1. This appeal arises out of a suit brought on the foot of a mortgage bond dated 5th December 1906 (Ex. A) executed by defendant in favour of the plaintiff. The plaintiff is a Kamma woman aged 55. According to the terms of the mortgage bond Rs. 6,000 were borrowed and they were to be repaid in six annual instalments of Rs. 1,000 each on the first April of each year beginning with 1908 and ending with 1913. The rate of interest in the first instance is 12 per cent per annum but the deed provides that if two consecutive instalments remained unpaid the entire principal and interest outstanding due at the time shall, without reference to future instalments, be recoverable together with interest thereon at 15 per cent per annum from the date of default till the date of payment. The mortgaged property comprises 763 acres in different villages in the East Godaveri District. By a sale-deed dated 17th March 1908 (Ex. B) the mortgagor sold the equity of redemption in 757 acres and one cent in five of the villages of the mortgaged property to five persons;. (1) Falloori Sathayya, (2) Marina Sooranna, (3) Marina Veeranna, (4) Pathoori Kannamma and (5) Yeriagadda Manikyam. Of these 5 persons the second and the third are the sons of the mortgagee under Ex. A., the fourth and the fifth are the daughters of that mortgagee; and the first is the father-in-law of the third, that is Marina Veeranna. These five entered into a kind of agricultural partnership. They purchased the 757 acres and after carrying on some agricultural operations they settled their accounts and sometime in 1909 and 1910,. divided the purchased properties between themselves and also settled their accounts in connexion with their liabilities relating to the purchase and the subsequent agricultural operations. The sale-deed was for Rs. 28,000 which consisted of Rs. 6,918, the mortgage amount due to the plaintiff under Ex. A, Rs. 13,082, paid before the Sub-Registrar and Rs. 8,000 represented by a promissory-note Ex. B (1) of the same date. The evidence of P. Ws. 2 and 3 shows there was a division of the lands in 1909 and 1910 and lists of shares (vatala jabitalu) were drawn up in connexion with the said divisions but apart from the division of the lands, it appears there was a settlement of their accounts showing how much each had to contribute originally, how much has been already contributed and for how much more each sharer remained liable. The main liability was in equal shares. Where the contributions made by each person are unequal, the balance which would still remain due will also be unequal. That some such settlement took place prior to 1911 is the case of both parties. The plaintiff's case on this matter was not expressly set forth in the plaint but was developed in the course of the trial, but defendants 2, 4 and 5 pleaded it in their written statement. Para. 5 of their written statement runs thus:
The vendees agreed at the time of their sale to discharge the mortgage bond in accordance with their specific shares. The plaintiff also consented to the same; and subsequently each of the sharers paid off their share of the mortgage debt from time to time and the suit bond is fully discharged.... The accounts were looked into and the bonds were treated as fully discharged and was so entered in plaintiff's accounts.
2. It is clear that this paragraph in the written statement shows that the partners settled their accounts inter se. No date is given in the written statement as to when this took place or what the result of the settlement was. The paragraph only alleges:
These defendants are informed and submit that a sum of Rs. 2,000 was paid in full discharge on or about 21st April 1911 to the plaintiff by the late Valloori Sathayya.
3. This sentence implies that sometime prior to 21st April 1911 the share of Valloori Sathayya, one of the vendees also was determined and that amounted to Rs. 200 by 21st April 1911 and that was paid at or about that time. The plaintiff's case is that the amounts due from the various sharers as settled in 1910 were unequal, that the amount due from Valloori Sathayya was about Rs. 3,759, that the amounts allotted to the other sharers were all paid off to the plaintiff and that after giving credit to those various amounts paid by the other sharers she brings the present suit to recover the amount remaining due.
4. It may now be convenient to describe the various defendants. Defendant 1 is the original mortgagor. Defendants 2 and 3 are the sons of Valloori Sathayya; defendants 4 and 5 are the sons of defendant 2 so that defendants 2 to 5 now represent Valloori Sathayya. Defendants 6 and 10 are the daughters of the plaintiff. Defendants 8 and 9 are her sons. Defendant 7, is the purchaser of some of the items of the mortgaged property and his case will be dealt with later on.
