Back
HIGH COURT OF CALCUTTA
P. C. Mallick
BINAPANI ROJA - Appellant
Versus
RABINDRANATH SARKAR - Respondent
Suit 2852 Of 1950
Decided On : JULY 21, 1958
EQUITABLE MORTGAGE - DEPOSIT OF TITLE DEEDS - VALIDITY - REGISTRATION - BENGAL MONEY LENDERS ACT - APPLICABILITY - INSTALMENTS - DISCRETION OF COURT - INTERIM INTEREST.
Fact of the Case:
Plaintiff filed a suit to enforce an equitable mortgage created by a deposit of title-deeds in March 1947. The suit was instituted in July 1950. The original mortgagee died in November 1950, and the suit was continued by his widow, the present plaintiff. The defendant No. 1 was the mortgagor, and the other defendants were mortgagees having an interest in the equity of redemption. The plaintiff alleged that the loan was made on the deposit of title-deeds of certain immovable properties situate at Calcutta in which the Mortgagor defendant had a half share. By way of additional security, three several promissory notes in favor of the mortgagor defendant were deposited with the plaintiff. The promissory notes were not, however, endorsed in favor of the mortgagees. The defendant No. 1 contested the suit and took up several defenses, including the denial of the equitable mortgage, the exercise of undue influence, and the applicability of the Bengal Moneylenders Act.
Finding of the Court:
The court held that the plaintiff had proved the equitable mortgage executed by the defendant by deposit of title deeds for the payment of Rs. 20,000/- lent and advanced by the original plaintiff to defendant No. 1. The court also held that the letter of deposit relied on by the plaintiff did not require registration as it was not the bargain or the contract of mortgage but a record of a past transaction. The court further held that the plaintiff was not a moneylender within the meaning of the Bengal Money Lenders Act as he had advanced money on a single occasion and not as a business. The court also held that the defendant was entitled to payment of the decretal dues by installments under the Act but granted more than two installments considering the delay in the disposal of the suit and the plaintiff's willingness to give up a part of the interim interest.
Issues: 1. Whether the plaintiff had proved the equitable mortgage executed by the defendant by deposit of title deeds? 2. Whether the letter of deposit relied on by the plaintiff required registration? 3. Whether the plaintiff was a moneylender within the meaning of the Bengal Money Lenders Act? 4. Whether the defendant was entitled to payment of the decretal dues by installments under the Act?
Ratio Decidendi: 1. To create an equitable mortgage, deposit of all title deeds is not necessary or imperative. The letter of deposit in this case was executed after the equitable mortgage had been created by the deposit of title deeds on receipt of the money and was not the bargain or the contract of mortgage, hence it did not require registration. 2. A person advancing a single loan on interest cannot be considered a moneylender under the Bengal Money Lenders Act as the definition of 'moneylender' requires carrying on the business of money lending, which means advancing loans on more than one occasion. 3. The defendant was entitled to payment of the decretal dues by installments under the Bengal Money Lenders Act, but the court granted more than two installments considering the delay in the disposal of the suit and the plaintiff's willingness to give up a part of the interim interest.
Final Decision: The court passed a decree in favor of the plaintiff for Rs. 17,000/- inclusive of interim interest, to be paid in installments. The defendant was also directed to pay the costs of the suit.
( 1 ) THIS is a suit to enforce a mortgage created by a deposit of title-deeds in March 1947. The suit was instituted by the original mortgagee in July 1950. Shortly after, in November 1950 the original mortgagee died and the suit is being continued by his widow the present plaintiff who has been substituted in the place and stead of the original plaintiff. The defenadnt No. 1 Rabindranath Sarkar is the mortgagor. The other defendants are mortgagees having an interest in the equity of redemption. It is alleged that the loan was made on the deposit of title-deeds of certain immovable properties situate at Calcutta in which the Mortgagor defendant had a half share. By way of additional security three several promissory notes in favour of the mortgagor defendant were deposited with the plaintiff. The promissory notes were not however endorsed in favour of the mortgagees. The said promissory notes are for Rs. 26,000/- , Rs. 17,000/- and Rs. 19,000/- respectively. It is alleged that the defendant No, 1 instituted a suit on the promissory note dated 2-4-1946 for Rs. 7,000/- and after recovering the said sum, Rs. 6,500/- has been paid by the mortgagor to the plaintiff. A second suit on the promissory note dated 16-4-1939 for Rs. 26,000/- is still pending. The third promissory note for Rs. 19,000/- is time barred. I am told, though it does not appear in evidence that on this promissory note of Rs. 19,000/- only Rs. 3,500/- was, due and payable. The amount due to the plaintiff as alleged in the plaint is Rs. 13,500/- on account of principal and Rs. 1434/- on account of interest calculated up to 30-6-1950. A decree in Form No. IX of Appendix D of the Code of Civil Procedure is claimed as also a declaration that the promissory note dated 16-4-1939 for Rs. 26,000/- is charged for the repayment of the loan. There is a further prayer for ad-judication of priorities of the various mortgagees.
( 2 ) THERE are all told five defendants in this action. Of those defendants, except the defendant No. 1, namely, the mortgagor, none have contested the suit before me. Of the remaining defendants the defendant Amarendranath Bose and the defendant Phanindra Lal Mukerji and Manindra Lal Mukerji have filed written statements. The only point that was made by Phanindra and Manindra is that even though their mortgage was subsequent to the mortgage in favour of the plaintiff they are entitled to priority. I am told now by Mr. Gouri Mitter, learned counsel appearing for the plaintiff, that all the mortgagees have been paid off. The contest, therefore, before me is a straight contest between the plaintiff on the one hand and the defendant No. 1 on the other. It is not necessary for me therefore to summarise or to state the defence of the defendants other than the defendant No. 1. No other defendant has appeared at the trial.
( 3 ) THE defendant No. 1 has contested the suit and in his written statement has taken up a luimbef of defences. In the first place, the deiendant denied the equitable mortgage. He admitted however that to secure an advance of Rs. 20,000/- taken by the defendant from A. K. Ghose of Messrs. H. N. Datta and Co. he deposited three promissory notes referred to in the plaint. It is pleaded that it was agreed that Mr. Ghose would be entitled to realise the amounts covered by the said three promissory notes and appropriate the same in payment of the loan in the present suit. It is further pleaded that two suits on the basis of the two promissory notes for Rs. 26,000/- and Rs. 7,000/- respectively were instituted by Messrs. H. N. Datta and Co. and the amount due on the second promissory note for Rs. 7000/- had been realised, the other suit for Rs. 26,000/- is still pending. The execution of the documents referred to in the plaint is admitted but it is alleged that the execution was procured by the exercise of undue influence by A. K. Ghose, a member of the firm of H. N. Datta and Co. Two other defences have been taken under th
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
