(1.) This is an appeal in a suit on a mortgage bond. The bond was executed in May 1926 for a sum of Rs. 200 at interest of 2 per cent per mensem with rests of three months. The due date having passed and the defendant not having paid the amount the suit was instituted in November 1931. The bond was executed by a widow, defendant 1, and by defendant 4, husband of her deceased daughter, and by defendants 2 and 3, minor sons of defendant 4 and the deceased daughter. The bond was executed by defendant 4, the father in respect of the shares of his sons, defendants 2 and 3. Various defences were taken. The Court of appeal below decreed the suit fully against the defendants. In appeal the first point taken is that the minor defendants 2 and 3 are not legally bound by the mortgage bond, Under Mahomedan Law the father is the legal guardian of his minor sons, but his power to sell the minors immoveable property is not absolute. He may sell the immoveable property of the minor in certain conditions stated in Section 263 of Mulla's Principles of Mahomedan Law. The learned Advocate has also quoted the cases of Imambandi V/s. Mutsaddi 1918 P C 11, Hurbai V/s. Hiraji Byramji (1896) 20 Bom 116 and Bhawal Sahu V/s. Baijnath Pertab Narain Singh (1908) 35 Cal 320. On perusal of those cases it appears that in the case of a sale by a guardian of a Muhammadan minor there must be an absolute necessity for the sale, or it must be for the benefit of the minor. In this case it was a mortgage but a mortgage bond should be governed by the rules applicable to sales.
(2.) The question is whether in this case there was necessity for the mortgage and whether it was for the benefit of the minors. In the document it was merely stated that the mortgage bond was made for urgent necessity. No details were given. In the evidence in Court which the Court of appeal below has accepted, it was stated that about Rs. 80 was spent for payment of arrears of rent for 4 years and about Rs. 60 was spent for purchase of plough cattle and about Rs. 60 was spent in getting mutation in the landlord's books. It is urged by the learned advocate that it was the duty of the plaintiff to have it clearly stated in the document for what particular purpose the money was borrowed, and that the omission of any such record in the deed is fatal to the success of the plaintiff. This extreme proposition cannot be accepted. The plaintiff would have been wise to have recorded the purpose of the loan in the bond itself, but the evidence which has been accepted by the Court of fact cannot be neglected. When Rs. 80 was spent for arrears of rent, and Rs. 60 was spent for purchasing plough cattle, it may be legally held that the mortgage was for the benefit of the minors. As to the payment of the mutation fee, it appears clear that there was no necessity for this on behalf of the minors, but the same cannot be said about the payment of arrears of rent or the purchase of plough cattle. In the circumstances the finding of the Court of appeal below is correct namely that the sale was for the benefit of the minors.
(3.) The next point taken is that the interest charged in the bond is excessive and the transaction was substantially unfair to the defendants. There is force in this contention. Interest at 24 per cent, if it was simple interest, probably would not be too high, but it was compounded every three months so that the original amount of Rs. 200 increased in 4frac12; years to Rs. 570. Following the decision of Radharani Dassya V/s. Kshetra Mohan (1935) 40 C W N 409, the interest in this case should be reduced. The appeal is allowed in part, namely that the interest is reduced to 18 per cent per annum with yearly rests. The decree of the Court of appeal below is varied accordingly. The parties will get their costs in proportion to their success in all the Courts.