JUDGMENT

Misra, A J C - These two appeals arise out of two suits brought by the plaintiff-appellant in the Court of the Additional Subordinate Judge of Sultanpur. One suit was No. 33 of 1923 and the other No. 34 of 1923. These suits were on the basis of two mortgages of one and the same date, namely, the 13th March 1917, one for Rs. 1,100 executed by Rajeshwari Prasad Singh and the other for Rs. 1,400 executed by Mata Prasad Singh. Rajeshwari Prasad Singh is defendant in suit No. 33 of 1923 and Mata Prasad is defendant in Suit No. 34 of 1923. The money was payable under both the deeds within one month from the date of execution and the deeds provided for enormous rate of interest at Rs. 20 per cent, per mensem, in other words, Rs. 240 per cent. per annum. Nothing has been paid under both the deeds and in one suit, namely, suit No. 33 of 1923, the plaintiff claims Rs. 21,420 on account of the principal and interest and in the other, namely, Suit No. 34 of 1923, he claims Rs. 15,202 on account of the principal and interest. Both the defendants have raised the same defence in the two suits. It is to the effect that the mortgage-deeds were obtained from them by undue influence, that the rate of interest provided therein was bard and unconscionable and that the plaintiff was not entitled to get the amount of interest claimed. By consent of the parties both the suits were tried together and the one point for trial was whether the deeds in suit had been obtained by undue influence and whether the interest claimed was hard and unconscionable.

2. The plea of undue influence was alleged in paragraphs 6 to 12 of the written statement in both the cases. But briefly the defence contained in those paragraphs was this: Government revenue was due from the defendants for which there was a pressing demand from them. The defendants approached the plaintiff who was their banker and to whom they were indebted and asked him to advance the sum required. The plaintiff asked the defendants to execute fresh deeds for the debts which were already due from them and told them that he would advance fresh money asked for by them at 20 per cent. per mensem. The defendants were helpless since Tahsil peons had demanded revenue from them and had told them that if they would not deposit the revenue due from them they would have to go to the lockup. The defendants were under the circumstances obliged to borrow the money from the plaintiff who took advantage of their helpless position and charged exorbitant rate of 20 per cent. per mensem stated above.

3. The learned Additional Subordinate Judge, on evidence produced before him having come to the conclusion that the story told by the defendants was substantially a correct one, held the plea of undue influence to have been established, declared the rate of interest provided in the deeds to be hard and unconscionable and in result allowed the plaintiff simple interest at the rate of 2 per cent. per mensem. The plaintiff has appealed in both the suits.

4. The learned Counsel for the plaintiff-appellant argued that the defendants were bound to pay interest agreed upon inasmuch as they had failed to substantiate the plea of undue influence. His main contention was that the defendants had with their eyes open agreed to pay the amount of interest stipulated in the deeds and were therefore bound to pay the same.

5. We have now to examine as to how far this position can be maintained. The leading case on the subject is a case recently decided by their Lordships of the Privy Council and reported in Raghunath Prasad v. Sarju Prasad A.I.R. 1924 P.C. 60. Their Lordships have held in that case that the question like the one arising between the parties to this case should be settled in accordance with the provisions of the Indian Contract Act and not by reference to the legislation of other countries e.g., the English Money Lenders Act. They referred to Section 16 of the Indian Contract Act and made the following observations: "