V.R. Sen, J.

This is a first appeal by the Defendants against the judgment and decree of the Court of Civil Judge, Class I, Betul. The facts which are not in dispute are these: The Defendants borrowed Rs. 4,500 from the Plaintiff on 1-5-1943. They agreed to repay the debt at Re. 0-12-0 per cent per mensem compound interest on the 15th May 1945. As a security for the debt the Defendants executed a mortgage-deed (Exh. P-3) on the same day in favour of the Plaintiff. It is not necessary to describe the property which was mortgaged for the purposes of this appeal. The mortgage-deed provided that in the event of default in payment the property was to be foreclosed.

2 The Defendants paid Rs. 3,000. The details of payment are shown below:

Rs. 405 on 19-6-1944

Rs. 405 on 27-6-1945

Rs. 1,200 on 12-5-1949

Rs. 990 on 19-6-1950

These payments were towards interest according to the Plaintiff. The Defendants have also made an endorsement on the mortgage-deed that these payments were towards interest.

The case of the Plaintiff is that no payment was made towards the principal of the debt and that the total amount due from the Defendants till the date of the suit was Rs. 5,870-5-0.

The Defendants admitted the claim to the extent of Rs. 1,500 on account of principal and interest for two years 1950 and 1951. The main plea in defence was that the Plaintiff, who was a moneylender, had not complied with the provisions of Section 3(1)(b) of the C.P. and Berar Moneylenders Act. He had not furnished annual statement of accounts in the prescribed form duly signed by him within one month from the date of Diwali. The statement of accounts was furnished only for the years 1950 and 1951. The Plaintiff therefore was not entitled to claim interest in respect of the period during which he failed to send accounts. The payments which the Defendants have made purporting to be on account of interest should be appropriated towards principal as the Plaintiff did not maintain accounts as required by the Act. Costs should be disallowed. According to the Defendants, the rate of interest was excessive.

The trial Court held that the Plaintiff had furnished accounts for the years 1950, 1951 and 1952 only. He maintained the accounts of the Defendants after the year 1949-50. The Plaintiff was entitled to interest at the agreed rate. The Plaintiff was not entitled to claim interest for the period before 1950. The Court further held that it had no power to call upon the Plaintiff to refund the payments already made towards interest. The Court allowed simple interest at the agreed rate of 9 per cent per annum. It upheld the claim of the Plaintiff to the extent of Rs. 5,398-2-0 with corresponding costs, directing payment within six months of the date of the decree. In case of default, the property was to beforeclosed.

The main contention on behalf of the Defendants is that the lower Court was wrong in holding that it had no power to re-open the accounts. Its interpretation of Section 7 of the Act was erroneous. Costs should have been disallowed. The argument on behalf of the Plaintiff is that the annual accounts used to be duly submitted and that the provisions of the Moneylenders Act were not applicable as the Plaintiff was not a moneylender. The Defendants had made payments voluntarily and they cannot now ask that the payments should be appropriated towards the principal of the debt. Costs are a matter of discretion and it cannot be said that the discretion has been wrongly exercised by the lower Court.

There is no substance in the contention that the Plaintiff is not a moneylender. It is true that the Plaintiff in the witness-box stated that he did not carry on the business of moneylender. His evidence cannot be accepted in view of the clear admission in paragraph 5 of the plaint that he was a registered moneylender under the C.P. Moneylenders Act. There is a further statement in the same paragraph that he had served statements of annual accounts on the Defendants as required