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Harbans Dube Vs. Sita Ram and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Reported inAIR1933All576
AppellantHarbans Dube
RespondentSita Ram and anr.
Cases ReferredSri Ram v. Sobha Ram Gopal Rai A.I.R.
Excerpt:
- - in any case, there is nothing in a transaction like this which can attract the application of section 92, evidence act. on the whole, i am satisfied that the learned judge was right in decreeing the plaintiff's claim with interest at the stipulated rate......court at jaunpur. the applicant was defendant 1 in the suit, and was alleged to have executed the promissory note and the receipt on foot whereof the suit was brought. he denied the execution of the promissory note and the receipt, and pleaded want of consideration. although the promissory note and the receipt purported to be for a cash advance of rs. 50 made by the plaintiff to defendant 1, it was not disputed by the plaintiff that the money had not been advanced to defendant 1, but the latter executed the promissory note in discharge of the obligation of defendant 2 to pay that sum to the plaintiff, under a compromise in which the plaintiff agreed in consideration of rs. 50 to withdraw his suit for demolition of a house constructed by defendant 2. a subsidiary question, raised by the.....
Judgment:

Niamatullah, J.

1. This is an application for revision directed against a decree of the Judge of Small Cause Court at Jaunpur. The applicant was defendant 1 in the suit, and was alleged to have executed the promissory note and the receipt on foot whereof the suit was brought. He denied the execution of the promissory note and the receipt, and pleaded want of consideration. Although the promissory note and the receipt purported to be for a cash advance of Rs. 50 made by the plaintiff to defendant 1, it was not disputed by the plaintiff that the money had not been advanced to defendant 1, but the latter executed the promissory note in discharge of the obligation of defendant 2 to pay that sum to the plaintiff, under a compromise in which the plaintiff agreed in consideration of Rs. 50 to withdraw his suit for demolition of a house constructed by defendant 2. A subsidiary question, raised by the plaintiff, related to the rate of interest, namely, 2 per cent per mensem, which was characterised as unconscionable. The lower Court found that the promissory note and the receipt had been executed by defendant 1 in the circumstances stated above and that the same must be considered to be for consideration. As regards the rate of interest, the lower Court considered it to be reasonable in the circumstances of the case. The learned advocate for the applicant has contended before me that the plaintiff's case as regards the nature of the consideration implied an agreement inconsistent with the recital in the promissory note and the receipt, namely, that cash consideration had passed from the creditor to the debtor, and that such agreement should not have been allowed to be set up, the same being inadmissible having regard to Section 92, Evidence Act. I do not think this; contention has any force. As found by the lower Court, the position was as follows:

Defendant 2 had to pay a sum of Rs. 50 to the plaintiff in consideration of the latter withdrawing his suit for demolition. The former had no ready money to pay to the plaintiff but his friend, defendant 1, agreed to pay to the plaintiff for him. The plaintiff accepted that mode 'of payment and had his suit for demolition dismissed. The promissory note and the receipt were accordingly executed by defendant 1 in favour of the plaintiff. It is not disputed that they were executed on the day on which the suit for demolition was dismissed at the plaintiff's instance. The net re-. suit of the transaction was as if the plaintiff advanced Rs. 50 to defendant 1, who paid it back to the plaintiff in discharge of the obligation of defendant 2. The fact that no money was actually produced and changed hands will not alter the rights and obligations of the parties arising from the arrangement. Notional payments of this kind have the same effect in law as payments in cash, if the parties agree to treat the transaction as if cash payment was made. In any case, there is nothing in a transaction like this which can attract the application of Section 92, Evidence Act.

2. The learned advocate for the applicant relied on Sri Ram v. Sobha Ram Gopal Rai A.I.R. 1922 All 213 In that case, the defendant set up an oral agreement, said to have been entered into contemporaneously with the execution of the promissory note and inconsistent with it. It was held that such an oral agreement was not admissible in view of Section 92, Evidence Act. In the case before me the circumstances are altogether different. The plaintiff's suit is based on the promissory note and the receipt which have been duly proved. All that can be said is that the consideration of the nature, mentioned in the promissory note and the receipt, did not pass; and if there had been no evidence before the Court establishing consideration of a different kind proceeding from the plaintiff to defendant 1, the plaintiff's suit might have been dismissed on the ground that the promissory note was without consideration. The plaintiff does not seek to enforce any agreement not embodied in the promissory note and inconsistent with it. In view of all the facts having been disclosed, the passing of consideration was not in doubt. For these reasons, I am of opinion that the argument, so far as it is based on Section 92, Evidence Act, has no force. It is not contended that the promise to pay contained in the promissory note was without consideration.

3. The learned advocate for the applicant has strongly pressed upon me the contention that the rate of interest, namely, 2 per cent, per mensem, is excessive. I do not think there is any justification for interfering with the decree of the lower Court as regards interest. In transactions involving loans of small amounts such a rate of interest is not considered unreasonable in rural areas. The parties had probably considered that it was a short term Joan and a comparately high rate of interest was not considered to be unreasonable in view of that fact. On the whole, I am satisfied that the learned Judge was right in decreeing the plaintiff's claim with interest at the stipulated rate. For the reasons stated above, this application for revision is dismissed with costs.


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