RAJA BHAGWAN BAKSH SINGH Vs. DAMODARJI JOSHI

JUDGEMENT

(1.) This appeal arises out of a suit for recovery of Rs. 3,50,000, principal, and Rs. 58,746-1-6, interest, in all, Rs. 4,08,746-1-6, on the basis of a promissory note executed by the appellant on the 9th of November 1910.

(2.) The plaintiffs are a firm of jewellers and money-lenders of Benares, who carry on considerable business. The defendant-appellant is the Raja of Amethi and a Taluqdar of Oudh. In 1904, a suit was pending against him in regard to his Estate and for the expenses of that suit he was in need of money. He was approached by the plaintiff s firm and dealings began with him. Large sums of money were advanced to him from time to time and he also purchased jewelry of considerable value from the plaintiffs. It is alleged, and not denied, that he received from the plaintiffs nearly three lacs of rupees in cash and it is stated that jewelry of the value of nearly Rs. 90,000 was supplied to him. Accounts were submitted to him from time to time and he signed them and, on two previous occasions, executed promissory notes for the amounts shown by the accounts to be due. The final promissory note is that of the 9th of November 1910, for the principal sum of Rs. 3,50,000. The rate of interest mentioned in the note is 8-annas per cent. per mensem, that is, 6 per sent. per annum, simple interest. The plaintiffs, however, state that the rate orally agreed upon was compound interest at the same rate with monthly rests and interest has been claimed at that rate. Credit has of course, been given for payments made by the defendant.

(3.) The defendant-appellant, whilst admitting execution of the promissory note, asserted that the first plaintiff, Damodarji Joshi, had ingratiated himself into the favour of the defendant and acquired great influence over him; that in collusion with the defendant s servants he fraudulently caused the defendant to sign accounts and execute promissory notes; that it was understood between the parties that accounts would be explained and adjusted when final payment would be made; that this had not been done, and that the full amount of the last promissory note was not due to the plaintiffs. He urged that the accounts should be re-opened and fresh accounts taken of the dealings between the parties. He objected to the charging of compound interest, to the claiming of interest on the price of the jewelry sold to him, to the price of the jewelry and, in particular, to that of a blue diamond, and in substance he contended that he had been overcharged to the extent of about Rs. 50,000.