5. The properties originally mortgaged under Ex. A are set forth in Schedule A to the plaint and the properties which fell to the share of Valloori Sathayya in the division between the five purchasers are set forth in Schedule A (1). Para. 9 of the plaint says that the plaintiff has given up the mortgage right in all the properties other than those in Schedule A (1) and wishes to recover the amount now due only from the properties in Schedule A (1), and when it is remembered that the properties in Schedule A (1) are those that fell to the share of defendants 2 to 5, this means that the plaintiff wants to get a decree only against defendants 2 to 5 and to exonerate the other defendants, who therefore are only pro forma defendants so far as the plaintiff is concerned, for it is possible that claim for contribution may arise between them and defendants 2 to 5. Defendants 2, 4 and 5 filed one written statement and the defendant 3 filed a separate written statement adopting the written statement of defendants 2, 4 and 5. I have already set forth para. 5 of the written statement of defendants 2, 4 and 5.
6. The cause of action for the suit having arisen on 1st April 1909 according to the terms of the mortgage bond, and the suit having been filed on 2nd October 1922, it is necessary for the plaintiff to allege in the plaint how the suit is within time. Accordingly she alleges in para. 4 that Valloori Sathayya and defendants 6, 8, 9, 10 made a payment of Rs. 1,386, on 1st October 1910 (which was wrongly described in Ex. A as 31st September 1910, the parties not being conversant with the correct number of days in September). The plaintiff also alleges that defendant 10 made another payment of Rs. 1,396-10-0 on a day which purports to be 2nd October 1910 but which must be taken to be really 3rd October 1910 on the footing that the parties thought that September consisted of 31 days. Then she mentions four payments in 1912, 1915, 1917 and 1919 by defendant 8. There is another payment of Rs. 3,100 by defendant 6 on 26th September 1922. Thus altogether seven payments are alleged in para. 4. All the seven payments are endorsed on the mortgage bond and in para. 11 of the plaint it is alleged that the suit will be within time if filed within 12 years of the first payment by Sathayya, namely the payment on 1st October 1910, but as 1st October 1922 was a holiday the plaint was filed on 2nd October. This paragraph reads as if the plaintiff thought that only the payment by Sathayya on 31st September 1910 (that is 1st October 1910) will save the suit from being barred by limitation and that the other payments will not avail her for saving limitation. If the second payment on 2nd October 1910 is relied on, by the plaintiff, the suit is just within time and it is unnecessary to refer to the fact that 1st October 1922 was a holiday; if the latter payments are relied on the suit is a fortiori within time; but none of these was relied on. This was because the first payment was made on behalf of all the partners including Sathayya, whereas the other payments were made only by the individual sharers and Sathayya was not one of them. In the written statement of defendants 2, 4 and 5 they pleaded that the first payment of 31st September 1910 is a forgery and as to the other payments and endorsements they pleaded they were not true. This obviously means not that the other payments were forgeries, for it is expressly admitted before us that the endorsements were written and signed by the persons who purport to write and sign them, but that they were not true payments. These other sharers are sons and daughters of the plaintiff and there is no need for forging such payments, for the plaintiff is claiming no relief against them. The suggestion on behalf of defendants 2, 4 and 5 is that the plaintiff and other defendants were colluding and those endorsements were collusive endorsements.
7. The Subordinate Judge dismissed the suit on two grounds, first that the endorsement of 31st September 1910 was not genuine and secondly that the mortgage document was not validly registered as a small item of property, 10 cents in extent, not belonging to the mortgagor was included in it to procure registration at a place other than the proper place of registration and therefore the transaction constituted a fraud on the law of registration. The plaintiff appeals In appeal both the points decided by the Subordinate Judge were argued very elaborately by the learned advocate on both sides.
