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Judgment
A.C. Sen, J.—The present appeal arises out of a suit to recover a specified amount, namely Rs. 6,180, with interest on the allegation that the said sum was lent and advanced by the Plaintiff to the Defendant. The Defendant is the Appellant before us as the suit was decreed in full by the Trial Court.
The Plaintiff''s case is that on May 26, 1958, the Defendant borrowed a sum of Rs. 13,000 from the Plaintiff on the terms that the Defendant would "repay the aforesaid sum of Rs. 500 or over annually" and would pay interest at Rs. 130 per month at the rate of 12 % per annum, that the Defendant accepted and acknowledged the aforesaid sum of Rs. 13,000 on the terms aforesaid and "granted a receipt and/or executed bond acknowledging the loan and the terms", and that the Defendant failed and neglected to pay in spite of repeated requests and demands the amount claimed which became due on the Defendant''s failure to pay the annual installments towards the principal sum and the monthly interest.
The suit was instituted in the City Civil Court on the allegation that the loan was not a commercial loan. Paragraph 7 of the plaint dealing with the question of jurisdiction runs thus:
Inasmuch as the claim of the Plaintiff in this suit is above Rs. 1,000 but below Rs. 10,000 and the said loan is not a commercial loan this Court and not the Hon''ble High Court has jurisdiction to entertain and try this suit.
The receipt mentioned in para. 2 of the plaint was annexed to the plaint, being annEx. A thereto.
The suit was instituted on April 24, 1963, and the Defendant filed his written statement on July 8, 1963, denying the claim of the Plaintiff. According to him, no consideration passed on the basis of the receipt mentioned in the plaint, being annEx. A thereto. The circumstances under which the said receipt was granted to the Plaintiff and retained by the latter have thus been narrated in para. 1 of the written statement:
(a) Sometime in May 1958 the Defendant approached the Plaintiff for a loan of Rs. 13,000 for the purpose of his business...and the Plaintiff agreed to advance the said loan.
(b) The Plaintiff wanted a writing from the Defendant under his signature which the Defendant did and thereafter upon Defendant''s demanding money, the Plaintiff wanted to have the said writing verified from his lawyer and then to pay the money and accordingly the Defendant believing in the Plaintiff''s said representation handed over the said writing to the Plaintiff. The relation between the parties was very cordial and friendly.
(c) In spite of repeated approaches by the Defendant to the Plaintiff the latter put off the matter on some pretexts and other and ultimately after a lapse of one month expressed his unwillingness to advance a loan to such a large extent whereupon the Defendant demanded back the aforesaid writing which the Plaintiff agreed to return subsequently as he was not having the said writing with him at that time.
(d) The Defendant thereafter approached one Sohanlall Jain.
...and obtained a loan of Rs. 15,000...and duly executed a Deed of Mortgage in favour of the said Sohanlal Jain....
(e) Upon the Defendant''s repeatedly insisting for return of the aforesaid writing the Plaintiff told the Defendant that he had already torn off the same and as such there was nothing to return.
(f) Thereafter, the Plaintiff on 2nd January, 1960, entered into a partnership with the Defendant in his aforesaid business and the said partnership continued between the parties for a considerable period of time.
(g) The relation between the parties being then very cordial and friendly and they trusted each other and as such the Defendant was satisfied with the aforesaid representation of the Plaintiff.
In para. 8 of the written statement the Defendant has stated that the alleged loan is a counter blast of the consent decree passed in Suit No. 642 of 1963 of the Hon''ble High Court at Calcutta in the Original Civil Jurisdiction started by the: Plaintiff against the Defendant for dissolution of partnership and accounts.
He has further stated in the said paragraph that the Plaintiff being under unavoidable circumstances and having no other alternative left but to settle the said at a considerably low figure, has now taken recourse to this deceitful means to wreck vengeance.
The learned Judge of the City Civil Court decreed the suit in full primarily on the receipt being annEx. A to the plaint. Hence, the Defendant has preferred this appeal.
The only question involved in this appeal is whether any consideration passed on the basis of annEx. A to the plaint. The granting of the receipt is admitted by the Defendant, but his definite case is that the amount mentioned in the receipt or any other amount was not in fact paid to him though the Plaintiff agreed to do so on his executing the receipt.
The case of the Plaintiff is based entirely on the receipt. He admitted in his cross-examination that he had no bank account and that except his word of mouth he had nothing to show that he was possessed of money to be able to give loans to the Defendant.
