JUDGMENT

Nasim Ali, J. - This is an appeal against the decision of the Subordinate Judge of 24-Parganas, dated 21st September 1939, dismissing the appellant's suit to enforce an equitable mortgage. The case of the plaintiff appellant as stated in the plaint is this: The plaintiff is a limited company incorporated and registered under the English Companies Act having its registered office in London. It is carrying on its business of insurance at its Calcutta office at No. 2, Fairlie Place in the town of Calcutta for a long time. The defendant was the cashier and accountant of the plaintiff company at its Calcutta office from 1st January 1929 to 8th January 1935. On 8th and 9th January 1935, while the accounts of the plaintiff company were being audited by its auditors Messrs. Price Waterhouse & Co., it was discovered that the defendant misappropriated large sums of money belonging to the plaintiff company in the course of his employment as cashier and accountant. The total amount misappropriated by him could not be ascertained at that time. The examination of the books of the plaintiff company and other papers so far as could be done up to that time disclosed that the amount misappropriated by him exceeded Rs. 50,000. On 10th January 1935, the defendant himself admitted his liability to the plaintiff company for Rs. 50,000 on account of such misappropriation. In order to make good the loss caused to the plaintiff company by his misappropriation to the extent of RS. 50,000 as admitted by him the defendant executed a promissory note for Rs. 50,000 in favour of the plaintiff company on 10th January 1935, and to secure repayment of the amount of the said promissory note deposited on the same day with Mr. Jackson the resident Secretary of the Calcutta office of the plaintiff company in the office of Messrs. Orr Dignam and Co., Solicitors of the plaintiff company at No. 30, Dalhousie Square in the town of Calcutta, the title deed of premises No. 110, Syed Ameer Ali Avenue, Calcutta, belonging to him. On further investigation, it was found that the liability of the defendant to the plaintiff company would come up to about Rs. 1,20,000. On 17th January 1935, a power of attorney was executed by the defendant in favour of Mr. Jackson to enable the plaintiff company to realise the monies secured by the mortgage out of Court. By this power of attorney, the defendant authorised Mr. Jackson to negotiate for the sale and to sell the mortgaged properties upon terms and conditions mentioned in the said power. On 4th February 1935, the plaintiff company realised Rs. 700 by sale of a dog belonging to the defendant and Rs. 1300 by sale of a motor car also belonging to the defendant of which Rs. 400 was realised on 25th February 1935 and Rs. 900 was realised on 2nd March 1935. Plaintiff is entitled to get interest u/s 80, Negotiable Instruments Act. The total amount due for principal and interest is therefore Rs. 56,637-11-6. On these allegations the plaintiff prayed for a mortgage decree in the usual form.

2. The defence of the defendant as disclosed in his written statement so far as it is relevant for the purposes of the present appeal is as follows: The defendant was no doubt the cashier and accountant of the plaintiff company from 1st January 1929 to 8th January 1935, but during this period he did not misappropriate any money belonging to the plaintiff company. On 10th January 1935, he did not admit any liability to the extent of Rs. 50,000 or any amount on account of misappropriation or on any other account whatsoever. He was compelled to execute a promissory note for Rs. 28,000 on 10th January 1935, and subsequently another promissory note for Rs. 50,000 on or about 18th January 1935, in favour of the plaintiff company after cancellation of the previous one for Rs. 28,000 without receiving any consideration therefor or for any liability for the said sum or any sum. The execution of this promissory note was due to the fraud, misrepresentation a