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Jiban Krista Kundu Vs. Rai Hari Nath Ghose Bahadur and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Reported inAIR1933Cal826,147Ind.Cas.459
AppellantJiban Krista Kundu
RespondentRai Hari Nath Ghose Bahadur and anr.
Cases ReferredNational Bank of Upper India Ltd. v. Bansidhar
Excerpt:
- .....presently.3. the second contention is that even if this power is held to include authority to make payment of interest with reference to debts due from jiban it is not such an authority as is contemplated by sections 20 and 21, lim. act, and his contention is that the authority contemplated by these sections really means a special authority in respect of this particular loan. the third argument with reference to this power of attorney is that there has been a fundamental misconception by the subordinate judge of this part of the case seeing that this power was subsequently revoked by a deed of partition between the two brothers which was executed and registered on 13th november 1923 before the payment in question was made. 'with reference to the first contention it appears to us.....
Judgment:

Mitter, J.

1. This is an appeal on behalf of defendant 1 and arises in a suit brought by the plaintiff for recovery of a certain sum of money on the basis of a promissory note said to have been executed by defendant 1 Jiban and his brother Mohit Krishna Kundu on 4th December 1919 for a sum of Rs. 10,000. The handnote carried interest at the rate of Rs. 1-8-0 per month. The defence of defendant 1, which it is now material to mention, to the suit is that it is barred by the statute of limitation so far as he is concerned. This defence which led to the framing of issue 1 in the Court below has been rejected by the Subordinate Judge who has granted a decree against both the defendants. Defendant 1 has alone appealed.

2. On his behalf the only contention that has been raised is that the suit is barred by limitation. It appears that in the plaint the plaintiff alleged that the defendants on paying the interest on several debts up to 3rd October 1927 due to the plaintiff on account of the handnotes endorsed the said payment on the back of the said handnote. After deducting certain payments the amount due to the plaintiff is stated to be about Rs. 11,555 for which the present claim is laid. The question of limitation turns on the payments made by Mohit Krishna Kundu alone on 21st September 1925 for it is admitted that the previous payment of 6th October 1922 was made both by Jiban and Mohit and this also appears on the face of the endorsement in the handnote. The question in controversy in the present appeal is whether this payment of 21st September 1925 which on the face of the document appears to have been made by Mohit alone was made by Mohit for self and as agent authorized specially in this behalf for Jiban, the defendant-appellant. If this payment of 21st September 1925 be held not to have been made under the authority of Jiban, then admittedly the last payment by both the brothers having been made on 6th October 1922 the suit would be barred by limitation, having regard to the provisions of Sections 20 and 21, Lim. Act, before its amendment by the Act of 1927. In order to take the case out of the statute of limitation the plaintiff will have to establish that Mohit Krishna Kundu when making the payment on 21st September was authorized by Jiban to make, this payment which was for interest as such. The Subordinate Judge on this part of the case has relied on a general power of attorney which was executed by Jiban in favour of his brother Mohit and another person so far back as 19th September 1918 and he has come to the conclusion from this power of attorney that Mohit had authority to make the payment on the score of interest, for he says that the power does not appear to be limited 'to some litigation, but appears to embrace acts all and sundry.' The Subordinate Judge has not been unmindful of the circumstance that this case of agency has not been made in the plaint, but putting the most favourable construction on para. 4 of the plaint it may be assumed for our present purposes that the plaintiff would be able to succeed if he really establishes a case of agency at the date when the payment of interest was made. The learned advocate for the appellant has therefore addressed an argument with regard to this power of attorney which falls under three heads. He has argued in the first place that the power of attorney does not specially authorise Mohit to make the payment of interest and this contention really turns on the construction of the said power to which we shall advert presently.

3. The second contention is that even if this power is held to include authority to make payment of interest with reference to debts due from Jiban it is not such an authority as is contemplated by Sections 20 and 21, Lim. Act, and his contention is that the authority contemplated by these sections really means a special authority in respect of this particular loan. The third argument with reference to this power of attorney is that there has been a fundamental misconception by the Subordinate Judge of this part of the case seeing that this power was subsequently revoked by a deed of partition between the two brothers which was executed and registered on 13th November 1923 before the payment in question was made. 'With reference to the first contention it appears to us clear that the power of attorney does embrace a power to deposit interest with reference to loans. The material portion of the power is as follows:

That it has become highly necessary to appoint Am-mukhtears on my behalf in order to look after the management and for facility of business in respect of Mahals held directly under the Government and of subordinate interests and other properties and business, etc., which are now in existence and which may come into existence*****

and again in another place it is said that the power extends to the making of deposits of all sorts of money due from Jiban. The passage is as follows:

