Jibach Mahto vs B. Shib Shanker Chaudhry

Kulwant Sahay, J.—Civil Revision No. 90 of 1933.--This is an application in revision by defendant 2 against whom a decree has been made jointly with defendant 1 by the Small Cause Court. The suit was based on a hand note alleged to have been executed by defendant 1 for a sum of money advanced. Defendant 2 is the younger brother of defendant 1. The plea of defendant 1 was a plea of partial payment. As regards defendant 2 his defence was that he was separate from defendant 1 and was not liable for the claim made.

The learned Judge found that the plea of payment set up by defendant 1 had not been established. He further found that defendant 2 had failed to prove separation from defendant 1. The question then arose whether defendant 2 could be made liable upon the footing of the hand note upon which the suit had been instituted. The learned Judge has held that it is an established rule that parsons who are not signatories to bills of exchange or promissory notes cannot be held responsible as undisclosed principals, but he has drawn a distinction so far as a Hindu joint family is concerned and he has held that even when a suit is instituted on the foot of a promissory note not only the person who signed the note, but also the members of the joint family can be made liable. He has referred to the decision of the Calcutta High Court in the case of Ramgopal Ghose Vs. Dhirendra Nath Sen and Others, , where it was held that in a suit properly framed the plaintiff may claim in the alternative the amount of the original debt for which the promissory note was given as security and may proceed under the Hindu law against the property of the joint family as a whole, but if he chooses to adopt this alternative the co-parceners will be entitled to raise the defence that the debt was not contracted or the proceeds of the loan applied for family purposes.

In the present case the learned Judge has held that defendant 2 is liable without coming to any finding that the loan Was contracted for the benefit of the joint family. He has made a decree against defendant 2 simply upon the finding that the loan had been contracted by the karta of the family. In the first place the suit as framed being based entirely upon the hand note, no person other than the signatory of the hand note can be made liable. In the second place assuming that the suit was framed on the original transaction and not on the hand note even then no decree could have been made against defendant 2 without a finding that the loan was for the benefit of the family. There is no such finding in the present case and therefore the decree as against defendant 2 cannot stand. The decree so far as it is against defendant 2 must be set aside. In other respects the decree will stand.

The appellant is entitled to his costs. Hearing fee one gold mohur.

Civil Revision No. 92 of 1933.--This is an application by the plaintiff whose suit has been dismissed as against defendants 2 and 3 although it has been decreed against defendant 1. The suit as framed purports to be for the recovery of a sum of money advanced to defendant 1 as the karta of the family, and the necessity for which the loan was contracted was set out in the plaint. It was no doubt stated in the plaint that defendant 1 had executed a hand note for the sum advanced, but the fact of the loan itself was recited and the prayer in the plaint was for the recovery of the loan.

Defendants 2 and 3 were impleaded as defendants on the allegation that the loan was contracted by the karta of the family for the legal and justifying necessities of the family. The learned Judge has found that the loan was contracted by defendant 1 as the karta of the family and he also appears to believe the evidence which would go to show that the loan was taken for the purpose of the legal necessity of the family. He has however dismissed the claim as against defendants 2 and 3 on the ground that the suit was instituted on the basis of a promissory note and that no other person except the signatory of the hand note can be made liable under it. The learned Judge is clearly under a misapprehension as, on reference to the plaint, it is clear that the suit was not based on the hand note, but on the transaction of the loan. It was clearly recited in para. 2 of the plaint that the defendants were in need of money and they borrowed the sum of Rs. 201 and that a hand note was executed by defendant 1 as taken on the borrowing of the money and although a reference was made to the hand note yet the suit was not based on the hand note, but on the transaction of the loan.

Indeed if we cut out all reference to the hand note in the plaint even then it does not disclose a cause of action and the plaintiff was entitled to a decree upon the allegations in the plaint apart from the allegation of the hand note. The reason given by the learned Judge for not making a decree against defendants 2 and 3 therefore is not sound. Having regard to his finding that the loan was contracted for the benefit of the family it is clear that the plaintiff is entitled to a decree as against defendants 2 and 3 also. The result is that the decree of the learned Judge will be modified and a decree will be made in favour of the plaintiff not only against defendant 1, but also against defendants 2 and 3. The petitioner is entitled to his costs, Hearing fee one gold mohur.

Courtney-Terrell., C.J.

I agree.