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Harishchandra and anr. Vs. Kailashchandra and anr. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtRajasthan High Court
Decided On
Case NumberFirst Appeal No. 48 of 1971
Judge
Reported inAIR1975Raj14; 1974(7)WLN440
ActsCode of Civil Procedure (CPC) , 1908 - Sections 151 - Order 2, Rule 2(3); Contract Act, 1872 - Sections 60
AppellantHarishchandra and anr.
RespondentKailashchandra and anr.
Appellant Advocate P.C. Bhandari, Adv.
Respondent Advocate H.C. Jain, Adv.
DispositionAppeal dismissed
Cases ReferredCanesh Ramchandra v. Gopal Lakshman
Excerpt:
probate - probate establishes legal character of person and it is conclusive evidence against validity & execution of the will. ; the grant of probate conclusively establishes the legal character of the person to whom the grant is made. it being a judgment in rem under section 41 of the evidence act, it is conclusive evidence against the whole world of the validity and execution of the will and the testamentary capacity of the testator. as the will dated 17.11.58 has been affirmed and probate issued by a competent testamentary court, the genuineness of the will cannot be challenged by the defendants.;(b) civil procedure code - order 2, rule 2(1) & (2)--every suit to include whole claim--suit for an omitted claim is barred--two suits filed at the same time, on same day and in same.....s.n. modi, j. 1. this first appeal by the defendants is directed against the judgment and decree of the additional district judge no. 1, jaipur city, dated 30-1-71 granting a decree for rs. 10,993.25 in favour of the legal representatives of deceased-plaintiff shivballabh. 2. the facts giving rise to this appeal are these; deceased-plaintiff shivballabh and defendant-appellant harinarain were running certain concerns in partnership. differences arose between the partners with the result that on 30-9-52 it was agreed to dissolve the partnership in respect of all the concerns with effect from 1-10-52. a deed of dissolution was executed on 10-10-52 which runs as follows:-- 'whereas it has been agreed to between myself and shri shivballabh mandhana that the partnership business carried on.....
Judgment:

S.N. Modi, J.

1. This first appeal by the defendants is directed against the judgment and decree of the Additional District Judge No. 1, Jaipur City, dated 30-1-71 granting a decree for Rs. 10,993.25 in favour of the legal representatives of deceased-plaintiff Shivballabh.

2. The facts giving rise to this appeal are these; Deceased-plaintiff Shivballabh and defendant-appellant Harinarain were running certain concerns in partnership. Differences arose between the partners with the result that on 30-9-52 it was agreed to dissolve the partnership in respect of all the concerns with effect from 1-10-52. A deed of dissolution was executed on 10-10-52 which runs as follows:--

'Whereas it has been agreed to between myself and Shri Shivballabh Mandhana that the partnership business carried on under the name and style of Rajasthan Textile Industries shall be dissolved with effect from 1st October, 1952, Shri Harinarain Rathi however desires to continue it. The following arrangement has therefore been agreed:

(a) That a balance-sheet exhibiting the ' affairs of the business as on 30th September may be drawn up and signed by the partners in token of their acceptance.

(b) That Shri Shivballabh Mandhana should agree to leave with Shri Harinarain Rath; assets and stock-in-trade amounting to Rs. 12,500 where with to carry on the business. This amount should be in addition to the liabilities of the partnership business as mentioned in the balance-sheet as on 30th September, 1952.

(c) That the stock-in-trade remaining in the partnership business shall be deposited with Shivballabhji Mandhana and removed as and when required against cash payment A store-keeper shall be kept in charge of this stock by Shivballabh Mandhana who will be paid by Harinarain Rathi. The salary shall not exceed Rs. 100. Interest on this sum shall be paid by Harinarain Rathi at Rs. 9% per annum monthly.

(d) Interest at Rs. 9/-% per annum shall also be paid by Shri Harinarain Rathi on account of Rs. 12500 vide item (b) above and also on the amount due by him to Shivballabh Mandhana on account of loss of his share (Harinarain Rathi's) remaining unpaid to Shivballabh Mandhana.