And take receipt, etc., on depositing all sorts of money due from me and shall enter appearance in all law suits against me on my behalf as my representative and file petition and make arguments and file solenamas, rajinamas, sastinamas etc.*****

4. We have no doubt therefore that this power, if it was not revoked, was sufficiently comprehensive to give the necessary authority to Mohit to make the payment. Taking now the second branch of the argument in this behalf made on behalf of the appellant it appears to us that there is no foundation for the contention that the authority contemplated by Section 21 must be a special authority given for the purposes of making payment of the particular loan in question. Indeed the argument of Mr. Chatterjee was that with reference to every such debt owing from a particular person to another there must be a separate authority. In other words the argument is that in order to take the case out of the statute the person relying on the authority must show that the person making the payment was armed with a special authority in this behalf with reference to this particular loan. To me the proposition seems somewhat startling and indeed there is no authority nor can there be any such authority for such proposition. Reliance was placed on a decision of the Allahabad High Court in the case of Narayan Rao Kalia v. Manni Kunwar AIR 1922 All 230. An examination of that case will show that the case is no authority for the proposition which is contended for. There the particular power was not before the Court and the facts were that a person who was described as the mukhtaraam for the defendant mortgagees verified a wajibularz and made a statement acknowledging liability, and in such circumstances it was held by the learned Judges that it cannot be assumed that a mukhtearaam has power to acknowledge liability within the meaning of Section 19, Lim. Act; but such a liability can only be fastened upon the principal by a person duly authorized in this behalf, that is, who has been given authority to make such an acknowledgment of liability. The learned Judges were not considering in that case any question regarding the power given by a particular document to the mukhtearaam which is the case here.

5. On the other hand there is a very high authority for the proposition that the question of special authority within the meaning of Section 19 or Section 20 really turns on the construction of the power-of-attorney. Reference may be made in this connexion to a decision of their Lordships of the Judicial Committee of the Privy Council in the case of Beti Maharani v. Collector of Etawah (1895) 17 All 198. There the question arose with reference to payment in respect of a mortgage debt and an authority appointing one Ajodhya Prosad as the ammukhtear which is quoted in the judgment of their Lordships of the Judicial Committee in extenso was produced in that case and it was contended that the acknowledgment of personal liability was justified under the authority given in the power-of-attorney or the mukhtearnama. Their Lordships on the construction of the document came to the conclusion that the mukhtearnama did not embrace the power to acknowledge liability of a personal debt of the debtor and that it was really confined to the liability in respect of certain mortgages. It seems to us to be manifestly inconvenient if the contention put forward by Mr. Chatterjea be given effect to. For, to take an illustration, a person may have very large commercial transactions and he may be under the necessity of borrowing large sums of money from different creditors. He may in view of his present and future borrowings empower a certain person to make payment in respect of payment of interest or payment of other sums in respect of these loans and give a general power to that effect to a particular person. It can hardly be said that the power being a general one in respect of debts which may be incurred and not being in respect of that particular transaction is not sufficient within the meaning of Section 20. The inconvenience of such a rule is manifest. We do not think that any authority can be found for such a proposition as this. This contention must therefore be overruled.

6. The next contention with reference to this power-of-attorney is a substantial one and must be given effect to. It appears that the power was revoked by the partition deed. The question is material in this case seeing that it is not the plaintiff's case that when this payment was made he had seen the power-of-attorney. On the other hand he says that he was told of it simply by Mohit. If of course he had seen the power-of-attorney and on the strength of that power had accepted payment from Mohit further questions might have arisen as to whether notice of revocation of this power was given to the plaintiff or not. But no such question arises in the present case on the plaintiff's own evidence that he had not seen the power and had not accepted payment on the faith of such power. It seems to us therefore that the Subordinate Judge's conclusion on this part of the case is wrong as he has missed a very fundamental fact, namely, that this power had been revoked by the partition deed of 13th November 1923. Some question has been raised as to the knowledge of the plaintiff with reference to this partition. The question becomes immaterial in view of the legal position to which we have just referred. But, I have no doubt on the evidence that all that the plaintiff knew about this partition was, as he himself stated, that he heard of the rumor of partition two or four years ago and that he inquired about it and could not knew positively if the rumour was true. It is admitted that no notice of this partition deed was formally sent to the present plaintiff.