Annexure A to the plaint is all right as far as it acknowledges the receipt of Rs. 13,000 as loan, but the mode of payment contemplated by it is absolutely vague. It says that Rs. 13,000 to be paid annually Rs. 500 or over and interest Rs. 130 to be paid monthly at the rate of 12 % per annum. As to interest it is not clear whether it is to be paid at the rate of 12 % per annum on the amount outstanding at the time of the payment of any annual instalment or whether it is to be paid at the rate of Rs. 130 per month till the repayment of the loan. The receipt says that the interest Rs. 130 to be paid monthly, it does not say that interest is to be paid monthly at the rate of 12 % per annum. An amount, namely Rs. 130, per month has been specifically mentioned. Then again, the expression "Rs. 13,000 to be paid annually Rs. 500 or over" is almost meaningless. Probably the executants means to say that Rs. 13,000 is to be repaid in 26 annual installments of Rs. 500 or over every year until the total payment amounts to Rs. 13,000. But as the transaction has been reduced to writing the omission cannot be supplied orally. If Rs. 13,000 is to be repaid in 26 years, in the first year the executants is to pay by way of interest Rs. 130 every month, but what about the succeeding years ? From the language used it seems Rs. 130 is to be paid every month as interest not only in the first year but in all succeeding years, but this could not have been the intention of the parties.
From the above discussion it is clear that the mode of payment envisaged in annEx. A to the plaint must be regarded as void on the ground of uncertainty. But this portion is severable. Therefore, the first part of annEx. A is nothing but receipt, pure and simple. The Plaintiff should have instituted a suit for money had and received, but the period of limitation for such a suit expired long before the institution of the present suit.
Let us now consider the second part of annEx. A to the plaint. The second part runs thus:
As a security I have issued a true copy of my residence deed 37-B Joy Mitter Street, Calcutta-5, and an original plan sanctioned by the Calcutta Corporation together with building sanctioned certificate of the Corporation of Calcutta No- 1B/B5 (32D-1-5-57) and a paper sanctioned by the additional building committee dated 15th November, 1956, two set of tax bill owner occupier October, November and December, 1957. All the tax bill to be paid in future to be submitted to you.
Enclosed�(6) six only Witness Pannalal Seal Hiralal Seal (owner) dated 26.5.58.
From the second part it is clear that the real intention of the executants, namely, the Appellant before us, was to create a mortgage by deposit of title deed. Annexure A has not been registered. If the second part is a mere memorandum, then no registration is necessary. If the transaction embodied in annEx. A to the plaint is regarded as a valid mortgage by deposit of title deed, then the present suit must be regarded as a suit for the mortgage money u/s 68 of the Transfer of Property Act. Sub-section (1) of Section 68 says that the mortgagee has a right to sue for the mortgage money in four cases, one of them being where the mortgagor binds himself to repay the same. The other cases envisaged by Section 68(1) are not material for our purpose. Can it be said that annEx. A contains a covenant by which the mortgagor, namely, the Appellant before us, binds himself to repay the mortgage money ? The mode of payment contained in the first part of annEx. A can by no means be regarded as covenant by the mortgagor binding himself to repay the same. Even if it be regarded as a covenant to repay it is void for uncertainty. Hence, if annEx. A is to be regarded as a memorandum of a mortgage by deposit of title deed, and the present suit is to be regarded as one on the covenant to repay the mortgage money, the suit is bound to fail, there being no covenant to repay.
Mr. Pain, appearing on behalf of the Appellant, submits that a mortgage by deposit of title deed was sought to be created by annEx. A and that consequently it should have been registered. In other words, he means to say that annEx. A is not a mere memorandum of a mortgage by deposit of title deed but is an instrument of mortgage. If it is a deed of mortgage, he argues, it is not admissible in evidence as it is not registered. He concluded that as the suit is primarily on annEx. A to the plaint and as annEx. A is not admissible in evidence because it cannot be looked into, the suit must necessarily fail. We cannot accept this process of reasoning of Mr. Pain. An unregistered mortgage deed though invalid as a mortgage may be used to prove the debt. The law is settled, so far as our High Court is concerned, that if the personal covenant to pay is separable from the creation of the security an unregistered deed may be used to support a personal claim for the debt. In annEx. A the debt is admitted. But we have already indicated that the mode of payment indicated therein cannot be construed as a promise to pay. A suit for money could have successfully been instituted on annEx. A even though unregistered if it contained an unequivocal premise to pay.
In the Trial Court there was some controversy between the parties as to the admissibility of annEx. A to the plaint. The Defendant Appellant objected to its admissibility on the ground of non-registration. He contended that it was a mortgage bond, that it was compulsorily remittable and that it could not be marked as an exhibit as it was not registered. The learned Judge marked it as an exhibit because in his opinion it was an agreement not compulsorily remittable. He refused to treat it as an instrument creating a mortgage by deposit of title deed because the Defendant delivered, not the original title deed, but only a copy thereof. He thinks that no mortgage by deposit of title deed can be created unless the original title deed is handed over as a security. It is not necessary for us to say anything as to the correctness of the view expressed by him on this point.
