Mahanth Kesho Das vs Hari Kishun Das and Others

Agarwala, J.—The respondents sued to recover Rs. 1125, alleged to have been lent to defendant 1 on 23rd March 1930, and Rs. 200 as interest on the loan. Defendant 2 was impleaded as surety for repayment of the advance.

In the plaint the plaintiffs stated that on 23rd March 1930, defendant 1st party borrowed the sum of Rs. 1125 and in token of the acknowledgment of the sum executed a handnote dated 23rd March 1930, and promised to pay this sum "on demand with interest at one percent per on demand." The plaint further alleged that on the same date the defendant 2nd party agreed by a letter dated 23rd March 1930, to repay the amount if defendant 1 failed to do so. The plaintiffs accordingly in their plaint prayed for a decree for Rs. 1325 against defendants'' 1st party and 2nd party, "on the basis of the handnote and the letter" of suretyship. Defendant 1 did not deny that Rs. 1125 was due from him. His defence was that this money was due not to the plaintiffs but to defendant 2 on bahi khata account. The first Court disbelieved the defence and decreed the plaintiffs'' suit. An appeal by defendant 1 resulted in the suit being remanded to enable the plaintiffs to amend their plaint. The reason for this was that the document described as a handnote did not contain the name of the payee and the Court therefore held that the plaintiffs were not entitled to succeed on the basis of the handnote, but that in the circumstances they were entitled to an opportunity to amend their plaint and to seek to recover from the defendants on the basis of the loan. The case accordingly went back to the trial Court and the plaint was amended. The amendment consisted of a statement in the plaint "that the fact of the loan being advanced to the defendant was entered in the rokar bahi of the plaintiffs'' shop which was kept in the regular course of business" and in the paragraph in which the date of the cause of action is mentioned, in addition to the original statement "that the cause of action arose on the date of the execution of the handnote" there was an addition "that the cause of action arose when the loan was taken from the plaintiffs." The Court on remand again decreed the plaintiffs'' suit.

In appeal by defendant 1 to the District Judge the decree was attacked on four grounds. First, that the amendment of the plaint should not have been allowed, secondly, that as the claim to recover the original loan was barred by limitation at the date of the amendment the suit should have been dismissed on that ground, thirdly, that the plaintiffs'' story of the loan was improbable, and, lastly, that interest at the rate mentioned in the handnote should not have been granted. All these grounds failed to impress the learned District Judge who upheld the decision of the first Court.

The first ground on which the decision of the Courts below is attacked in second appeal is that the suit, after the amendment, was not maintainable. This is a ground which was not taken in the Courts-below and was not taken in the grounds of appeal to this Court.

It is contended however that the question is really decided by a decision of the Full Bench of this Court in Domoo Khan v. Agha Arnhad A.I.R.1983. Pat 575 which was a ease referred to the Full Bench by Macpherson, J. and myself, the question being whether, when a suit on a handnote fails by reason of the handnote being inadmissible in evidence, the creditor is entitled to recover on the original debt. So far as this Court is concerned, the first reported caee in which that question was dealt with was Suruj Lall v. Anant Lal A.I.R.1920. Pat 730. In that case Mullick and Sultan Ahmad JJ. held that when the plaintiffs alleged that there was an adjustment of accounts of loans taken by the defendants who in acknowledgment thereof executed the handnote in suit, which was found by the lower Courts to be a forged one, the plain, tiffs could maintain the suit on the basis of their account books even though the handnote in suit was forged.

The next case in this Court was Dhaneshwar Sahu v Ramrup Gir A.I.R.1928. Pat 426 which was decided by Kulwant Sahay and Macpherson JJ. (one of the Judges by whom the first mentioned case was referred to the Full Bench). It was there held that there was an implied contract to repay money borrowed from another even though no express promise to repay is made either in writing or verbally and that this implied promise to repay arises apart from the instrument or promissory note evidencing the loan and is enforceable independently of the instrument or promissory note, even where the lending of the money and the execution of the note are contemporaneous.

This view of the law was reiterated by Jwala Prasad and Kulwant Sahay JJ. in Abdul Muhammad Khan v. Mahananda Upadhyaya A.I.R.1931. Pat 293 in which the decision in Dhaneshwar Sahu v Ramrup Gir A.I.R.1928. Pat 426 was followed. The last decision of this Court before the Full Bench case was Tasadaq Hussain v Basawan Rai A.I.R.1933. Pat 159 decided by Mohammad Noor, J. There the plaintiff sued on the allegations that the defendent had borrowed Rs. 218 from him and bad given him a handnote. There also the payee''s name was not entered in the handnote. Mohammad Noor, J. held that the suit as framed could be tried and decided as a suit for recovery of the loan independent of the handnote and that the writing was admissible in evidence of the loan irrespective of whether it was or was not a promissory note within the meaning of the Negotiable Instruments Act.

In Brijbhusan Pande v. Ramjanam Kuer A.I.R.1932. Pat 324 Dhavle, J. sitting singly held that where a suit on a hand-note fails for some technical defect and the plaintiff asks for a decree on the loan itself, no decree can be passed unless a specific case has been made in the plaint as originally filed, or the plaint has been amended, the reason given being that in such a case the onus shifts to the plaintiff. In that case the learned Judge sent the case back to the lower Court to afford the "plaintiff an opportunity to amend the plaint if he so desired to do. Except for the decision of the Full Bench therefore, the views expressed by this Court have been consistent that the plaintiff is entitled to recover his claim on the original loan when the suit on the handnote fails either because the payee is not mentioned or because the handnote is not admissible in evidence provided that a proper case has been made out in the plaint or the plaint has been amended to state the facts necessary in support of the claim and the only question therefore is whether the Full Bench has upset this line of decisions so that we should have to follow the decision of the Full Bench in preference to the other decisions on the point of this Court.