7. There is no reason to disbelieve the statement made by the present plaintiff who is a Government pensioner and medical practitioner of respectability and one does not see any reason why that statement should not be accepted. The Subordinate Judge has really rested his decision on the power-of-attorney which for the reason of its revocation cannot be regarded as furnishing the necessary authority. He has also relied on a letter sent by Hari Nath Ghose, the plaintiff, to defendant 1, appellant, on 15th August 1925: see p. 13, part 2 of the paper book, and he concludes from this that this letter which was not replied to by Jiban made the plaintiff think that Mohit's payment would be sufficient for the purpose. It is difficult to follow the Subordinate Judge in his remarks with regard to this part of the case. He states:

This letter no doubt discloses plaintiff's apprehension that Jiban was perhaps unwilling to make the payment, and it also shows that plaintiff was in a sense aware of the fact of the partition between the brothers, but when the plaintiff positively and categorically asked Jiban to make the payment and to admit the payment to save limitation, it was certainly the duty o the defendant to make a plain assertion of his unwillingness to pay or to admit the payment purporting to have been made by Mohit. Jiban did neither answer plaintiff's notice to sue. This silence, studied and wilful, certainly led the plaintiff to think that the payment by Mohit was not denied.

8. This last sentence is rather ambiguous and neither of us has been able to follow the exact import: see pp. 23 and 24, part 1 of the paper book. It is difficult therefore to sustain the judgment of the Subordinate Judge on the ground on which he has rested his judgment. Dr. Pal who appears for the respondent has to some extent frankly conceded that he is unable to support all the reasons given by the Subordinate Judge in his judgment. But he supports the judgment of the Subordinate Judge on another ground, a ground not taken in the Court below and with reference to which no issue was joined. He contends from the deed of partition that Mohit was entrusted to make payment of all debts owing from him or from his brother Jiban, the appellant, or from both, and this stipulation in the partition deed was sufficient to authorize Mohit to make the payment on behalf of his brother. The material portion of the deed on which he relies is to the following effect:

Besides this I, Mohit Krishna Kundu, the second party, alone remain wholly liable for the debts which may be found to be due in the name of the first party or in the name of the second party or in the names of both the parties, in respect of the properties up to the year 1329 B.S., i.e. up to the period during which our state was joint, and in respect of the Ultadingi Arat up to Pous 1330 B.S. If anyone of the parties be compelled to pay any debt due by the other, then he shall be competent to realise the amount with legal interest from the other party amicably or through the help of the Court,

and he contends on the basis of this passage in the partition deed that this shows that Mohit at any rate had implied authority to make payment in respect of any debts owing from either of the two brothers, and in support of this contention he has relied on a recent decision of their Lordships of the Judicial Committee of the Privy Council in the case of National Bank of Upper India Ltd. v. Bansidhar AIR 1929 PC 297. An examination, however, of the facts of this case before their Lordships would show that th8 state of facts there was very different. The facts, as appear from the judgment of Sir George Lowndes who delivered judgment of their Lordships in the passage to which I shall presently refer, show that there was an implied authority in favour of the person making the payment to make the particular payment. It appears that on 22nd December 1917 respondent 1 in that case executed in favour of the National Bank of Upper India Limited a promissory-note payable on demand for Rs. 20,000 and interest together with a formal receipt for the money. The bank went into liquidation and the liquidators suing in the name of the bank claimed from the respondent the money due under the hand-note. The appellant bank asserted in their plaint that the sum of Rs. 20,000 was advanced to respondent 1, and that he and his brother made various payments in respect of principal and interest upon which reliance was placed to save limitation and the suit was instituted more than three years after the date of the note. The facts which were not in dispute are as follows:

One Bishambhar Nath, who was a director of the bank, had been allowed by the bank's manager, Ram Nath Sapru, to become indebted in a large sum to the bank,'and in December 1917, in view of the approaching half-yearly audit, it was desirable that the accounts should be squared in some way so as not to show the director as the debtor to the bank. Respondent 1, who carried on business in Lucknow with his brother, respondent 2, (who was also a director of the bank), was accordingly persuaded to execute the promissory-note sued on, so as to show him as the bank's debtor for Rs. 20,000, and this amount was credited in the books of the bank to Bishambhar, thus wiping out his indebtedness.

9. After the indebtedness of Bishambhar was wiped out he (Bishambhar) paid a sum of Rs. 900 with interest due on the bank's promissory-note and the arrangement was that sum was to be paid by Bishambhar although in the bank's books it appears that the sum was, as a matter of fact, paid by respondent 1 who took over the liability of Bishambhar. In this state of facts the Judicial Committee dealing with the question of limitation, after referring to Section 20, Lim. Act, said this:

In answer to the first question, counsel for the appellant contended that even if Bishambhar could not be regarded as duly authorised by respondent 1 to make a payment of interest on his behalf, he was himself under a direct obligation to respondent 1 to satisfy the debt, and in that sense was at all events 'a' person liable to pay it. In support of this contention the case of Bradshaw Widdrington (1902) 2 Ch 430, and other similar English decisions, were relied upon. Their Lordships do not think it necessary to discuss the applicability of these cases to the construction of the Indian Act. Upon what they have already held to be the true meaning and effect of the transaction of 22nd December 1917, it was agreed between Bishambhar and respondent 1 that the former would discharge the latter's debt to the bank in respect of both principal and interest, and it is clear from respondent 1's evidence that he left it to Bishambhar to do so. Under these circumstances, it being admitted that no formal authorization of the agent is required under this section, their Lordships find no difficulty in implying authority from respondent 1 to Bishambhar to pay the interest on his behalf as it became due.

