Manasharam Das v. Ahmad Hossein Rodhan

This appeal arises out of a suit on a mortgage bond executed by Defendant No. 2 on behalf of her son Manasharam Das, Defendant No. 1, who at the date of the mortgage was a minor. The mortgage was executed in favour of one Rahamatullah Prodhan whose heirs the Plaintiffs are. It is not denied that Defendant No. 2 had executed the mortgage. But the defence was that no consideration was actually paid for the bond. It appears that Defendant No. 2 was the certificated guardian of Defendant No. 1 under Act VIII of 1890. She applied to the District Judge for permission to raise a loan of Rs. 2,000 on mortgage from one Hossain Patwari at an interest of one rupee four annas per cent, per month. The permission was granted: but Hossain subsequently being unable to advance the loan, the Defendant No. 2 again applied to the Judge for permission to raise the loan from Rahamatullah, the father of the Plaintiffs. This application was granted by the District Judge. Subsequently, it appears that the District Judge called upon the guardian of the minor (Defendant No. 2) to state whet for the mortgage had been executed or not, and on her failing to do so the Judge on the 8th March, 1906 revoked the order granting permission to the guardian to execute the mortgage. The creditor, Rahamatullah, it appears, had acted upon the original order of the District Judge granting permission to raise the loan from him, a copy of the order having been shown to him on behalf of the guardian. It may be observed that Rahamatullah was specifically warned in the application for permission as the person in whose favour, the mortgage bond was to be executed on taking the loan from him. But, although the order revoking the permission was made, no notice was given either to the said Rahamatullah or even to the guardian. The guardian denies in her written statement that any such notice bad ever been given to her: and her witness, Mohesh Chunder Barman, denies that any notice was served upon her. Rahamatullah appears to have acted boné fide in advancing the loan on the mortgage without any knowledge whatever of the order revoking the permission; although the order was passed before he advanced the money. It is unnecessary, however, to decide whether the order revoking the permission is effective as against Rahamatullah.

Assuming that the order was effective, the transaction stands in the same position as if there were no sanction by the Judge to the certificated guardian. The order was merely a voidable one under sec. 30 of the Guardians and Wards Act at the instance of the minor, and the minor, who is now of age, can avoid the transaction only on restoration of the benefit received by him under the order. (See the cases of the Eastern Mortgage and Agency Co., Ld. v. Rebati Kumar Ray(1) and Hem Chandra Sarkar v. Lalit Mohan Kar(2)]. There can be no doubt that the full consideration was paid. Apart from the oral evidence adduced on behalf of the Plaintiffs, there are two receipts executed by Defendant No. 2, the guardian, which show payments of the money on certain dates, namely, the 11th April, 1906 and 27th June, 1906. These two receipts were registered and Defendant No. 2 was identified by one Mohesh, who is an uncle of Defendant No. 1 and lived in the same mess with him. There can be no doubt therefore that the money was actually paid by Rahamatullah to the guardian.

It is contended before us that it is for the creditor to show how much of the money was actually applied for the benefit of the minor and that he cannot get any decree for more than the amount so applied. No doubt it is for the Plaintiff to show to what extent the money was applied for the benefit of the minor's estate. The guardian in her application to the Judge stated that there was urgent necessity for raising a loan of Rs. 2,000 for paying off the creditors of the estate; and as we have said there is no doubt that Rs. 2,000 were actually advanced to her by the father of the Plaintiffs.

The Defendants were called upon to produce account-books. They produced an account-book which does not appear to be the genuine book because it does not contain any entry as to the payments of Rs. 1,200 and Rs. 800 made to the guardian in March and. April 1906. But the account-book produced by the Defendant shows that, at any rate, a portion of the money advanced was actually applied for the benefit of the estate. The Defendant withheld the real account-books and having regard to all the evidence and circumstances of the case, the Court below came to the conclusion that it had been established that the extra amount had been applied to the benefit of the minor's estate. That being also our opinion, the Plaintiffs are entitled to a decree for Rs. 2,000 advanced on the mortgage bond.

The only question which remains to be decided is what is the rate of interest which ought to be allowed. The order of the judge does not specify the rate of interest. In the application made by the guardian to the Judge for permission to raise a loan by mortgaging the property to Hossain Patwari, Re. 1-4 annas was stated as the rate of interest. In the mortgage bond executed in favour of Rahamatullah the rate of interest was rupee 1 annas 8 with annual Test. This rate of interest does not appear to have been placed before the Court, nor was it sanctioned by the Court. We are of opinion that compound interest at Re. 1-8 ought not to be allowed. We think the Plaintiffs should not get more than 12 per cent, simple interest. That interest is to be calculated upon the amounts advanced on the 31st March, 1906, 11th April, 1906 and 27th June, 1906 respectively after deducting Rs. 198 admitted by the Plaintiffs to have been paid by the Defendants on account of the debt.

Let a decree be made accordingly. The subsequent interest will be at the rate of six per cent, per annum. Six months will be allowed to the Defendants for redemption.

The parties will pay costs in proportion in both Courts.

S.C.M

Decree modified.