(e) Harinarain Rathi shall execute a promissory note for the amount due to Shivballabh Mandhana and for payment of Rs. 400 per month regularly to cover interest and principal.

(f) Of the above money Rs. 12500 shall be repaid with interest within a period of2 years.

(g) Harinarain Rathi shall find a guarantor to guarantee payment of Rs. 12500 within 2 years and for the payment of interest at Rs. 9% per annum thereon and for the amount of the stock in trade remaining unsold until the same is sold and the money realised therefrom paid to him.

(h) That Shivballabh Mandhana shall be free from all risks or liabilities of thepartnership business with effect from 1st October 1952,

(i) That in compliance with the above terms Harinarain Rathi has already given the guarantee and executed a promissory note for Rs. 25775 (twenty five thousand seven hundred and seventy five only) being the amount due to Shivballabh Mandhana as specified below:

Rs. 12500/- left with H. N. Rathi in the partnership account. Rs. 13272/15/6 net amount due in addition to above sum Rs. 2/0/6 cash paid by Shivballabh Mandhana.

And in witness of the above I Harinarain Rathi s/o Gangabux Rathi r/o Jaipur sign this of my own free will this 10th day of October 1952.

Witness Vishnuswaroop Meloo

Gulabchand Mandhana.

Sd/-

Harinarain Rathi

10-10-52.'

As per Clause (a), a balance-sheet of the partnership business was prepared and it was signed by Harinarain. It showed a sura of Rs. 13,272/15/6 payable by Harinarain to Shivballabh in respect of the loss in the partnership business. Besides this amount, assets and stock-in-trade worth Rs. 12,500/-were left with Harinarain who agreed to pay the sum of Rs. 12,500 to Shivballabh with interest at the rate of nine per cent. per annum. The remaining assets and stock-in-trade valued at Rs. 17280/4/6 were allowed to remain in deposit with Shivballabh as per Clause (c) of the deed of dissolution. As per Clause (g), Harinarain produced defendant Harishchandra as guarantor. Harish-chandra executed a deed of guarantee and stood surety for the payment of Rs. 12,500 with interest @ 9% p. a. as also interest at the same rate on Rs. 17,280/4/6 until the assets and stock-in-trade deposited with Shiv-ballabh were sold to Harinarain. The assets and stock-in-trade deposited with Shivballabh remained in the custody of Vishnuswaroop who was appointed as store-keeper. It is said that Vishnuswaroop allowed Harinarain ta take away the whole of the assets without making any payment. On failure of Harinarain to repay the various amounts due from as per terms of the deed of dissolution, Shivballabh instituted three suits on 28-9-55 in the Court of the Additional District Judge No. 1, Jaipur City. The first suit related to the recovery of Rs. 13272/15/6, the amount of loss in the partnership business. The second suit related to the recovery of Rs. 17280/4/6, the value of the assets deposited with Shivballabh and subsequently removed by Harinarain. The third suit is the suit out of which this appeal arises. It relates to the recovery of Rupees 12,500 with interest thereon as also the interest on the amount of Rs. 17280/4/0. The details of the amount claimed by the plaintiffs in this suit are as under:

1. Amount of stock-in-trade left with defendant HarinarainRs. 125002. Interest on the above amount @ 9% per annum plus interest on the sum of Rs. 17280/4/6 from 1-10-52 to 31.8.55Rs. 7827/1/6TotalRs. 20327/1/6Less Amount of instalments received from defendant Harinarain minus bank commissionRs. 4788/-BalanceRs. 15539/1/6

The plaintiffs relinquished Rs. 39/1/6 and brought the suit for the recovery of Rupees 15500 against the defendant-appellants.

