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Bhukhi Sahu Vs. Kodai Panday and ors. - Court Judgment

LegalCrystal Citation
CourtAllahabad
Decided On
Judge
Reported inAIR1919All238; 50Ind.Cas.814
AppellantBhukhi Sahu
RespondentKodai Panday and ors.
Cases ReferredHurro Nath Rai Chowdhuri v. Randhir Singh
Excerpt:
hindu law - joint family--mortgage by father necessity--burden of proof--interest--court, power of to reduce contract rate--parties to suit not parties to ontract. - - that argument does not apply and is well understood to apply to cases where the parties to the suit are the parties to the contract. in a case like the present, however, there is this difference, some of the parties to the suit are not parties to the contract and it is for the protection of the latter that the courts have laid down the principle which we have enunciated alone......was nothing harsh or unconscionable in the bargain and he allowed interest to the plaintiff at the contract rate. on appeal the learned' judge of the court below has reduced the interest to 18 per cent, per annum simple. he relied upon certain authorities of this court, viz., nana ram v. bhupal singh 13 ind. cas. 5 : 8 a.l.j. 1294 : 34 a. 126 and gaya prasad tewari v. ram phal misir 28 ind. cas. 21 : 13 a.l.j. 246. there is also another case to the same effect which is reported as rao raghunath singh v. nazir begam 19 ind. cas. 639. it has been laid down in these cases that in suits of this nature where a mortgagee is seeking to enforce a mortgage executed by the father in a joint hindu family, he must prove not only that there was a necessity for the loan secured by the mortgage but.....
Judgment:

1. The only question for decision in ton second appeal is whether the lower Appellate Court was right in reducing be rate of interest entered in the bond which was put in suit.

2. The suit was a suit on a mortgage brought against Kodai Pande and his sons. Certain other defendants were impleaded as subsequent mortgagees. The sons resisted the claim on various grounds and pleaded, inter alia, that there was no legal necessity for the loan, and that there was no need for their father to borrow, at the exorbitant rate of interest entered in the deed, namely, 25 per cent, per annum compoundable with yearly rests. An issue was raised in the Court of first instance regarding the propriety of this high rate of interest. The Subordinate Judge came to the conclusion that there was nothing harsh or unconscionable in the bargain and he allowed interest to the plaintiff at the contract rate. On appeal the learned' Judge of the Court below has reduced the interest to 18 per cent, per annum simple. He relied upon certain authorities of this Court, viz., Nana Ram v. Bhupal Singh 13 Ind. Cas. 5 : 8 A.L.J. 1294 : 34 A. 126 and Gaya Prasad Tewari v. Ram Phal Misir 28 Ind. Cas. 21 : 13 A.L.J. 246. There is also another case to the same effect which is reported as Rao Raghunath Singh v. Nazir Begam 19 Ind. Cas. 639. It has been laid down in these cases that in suits of this nature where a mortgagee is seeking to enforce a mortgage executed by the father in a joint Hindu family, he must prove not only that there was a necessity for the loan secured by the mortgage but also that there was such necessity as justified the agreement for a high rate of interest. The principle 80 laid down is derived, from the judgment of their Lordships of the Privy Council in the case of Hurro Nath Rai Chowdhuri v. Randhir Singh 18 C. 311 (P.C.) : 18 I.A. 1 : 15 Ind. Jur. 34 : 5 Sar. P.C.J. 642 : 9 Ind. Dec. (N.S.) 207. The argument before us is that the Court had no power to reduce the rate of interest except in a case which can be shown to fall under the provisions of Section 16 of the Contract Act. That argument does not apply and is well understood to apply to cases where the parties to the suit are the parties to the contract. In a case like the present, however, there is this difference, some of the parties to the suit are not parties to the contract and it is for the protection of the latter that the Courts have laid down the principle which we have enunciated alone. We are of opinion, therefore, that on the authorities referred to by the learned Judge, he had the power to reduce the rate of interest and this being so, our finding on the only point urged in appeal is against the appellant. The appeal fails and is dismissed with costs, including in this Court fees on the higher scale.


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