8. I first take the question of registration. The mortgaged properties comprise certain extents situated in Katrenikona, Naimmakayala Kotapalli, Vuppalaguptam and Munipalli and 10 cents of land in Daksharama all these are ryotwari lands and certain other lands (Inam) of about 7 acres situated in three other villages. All the villages being in the Godaveri District, the document could be registered in the headquarters of the district, namely Cocanada, but this requires a small additional registration fee beyond the fee to be paid in the Sub-Registrar's office; but if the document has to be registered in a Sub-Registrar's office with reference to the ryotwari lands, excluding the 10 cents in Daksharama, it may be registered either in Mummidivaram or Amallapur and with reference to the inam lands it can be registered in Kothapatta; but as a matter of fact it was registered in Daksharama. The parties were able to do this by including the 10 cents in Daksharama. The plaintiff was a resident of Velangi. It is said that the plaintiff wanted to register the document in Daksharama because she did not want to carry the large sum of money of Rs. 6,000 to the other three places mentioned which require the crossing of a branch of the river Godaveri, but it appears from the evidence (P.W. 2) and the map of the Godaveri district also that Cocanada is not more distant from the plaintiff's village than Daksharama. No false addition need be made if the document is registered at Cocanada but it requires small additional payment. There is no purpose therefore in resorting to any fraud on the registration law. But apart from this the defendants must show that the item in Daksharama does not belong to the mortgagor and was included in the document, the mortgagee knowing that it did not belong to the mortgagor and not intending to take it as security. There is no question of the non-existence of the ten cents of land as is the case in Harendra Lal Roy v. Haridasi Debi A.I.R. 1914 P.C. 67. The story given by the defendants' witnesses, D. Ws. 2, 4 and 5 is that the plaintiff was represented in the transaction by her husband and her son-in-law, P.W. 2. It was they that desired that the document should be registered in Daksharama; the mortgagor said he had no lands at Daksharama: then it was the plaintiff's men that suggested that the land of 10 cents belonging to Dinavahi Murthiraju (D.W. 4) should be included in the document. The suggestion is that this land of 10 cents really belonged to Murthiraju and that this was known to the plaintiff's men. But the whole of this story was not put to P.W. 2 in his cross-examination. It was not suggested in the cross-examination of P.W. 2 that the land belonged to Murthiraju, that the fact was known to 3?. W. 2 or that afterwards the whole thing was brought to the knowledge of 'the plaintiff. The whole case was devedoped only in the evidence of D. W. 2. The written statement itself gave no indication of the ownership of the land. D. Ws. 4 and 5 were examined to prove that the land belonged to their family, in 1911, there was a partition in their family and that in the partition it fell to the share of the elder brother's son of D. Ws. 4 and 5 who are brothers. The alleged present owner of the land, that is the elder brother's son of D. Ws. 4 and 5 is not examined. No document is produced to show that the land fell to his share. The partition is said to be oral. It is very difficult to test such evidence as it is easily produced. D. W. 4 married the niece of defendant 1. Defendants 1 to 5 appear by the same vakil who is the brother-in-law of D. W. 4. Though no reflection is intended to be made by these observations against the vakil, it is clear that defendant 1 has for some reason made common cause with defendants 2 to 5 and he and his brother-in-law have given evidence to help them.
9. The Subordinate Judge in his appreciation of the evidence on this matter has made the serious mistake of supposing that all the properties mortgaged under Ex. A except the 10 cents in question were sold under Ex. B. This is a mistake. The seven acres and odd of inam lands situated in three villages were not included in Ex. B and were reserved by the mortgagor and there is nothing strange in 10 cents of land in Daksharama being also reserved by the mortgagor. There is nothing convincing to show that the 10 cents of land did not belong to the mortgagor; but, assuming that it really did not belong to the mortgagor, there is nothing to show that this fact was known to the plaintiff or that the plaintiff never intended to take this item as security. The observation of the Privy Council in Biswanatha Prasad v. Chandra Narayana A.I.R. 1921 P.C. 8
This case differs tota caelo from the case suggested in argument of a mere failure to make a good title to property dealt with by the instrument, and which both parties had intended should form part of the security
is in favour of the plaintiff and does not help the defendants. That observation shows that, even if the mortgagor's title to the property was not made out, if it appears that it is intended to be taken as security the document is still valid. In that case, it was expressly found as a fact by Cox, J., in the High Court, with which the Privy Council agreed, that the parties never intended that the share of Kolhua should really be sold to Udit Narayan or mortgaged to Polai Lal. Oral evidence suggesting fraud on the law of registration is easily given and difficult to refute by the opposite side and it should be scrutinised with great care and if it is convincing it must be given effect to, but where it is suspicious the contention must be disallowed. Here I may observe that the evidence of D. W. 4 is that he said that he had no objection to his land being included in Ex. A is very improbable and must be taken to be false. Prior to 1911, it was the joint family property of himself and his elder brother, and assuming he was the manager, why should he allow the property of his family to be mortgaged in a transaction between his wife's maternal uncle (defendant l) and the plaintiff His evidence almost implies that the title has vested in defendant 1 by estoppel and after his not raising the objection the property must be regarded as having passed to defendant 1. But whether this is so or not his evidence is so improbable that one finds a great difficulty in believing it. What is the reason for his being so altruistic? I am unable to believe D.Ws. 2, 4 and 5. I therefore differ from the conclusion of the Subordinate Judge on this matter and hold that it has not been shown that the plaintiff was aware of the fact, if it was a fact at all, that the 10 cents of land did not belong to the mortgagor and that she was a party to: any fraud on the Registration Law. Issue 2 must therefore be found in favour of the plaintiff.