In order to ascertain the nature of annEx. A the learned trial Judge concentrated his attention on the first sentence, ignoring the rest of the document altogether. He described the first sentence as the first paragraph and tried to ascertain the nature of annEx. A by analyzing the first sentence. His analysis and conclusion is as follows:
In order to know the nature of the document. X (annEx. A to the plaint) we have to properly appreciate what is stated in paragraph 1 already quoted above. This paragraph consists of 2 parts. The first part relates to acknowledgment of loan and the second part related to the manner of repayment, i.e., the details of contract relating to repayment are stated in the second part. There is no express premise by the debtor about repayment. It is, however, clearly discernible that there is an implied promise to pay according to the mode or manner of repayment mentioned in second part. In my view the document is an agreement or memorandum of agreement....
We cannot accept the conclusion of the learned Judge that there is an implied premise to pay according to the mode or manner of repayment. The mode or manner of payment is, as already indicated, vague and uncertain and ought to be ignored altogether. Such a clause can never be construed as an implied promise to pay. The present suit, not being a suit for money had and received as per acknowledgment of debt, is not maintainable and even if the present suit is taken to be one for money had and received it is clearly barred by limitation.
The learned Judge was not justified in altogether ignoring the second paragraph of annEx. A to the plaint. The nature of a document is to be ascertained on a conspectus of the whole of it. It is not possible to gather the intention of the parties to a document by ignoring a part of it and it is the intention that determines the nature of a document. On a survey of annEx. A in its entirety there is no escape from the conclusion that the parties really intended to create a mortgage by deposit of title deeds. The deposition of any party to a document at the trial is not at all relevant for the purpose of ascertaining the intention at the time of the execution of the document. The learned Judge erred in law in referring to the deposition of the Defendant for the purpose of finding out the nature of annEx. A. The intention is to be gathered from the language used when it is clear and unequivocal. There is scarcely any room for doubt on the language of annEx. A taken as a whole and, in particular, of para. 2 that the parties intended to create a mortgage by deposit of title deed. Whether they have succeeded in doing so is immaterial so far as the question of construction is concerned. Even if annEx. A to the plaint is taken to be a deed of mortgage or as a memorandum of a mortgage by deposit of title deed, the suit is, as shown above, liable to be dismissed as there is no covenant to pay. The view taken by us as to the effect of the clause for payment is sufficient for the purpose of dismissing the suit and allowing the appeal.
But even assuming that the mode of payment laid down in annEx. A to the plaint may be construed as a promise to pay, can it be said that the Plaintiff has succeeded in proving the payment of Rs. 13,000 to the Defendant by way of loan ?
The sheet anchor of the Plaintiff''s case is the admission of the Defendant in annEx. A to the plaint. The Defendant too does not deny the execution of annEx. A to the plaint. The onus undoubtedly lies on the Defendant to establish that a sum of Rs. 13,000 or any other sum was not paid to him by the Plaintiff. The question of onus is not of much importance at the appellate stage as the entire evidence is before us. It is indeed an uphill task for the Defendant to prove that he received nothing from the Plaintiff by way of loan in view of his admission in writing in annEx. A to the plaint.
The Plaintiff said in his examination-in-chief that he kept the documents mentioned in annEx. A to the plaint as security and that but for the security he would not have given the loan. He is, therefore, emphatic in his assertion that he advanced money on security. In other words, according to him, he accepted a mortgage by deposit of title deed from the Defendant.
Six documents are mentioned in annEx. A to the plaint and all of them were enclosed to annEx. A. One of the documents mentioned is a true copy of the title deed of the Plaintiff''s residence at 37-B Joy Mitter Street, Calcutta-5. According to the Plaintiff''s evidence the copy of the title deed was kept by him. If that be so, he must still be in possession of the same. But the Defendant''s evidence is that he came away on May 26, 1958, with copy of the title deed of his residence. There was no cross-examination on this point. It is also not disputed that the copy of the title deed is not in the possession of the Plaintiff. Therefore, it must be held that the Defendant came away on May 26, 1958, with the copy of the title deed of his residence. The Plaintiff has made no attempt to explain why he parted with the copy of the title deed. It is not his case that the copy of the title deed is worthless as a document of title. Rather, he thinks that the copy was sufficient to create a mortgage in his favour over the residence of the Defendant. If he really advanced Rs. 13,000 on May 26, 1958, he would not have parted with the copy of the title deed which, according to him, was as good as the original title deed as security for his alleged loan. This fact alone, namely, his parting with the copy of the title deed, is sufficient to establish that the Plaintiff''s story of paying Rs. 13,000 in cash to the Defendant by way of loan on May 26, 1958, is entirely false.