3. Various pleas were raised in defence. It was admitted that Harinarain executed deed of dissolution and also signed the balance-sheet. Harishchandra admitted having executed the deed of guarantee. The main grounds raised by the defendants in their defence were firstly that the assets & stock-in-trade amounting to Rs. 12,500 were not handed over to Harinarain and secondly that the suit was barred under Order 2, Rule 2, C. P. C. Several issues were framed on the pleadings of the parties. During the pendency of the suit, plaintiff Shivballabh died and his legal representatives, namely, Kailashchandra and Rameshchandra, the grandsons of Shivballabh, were brought on record on the basis of a will said to have been executed by Shivballabh. The defendants contested the right of Kailashchandra and Rameshchandra to continue the suit. The defendants also denied that Shivballabh had executed the alleged will dated 17-11-58 in favour of Kailashchandra and Rameshchandra. They also pleaded that the suit was not maintainable without obtaining probate of the will. The learned Additional District Judge held that there was no splitting of cause of action as Harishchandra could not have been sued in the other two suits filed by Shivballabh. He further held that assets and stock-in-trade worth Rs. 12,500 were handed over to Harinarain. The learned trial Judge then held that the will dated 17-11-58 was executed by Shivballabh and it was not necessary to obtain probate of the will as it was not executed in Bombay or Madras or Calcutta. In the result, the learned Additional District Judge after deducting the amount repaid by Harinarain from the principal amount of Rs. 12500 passed a decree for Rs. 7712 as principal and Rs. 3281.25 by way of interest--total Rs. 10,993.25 with proportionate costs and pendente lite and future interest at the rate of six per cent per annum on the principal sum of Rs. 7712/-. It is against this decree that the defendants have preferred this appeal.

4. The plaintiff-respondents have filed cross-objections with the prayer that the decretal amount be enhanced by Rs. 4788/-.

I first take up the appeal filed by the defendants.

Arguing the appeal, Mr. P. C. Bhan-dari, the learned advocate for the appellants, restricted his arguments to the following points only:

1. That the plaintiffs have failed to prove the will dated 17-11-58 in accordance with law.

2. That the suit was not maintainable on account of splitting of cause of action.

3. That there is no reliable proof that the assets and stock-in-trade worth Rs. 12,500 were handed over to defendant Harinarain. During the course of the hearing of this appeal, the plaintiff-respondents produced the copy of the probate dated 15-11-61 granted in their favour by the Court of District Judge, Jaipur District, Jaipur, in exercise of its probate jurisdiction in respect of the will dated 17-11-58 executed by Shivballabh. The probate was admitted in evidence by the order of this Court dated 9-1-74 under Order 41, Rule 27, C. P. C. The defendant-appellants were then given an op- portunity to produce evidence in rebuttal ut no evidence was produced.

The effect of probate as stated in Williams on Executors, Vol. 1, page 254, Chapter 10 (13th Edition) is as follows:

'A probate even in common form, un-revoked, is conclusive both in the Courts of Law and of Equity as to the appointment of executor, and the validity and contents of a will..... Therefore it cannot beproved that another person was appointed executor or that the testator was insane or that the Will of which the probate has been granted was forged, for that would be directly contrary to the seal of the Court.'

Thus, the grant of probate conclusively establishes the legal character of the person to whom the grant is made, It is being a judgment in rem under Section 41 of the Evidence Act, it is conclusive evidence against the whole world of the validity and due execution of the will and the testamentary capacity of the testator. As the will dated 17-11-58 has been affirmed and probate issued by a competent testamentary Court, the genuineness of the will cannot be challenged by the defendants. I therefore overrule the first contention raised by the learned counsel for the appellants.

5. Coming to the second point, it is urged that three suits were filed by deceased Shivballabh on the basis of the deed of dissolution on the same date in the Court of the Additional District Judge, Jaipur. The claim in the present suit could very well be included in the other two suits and that being the case, the present suit is barred under Sub-rule (2) of Order 2, Rule 2, C. P. C. On the other hand, it is argued on behalf of the respondents that Order 2, Rule 2, C. P. C. only applies where the cause of action is one and it cannot apply where one transaction gives rise to several causes of action. It is emphasised that the deed oi dissolution on which the three suits were based gave rise to three separate and distinct causes of action and therefore the provisions contained in Order 2, Rule 2, C. P. G. cannot apply to the present case. It is further contended that since the present suit was filed on the same date on which the other two suits were filed, the question oi relinquishment of a part of a claim does not arise.

