A suit for recovery of a loan is barred under Sec. 4 of the Bihar Money-Lenders (Regulation of Transactions) Act, 1939, if the money-lender was not registered under the Act at the time the loan was advanced.

Sinha, J.

1. This application in revision has been made by the plaintiff whose suit for recovery of a certain sum of money on a hand-note has been dismissed. This application was at first placed before his Lordship the Chief Justice, but has been referred to a Division Bench by him.

2. The plaintiff is a registered money-lender. On 10-1-1948, the pro forma defendant, namely, Amir Chand Khan Wall Mohammad Khan Wazir Mohammad Khan Gul Mohammad Khan, a registered firm of money-lenders, advanced a sum of Rs. 230.00 to the defendant, namely, Hari-das Banerjee, at the rate of Rs. 107- per cent, per month on the basis of the handnote in question. On 15-12-1950 the pro forma defendant endorsed the promissory note, the handnote in question, in favour of the plaintiff and delivered the same to him. The plaintiff brought the present suit for recovery of Rs. 313, principal, plus interest at 12 per cent, per annum. The defendant pleaded the bar of Sec. 4, Bihar Money-Lenders (Regulation of Transactions) Act, 1939. It has been alleged by the defendant that the pro forma defendant was not registered under the Bihar Money-Lenders Act at the time the loan was advanced and, therefore, the suit was not maintainable. The Court below has given effect to this defence.

3. Mr. Chatterji has contended the following points on behalf of the plaintiff-petitioner -- (1) that it has not been shown that the plaintiff is not a casual money-lender, that is to say, the money-lending transactions of the pro forma defendant did not exceed Rs. 500 in the year; (2) that, the plaintiff being a registered money-lender under the Act, the suit has been wrongly dismissed by the Court below; (2a) Sec. 4 of the Act does not apply to this suit because in terms the bar applies to a person who has advanced a loan himself and, the plaintiff not being such a person, Sec. 4 had no application to his suit; (3) that the plaintiff is a holder in due course under Section 9, Negotiable Instruments Act, and as such he was entitled to a decree; (4) two out of the four brothers mentioned as pro forma defendants had in fact been registered under the Money-Lenders Act in 1946, and, therefore, the suit by the plaintiff was not liable to be dismissed; and (5) that, in any view of the matter, the plaintiff was entitled to a refund of the consideration money.

4. The Court below has found that the firm of the pro forma defendant and the firm Gul Mohammad Khan Mohammad Amir Khan are two different firms and, therefore, the fact that the firm Gul Mohammad Khan Mohammad Amir Khan was registered under the Money-Lenders Act 1946 did not protect the plaintiff from the bar of the provisions of Sec. 4 of the Act. It was also found that the plaintiff could not be deemed to be a holder in due course within the meaning of Section 9, Negotiable Instruments Act, and that the plaintiff cannot sue for the money lent because the plaintiff can have no better rights than the original moneylender, namely, the pro forma defendant, who had advanced the money to the defendant,

5. It has been urged that there were four brothers, Amir Chand Khan, Wali Mohammad Khan, Wazir Mohammad Khan and Gul Mohammad Khan, and that they had been partners in a firm which had been registered in the name of these four brothers under the Partnership Act in 1941, Of these four brothers, two, namely, Gul Mohammad Khan and Amir Chand Khan, had got themselves registered under the Money-Lenders Act on 4-7-1946. According to the case of the plaintiff, the loan in question was advanced by the firm of these four brothers to the defendant on the 10th of January, 1948. The firm of the four brothers mentioned above was also registered under the Money-Lenders Act on the 26th of August, 1950. On the 19th of July, 1939, under sec. 3 of the Bihar MonSy-Lenders Act, 1938 (Bihar Act III of 1938) the Governor of Bihar was pleased to exempt in all areas of the Chota-Nagpur Division a casual money-lender whose money-lending did not exceed the tot