MONOJ KUMAR MUKHERJEE, J. - (1.) This appeal is at the instance of the defendants and it arises out of a suit for redemption of mortgage and of charge, rendition of accounts, recovery of money over paid and for other consequential reliefs.
(2.) The case of the plaintiff is as under. The plaintiff was incorporated as a private limited company on Mar. 15, 1951 for exhibition of Cinematographic Films with three directors on Board, namely, Ranatsen Ghose, Birendra Mohan Bhar and Dhanaballav Pal. The plaintiff therefore purchased three vacant plots of land at Khardah in the district of 24-Paraganas at a price of Rs. 23,500/- with a view to constructing a cinema house thereon and starting a cinema exhibition business of its own under the name and style of "Sandhya Cinema Corporation." Thereafter the plaintiff mortgaged the said land to Smt. Ramarani Pal, wife of its director Dhanaballav Pal, for Rs. 10,000/- and at the relevant time the mortgage money along with interest thereon amounted to Rs. 12,700/-. The plaintiff got a plan for the proposed cinema house sanctioned by the Titagarh Municipality and started foundation work but for paucity of funds the construction had to be stopped. It was therefore decided to raise loan from the market to carry on the construction of the cinema house and also to pay off Smt. Ramarani Pal. For that purpose, in or about the month of Sept./or Oct. 1955, the plaintiff approached the defendants, who are money lenders by profession, for loan. They agreed to lend and advance Rs. 12,700/- at an interest of 8% per annum to the plaintiff to enable it to liquidate the mortgage debt of Smt. Pal on condition that the plaintiff would execute a fresh mortgage in respect of the said plots of land in favour of the defendants as security for the loan.
(3.) According to the plaintiff, Rama Sankar Singh, the defendant No. 1 at the material time was carrying on business of purchasing old buildings and structures and selling second-hand building materials collected from them after demolition and at his instance all the four defendants made a further demand that the loan would be advanced only if the contract for construction of the cinema house was made with them. The defendants further gave out that keeping a profit of 20% the cost of construction of the entire cinema house would be Rs. 67,300/- with second-hand building materials and they proposed that the said costs would be treated as loan to be offered by the defendants jointly and included in the deed of mortgage of the land so that the cost of construction could be realised with interest of 8%. Due to its financial constraint and helpless condition the directors of the plaintiff agree to place the contract with the defendants. The defendants then through their Attorney got a deed of mortgage drafted with the condition that the defendants would advance Rs. 80,000/- as loan at an interest of 8% per annum to the plaintiff out of which Rs. 12,700/- should be paid on the date of execution of the deed to Smt. Pal to redeem the mortgage and Rs. 67,300/- would remain with the defendants to construct the cinema house for the plaintiff as per plan sanctioned. At the time the directors of the plaintiff were negotiating with the defendants for the loan, one of them, namely, Dhanaballav Pal expressed his inability to agree to the terms of the defendants and resigned on Oct. 16, 1955. Taking advantage of the predicament in which the other two directors, namely, Ranatsen Ghose and Birendra Mohan Bhar were placed the defendants got it stipulated in the mortgage deed that the interest on Rs. 80,000/- would run from 20-10-1955, the date of execution of the mortgage deed and the plaintiff would have to repay the mortgage amount of Rs. 80,000/- with interest within two years though the defendants paid only Rs. 12,700/- on 20-10-1955 to liquidate the mortgage debt of the plaintiff to Smt. Pal while the remaining sum of Rs. 67,300/- remained with the defendants which was supposed to have been spent in the construction of the cinema house till 1960 when the construction was completed. According to the plaintiff the defendants thus tried to make a fraudulent gain of Rs. 26,920/- as interest for five years on Rs. 67,300/-.;