Sir John Edge, C.J (Tyrrell, J., concurring):— The appellant's suit was dismissed by the Court below on the preliminary ground that it must fail in the form in which it was brought, the Judge holding that the plaintiff by buying part of the property mortgaged to him had put it out of his power to sue for relief against the whole property mortgaged. Ordinarily we should have remanded the case under s. 562 of the Code of Civil Procedure for trial on the merits according to law. But we are precluded from this course because we find that the parties were not by the action of the Judge precluded from giving such evidence as they considered necessary, but on the contrary elected to stand on the evidence which had been recorded and to give no further evidence. The decision arrived at by the Subordinate Judge has not excluded evidence in the sense of that section.

That decision is clearly unsustainable. No Court in India has the power to make such a decree as the one before us, which is in effect a decree of non-suit. It was not made under s. 373 of the Code of Civil Procedure, nor was the plaint returned or rejected under Chapter V of the Code. These are the only provisions which justify a procedure analogous to a decree of non-suit. The decision of the Judicial Committee of the Privy Council in Watson v. The Collector of Rajshahye and our ruling in Kudrat v. Dinu, are authorities in point. That decree must be set aside, and we must proceed to try this appeal and the issues on the materials before us.

The bond on which the plaintiff sued was dated the 15th September, 1874. Subsequently to the making of that bond the mortgagors assigned a portion of the property, and other portions of property were sold in execution of a decree obtained by the plaintiff on a hypothecation bond, dated the 18th September, 1874. On the hearing of the appeal Pandit Ajudhia Nath consented on behalf of [698] the appellant that in the event of the appeal being allowed, the property in Husainalipur Mathra should have allocated to it a proportionate share of the debt and interest claimed, and that the burden to be thrown on the other property in suit should, to that extent, be diminished. He also consented, not as a matter of right but of grace and to save argument, that the Court should apportion the remainder of the amount to be decreed amongst the other properties in suit. This consent has considerably cleared the ground. The first defence raised by the respondents depended on an allegation of payment. It is admitted that there is no evidence to prove that allegation, and as that was a defence which it was for the defendants to make out, we may say no more than that there is no evidence in support of it. Another point was raised and contended for on behalf of all the respondents who were represented before us, namely, that the provision in the bond to the effect that if the principal debt was not paid within one year 27 per cent, should be paid as interest as from the date of the bond, was a provision to be regarded as providing for a penalty, and consequently that the plaintiff was not entitled to interest but only to compensation to be settled by the Court for the non-payment of the principal within the stipulated time. In support of the contention that we should regard the provision as to the 27 per cent, interest as a provision for a penalty, the following authorities were cited by Pandit Sundar Lal:—Kharag Singh v. Bholo Nath, Muthura Persad Singh v. Luggun Kooer, Mackintosh v. Crow Kunj Behari Lal v. Gulab Singh, Ram Lal v. Sada Sukh, and Shirekulu Timapa Hegda v. Mahablya(6). On this point Anson on Contracts (2nd ed.), p. 252, was also referred to. Pandit Sundar Lal's arguments on this point were adopted by those who represented the other respondents who appeared. In support of the contrary contention of the appellant, that we should infer that the parties intended to contract that the 27 per cent, should be regarded and paid as interest and should not be considered as a penalty, the following authorities were cited before or were referred to by us: Sham Lal v. Banni Begam(7), Chhab Nath v. Kamta Prasad(8), [699] Maya Ram v. Naubat(9), Darjan Singh v. Muhammad Abdul Ali Khan(10), Rai Balkishen Das v. Raja Run Bahadoor Singh(11), Wallis v. Smith(12), and Herbert v. Salisbury and Yeovil Railway Company(13).

We are of opinion that the cases relied upon on behalf of the appellant establish the principle that what we have to consider is whether the parties to the bond of the 15th September, 1874, intended to contract and contracted that on failure of the mortgagors to pay within the stipulated time, 27 per cent, should be payable qua interest from the date of the bond, or intended that the provision as to the 27 per cent, should be regarded merely as providing for a penalty, leaving the amount of compensation or damages for the non-payment of the principal at the stipulated time to be ascertained and decided in case of dispute by a Judge or a jury. We may say that it appears to us that the stipulation as to the payment of the 27 per cent, interest would not in itself be an unreasonable one under the circumstances. In our opinion the case of Rai Balkishen Das v. Raja Run Bahadoor Singh, referred to above is a direct authority to show that there is no such rule of law as that which was enunciated in the passage from the judgment in Muthura Persad Singh v. Luggun Kooer, which has been relied upon on behalf of the respondent. That passage is as follows: “But where, as here, an increased rate of interest from the data of the bond is made payable on default, we cannot regard it in any other light than as a sum named in the contract to be paid in case of breach, within the meaning of s. 74 of the Contract Act.”

We thoroughly agree with the opinion expressed by the late Master of the Rolls, Sir George Jessel “in his judgment in Wallis v. Smith, where he said:—“I have always thought and still think, that it is of the utmost importance as regards contracts between adults, persons not under disability and at arms length, that the Courts of law should maintain performance of the contracts according to the intention of the parties; that they should not overrule any clearly expressed intention on the ground that Judges [700] know the business of the people better than the people know it themselves. I am perfectly well aware that there are exceptions, but they are exceptions of a legislative character.”

