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G. Narasappa Vs. Kalappa - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKarnataka High Court
Decided On
Case NumberCRP No. 2402 of 1981
Judge
Reported inILR1985KAR2223
ActsNegotiable Instruments Act, 1881 - Sections 4 and 11; Karnataka Money Lenders Act, 1961 - Sections 11(2)
AppellantG. Narasappa
RespondentKalappa
Appellant AdvocateV.S. Jagannath, Adv.
Respondent AdvocateMarkande Gowda, Adv.
DispositionRevision dismissed
Excerpt:
.....a money ending licence, munsiff decreed the suit only for principal amount having held that suit document which amounted to a bond was executed by plain-tiff'. appeal of defendant was allowed and suit dismissed on the ground the suit document amounted to a pronote and that it was not stamped. contended that it was not open to defendant to contend for the first time in appeal that suit document was a pronote since the trial court had held it to be a bond and recovered duty and penalty ; that even if plaintiff was a money lender the court ought to have given time to him to obtain licence ; that the words 'this act' in amended section 11 means only the amending act.;it is for the court to find out whether it amounts to a bond or pronote. even if the defendant admits that it is a..........with interest.2. according to the plaintiff, the defendant on receiving rs. 1,450/- executed the suit document on 15 6-71 agreeing to pay interest at 1% per month. notwithstanding repeated demands the defendant did not pay the amount. hence the suit.3. the defendant contended, amongst other things, that the plaintiff is a money lender and he did not hold a money lending licence at any time and that, therefore, the suit deserves to be dismissed. he also denied the execution of the document.4. the munsiff, on scrutiny of the evidence, held that the defendant had executed the document on receiving rs. 1,450/-. but, however, he held that the plaintiff was a money lender and he did not possess a money lending licence and,therefore, he decreed the suit only for the principal amount. the.....
Judgment:
ORDER

Kulkarni, J.

1. This is a plaintiff's revision against the Judgment and decree dated 21-8-80 passed by the lower Appellate Court i.e. Civil Judge, Madhugiri in R.A. 154/78, reversing theJudgment and decree dated 27-10-75 passed by the Prl. Munsiff, Madhugiri in O.S. 214/74, decreeing the plaintiff's suit with costs and with interest.

2. According to the plaintiff, the defendant on receiving Rs. 1,450/- executed the suit document on 15 6-71 agreeing to pay interest at 1% per month. Notwithstanding repeated demands the defendant did not pay the amount. Hence the suit.

3. The defendant contended, amongst other things, that the plaintiff is a money lender and he did not hold a money lending licence at any time and that, therefore, the suit deserves to be dismissed. He also denied the execution of the document.

4. The Munsiff, on scrutiny of the evidence, held that the defendant had executed the document on receiving Rs. 1,450/-. But, however, he held that the plaintiff was a money lender and he did not possess a money lending licence and,therefore, he decreed the suit only for the principal amount. The defendant approached the Civil Judge. The Civil Judge accepted the appeal and dismissed the suit on the ground that the document in question amounted to a pronote and that as it was not stamped, it was liable to be dismissed. He also held that the plaintiff did not possess a valid money lending licence either at the time of the transaction or at the time of the filing of the suit. He dismissed the suit.

5. Learned Counsel for the revision petitioner submitted that the Trial Court held it to be a bond and duty and penalty had been recovered from him. According to him, the defendant for the first time contended that the present document amounted to apronote. According to him, once the document is admitted in evidence, it is not open to the defendant to raise the contention in the Appellate Court that it amounted to a pronote. The question of admissibility or otherwise would depend upon so many factors. It is for the Court to find out whether it amounts to a bond or pronote. Even if the defendant admits that it is a bond, it would not relieve the Court from finding out whether it was a bond of a pronote. Admittedly, the document was not stamped Therefore, the lower Appellate Court was right in dismissing the suit holding that the document amounted to a pronote and it was not sufficiently stamped.

6. The next question is whether the plaintiff is a money lender. The plaintiff himself has admitted that he has lent money to more than 20 persons and from the various persons he had taken pronotes and he has filed a suit for recovery of more than Rs. 2,000/- from one of his debtors. Therefore, on his own admission, his transactions cover more than Rs. 3,000/-. Therefore, on his own admission, the Courts below were right in holding that he was a money lender.

7. Sri Jagannath urged that even if he was a money lender under Section 11 of the original Act of 1961, the Court ought to have given time to obtain the licence. Section 11(2) of the old Act says :

'11. Stay of suits by money lenders not holding licence :-

(2) If during the trial of any such suit, the Court finds that the money-lender had not held such licence, the Court may, on the application of the money-lender, stay the hearing of the suit and require him to produce within a period of three months a licence on payment to the Registrar of ail the arrears of the licence feepayable by him under this Act for the period commencing from the date on which he started the business ofmoney lending or the expiry of six months from the date on which this Act corner into force, whichever is Inter, together with such penalty, not exceeding five hundred rupees as the Court may direct :

Provided that when the Court is satisfied that the failure of the money lender to obtain a licence was due to any reasonable cause, the Court may direct that no penalty us aforesaid or part of such penalty shall be paid by themoney lender.

Admittedly, the plaintiff has not filed any application as contemplated under Section 11(2). The Court cannot request the plaintiff to file an application for licence. If the plaintiff wanted to take advantage of Section 11(2) he ought to have filed an application and thus requested the Court to grant him time. The plaintiff has not done his part of the job and he now cannot urge that the Courts below ought to have given him time to obtain the licence. Sub-section (4) of Section 11 of the old Act says that if the plaintiff fails to produce the licence required by sub-section (2) within the period specified, the Court can dismiss the suit. The plaintiff did not apply to the Court to give him time and as he did not produce the licence, the Court below was justified in dismissing the suit. Section 11 as amended by Act 77/76 reads :

' 11. Suits by money-lenders not holding licence :-

After the expiry of six months from the date en which this Act comes into force, no Court shall pass a decree in favour of a money lender in any suit to which this Act applies, filed by a money-lender, unless the Court is satisfied that the time when the loan or any part thereof to which the suit relates was advance, and on the date such suit was filed the money-lender held a valid licence.'

According to Sri Jagannath the word, 'this Act' used in Section 11 means only the Amending Act. Thisinterpretation tried to be put by Jagannath runs contrary to Section 1 of the Act itself. Section 1 says that this Act may be called the Money Lenders Act, 1961. Section 11 says,unmistakably, that if the plaintiff is a money lender and if he had not obtained the licence within six months from the date on which this Act came into force, the Court should refuse to pass a decree. Therefore, the lower Appellate Court was justified in dismissing the suit on this ground also.

8. Hence, there is no merit in the revision and it is dismissed.


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