Borrowing under a mortgage-deed can be justified by legal necessity if it is for the benefit of the estate and capable of producing a larger income.

Findlay—The main point urged in this appeal is that the borrowing of Rs. 1,200 under the mortgage-deed in suit was not justified by legal necessity, having regard to the fact that the house is alleged to have been built on a, somewhat extravagant scale, and I have been referred, in support of the appellant's position, to the decision in Shankar Sahai v. Bechu Ram, 1925 AIR(All) 333 in this connexion. This decision is to the effect that any act for which the character of legal necessity or benefit to the estate can be claimed must be a defensive act, something undertaken for the protection of the estate already in possession, not an act done with the purpose of bringing fresh property in possession and which may or may not be successful under the chances attending upon litigation. The circumstances of the case just quoted seem to me to be essentially different from those of the present case. The new house has been constructed upon the site of the old one and, even if we assume it is oh a larger and more extensive scale, there has been, no proof that the construction was not a reasonable and natural one in the circumstances. Morever, even if we assume that the original plan of the new house was on a somewhat extravagant scale, which point is indeed largely a matter of surmise it is equally apparent that the work had already been commenced and that some money was required for completing it. It would have been an uneconomic and indeed a disastrous step to have left matters as they were, and the net result has been that the family property has been improved and increased in value and is capable of producing a larger income. In those circumstances, I am of opinion that, on the facts proved, it is reasonable to assume that the construction in question, or anyhow the completion of it, which is essentially the matter we are concerned with in the present case, was not only for the benefit of the estate, but was for legal necessity. The third and fourth grounds of appeal, therefore, fail.

2. The only other point pressed was that there was no proof of sufficient enquiry on the part of the plaintiff. On this point, I think the recitals in the mortgage-deed, combined with the evidence both of the plaintiff and the defendant, amply prove that the plaintiff had reasonable cause to suppose that the amount was borrowed for the purpose stated in the mortgage deed, and that this was so is not seriously disputed. It is difficult to see what further enquiry on the part of the plaintiff could have been made, much less was necessary. As a matter of fact, P.W. 3 Nilkanth's evidence shows that he actually made enquiries from the maistry in charge of the construction in question. The sixth ground of appeal is, therefore, an entirely baseless one and has no chance of success.

3. The other grounds of appeal were not pressed. The appeal is accordingly dismissed without notice to the respondents.

Final Result : Dismissed