JUDGMENT

Niamatullah, J. - The facts of this case are stated in detail in the judgment delivered by my brother, Allsop, J., with whose conclusions I find myself in entire agreement. I desire to make a few observations on the important question of fact on which the decision of the case largely depends. I have taken time to consider the point in all its aspects and made due allowance for the fact that the Subordinate Judge arrived at a different conclusion. I may however point out that the case is not one in which the trial Court is in a peculiarly better position than the Court of appeal in recording a finding on a question of fact. The conclusion rests on inferences to be drawn from proved circumstances of the case, and not on believing or disbelieving witnesses. Excepting the evidence of Mela Ram, whose good faith is in controversy, the evidence bearing on the point is all circumstantial.

2. In all cases of fraud which is not capable of proof by direct evidence, we have to fall back upon inferences to be drawn from circumstances established by evidence. The party alleging fraud is nevertheless bound to establish it by cogent evidence, and suspicion cannot be accepted as proof. Unless therefore the proved circumstances are incompatible with the hypothesis of the person charged with fraud having acted in good faith, they cannot be accepted as affording sufficient proof of fraud. I have approached the case with this point of view, and have been driven to the conclusion that the evidence as a whole, excludes all hypothesis of good faith on the part of Mela Ram in granting the three receipts to Beltie Shah Gilani.

3. The plaintiff's case, in the first instance, is that there was a conspiracy between Mela Ram and Beltie Shah Gilani, in pursuance of which the sura of Rs. 39,750 was embezzled. I may say at-once that the evidence falls far short of establishing any such conspiracy. I am convinced that Mela Ram was not in Beltie Shah's confidence when the latter misappropriated the various sums making up Rs. 39,750. The embezzlement took place as follows. (After giving the details as to embezzlement, his Lordship considered questions of fact and then proceeded). I agree with my learned brother that the plaintiff's puit is not harried by limitation or by the fact that in proceedings under the Companies Act certain sums were awarded, in winding up proceedings, against the auditors. I also agree that Mela Ram acted within the scope of his authority when he gave receipts to Belti Shah. It was not disputed that, if Mela Ram had the authority to grant the receipts and if his conduct amounted to fraud, his principals are liable to the company for the fraud of their agent.

4. One of the pleas taken by the defendants other than Mela Ram is that the estate of Raghu Mal, which is now represented by his executors, is not liable for damages as the cause of action did not survive against the legal representatives of the deceased wrongdoer. The contention is based on the maxim "actio personalis moritur cum persona." The English Law is undoubtedly in favour of the defendant's contention. It is thus summarised in Halsbury's Laws of England (Vol. 14, paragraph 726):

The general rule is that the representative cannot be sued for wrong committed by the deceased for which unliquidated damages only would be recoverable; the rule is expressed in the maxim actio personalis moritur cum persona, and the principle is applicable both at law and equity. Thus an action for deceit will not lie against the representatives of a person who has fraudulently induced another to take shares in a company or even to purchase shares from the deceased himself.

5. The maxim has been the subject of adverse comments, in that it is too broadly stated and leads to inequitable results in many cases. By some Judges it has been characterised as "barbarous." In India there is no statutory law of torts and the Courts are expected to administer rules of justice, equity and good conscience. The