Order 2, Rule 2, G. P. C. runs as under:

'Rule 2. Suit to include the whole claim.-

(1) Every suit shall include the whole of the claim which the plaintiff is entitled to make in respect of the cause of action; but a plaintiff may relinquish any portion of his claim in order to bring the suit within the jurisdiction of any Court,

(2) Relinquishment of part of claim.--Where a plaintiff omits to sue in respect of, or intentionally relinquishes, any portion of his claim he shall not afterwards sue in respect of the portion so omitted or relinquished.

(3) Omission to sue for one of several reliefs.-- A person entitled to more than one relief in respect of the same cause of action may sue for all or any of such reliefs; but if he omits, except with the leave of the Court, to sue for all such reliefs, he shall not afterwards sue for any relief so omitted.

Explanation.-- For the purposes of this rule an obligation and a collateral security for its performance and successive claims arising under the same obligation shall be deemed respectively to constitute but one cause of action.'

All that Order 2, Rule 2 provides is that where there is one and the same cause of action, the plaintiff cannot split up his cause of action and sue for one part in one suit and for another part in another suit. As their Lordships of the Privy Council put in Nabakumar Hazra v. Radhashyam Mahish, AIR 1931 PC 229, 'the rule in question is intended to deal with the vice of splitting a cause of action.' Thus the applicability of Order 2, Rule 2 depends upon there being established one and the same cause or action in the two suits. The defendant who raises the plea must establish that the subsequent suit was in respect of the same cause of action as the earlier suit. The questiontherefore arises whether the cause of action in the present suit is the same as the cause of action in the other two suits. To answer this question, the defendants should have filed the copies of the plaints of other suits filed by the plaintiffs. Without placing on the record the plaints of the other two suits, a plea of bar under Order 2, Rule 2 cannot be adequately answered as it is not possible to find out the identity of cause or action in the three suits. Their Lordships of the Supreme Court in Gurbuxsingh v. Bhooralal, AIR 1964 SC 1810, laid down that a plea based on the existence of a former pleading cannot be entertained when the pleading on which it rests has not been produced. The relevant observations of their Lordships read as under:--

In order that a plea of a bar under Order 2, Rule 2 (3), C. P. C. should succeed the defendant who raises the plea must make out (1.) that the second suit was in respect of the same cause of action as that on which the previous suit was based; (2) that in respect of that cause of action the plaintiff was entitled to more than one relief; (3) that being thus entitled to more than one relief the plaintiff, without leave obtained from the Court omitted to sue for the relief for which the second suit had been filed. From this analysis it would be seen that the defendant would have to establish primarily and to start with, the precise cause of action upon which the previous suit was filed, for unless there is identity between the cause of action on, which the earlier suit was filed and that on which the claim in the later suit is based there would be no scope for the application of the bar. No doubt, a relief which is sought in a plaint could ordinarily be traceable to a particular cause of action but this might, by no means, be the universal rule. As the plea is a technical bar, it has to be established satisfactorily and cannot be presumed merely on basis of inferential reasoning. It is for this reason that we consider that a plea of a bar under Order 2, Rule 2, C. P. C. can be established only if the defendant files in evidence the pleadings in the previous suit and thereby proves to the Court the identity of the cause of action in the two suits.....Just as in thacase of a plea of res judicata which cannot be established in the absence on the record of the judgment and decree which is pleaded as estoppel, we consider that a plea under Order 2, Rule 2, C. P. C. cannot be made out except on proof of the plaint in the previous suit the filing of which is said to create the bar. As the plea is basically founded on the identity of me cause of action in the two suits the defence which raises the bar has necessarily to establish the cause of action in the previous suit. The cause of action would be the facts which the plaintiff had then alleged to support the right to the relief that he claimed. Without placing before the Court the plaint in which those facts were alleged, the defendant cannot invite the Court to speculate or infer by a process of deduction what those facts might be with reference to the reliefs which were then claimed. It is not impossible that reliefs were claimed without the necessary averments to justify their grant....'