The Acting Chief Justice, in the Full Bench case, referred to the finding of the trial Court that the plaintiff had proved that there was an oral contract to repay the advance and his Lordship therefore held that the question of whether the decisions in Dhaneshwar Sahu v Ramrup Gir A.I.R.1928. Pat 426 and Abdul Muhammad Khan v. Mahananda Upadhyaya A.I.R.1931. Pat 293 were correctly decided did not arise for consideration. Those decisions therefore were not reversed by the Full Bench. A number of decisions in other Courts relating to this much debated question have been brought to our notice including the Full Bench decision in Nazir Khan and Another Vs. Ram Mohan Lal and Another and the Full Bench decision of the Madras High Court in Ramaesmi Pilial v. Murugiah Padayachi A.I.R.1936. Mad. 179 the decision of Sir Richard Garth Sheikh Akbar v. Sheikh Khan 7 Cal. 256. and other cases of similar nature to which I do not propose to refer in detail. An attempt to summarise the law was made by the Fall Bench of the Rangoon High Court in Maung Chit v. Roshan N.M.A. Kareem Oomer, & Co. A.I.R.1934. Rang 389.

The decisions of our own Court on this point are binding on us and I do not therefore propose to analyse those decisions. Furthermore, the plaintiffs did not raise the question of maintainability of the suit in the Courts below after the amendment had been allowed and did not raise it in the grounds of appeal in this Court and the question of law propounded by the appellant, even if it be accepted, turns on a question of fact, viz. whether in this particular case there was an independent con tract to pay or not. That was a question which was not raised in the pleadings of the defendant.

The second question raised by the learned advocate for appellant was that the suit as now framed is barred by limitation. The loan was on 23rd March 1930. The suit was instituted on 17th September 1931, the amendment was made on 21st March, 1934. The circumstance that an amendment of the plaint may have the effect of depriving the defendant of the benefit of the plea of limitation is one of the circumstances, and a most important one, which has to be considered by a Court before permitting an amendment of the plaint. It is only in exceptional cases that the Court will allow the plaintiff to amend his point in such a way as to deprive the defendant of the plea of limitation, but when once the Court has exercised its discretion judicially, and the amendment has been allowed, the amendment dates back to the presentation of the plaint, and if that date is within the period of limitation prescribed for the particular relief which the plaintiff seeks by his amendment, the suit must be held to be within time. This was also the view expressed by the Division Bench of the Calcutta High Court in East Bengal Commercial Bank, Ltd. v. Surendra Narayan 39 C.W.N. 1235 which was a case in which the claim on a promissory note failed as the note was under stamped and the plaint was amended so as to introduce a claim on the loan, the amendment being made after the suit on the loan was barred.

In any case in my view, the allegations in the plaint in this case were sufficient to entitle the plaintiffs to succeed on a suit on the loan distinct from the claim on the handnote. The plaintiffs distinctly set out in their plaint that the defendant had borrowed money from them on 23rd March 1930, and it was to recover that money that the suit was instituted. It is true that they did not alternatively make a claim that they were entitled to recover the money as well on the original loan as on the basis of the handnote, but that I think is not fatal to the suit as all the facts necessary to support a claim on the loan were alleged and proved.

In view of the observations regarding interest in Suruj Lall v. Anant Lal A.I.R.1920. Pat 730, the plaintiffs-respondents did not press for interest at the rate mentioned in the handnote. They will recover interest at the rate of six per cent. from the date of the loan. The respondents will be entitled to the coats of this appeal.

Rowland, J.

I agree. If I may say so, I feel no doubt as to the correctness of the decisions of this Court which have just been summarised. I think the law is correctly stated in those decisions and in Gopal Chand Marwaree v. Thakurani Mohokoom Kooaree 1877. 3 Cal 314, Pramath Nath Sandal v. Dwarka Nath Dey 1896. 23 Cal 851, Ram Bahadur v. Daauri Ram 1913. 17 C.L.J. 399 and East Bengal Commercial Bank, Ltd. v. Surendra Narayan 1935. 39 C.W.N. 1235. These decisions, it seems to me, are in agreement with 1 East 5516 and the Privy Council decision in Ram Bahadur v. Daauri Ram 1913. 17 C.L.J. 399. The other view seems to be based on over emphasis on the word "then" in the pronouncement of Sir Richard Garth in Sheikh Akbar v. Sheikh Khan (1881) 7 Cal. 256

when a cause of action for money is once complete in itself...and the debtor then gives a bill or note to the creditor...the creditor may sue for the original consideration.

The view has been expressed in some places that "then" does not include "at that time" which is the dictionary meaning of the word but means "thereafter" or "subsequently" and the Full Bench decision of the Allahabad High Court in Nazir Khan and Another Vs. Ram Mohan Lal and Another , goes so far as to introduce an analogy with the requirement of antecedency in debts to make them binding on the junior members if a Hindu family. I can find nothing in the reasoning of that and the other decisions referred to, to displace the line of authority leading up to and contained in the decisions of this Court.

In the Fall Bench decision Domoo Khan v. Agha Arnhad A.I.R.1983. Pat 575, we have referred to the original record and so far as we could ascertain, the loan and the handnote appear to have been of the same date; and as I under, stand the matter, to say that there is a cause of action independently of the bill or note need not imply that there is an antecedent and a subsequent transaction; it is enough that there was a good cause of action if the handnote had not been axecuted.

Had it not been so, the case before the Fall Bench should have been decided differently.