Most of the English authorities on the question as to when stipulations may be treated as stipulations for penalties were considered by Sir George Jessel in his judgment in that case. We are of opinion that the parties to the bond in questions did intend to contract and did by the bond contract that the 27 per cent, should be payable and paid qua interest.

Consequently we hold that the plaintiff's claim for interest at the rate of Rs. 27 per centum per annum must be allowed.

We can see nothing unreasonable in a man who is asked to lend his money on the security of landed property saying to the would be borrower, “You can have the loan on the terms that if you repay it within one year you shall pay interests at the rate of 13½ per centum per annum, but if you do not repay the principal with interest within the year you shall pay interest as from the date of the bond at the rate of 27 per cent, per annum.”; nor do we sea anything unreasonable in the borrower agreeing to accept the loan on those terms. The borrower is under no compulsion to borrow the money from the particular lender, but if he does agree to accept it on the terms stipulated for by the lender, he and his assigns must, if there is no fraud and nothing illegal or obviously unconscionable in the transaction, abide by the contract. Equity does not relieve a borrower from the performance of his contract on the mere ground that his contract was a foolish one or on the ground that he might have made a contract more advantageous to himself by applying elsewhere.

Mr. Sundar Lal on behalf of Fazl Ilahi contended, in addition to the other points raised by him, that the plaintiff was estopped, so far as Fazl Ilahi was concerned, because he had witnessed the execution of the sale-deed dated the 17th March, 1883. The plaintiff denies that he witnessed that sale-deed. That the sale-deed was witnessed in the ordinary way was not attempted to be proved. The evidence shows not that the alleged witnesses were present at the execution of the deed, but that at some subsequent date they, on the representation that Muhammad Yahiya, one of the mortgagors-[701], had executed the deed, affixed their signatures as witnesses to the execution of the deed.

This point of Mr. Sundar Lal raised questions of law and issues of fact. We have very great doubt that Banwari Das, the plaintiff, ever put his signature to that deed. We are not satisfied that he did so. It is not proved or contended that if he did put his signature to that deed, he was present at the execution of that deed, and even if he had witnessed the execution of the deed there is not a tittle of evidence to show that the plaintiff represented before the contract of sale was completed that the property was not incumbered, nor is there any evidence to show that Fazl Ilahi believed or acted on any such, alleged representation. For these reasons we think that point of Mr. Sundar Lal fails.

Mr. Amir-ud-din, on behalf of Musammat Begami, further contended that the plaintiff could not have recourse to the property which she had purchased. The facts upon which that contention was based are as follows: The plaintiff had obtained a decree upon a bond dated the 18th September, 1874, and under that decree he caused the property which was subsequently purchased by Musammat Begami to be put up for sale. The plaintiff obtained permission to bid at the sale, and was in fact a bidder through his son, Naubat Rai. At the sale, the property was purchased by Abid Ali, apparently for Fazl Ilahi and Musammat Imam-un-nissa.

The plaintiff did not, as far as we know, personally announce that the property was subject to a prior incumbrance.

In the order sanctioning that sale, it was stated that Abid Ali had purchased the properties in question for Fazl Ilahi and one Musammat Imam-un-nissa. On the statement of Fazl Ilahi and Musammat Imam-un-nissa that Musammat Miriam-un-nissa, was the real purchaser, her name was entered on the register. Musammat Begami purchased subsequently from Musammat Miriam-un-nissa. Muhammad Yahiya, the mortgagor, acted in that sale as the agent of Musammat Miriam-un-nissa. On these facts Mr. Amir-ud-din's argument on this point was based, and in support of that argument he cited Mackenzie v. British Linen Co., and the notes to Le Neve v. Le Neve in White and Tudor's Leading [702] Cases in Equity, 1872, at page 49. His client's case was that the plaintiff was estopped from setting up his mortgage as against Musammat Begami. It was not attempted to be shown that the provisions of s. 287 of the Code of Civil Procedure had not been complied with. We assume that the provisions of that section had in fact been complied with. Under s. 114 of the Indian Evidence Act we are entitled to make this assumption. If we are correct in making this assumption, the fact of the existence of the prior mortgage of the 15th September, 1874, now sued on, was disclosed by the notification of sale, and must have been known to any one who eared to enquire. The price at which the property was sold indicates that the bidders at the sale were aware that it was encumbered, and that what was being sold was in fact the equity of redemption. We consider that the plaintiff's rights were not affected by his not having personally given notice at the sale of his prior incumbrance, if in fact he gave no such notice. He was, we thick, entitled to assume that the intending purchasers would take the ordinary precaution, by reading the notification of sale or searching the register, of ascertaining what was the property being sold. As was pointed out in the judgment in Gheran v. Kunj Behari it cannot be said that one person solely by bidding at an auction-sale encouraged another person to buy. There is no proof here that Musammat Miriam-un-nissa or Musammat Begami believed or acted upon any representation of the plaintiff. In fact there is no proof that the plaintiff made any representation whatever. It Musammat Begami intended to rely upon facts which would have constituted an estoppel, it was for her to prove those facts. She has not done so, nor has she attempted to do so. The cases cited by Mr. Amir-ud-din on this point have no bearing on the facts before us.