10. I now come to the main and substantial point in the ease, which is, whether there is any sum still remaining due under Ex. A, the plea of the contesting defendants being that it was wholly discharged, and whether the suit is barred by limitation. I will first discuss the latter question, namely, whether the suit is barred by limitation. (After discussing the evidence as to the genuineness of the endorsement A-1 dated 31st September 1910, his Lordship proceeded.) The result is that I find Ex. A-1 to be genuine and that the suit is not barred by limitation against defendants 2 to 5.
11. In the result I have to allow the appeal against 2 to 5, but the question arises, to what sum is the plaintiff entitled? The sum claimed in the plaint is made out on the footing of the terms of the mortgage bond, that is, the plaintiff calculated interest at the rate of 15 per cent. on the total sum of principal and interest due on 1st April 1909 up to date giving credit to the various payments, the seven payments mentioned in Ex. A but it is easy to see that this imposes a larger burden on defendants 2 to 5 than they should bear at any rate according to the settlement in Ex. F as between the partners. The settlement in Ex. F was made on the footing that interest should be calculated after 1st April 1909 at 12 and not 15 per cent. As I have already remarked, it is only in this way that Ex. P supports Ex. A-l. Now seeing that there are two penal clauses in Ex. A, namely the clause making the whole amount claimable on default of payment of two instalments and another clause raising the rate of interest the stipulation is obviously penal, within the meaning of Section 74, Contract Act, and the parties who made the calculations under Ex. F were probably right in thinking that the provisions would not be given effect to in Court of law, nor would the plaintiff herself being a close relation of all the parties enforce it with all its strictness. As a matter of construction of document I think the plaintiff is entitled only to the sum due on Ex. A with interest from 1st April 1909 at 12 per cent. per annum, This gives compensation both for failure to pay the instalment regularly and for failure to pay the interest due up to 1st April 1909. But the present calculation in the plaint is made on the footing of 15 per cent. from 1st April 1909. The claim for the larger interest must be disallowed. It may be said on behalf of the plaintiff that there is no issue on the matter,, but even without an issue, with reference to Section 74, Contract Act, I think we have-got jurisdiction to cut down the rate of interest as the point does not require for its decision any oral evidence. But apart from this consideration, there is' this fact that the parties have calculated at the rate of 12 per cent in Ex. F and the plaintiff seems to have adopted that calculation and consented to take the various allotments in that paper from the several partners as showing their proper liability.
12. The first payment, namely, Ex.. A-I is a joint payment, but after the 1st October the various payments were by the respective persona, liable to pay them. The second payment of 2nd October of Rs. 1,396-10-0 was by defendant 10 and that refers to ' her share ' of the mortgage money. I have already mentioned the fact that the payments of 1912, 1915, 1917 and 1919 exactly agree with the allotment made for defendants 8th and 9th after due allowance is made for interest and the last endorsement of 1922 represents the payments of defendant 6. In a simple case of mortgage by several mortgagors if each mortgagor makes a certain payment in pursuance of an agreement between the mortgagors and the mortgagee merely takes it as a payment towards the mortgage bond, it cannot be said that the mortgagee had agreed to the division inter se of the various-shares between the mortgagors; but this is not a simple case of the kind. In the circumstances of this case I think the plaintiff has agreed to the splitting up of the original liability into several liabilities of the various partners and her consciousness that the endorsement of 31st September 1910 in Ex. A-1 is necessary to prove the claim against defendants 2, 4 and 5 also shows that she recognized the division between the sharers. All the circumstances of the case probabilise this conclusion. I therefore think that the plaintiff is not entitled to the sum prayed for but to a lesser amount. After the figure of Rs. 7,672 mentioned in the plaint schedule the calculation of interest must be made at 12 per cent instead of 15 per cent. The sum arrived at in this way would be Rs. 3,759-1-0, shown as due by Sathayya in Ex. P. This sum shall carry interest at 12 per cent per annum from 1st October 1910 to the date fixed for payment (8th July 1929) and after that the consolidated amount shall carry interest at 6 per cent. As the amount is large we will give seven months' time for payment. The plaintiff will pay and receive proportionate costs throughout.
