VEDDEVALLI GUNDARAYUDU Vs. MUDDANA VENKATASUBBIAH
LAWS(APH)-1955-11-21
HIGH COURT OF ANDHRA PRADESH
Decided on November 21,1955

VADDEVALLI GUNDARAYUDU Appellant
VERSUS
MUDDANA VENKATA SUBBAIAH Respondents

JUDGEMENT

Viswanatha Sastry, J. - (1.)The plaintiff, here appellant, filed a suit for the recovery of Rs. 32,794-4-4 being the balance of principal and interest claimed to be due under a mortgage Exhibit A-1 dated 10-9-1936 executed in his favour by defendants 1 and 2 and the deceased husband of defendants 3 and 4 for Rs. 15,681-7-4 carrying interest at annas 9 per cent, per mensem, compoundable with three yearly rests. The amount due according to the terms of Exhibit A-1 was claimed by the plaintiff. The defendants contended that they were agriculturists entitled to the benefits of Madras Act IV of 1938 and that in spite of repeated demands, the plaintiff had evaded settlement of the debt after scaling it down under the provisions of that Act. Though an issue was framed I whether the defendants were entitled to the benefits of Madras Act IV of 1938, it was not pressed at the trial and the plaintiff conceded that the mortgagors were agriculturists within the meaning of the Act and that the mortgage debt had to be scaled down accordingly. The only question that remained to be decided by the court below related to the correct amount due under Exhibit A-l after applying the provisions of Act IV of 1938. The court below decreed the suit for Rs. 16,859-4-0 and disallowed the plaintiff his costs applying Sec. 24-A of Act IV of 1938. Madras Act IV of 1938 will hereinafter be referred to as "the Act". On behalf of the mortgagee-appellant, objection has been taken to the finding of the court below in respect of the amount found due under the mortgage, Exhibit A-l and also in respect of the costs disallowed to the mortgagee. There are two items of prior debts which are included as part of the consideration for Exhibit A-l and the controversy between the parties centred round these two debts. One of the prior debts is the amount of principal and interest due under Exhibit A~9 dated 2-4-1931, a promissory note executed by the 1st defendant and another in favour of the deceased father of the plaintiff for Rs. 2,217-8-0- Exhibit A-Q was itself a renewal of an earlier promissory note Exhibit A-8 dated 17-1-1930 executed by the deceased husband of defendants 3 and 4 in favour of the deceased father of the plaintiff for Rs. 2.000/-.
(2.)It might here be mentioned that defendants 1 and 2 and the deceased husband of defendants 3 and 4 formed members of a joint Hindu family. The consideration for Exhibit A-8 is stated to be Rs. 2,000/- out of which a sum of Rs. 975-2-3 represented cash paid by the creditor to the debtor on 17-1-1930 when Exhibit A-8 was executed. There is no dispute with regard to this cash payment. The balance of Rs. 1,024-13-9 is recited in Exhibit A-8 as "the amount due to you upto this day in respect of the groundnut transaction". The creditor has treated this sum of Rs. 1024-13-9 as the principal amount due to him on the date of Exhibit A-8 while the debtor contends that this sum comprised the balance of the price due by him to the creditor in respect of purchases of groundnuts spread over a period of two years before 1930 and interest on the price calculated at 12% upto 17-1-1930. The Court below has accepted the version of the debtor and held that only a sum of Rs. 224-13-9 was due for principal and the balance of Rs. 800/- out of the sum of Rs. 1,024-13-9 represented the interest charged to the debtor on the price of groundnuts sold to him by the creditor. On this basis the principal amount due under Exhibit A-8 was taken to be Rs. 1,200/- and interest on this sum at the statutory rate was awarded to the creditor. It is argued by the learned Advocate for the appellant that the conclusion of the court below is erroneous and that the entire sum of Rs. 2.000/- payable under Exhibit A-8 should have been taken as the principal of the debt. If the sum of Rs. 1,024-13-9 represented the price and nothing but the price payable to the creditor in respect of the purchase of groundnuts it would have been so stated in Exhibit A-8. The recital is that the amount represented the debt payable in respect of the groundnut transaction. It is not as if the purchase of groundnuts was a recent event in which case it might be assumed that no interest would have been charged. The purchases were for large amounts and frequent repayments had been made by the debtor before the date of Exhibit A-8. The sum of Rs. 1,024-13-9 forming part of the consideration for Exhibit A-8 represents the balance of the account as between the debtor and the creditor in respect of the groundnut transactions. It may be presumed that a money-lender like the plaintiff would have charged interest for the unpaid price particularly when the transactions went on during a period of two years and more. It is seen from the evidence of the defendants that the purchase of groundnuts were considerable and the total price payable in respect of such purchases would have been more than Rs. 10,000,'-. There have also been part payments made by the debtors. The odd sum of Rs. 1,024-13-9 taken as the consideration for Exhibit A-8 should have been arrived at on the basis of accounts maintained by the parties. The plaintiff, though he is an income-tax assessee, stated that he did not maintain accounts. In his cross-examination, he admitted that he had some account showing the amounts received by him by way of interest on securities and that his incometax returns were prepared on the basis of that account. Even in his chief-examination, the plaintiff would not say if the sum of Rs. 1,024-13-9 included or did not include interest also, and in his cross-examination he could not or would not say how long prior to Exhibit A-8 he sold groundnuts or for what amounts the groundnuts were sold or whether interest was charged for the price payable by the debtor or whether the rate of interest provided was 12% per annum. This unsatisfactory evidence of the plaintiff coupled with the non-production of accounts which must have been maintained for the transactions, casts serious doubts on the truth of his case.
(3.)The debtors examined one Raghavulu who belongs to the same village as the plaintiff and who worked as the plaintiff's gumastha for 25 years. Raghavulu, examined asD. W. 1 is the attestor of the endorsement of discharge on Exhibit A-8 and of the renewed promissory note Exhibit A-9. It is conclusively proved by the evidence in the case that D. VV. 1 was working as the gumastha of the plaintiff during the year to which the suit transactions related. See Exhibits B-1, D-1 (a) and A-12 (a). The plaintiff disingenuously sought to deny that D. W. 1 acted as his gumastha, but when confronted with the documentary evidence referred to above reluctantly admitted that D. W. f used to accompany him when he went to make collections. D. W. 1. in his evidence stated that the defendants purchased groundnuts from the plaintiff during a period of two years prior to Exhibit A-8 and that interest had been agreed to be paid on the price at 12% per annum. He would say that on the date of Exhbit A-8, the defendants had to pay Rs. 200/-towards principal and Rs. 800/- towards interest in respect of the groundnut transactions. According to D. W. 1, the transactions relating to the sales of groundnuts and the payments made from time to time by the defendants had been entered in an account book kept by the plaintiff. He was present when Exhibit A-8 was written and the sum of Rs. 1,024-13-9 was calculated and ascertained as payable by the defendants to the plaintiff in respect of the principal and interest due on the groundnut transactions. D. W. 2, the 2nd defendant, also gave similar evidence as D. W. 1. He produced some books of account into court showing payments made to the plaintiff from time to time. According to him, he purchased about 550 or 600 bags of groundnuts from the plaintiff for the purpose of distribution among the ryots as seeds. D. W. 2 also gave evidence to the effect, that only a sum of Rs. 224-13-9 was due towards the principal in respect of the groundnut transactions and that the balance of Rs. 800/- included in the sum of Rs. 1,024-13-9 was interest. The court below has accepted the evidence of the defendant in preference to that of the plaintiff and in view of the state of the evidence discussed above, we see no reason for differring from its conclusion.
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