10. In that case there was in the circumstances an implied authority in view of the arrangement between Bishambhar and respondent 1 to pay the particular interest on the particular loan. Here from the passage in the partition deed which has already been quoted all that appears is that Mohit took upon himself the liabilities in respect of debts owed by both himself and Jiban and there was also this penal clause further that if one of the parties be compelled to pay any debt due by the other then he would be competent to realise the amount with legal interest from the other party amicably or through the help of Court. It was in view of this position, it seems to me, that no reply was given by Jiban to the letter sent by the present plaintiff. It seems to be somewhat strange that notwithstanding the circumstance that the letter was not replied to by Jiban the payment made by Mohit was accepted as payment made on behalf of both. For the letter, at any rate, indicates this that there was some sort of settlement between Mohit and the present appellant and in view of that settlement the latter suggested:

Why should both of you not sign and make a settlement between yourselves in writing.

11. After writing this letter it seems somewhat strange that the plaintiff should be content to accept the payment by one shortly after this letter which was written on 15th August 1905. In this view we are of opinion that the plea raised by the defendant-appellant has been made out. This appeal must be allowed and the suit dismissed against defendant 1. The rest of the decree against defendant 2 will stand. There will however in the circumstances be no order as to costs either here or in the Court below.

Henderson, J.

12. I agree. With great respect to the learned Subordinate Judge it does not appear that he kept very clearly before his mind what was the question which he had to determine. The suit is prima facie barred by limitation. In order to get rid of this bar the plaintiff relied on certain payments on account of interest which he alleged had been made by the defendants. The vital payment is one referred to by an endorsement on the bond dated 21st September 1925. At the trial the plaintiff failed to prove payment by the appellant. In my judgment, when the plaintiff failed to prove the case which he made, the suit against the appellant should have been dismissed. The learned Subordinate Judge, however, gave a decree against the appellant on a finding that the payment was made by defendant 2 as his authorised agent. No such case was aver made out in the plaint. In order to support this finding the learned Subordinate Judge relied upon a power of attorney. As my learned brother has pointed out, that power had already been revoked. This finding of the learned Subordinate Judge is therefore not only against the pleadings but also against the evidence. In addition to this the learned Subordinate Judge also appears to have decreed the suit on the ground that the appellant either by his representation or conduct allowed the plaintiff to suppose that the other defendant was authorised to make payments on his behalf. This case again was never made by the plaintiff himself. In his examination-in-chief the plaintiff never even said that he thought that defendant 2 was making a payment on behalf of the appellant; in view of the letter which he had written to the appellant shortly before, it is difficult to believe that he would ever put forward such a claim. In his cross-examination the plaintiff stated that defendant 2 informed him that it would not be necessary to insist on a signature from defendant 1 who had given a power of attorney to defendant 2.

13. The plaintiff admits that he never saw the power. It is quite clear that no case of misrepresentation by the appellant was made out on this evidence, even if it is true. It was also found that prior to the partition defendant 2 made payment on behalf of both the defendants. In coming to this finding the learned Subordinate Judge was confusing defendant 2 with a totally different person named Mohit Krishna Hari. Dr. Pal contended that the case was taken out of the scope of Section 21 in view of the deed of partition between the defendants. I agree with my learned brother that the facts of the case upon which Dr. Pal relies are quite different from the facts of the present case. It is quite clear that a payment by defendant 2 alone would not save limitation against the appellant. The arrangement made by the deed of partition with respect to this debt was that as between themselves defendant 2 would discharge the liability. In my opinion this would not affect the matter at all. The learned Subordinate Judge also refers to some payments which are certified by an endorsement which is unsigned and undated. There is no evidence whatever to connect the appellant with any of these payments. There is, in fact, no evidence to show who made the payments. The only evidence on the point is to the effect that the endorsement was made by one Kshetra Mukherjee who is said to be the manager of the defendant: it is not clear which of the defendants the plaintiff was referring to. There can, however, be no doubt that if the plaintiff relied upon the payment made by Kshetra Mukherjee on the ground that he was an authorized agent of the appellant he should make a specific case to that effect in the plaint.


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