In my opinion, this ground alone is sufficient to discard the second contention of the appellants.

6. There is yet another aspect of the case. The three suits in the present case were admittedly filed simultaneously on the same date and in the same Court, It is further not in dispute that even if the plaintiffs were to file one suit comprising therein the entire cause of action, such suit would have been triable by the Court of the Additional District Judge where the three suits were filed as its pecuniary jurisdiction is unlimited.

7. Now the gist of the relevant law contained in Sub-rules (1) and (2) of. Order 2, K. 2, C. P. C. is that every suit shall include whole of the claim which the plaintiff is entitled to make in respect of a cause of action and that omission to sue or intentional relinquishment of a portion of such a claim debars him from afterwards doing so. Assuming that the plaintiffs in the present case had only one cause of action and further that each suit did not include the whole of the claim which the plaintiffs could make in respect of that cause of action within the meaning of Sub-rule (1) of Order 2, Rule 2, C. P. C., the question arises whether Sub-rule (2) of Order 2, Rule 2 can be applied to the three suits which were certainly filed simultaneously on the same day. On this point, there appears to be conflict amongst the various High Courts in India. The earliest case cited before me is of Lala Sewaram v. Kashiram, 1890 Pun Re 76, wherein it was observed that where two suits were filed simultaneously on the one day, it was not possible for the defendant 'to establish positively which of the two suits is the subsequent suit, in other words, which of the two Suits is liable to be dismissed on the ground that the plaintiff in bringing that suit has violated the provision contained in second clause of Section 43 (corresponding to Sub-rule (2) of Order 2, Rule 2, C. P. C.), that 'he should not afterwards sue' in respect of the portion of the cause of action omitted in the former suit (bracketing is mine). It was further observed by Rivaz J.-

'I cannot agree with the contention that because the two suits were numbered 42 and 43 respectively, in the first Court's register, that it must be therefore taken as proved that the suits were filed one after the other in the order which the numbers indicate. The argument deducible from the numbering of the suits is quite inconclusive, the plaints may (for all we know) have been presented together or possibly in the reverse order to that indicated by the numbers.'

In Murti v. Bholaram, (1894) ILR 16 All 165, A Full Bench of the Allahabad HighCourt laid down that where two suits are filed on the same day it must be presumed until the contrary is proved, that they were presented and admitted in the order in which their numbers appear in the Register of Civil Suits. This Fun Bench decision was later on followed by the Rangoon High Court in The Standard Electric and Motor Works v. Picture Palace, AIR 1924 Rang 161 (2) in preference to Lala Sewaram's case (supra). The Madras High Court in Rayalu Ayyar v. Ramudu Ayyar, AIR 1926 Mad 934, dissented from the view taken by the Allahabad High Court in Murti's case (supra) and held that where two suits are fifed simultaneously on the same day, the plaintiff may elect as to which of the two suits instituted by him together shall be held barred by the operation of Order 2, Rule 2, C. P. C. The relevant observations run as follows:--

'The Allahabad case is invoked as laying down the proposition that the numbering affixed by the Court shall prima facie be conclusive as to the order of time in which the suits were respectively instituted. We are not prepared to assent to that doctrine but would rather hold that the plaintiffs here can confine themselves to suit No. 72 and have suit No. 73 dismissed under Order 2, Rule 2. It may very well happen that of two suits presented simultaneously one was held for some technical cause for a week or ten days and then would be numbered several numbers behind the one which was admitted without question. Even if it be that the numbering is prima facie evidence of the respective dates of admission, it does not seem to us that it determines that the suit bearing the later number was 'afterwards' launched within the meaning of the rule which in our opinion contemplates a later proceeding in the real sense. In any case, we prefer to follow the ruling in Appasami v. Ramasami which clearly contemplates that in a case like the present the plaintiff may elect as to which of two suits instituted by him together on the same day shall be held to be barred by the operation of Order 2, Rule 2.'