As to why he did not take back annEx. A to the plaint from the Plaintiff the Defendant offered the following explanation:
In 1960 Plaintiff and myself did partnership business. I asked Plaintiff to return Id. X (annEx. A to the plaint) and other documents on many occasions but he put me off on various pretexts. Eventually he assured me that he had torn off the writing given by me and other papers.
There was no cross-examination on the statement by the Defendant that the Plaintiff assured the Defendant that the Plaintiff had torn off the writing. If in fact the Plaintiff gave such assurance, then it is clear that annEx. A was never intended to be acted upon. The subsequent conduct of the Plaintiff shows that this document i was not intended to be acted upon. According to the Plaintiff, the loan was advanced in May 1958. He did not think of taking any action on annEx. A till after he had filed his suit for the dissolution of partnership with the Defendant in April 1963. Both the suits are A evidently the outcome of strained relation between the parties.
The Defendant borrowed Rs. 5,512 from the Plaintiff in 1959. They entered into partnership in I960. In the deed of partnership there is a mention of this loan of Rs. 5,512, but there is no mention of the alleged loan of Rs. 13,000. It is highly improbable that credit was given to the Plaintiff for the subsequent loan keeping outstanding the previous loan of Rs. 13,000. As to the effect of the non-mention of Rs. 13,000 in the deed of partnership the learned Judge has observed as follows:
That this loan of Rs. 13,000 was not mentioned in the partnership deed may be a circumstance (I have my doubts) in Defendant''s favour, but it is by no means a conclusive circumstance. There cannot be any doubt whatsoever that the non-mention of Rs. 13,000 in the partnership deed is a circumstance in favour of the Defendant. It may not be a conclusive circumstance, but coupled with the other facts mentioned above, it goes a great way in establishing the defence version that Rs. 13,000 or any other sum was not actually paid to the Defendant by the Plaintiff on May 26, 1958, pursuant to annEx. A to the plaint.
The learned Judge has commented upon the non-production of the account books by the Defendant by saying:
It would have been well if Defendant produced these books of account, but he withheld them.
The learned Judge seems to think that this goes against the Defendant. But, in our opinion, no adverse inference can be drawn against the Defendant for the non-production of his account books.
The Plaintiff has instituted the present suit on the footing that the disputed loan is not a commercial loan. The Defendant''s case is that if any loan is required for the business that alone is entered in the books of account. In his cross-examination he said:
I succeeded in getting loan in 1959. As the loan was required for my business it was mentioned in my books of account which have not been filed by me.
The Defendant could not be expected to file his books of account just for the purpose of proving that he did not receive Rs. 13,000 or any other sum as loan on the basis of annEx. A to the plaint. He did not rely upon the books of account for the purpose of substantiating his defence. Therefore, no adverse inference can be drawn against him for not producing the books of account. If the Plaintiff relied upon the books of account for his case he should have applied to Court for directing the Defendant to produce his books of account. If on such requisition the Defendant failed to produce them, adverse inference could have been drawn against him. But on the facts and in the circumstances of the present case it is immaterial that the Defendant did not produce his books of account. The learned Judge is not justified in saying that he withheld them.
According to the Plaintiff, he paid Rs. 13,000 in cash. One would expect the Plaintiff to disclose the source of his money. On the other hand, he says that he has no bank account and that except his word of mouth he has nothing to show that he was possessed of money to be able to give loans to the Defendant. Rs. 13,000 is rather a heavy amount. It is highly improbable that he paid the amount in cash immediately on the execution of annEx. A to the plaint. It is not his case that he took time for procuring or collecting the amount. His further case is that he used to advance money to the Defendant from time to time on interest. Since 1957 the Defendant had been borrowing money from him and the amount of loan varied from Rs. 500 to Rs. 1,000. He, however, has said that he did not lend money to anybody else. Even then, it is difficult to believe that he did not maintain any books of account in relation to hi: loan transactions with the Defendant, but he has not produced any books of account. There is, to say the least, a ring of unreality around the disputed loan. For all the reasons stated above we are constrained to hold that no consideration passed on the basis of annEx. A to the plaint and that the annexure was not meant to be acted upon. We have also indicated why the suit as framed is not maintainable on the clause indicating mode of payment in annEx. A to the plaint, because the clause itself is vague and tainted with uncertainty.
In the result, the appeal succeeds. The judgment and decree of the trial Court are hereby set aside and the suit dismissed Parties shall bear their respective costs throughout.
In view of the facts found by us from the evidence or record, it is not necessary to take any additional evidence in this Court. It is for this reason that the application for additional evidence is rejected without any order as to costs.
Laik, J.
I agree.