13. After I finished the above judgment, I had the advantage of reading ray brother's judgment. I find I have overlooked the point argued by the advocate for the respondents viz., that the date of endorsement does not avail under Section 20, Lim. Act but the date of actual payment. I agree with my learned brother's judgment on this point. As to defendant 7, the item purchased by him is not included in the Schedule A-1 and the appeal must be dismissed as against him on this ground.
Venkatasubba Rao, J.
14. This is a suit instituted on 2nd October 1922 on a mortgage (Ex. A) dated 5th December 1906 for Rs. 6,000. Defendant 1 is the mortgagor, and no relief is claimed against him. Defendant 7 was impleaded on the ground that he was in possession of a part of the property mortgaged. The other defendants are persons entitled to the equity of redemption at the date of the suit. On 17th March 1908, by Ex. B, the bulk of the property mortgaged was purchased from the mortgagor by five persons.
1. Valluru Sathayya, the predecessor in title of defendants 2 to 5, who died some time previous to the suit. 2. Defendant 6, a daughter of the plaintiff. 3. Defendant 10, another daughter. 4, Defendant 8, the son of the plaintiff. (He married the daughter of Valluru Sattayya). 5. Defendant 9, another son.
15. The five purchasers continued to be an joint enjoyment of the properties purchased and they entered into a partition in 1909 and 1910. The plaintiff exhone rates in the suit, her sons and daughters and seeks to recover the amount due, by the sale of the properties that fell at the partition to the share of Valluru Sathayya. Defendants 2 to 5, his sons and grandsons, pleaded first, that the mortgage was fully discharged and secondly that the suit was barred by limitation. There was a further plea taken that the mortgage bond was inoperative for want of proper registration. The learned Subordinate Judge held that registration was obtained by fraud and that the suit was barred by limitation and dismissed the suit on both these grounds. In regard to the discharge pleaded, he found against the defence and held that the plea was not made out.
16. I shall first deal with the question of limitation. In so doing, I shall also deal with the plea of discharge, as to a certain extent, both the defences rest on the same facts. By the sale-deed Ex. B the purchasers agreed with the vendor (defendant 1) to pay up the amount due to the plaintiff and discharge the mortgage. The consideration for the sale, namely, Rs. 28,000 was thus made up:
1. Rs. 6,918 due upon the mortgage to the plaintiff.2. ' 13,082 cash paid before the Sub-Registrar.3. ' 8,000 amount of the promis-sory note executed by the purchasers in fav-our of the defendant 1.-------------' 28,000-------------
17. The case of the plaintiff is, that just on the eve of the final winding up of the concern by the five sharers, they made a joint payment on 1st October 1910, of Rs. 1,386 towards the interest due on the mortgage, that it was endorsed on the back of the bond and that the date appearing against the endorsement the 31st September 1910 is a mistake for the 1st October. The endorsement (Ex. A-l) purports to have been signed inter alia by Valluru Sathayya. His representatives, defendants 2 to 5, attack the signature as a forgery. One of the main questions to be decided in the suit is, is this a genuine endorsement? It is part of the plaintiff's case, that at the winding up referred to, the several sharers agreed to discharge the plaintiff's debt, each by paying a certain specified sum-the amount depending on the state of the account between the cosharers. it is said that this agreement was in fact carried out by all excepting Sathayya. On the mortgage-deed, there are various endorsements of payments said to have been accordingly made subsequent to the partition.
18. They bear the following dates:
(1) 2nd October 1910, (2) 15th October 1912, (3) 21st July 1915, (i) 12th July 1917, (5) 13th September 1919, (6) 26th September 1922.
