The main legal point established in the judgment is that the contract rate of interest can only be reduced if it was brought about by undue influence as defined by Section 16 of the Indian Contract Act IX of 1872.

Charles Arnold White, Kt., C.J.

1. This is a suit brought by the endorsee of a promissory-note of Rs. 1,500 which provided for the payment of interest at the rate of 60 per cent per annum. The makers of the none were five ladies. Two issues were raised: is the note genuine? is the rate of interest provided in the note enforceable? The judge found that the note was genuine but that the rate of interest was not enforceable and in lieu of the interest provided for in the note he gave the plaintiff interest at the rate of 24 par cent, per annum. The plaintiff appeals against this. There is no cross-appeal as regards the genuineness of the note. The contesting defendants are defendants Nos. 1, 6, 7 and 8. They plead that the note was fraudulent and that the rate of interest was high and unconscionable There is no plea that the note was procured by the exercise of undue influence on the part of anybody. There is no issue as to this and there is no finding of the District Judge as to this. Consequently, I suppose it must be taken that the District Judge, although he was not prepared to find or although at any rate he did not consider it necessary to find that the execution of the note was procured by undue influence, was of opinion that he could give relief to the defendants by way of reducing the rate of interest provided for in the note to what he considered an equitable rate in all the circumstances of the case. Now it seems to me and I speak only for myself that it was not open to the District Judge on general equitable grounds to interfere with the contract between the parties unless he was satisfied that the contract was brought about by the exercise of undue influence. As the Judge has given the plaintiff a decree on the note it must of course be taken that the Judge did not consider that it was vitiated by fraud. In support of the contention that the learned Judge can, on general equitable grounds, interfere with the contract rate of interest, our attention has been called to several authorities. Poma Dongra v. William Gillespie (1907) I.L.R., 31 Bom., 348 at p. 352, was cited to us. There the Court granted equitable relief on the ground that the agreement appeared to be of an unconscionable character. It would seem in that case the learned Judge (Dewar, J.) was of opinion that the agreement was brought about by undue influence. He says "I have no doubt in my mind that, when the defendant executed the two promissory-notes in this suit undertaking to repay the loans with interest at 75 and 60 per cent, per annum, the plaintiffs were in a position to dominate his will." That, observation is obviously made with reference to Section 16 of the Contract Act. Then we have the Allahabad decision in Balkishan Das v. Madan Lal (1907) I.L.R., 29 All., 303. In that case the learned Judges confirmed the judgment of the District Judge reducing the rate of interest, although in that case there was the finding by the Court below which was accepted in the High Court that it was not a case in which it could be said that undue influence was brought to bear. All I can say with regard to that case is, speaking with all respect, that it seems to me to be impossible to reconcile it with the decision of the Privy Council in Dhanipal Das v. Raja Maneshar Bakhsh Singh (1906) 33 I.A., 118 at p. 127, a case, I think I am right in saying which was not brought to the notice of the learned Judges of the Allahabad High Court. In that case the Subordinate Judge held that it was not one of fraud or undue influence but of inequitable dealing and he decided to interfere in the enforcement of the hard terms of the contract and accordingly allowed simple interest at 18 per cent, but not compound interest. In dealing with this judgment Lord Davet in delivering the judgment of the Privy Council said "The Subordinate Judge was wrong in deciding the case in accordance with what he supposed to be English equitable doctrine. He ought to have considered the terms