Mr. Amir-ud-din also contended that the plaintiff by causing the auction-sale to be carried out under the decree, sold not only the judgment-debtor's interest, but also all the interest which he, the plaintiff, had in the property. This may no doubt be true so far as the plaintiff's interest under the mortgage-bond of the 18th September, 1874, was concerned, as it was in execution of the decree obtained on that bond that the plaintiff brought the judgment-debtor's-[703] interest to sale. It is not necessary to consider that point. We know of no authority to show that under the circumstances in this case the plaintiff must be taken to have sold the interest which he had under the prior bond of the 15th September, 1874, and we are of opinion that Mr. Amir-ud-din's contention on this point cannot be supported. Musammat Begami purchased only the interest which Musammat Miriam-un-nissa had bought. She could by examining the register have ascertained what the title was. Mr. Amir-ud-din also contended that the plaintiff could not maintain this action, on the ground that there was still a sum of Rs. 1,125 portion of the mortgage-consideration unpaid to the mortgagors. On investigation, it appears that this sum of Rs. 1,125 is a portion of the sum of Rs. 1,126 for which the plaintiff has given credit in account at the end of his claim, and that it remained in his hands on account of interest.

In any event, Muhammad Mashiat Ali, one of the mortgagors, for whom and Musammat Begami Mr. Amir-ud-din appears, made no point as to this sum of Rs. 1,125 beyond alleging that it was held by the plaintiff on deposit and claiming that credit should be given for it, which has been done by the plaintiff. As a matter of fact, instead of Mr. Amir-ud-din's clients having been damnified by the Rs. 1,125 not having been actually paid over but only credit having been given for it, Mr. Amir-ud-din's clients will be benefited by their properties having to contribute a smaller sum than would otherwise have to be provided for. Mr. Chaudhri on behalf of Parshadi Lal contended that the plaintiff should first of all have recourse to the property known as Husainalipur Mathra. The effect of that contention would be, if well founded, that the plaintiff would lose the purchase-money given by him for that property, if in fact he purchased that property, unless he was entitled to claim contribution from the other properties in the suit. All Mr. Chaudhri's client could be entitled to, he has obtained by the concession made on behalf of the plaintiff by which the property in Husainalipur Mathra, purchased in the name of Naubat Rai, is to have allocated to it its proportion of the total amount claimed. The plea of Parshadi Lal that his 2½ biswas in mauza Barkatia had been purchased under a lien prior to that which the plaintiff is seeking to enforce in this action is admitted here to have no [704] evidence in its support. Mr. Sinha, who appeared for Bihari Lal, one of the defendants, informed us on the last day of the hearing that his client had died on the 11th August, 1886, and he produced an affidavit to that effect sworn as far back as February last. Pandit Ajudhia Nath applied to us to add as respondents the persons who appeared by that affidavit to be the representatives of Bihari Lal. Mr. Sinha opposed that application on the ground that the application was not made within time. We granted the application under the powers given to us under the last clause of s. 368 of the Code of Civil Procedure, being of opinion that sufficient cause had been shown. As to the appellant not making this application within time we may mention that even in this year documents were printed apparently on behalf of Bihari Lal as if he was alive, from which it would appear that the appellant may have bona fide believed up to this day that Bihari Lal was alive. On behalf of the representatives of Bihari Lal Mr. Sinha also contended that the plaintiff should first have had recourse to the property of Husainalipur Mathra. That contention was the same as that of Mr. Chaudhri.

Mr. Sinha also contended as Pandit Sundar Lal had done that the plaintiff should first have had recourse to those portions of the mortgaged property which had not been sold. We see no reason in this case for limiting in that way the rights which the plaintiff obtained under the bond of the 15th September, 1874. The purchasers, whether by private contract or by auction-sale could, if they had adopted the ordinary precaution of examining the register, have ascertained the existence of the incumbrance created by the bond upon which this suit has been brought. It is most probable that they were aware of the circumstance in question.

It was also contended that the plaintiff's claim ought to be dismissed as against Behari Lal and his representatives on the alleged ground that, although Behari Lal had purchased property in the village in respect of which he was made a defendant, he had never obtained possession. It is admitted by Mr. Sinha that Behari Lal made the purchase. Under these circumstances we consider he was properly brought on the record, and the property he bought must hear its portion of the burden. In the result we allow this [705] appeal subject to the due proportion of the money claimed being allocated to the 10 biswas in Husainalipur Mathra. This brings us to the question of apportionment. We have no materials on the record by which we can now make an apportionment.

We refer this question under s. 566 of the Code of Civil Procedure to the Subordinate Judge, who will ascertain and determine what the value of each of the properties was at the date of the suit.

On the materials so supplied we will give a final decree in this case. The question of costs will be dealt with when we are dealing with the final decree.

Issue remitted.