19. The first of these is alleged to relate to a payment by defendant 10. The 2nd, 3rd, 4th and 5th are said to relate to payments by defendant 8. The 6th is alleged to refer to a payment by defendant 6.
20. Though the plaintiff relied in her plaint generally, upon all the endorsements noted above to save her claim from the bar of limitation, she more or less con-fined herself at the trial to the endorsement dated 31st September 1910, and the evidence that was adduced almost exclusively related to that endorsement. That was the only endorsement to which Sathayya was said to be a party and the plaintiff seems to have thought that to get a decree against the latter's representatives, the genuineness of that endorsement must be established. (Here his Lordship discussed at length the evidence on this point and then proceeded). I have come to the conclusion that Ex. A-1 is genuine and that Sathayya signed it.
21. A long paragraph in the judgment exclusively deals with the motive for the suit. Many of the matters to which the learned Judge has adverted seem, in my opinion, to be irrelevant. Between the family of Sathayya and that of the plaintiff, there was continued litigation from about 1919; but from that fact, it seems to be unsafe to draw any inference. That is, of course, a reason for our scrutinizing the evidence with great care. Although the nature and history of the quarrels has been fully dealt with at the Bar, it is quite unnecessary to refer to them in detail in this judgment. The fact that emerges is, that there were disputes both of a civil and criminal nature; in some cases, they ended in favour of the plaintiff's family and in some, in favour of Sathayya's. I desire only to make a few-remarks in regard to this aspect of the case. In discussing the evidence on this point, the learned Judge says, that in the litigation between defendants 2 and 8, the former uniformly won and he suggests that this suit is in the nature of a counterblast. On an analysis of the various events, this statement has been shown to-be quite wrong, and the learned Counsel for the respondent has had to admit this. Then again, the Judge observes, referring to a certain agreement, that was ' brought into existence ' by defendant 8,, suggesting thereby, that it was a forgery. There is no justification in the evidence for this statement and what is more important is, that agreement, impeached as a forgery by defendant 2's wife; has since been found by Courts to be absolutely-genuine. If from this episode an inference is to be drawn, that can be not against the plaintiff, but against the defence; but I do not propose to take this into consideration and my only reason for referring to the quarrels is, to show that the learned Judge allowed his bias against the plaintiff to influence his mind The misunderstandings may show either that the suit is false or the defence unfounded, and they cannot furnish any proper-grounds for judgment.
22. Mr. C. Rama Row, for the respondent, has contended before us for the first time-that the endorsement (Ex A-l) is not in law sufficient to take the debt out of the statute. He says, that on the plaintiff's own showing, the payment was made long before the endorsement and argues that, on that account, the suit is barred by limitation. True, under Section 20, Lim. Act, the period has to be computed from the time when the payment is made. What happened in this case? Though the actual payment was on a previous date,, the parties on the date in question agreed to treat it as a payment of interest towards the bond. I have already dealt, with the evidence on the point. Some amounts had been paid out of joint funds to Gangaraju on behalf of the plaintiff. There was thus a sum due by the plaintiff to the five cosharers. On 1st October, an account was taken of the sum due by the plaintiff, interest was added and it was found that Rs. 1,396-10-0 was the. total sum due by her to the debtors, that is, the mortgagor's representatives. It was for the first time on that date, that the parties agreed that the debt due by the plaintiff was to be treated as a payment towards interest under the mortgage bond. It is unnecessary under Section 20 that money should actually pass, for a settlement of account may be as effectual as a real payment. In, fact a transaction, whereby the parties agree that an amount previously due by the creditor to the debtor shall be treated as amount paid by the latter to the former, is in substance identical with a transaction where the debtor receives actual payment and pays the amount back to the creditor. This is exactly what happened in the present case. I have no doubt that this is the correct view to be taken of the law and the respondent's contention, therefore, fails. I may note in this connexion that if the evidence on this lacks details, it is not the plaintiff's fault. In the plaint, it is distinctly alleged that the payment was made on 1st October, and the point now raised was not taken in the written statement or at the trial in the Court below.
23. Further, the endorsement, on a proper construction, amounts, to an acknowledgment of liability under Section 19; and the plaintiff has referred in her plaint to Section 19 as well as Section 20.
