B.K. Mukherjea, J.
1. This rule is directed against an order of the Subordinate Judge, Second Court, Dacca, dated 19th June 1941, rejecting an application of the petitioner for re-opening of a mortgage decree and for certain other reliefs under Section 36, Bengal Money-lenders Act. The facts are not in controversy and may be shortly stated as follows: The petitioner had various business transactions with Rai Revati Mohan Das Bahadur the father of the opposite parties for over a considerable period and the latter had supplied timber and tin goods to the petitioner from time to time for which, on adjustment of accounts outstanding in August 1928, it was found that a sum of Rs. 74,297 and annas odd was due by the petitioner to the said Revati Mohan. In August 1928, the petitioner executed a security bond in favour of Revati Mohan hypothecating certain properties as security for the said sum of Rupees 74,297 and annas odd and for price of other goods that might be supplied to him in future aggregating in all to Rs. 75,000. It may be mentioned here that this sum of Rs. 74,297 represented only the unpaid purchase money in respect of the goods supplied to the petitioner and nothing by way of interest on the same and the stipulation in the security bond was that interest at the rate of 9 per cent. per annum would be payable if the petitioner failed to pay the money within Chaitra 1335 B.S. In 1932, the father of opposite parties instituted a suit (being Title Suit No. 27 of 1932), in the Court of the Subordinate Judge, Second Court, Dacca, against the petitioner for recovery of a sum of Rs. 52,046 as the outstanding price of goods supplied to the defendant on the basis of the security bond aforesaid. The trial Court decreed the suit in part for Rs. 27,000 and odd but on appeal to this Court the plaintiff's claim was allowed in full with the exception of a small sum of Rs. 104 only. The decree was made final in due course and in execution of the same the hypothecated property was put up to sale and purchased by the opposite parties on 1st June 1940. The opposite parties then applied for delivery of possession of the properties purchased and thereupon the petitioner filed this application under Section 36, Bengal Money-lenders' Act, praying inter alia for reopening the mortgage decree and for passing a new decree in conformity with the provisions of the Act. The Subordinate Judge rejected the application on the ground that the transaction was not a loan within the meaning of the Bengal Money-lenders' Act. It is the propriety of this view that has been challenged before us in this rule.
2. In our opinion the decision of the Court below is right and should be upheld. A loan as defined in Section 2, el. (12), Bengal Money-lenders' Act, means an advance either of money or in kind made on condition of repayment with interest and includes any transaction which in substance is a loan. Primarily therefore a loan implies the idea of money or its equivalent advanced to the borrower on condition of its being repaid with interest. There may not be actual advance in a particular case as for example when an old bond is renewed but still it would rank as a loan within the meaning of the Act as in substance it can be treated as an advance. It is conceded by Dr. Sen Gupta, who appears in support of the rule, that the unpaid purchase money which a purchaser of goods or certain property owes to the vendor cannot be regarded as a loan as defined in that Act. This was expressly held by a Division Bench of this Court in Saradindu Sekhar v. Lalit Mohan Mazumdar : AIR1941Cal538 . But he argues that when a bond or security is taken by the vendor in respect of his claim against the purchaser for the unpaid purchase money the transaction may be and in fact is a loan. We think that we may concede so far, that circumstance might exist under which the transaction by which a bond or security is taken in respect of unpaid purchase money might come within the definition of a loan as laid down in Section 2, Clause (12), Bengal Money-lenders Act. The Legislature has for reasons of policy thought it proper not to define the term 'loan' in an inelastic or rigid manner and in every case we have got to look to the substance or the essential nature of the transaction for the purpose of determining as to whether or not it is a 'loan' within the meaning of the Act. If a vendor of property feeling unable to rely on the personal credit of the purchaser merely takes a bond or security from him in respect of the unpaid purchase money the transaction by itself cannot rank as a loan because there is no element of advance involved in it.
3. Consider however a case of the following nature, namely, where A executes a promissory note in favour of B from whom he has purchased certain goods, promising to pay a certain sum of money and B after deducting the amount due to him as the price of goods supplied to A, advances only the balance to him and the whole amount carried interest. In such a case it is possible to argue that there was in substance an advance of the whole amount by B to A and the transaction could be regarded as a loan. Again the vendor might be a money-lender himself and might take a bond for the unpaid purchase money from the purchaser at an usurious rate of interest and this might afford room for argument that in substance he had advanced the money to the purchaser to pay off the price of goods due to him in order to obtain the advantages of a loan at such rates. No such consideration however applies to the facts of the present case. Here the security taken was a sort of floating security not only for the sum of Rs. 74,297 which was actually due at the time as the price of goods supplied to the petitioner, but for other goods that the petitioner might purchase from the opposite party in future. In fact, the petitioner had the right under the provisions of the security bond to take goods from the opposite party the value of which, together with the price already due did not exceed Rs. 75,000. The opposite party instituted the suit against the petitioner only to recover the balance of the purchase money that was still outstanding and the pleadings of the parties and the judgments in that suit clearly indicate that the whole dispute between the parties centred round the point as to what amount was actually paid by the petitioner towards the price of the goods purchased by him.
4. In our opinion there 'is no question of advance either express or implied in the present case and consequently it could not be treated, in substance, as a loan within the meaning of Section 2, Clause (12), Bengal Money-I lenders' Act. The contention of Dr. Sen Gupta must therefore fail. We may point out in this connexion, though it is not necessary for us to do so, that on the face of the document upon which Dr. Sen Gupta relies and upon the basis of the admissions which his client made in the title suit aforesaid the transaction even if it could be regarded as a loan could not but be held to be a commercial loan. It is not necessary however to decide the point finally as in our opinion it was not a loan at all. The result is that the rule is discharged with costs. We assess the hearing fee at two gold mohurs.
5. I agree.