provides: In any suit brought by a money lender in respect of a loan advanced before the commencement of the Act, the Court may exercise all or any of the following powers.