24. The trial proceeded in the lower Court on the footing that the question of limitation was to be decided solely with reference to Ex. A-l. The plaintiff accordingly made no attempt to prove the other endorsements on the bond excepting that of 2nd October, 1910. There is sufficient evidence to hold that the last mentioned endorsement is proved, although the plaintiff did not consciously seek to prove that endorsement. In the view I have taken, that Ex. A-1 is genuine, I do not propose to consider the other endorsements in the case or their effect more especially, because there has been no argument before us on the point.
25. The next point that has to be considered is, whether the registration of the bond was not legal on the ground that it was a fraud on the registration law. On this point again, as I have said, the finding of the lower Court is against the plaintiff and I regret, that after a careful consideration of the evidence, I am unable to agree with that finding. The mortgage-deed comprised several items, which may be grouped under four headings.
1. Lands in one block, at Nimmakayala Kothapalli, Nunipalli, Pedagadavalli and Uppalaguptam. Extent acres 218-18 cents.
2. Another block of lands, in Katrene-konda. Extent acres 537-62 cents.
3. Inams in Palivela, Komarajulanka and Devarapalli, acres 7-75 cents.
4. Daksharamam 10 cents.
26. The case put forward by the defence in their pleading is, that defendant 1 to his knowledge as well as that of the mortgagee, was not the owner of item 4. It was further pleaded:
The said item is a fictitious and unidentifiable piece of property.
It was included in the mortgage solely with the object of getting the mortgage bond registered at Daksharamam. This was the defence that was put forward in the written statement; but at the trial, one part of it was abandoned. The case that item 4 was a fictitious and nonexistent item, was given up. The only contention that was pressed was, that defendant 1 was not the owner of the property. Has this contention been made out? The mortgagor, defendant 1, was examined and he said that the property belonged not to him, but his nephews, who in their turn, gave evidence as D. Ws. 4 and 5 and confirmed that statement. They had to admit that there was not a particle of documentary evidence to show that they were the owners. Nothing was more easy for the uncle than to suggest that the item belonged to the nephew. It was to their interest to support that statement and I regard their evidence as worthless in the absence of any writing to prove their ownership. The nephews, be it noted, are kurnams, and what prevented them from showing by producing revenue records that they were enjoying the land? Then again, it was D. W. 4, that arranged the mortgage transaction and it was D. W. 5 that wrote out the mortgage-deed. Is it likely that if that item was their property, they would have allowed it to be included, to their detriment, in the mortgage executed by their uncle?
27. Suppose that the dispute was between defendant 1 and his nephews. Would not the fact, that they willingly allowed the property to be described as belonging to the uncle, be a strong piece of evidence in his favour? And in the absence of any title deed or other documentary evidence would not that fact be almost conclusive evidence? In my opinion it is an idle contention that the property belonged to the nepews.
28. Let us now examine the case put forward by the defence as regards how this happened. If this item had not been included, the proper registration office would have been either that of Amalapuram or Mummidivaram or Kothapetta. The plaintiff, it is suggested, was unwilling to cross the river with money, to either of these three places. So it was, that a piece of land at Draksharaman was included, to give the Sub-Registrar jurisdiction. According to the mortgagor, this is what happened:
I said I have no land there. Then they said that some land belonging to Murthraju (D. W. 4) could be included and the document registered at Drakaharaman. I said I do not know about that and if they arranged that with Murthiraju, I had no objection.
29. Murthiraju, as D. W. 4, supports the statement and adds:
I did not object to our 10 cents being included in Ex. A.
30. The document was written at this man's house and as I have said, the writer was his brother, D. W. 5. The motive suggested is thus one of convenience. It is admitted that there was another place, Cocanada, where the document could have been validly registered without the inclusion of this item. It is further admitted that Cocanada and Draksharaman are equidistant from Velangi, the plaintiff's place. The reason for not choosing Cocanada (so it is said) is to save a paltry sum of a few rupees, for the registration fee at Cocanada is slightly more than at Draksharaman. When, two years after the mortgage, the property was sold by Ex. B, it is common ground, that the money was carried across the river and the sale-deed was registered at Amalapur. The persons who had to take the money in 1908 were, as the evidence shows, the same as those that had to carry it in 1906. The motive suggested for the fraudulent insertion is therefore utterly inadequate.
