JUDGMENT

Suffian FJ (read by Gill FJ):

Thirunaman s/o Vairamuthu (the debtor) had a wage-earner's administration order made against him on 22 November 1962.

He filed his statement of affairs on 28 November 1962, in which he disclosed gross unsecured liabilities amounting to $7,866 due to 12 creditors.

The appellant was disclosed as a creditor in the statement of affairs to the extent of $1,000. He filed his proof of debt with the official assignee on 13 December 1963, claiming a sum of $1,565 as follows:

Principal due on demand note dated 3 May 1956 ... $1,000

Interest thereon from 3 March 1958 to 22 November 1962 at 12 per annum ... 565 227227227227

Total = $1,565 227227227227

Rule 26 of Sch C to the Bankruptcy Act. 1967, reads as follows:

The Official Assignee shall examine every proof and the grounds of the debt, and in writing admit or reject it in whole or in part or require further evidence in support of it. If he rejects a proof he shall state in writing to the creditor the grounds of the rejection.

Accordingly, the official assignee, who is the respondent here, proceeded to examine the appellant's proof. On doing so he found that the note on which the claim is based, carried interest at the rate of 120 per annum and that no note or memorandum executed by the parties in accordance with s. 16(1) of the Moneylenders Ordinance No. 42 of 1951 had been produced.

The official assignee thereupon wrote a letter dated 22 August 1969, asking the appellant to produce his moneylender's licence and the memorandum or note to the contract.

The appellant, in his reply dated 28 August 1969, admitted that he was not a licensed moneylender. He also admitted receiving a total of $220 as interest on the note. But he claimed that s. 16 of the Ordinance did not apply to him because he was not a habitual moneylender and this loan was a friendly loan to a member of his (Tamil) community.

Subsequent investigations by the official assignee into the affairs of two other bankrupts, a Mr. T Kasipillay and a Mr. Ramakrishnan son of Ramasamy revealed that the appellant had also proved in two other bankruptcy matters. In the case involving Mr. Kasipillay it was discovered that he had on 30 June 1959 executed an On Demand Note for $2,600 at 18 interest in favour of the appellant. In the case of Mr. Ramakrishnan he had on 1 February 1963 executed an IOU for $374.50 at 12 Interest in favour of the appellant. Taking these two transactions into account, the official assignee concluded that the appellant was a moneylender within the meaning of the Moneylenders Ordinance and as he did not have a Moneylender's licence under s. 6, his claim was rejected under s. 15.

The material part of s. 2 defines a moneylender as including "every person whose business is that of money lending or who carries on or advertises or announces himself or holds himself out in any way as carrying on that business ... but does not include ... any person ... bona fide carrying on any business not having for its primary object the lending of money in the course of which and for the purposes whereof he lends money ..."

Section 3 provides:

... any person who lends a sum of money in consideration of a larger sum being repaid shall be presumed until the contrary be proved to be a moneylender.

Section 15 provides:

No contract for the payment of money lent after the coming into force of this Ordinance by an unlicensed moneylender shall be enforceable.

The appellant was dissatisfied with the official assignee's decision. On 20 September 1969, he applied by way of motion for an order to reverse the official assignee's decision. The motion was accompanied by an affidavit in which he said:

I am not and have never been a habitual moneylender nor carried on money lending as a business. I have known the bankrupt and his family for a long time and my purpose in lending the sum of $1,000 was purely to help him and his family. I am a certified and public accountant by profession and h