- (1.) Defendants have filed this appeal aggrieved by the Judgment and decree of the Subordinate Judge, Viiayawada. The plaintiff respondent filed the suit for recovery of Rs. 6,000 with interest on the basis of a mortgage bond Exhibit A-l dated 5th June, 1962, executed by the husband of the 1st defendant and father of the 2nd defendant (Gandham Venkata Krishnarao hereinafter referred to as the Mortgagor). The mortgagor died somewhere in the year 1965 and prior to his death the plaintiff demanded the payment of the amount from, him which he promised. After the death of the executant a demand notice was issued to the defendants and they called upon the plaintiff to give a true copy of the mortgage bond. The plaintiff instead filed the suit from which the present appeal arises. The case of the plaintiff is that the mortgagor borrowed Rs. 6,000 out of which he paid off an earlier mortgage Exhibit A-2 dated 19th September, 1960. The amount under the earlier mortgage amounted to Rs. 4,411 and the rest of the amount was paid to the mortgagor Rs. 589 at the time of execution of the document and Rs. 1,000 before the Sub-Registrar. The mortgage deed provides for payment of interest at the rate of 12% per annum compoundable every three years. In her claim the plaintiff has included simple interest at 12% for the first three years from 5th June, 1962 to 4th June, 1965 and has claimed interest on the amount of three years interest from 4th June, 1965 to 14th September, 1965.
(2.) The defendants in their written statement denied that the document was executed by the mortgagor or that any consideration passed under it. They further contended that the rate of interest stipulated under Exhibit A-1 is not only excessive but unfair and the plaintiff is not entitled to claim interest at that rate. They also raised the plea that they are entitled ti the benefits of the Madras Agriculturists Relief Act (IV of 1938).
(3.) On these pleadings the trial Court framed the necessary issues and held that the mortgage bond is true and supported by consideration and is binding on the defendants. As regards the rate of interest it held that the interest is neither penal nor usurious. In the result, the plaintiff was granted a preliminary decree for sale of the plaint schedule property.;