31. I have already said that the case set up in the written statement was in part abandoned at the trial. We further find, that when the plaintiff's witnesses were cross-examined, the case as presented at the trial was not even indicated. P.W. 2 was asked in cross-examination whether any attempt was made to find out that defendant 1 had title to this item. Why was not the case of the defence put to him? P.W. 2 was cross-examined on 30th October and D. W. 2 gave his evidence on 28th November. There was sufficient time for inventing the story to which the defence witnesses spoke.
32. The learned Judge says that the mortgagor sold by Ex. B all the items included in Ex. A excepting the 10 cents in question. This, in the Judge's words, is, ' conclusive indication ' of the fact that the mortgagor did not own that item. It is not disputed that this is based on a misapprehension. There were certain items beyond item 4 not included in the sale-deed. What was regarded by the lower Court as a conclusive argument turns out to be wrong. Next, the respondent's learned Counsel argued ' that it was admitted ' that before the mortgage the plaintiff did not care to inspect the 10 cents in question; but it is in evidence that the item 3, inam lands, were likewise not inspected.
33. It is for the defence to affirmatively make out that the parties committed a fraud. It seems to me that the evidence falls for short of what is required in a case of this kind. For invalidating a document on this ground, it is not sufficient to show that the mortgagor contemplated a fraud; it must be further shown that the mortgagee was a party to that fraud. Harendra v. Haridasi. Did the parties intend or not, that the item should form part of the security? If the parties did, in any event the mortgagee did, then fraud is out of the question: Biswanath Prasad v. Chandra Narayan. It is not sufficient to render a document invalid that the mortgagor is unable to establish his title to the property. Their Lordships observe in the second mentioned case:
This case differs toto caelo from the case suggested in argument of a mere failure to make good a title to property dealt with by the instrument and which both parties had intended should form part of the security.
34. Even granting that every word of the defence evidence is true what is its effect? There was nothing to prevent the nephews from consenting to their property forming part of the security. Nor was there anything wrong in the plaintiff including that property in the mortgage. The crucial question is, as I have said, was the item intended or not to be part of the security? If it was, the nephews would be estopped from disputing that their property became effectively subject to the mortgage. In Biswanath Prasad v. Chandra Narayan, it was distinctly found that neither the mortgagor nor the mortgagee intended that the item there in dispute should form part of the security. In the present case, I am satisfied that there was a clear intention that the security should operate on the fourth item to whomsoever it belonged, although, as I have already said, I have no hesitation in finding that defendant 1 was its owner. In this connexion, I must mention, that about two weeks after the evidence was closed, the defendant applied to the lower Court for permission to file a copy of Diglott Register with a view to prove the title to the item in question. This application was refused, and, in my opinion, rightly. Apart from the reason given by the Judge that there was no explanation for the delay, the document is most inconclusive on the point. We have been asked to admit it and for the reasons mentioned we have refused to comply with that request.
35. The only question that remains is, to what amount is the plaintiff entitled? She now seeks to recover the entire balance, that is, to throw the whole burden upon defendants 2 to 5. Can she be permitted to do so? The plaintiff's conduct shows that she agreed to split up the mortgage and recognize the arrangements embodied in Ex. F by which the debt was apportioned among the various purchasers. The endorsements made on Ex. A furnish clear evidence of this fact; they contain reference to the amounts severally payable by each of the cosharers. Moreover, Ex. 1, dated 16th September 1922, is conclusive on this point. I am therefore of the opinion that the plaintiff's claim against these defendants must be limited to the amount mentioned in Ex. F that is, to Rs. 3,759-1-0 and to the interest thereon. As regards the rate of interest, the plaintiff's conduct shows that she cannot claim more than 12 per cent for, it is on this basis, that she alleges, she received the amounts due from the other co-sharers. The plaintiff is therefore entitled against defendants 2 to 5 to a decree for Rs. 3,759-1-0 with interest at 12 per cent per annum from 1st October 1920 to the date fixed for sale and with interest thereafter at 6 per cent on the aggregate sum.
36. As regards costs, I think the proper order is, that the plaintiff shall pay and receive proportionate costs throughout. The date for redemption is 8th July 1929. I have said that defendant 7 was impleaded on the ground that he was in possession of some items of the suit property. It was for the first time discovered by defendant 7's counsel, almost at the close of the argument before us, that his client is not in possession of any part of the property and the suit is on that ground dismissed against defendant 7 but without costs.