The Bombay High Court in Canesh Ramchandra v. Gopal Lakshman, AIR 1943 Bom 12, after referring to the above cited cases dealt with the situation in a different way. It was observed that if suits are filed simultaneously, there is no contravention of Sub-rule (2) of Order 2, Rule 2 which prohibits a plaintiff from afterwards suing for a relief omitted in a former suit and the two suits should be consolidated and tried together. It was observed by Broomfield J. in the above case as follows:

'The important question is whether the second part of Rule 2 applies. Is it a case of a plaintiff afterwards suing in respect of a portion of a claim omitted from a former suit? The plaints in the two suits were presented on the same day and bear consecu-tive numbers. It is reasonable to suppose that they were presented simultaneously. It has been held by the Allahabad High Court in 16 All. 165 and by the Rangoon High Court in 1 Rangoon 682 that in such circumstances the suit bearing the later number is to be presumed to have been filed afterwards. The basis of these decisions is that if Order 2, Rule 2 (or Section 43 of the old Code), were not to be applied in the case of suits filed on the same day, it would open the door to deliberate and continual evasion of the law. For instance, if A buys on the same occasion seven different articles from B in B's shop, B might file on the same day seven suits against A in respect of the price of the seven articles sold which, it is said, would be absurd. I am by no means satisfied, however, that this argument ab incon-venienti really makes it necessary to strain the language of the rule and to assume contrary to the fact that one of two plaints presented simultaneously has been presented afterwards. The Madras High Court has declined to make this assumption (49 Mad 869), but apparently it thought it necessary nevertheless to assume that one or the other of the suits was instituted afterwards and so the expedient was adopted of giving the plainitff the option of electing which of the suits should be regarded as the earlier.

It is obvious that either of these purely arbitrary methods of procedure may cause great injustice. That would no doubt be irrelevant if there were no other way of preventing evasion of the rule that a suit must include all claims arising out of the same cause of action. But I think that is not so. In the hypothetical case put by Sir John Edge in 16 All. 165 the man who brought seven suits on the same day based on the same cause of action would not and could not in face evade the provisions of the first part of Order 2, Rule 2, and the Court would obviously not be bound to hear all the suits separately. The Court might consolidate them or call upon the plaintiff to include all the claims in one suit and withdraw the rest.'

Having considered the above authorities, I am of opinion that the bar under Order 2, Rule 2, C. P. C. does not come into play when two or more suits are filed at the same time on the same day in the same Court having pecuniary jurisdiction to deal with the entire cause of action if included in one suit. The view taken by the Allahabad High Court in Murti's case (supra) and followed by the Rangoon High Court in Standard Electric and Motors Works' case (supra) that when two suits are filed on the same day, then one must be held to have been filed first and the second subsequently will, in my opinion, be not in consonance with the language used in Order 2, Rule 2, C. P. C. I subscribe to the view taken by the Bombay High Court in Ganesh Ramchandra Thakur's case (supra) that penalty provided for in Sub-rule (2) of Order 2, Rule 2 would not applywhere the two suits based on the same cause of action are instituted simultaneously on the same day and the proper procedure in such eventuality would be to consolidate them in exercise of inherent powers under Section 151, C. P. C. By adopting the procedure of consolidation of the suits, not only the plaintiff would be relieved but hardship of the defendant would also be obviated. In the present case, it is admitted that the trial Court of course did not formally consolidate all the three suits but it proceeded and tried all the three suits as if they had been virtually consolidated. I am also told that the other two suits have already been decided and there is no suggestion that the defendants were in any way prejudiced by splitting of cause of action. In any case, the bar under Order 2, Rule 2, C. P. C. is not attracted and the present suit cannot be Held to be not maintainable. I am further of the opinion that Order 2, Rule 2, C. P. C. does not require that when a single transaction gives rise to several causes of action, they should all be combined in one suit. In the present case, the deed of dissolution gave rise to several causes of action and it was not necessary for the plaintiffs to include all the causes of action in one suit. The first suit related to the recovery of the amount of loss suffer-red by the defendant Harinarain. The second suit related to the recovery of the price of assets and stock in trade which were unauthorisedly handed over by the store-keeper to the defendant Harinarain. The present suit related to the price of the assets and stock-in-trade handed over to Harinarain and for the repayment of which Harishchander stood surety. It is however contended on behalf of the appellants that the suit for recovery of interest on the sum of Rs. 17280/4/6 relating to the assets and stock-in-trade alleged to nave been unauthorisedly handed over to Harinarain by Vishnu Swaroop ought to have been included in that suit and the present suit so far as it relates to the recovery of interest on that amount is barred under Order 2, Rule 2. The contention is without any merits in view of the foregoing discussion. That apart, the suit for recovery of Rs. 17280/4/6 was based on the tort committed by Vishnuswaroop and Harinarain arid not on the deed of dissolution. Furthermore, Harishchandra had stood surety for the payment of interest on the amount of Rs. 17280/4/6 and could not have been made a party in the suit based on tort. With whatever angle the case is viewed, the suit is not barred under Order 2, Rule 2, C. P. C.

8. The last point raised by the learned counsel for the appellants is equally without any merits. The deed of dissolution Ex. 2 shows that Harinarain took the liability for payment of Rs. 12,500/- in lieu of stock-in-trade worth that amount which was to be left with him with a view to enablehim to carry on business. The deed of guarantee Ex. 3 shows that Harishchandra stood surety for repayment of Rs. 12,50C because the assets worth that amount were handed over to Harinarain. The defendants then regularly paid monthly instalments of Rs. 400 each for complete one year against the interest on the amount of Rs. 12,500 and the amount of Rs. 17,280/4/6. In view of the above facts, a heavy burden lay on the defendants to prove that assets worth Rs. 12,500 were not handed over to Harinarain. To discharge this burden, there is the solitary oral statement of Harinarain whicb is wholly insufficient. I therefore find no substance in the last contention.

9. I now take up the cross-objection, It is argued on behalf of the plaintiffs that the Court below committed gross error in appropriating the amount of Rs. 4788 received by the plaintiffs towards the - principal amount of Rs. 12,500. The contention is well founded. It is not disputed that the plaintiffs received from the defendants Rs. 4800 by way of monthly instalments of Rs. 400 each from 1-11-52 to 1-10-53 as provided in Clause (e) of the deed of dissolution (Ex. 2) and Clause (2) of the deed of guarantee (Ex. 3). Out of Rs. 4800 the plaintiffs deducted Rs. 12 for bank commission and appropriated the balance towards the amount of interest accrued on the principal sums of Rs. 12,500 and Rs. 17,280/4/6. A perusal of Ex. 2 and Ex. 3 would show that the defendants agreed to pay Rs. 400 per month on account of interest at the rate of nine per cent per annum on the aforesaid two principal sums and in discharge of guarantee bond of Rs. 12,500/-. In view of the above agreement between the parties, the amount or Rs. 400 paid every month by the defendants should first be applied in payment of interest and then, after it is satisfied, in payment of the principal amount of Rupees 12,500/-. Even apart from the agreement, the general rule is that in absence of any appropriation by the debtor at the time of payment, the payments should be attributed in the first instance to interest. It is not the case of the defendants that they at the time of making payment of Rs. 400 every month, gave direction for appropriation of the amount towards the principal amount of Rs. 12,500. The plaintiffs, therefore, were entitled to apply the payment first towards interest accrued upto the date of payment and the balance towards the principal. Calculating in the above manner, the amount due to the plaintiffs up to the date of the suit comes to Rs. 10301.68 as principal and Rs. 4755.81 by way of interest, total Rs. 15,057.49. Since the plaintiffs relinquished Rs. 39.18, they are entitled to a decree for Rs. 15,018.31.

10. In the result, the appeal filed by the defendants is dismissed with costs. The cross-objection filed by the plaintiffs is allowed, the decree of the Court below ismodified and the decretal amount is enhanced from Rs. 10,993.25 to Rs. 15,018.31. The plaintiffs shall be entitled to interest at the rate of six Per cent. per annum from the date of the suit to the date of the decree and from the date of the decree to the date of realisation of the principal sum of Rupees 10,301.68. The parties shall give and take costs of the cross-objection according to their success and failure.


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