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2015 DIGILAW 304 (GAU)

Manik Chakraborty v. Jiten Ch. Das

2015-03-12

MANOJIT BHUYAN

body2015
ORDER Manojit Bhuyan, J. (Oral) - Heard Mr. S.P. Roy, learned counsel for the appellant, assisted by Mr. K. Roy. None appears for the respondent. 2. The facts briefly stated are that the respondent/plaintiff is a businessman by profession and the proprietor of M/s Hiren Stores located at Rangapara. The appellant/defendant was an employee and was looking after and maintaining the Sales Tax and Income Tax Registers in respect of the plaintiff's business. On 11.09.1994 the respondent/plaintiff had lent a sum of Rs.20,000/- to the appellant/defendant by executing a Hand Note and on condition that the same would be repaid with interest @ 10%. A further sum of Rs.9,000/- was also lent on 09.11.1994 on the same terms and conditions by execution of a Hand Note. The appellant/defendant having failed to repay the amount, the respondent/plaintiff was constrained to institute Money Suit No. 33 of 1997 before the Court of the Civil Judge (Senior Division) Sonitpur, Tezpur. The appellant/defendant contested the suit and had also filed a written statement, denying the averments made in the plaint in to, besides taking the categorical stand that the transaction was void/voidable in law and the respondent/plaintiff was debarred from instituting the suit inasmuch as he had no license to lend money as required under the law. 3. The judgment and decree in the said Money Suit No. 33 of 1997 was passed on 19.08.2002 on the basis of the issues so framed and upon appreciation of the deposition of one witness from either side and the Hand Notes which were exhibited as Ext. 1 and 2. The Trial Court held that the suit was maintainable in view of the fact that the appellant/defendant had failed to show otherwise. The Trial Court while discussing Issue No. 4 had also taken note of the decision rendered in (1984) 2 GLR 118, which is a case discussing Section 7D of The Assam Money Lenders' Act, 1934. The said decision did not fall for consideration as in the opinion of the Trial Court no such plea had been taken by the defendant in his written statement. Accordingly, the suit was decreed against the appellant/defendant for a sum of Rs.37,550/- on contest with cost and with interest at 6% per annum on the decretal amount from the date of institution till realisation of the decretal amount. 4. Being aggrieved Money Appeal No. 1/2002 came to be preferred. Accordingly, the suit was decreed against the appellant/defendant for a sum of Rs.37,550/- on contest with cost and with interest at 6% per annum on the decretal amount from the date of institution till realisation of the decretal amount. 4. Being aggrieved Money Appeal No. 1/2002 came to be preferred. The first appellate Court while concurring with the decision of the Trial Court also noticed that the Trial Court had rightly held that there was no averment in the written statement with regard to the respondent/plaintiff being a money-lender without having license to that effect. On that premise, the first appellate Court held that evidence beyond pleading cannot be taken into consideration. Accordingly, the appeal was dismissed on contest and the judgment and decree of the Trial Court was upheld. 5. On second appeal before this Court, the same was admitted for hearing by order dated 21.05.2004 on the following substantial questions of law: "1. Whether the suit was maintainable in the absence of licence under the provisions of The Assam Money Lenders' Act, 1934? 2. Whether the impugned judgment and decree is perverse, bad in law and liable to be set aside and quashed?" Before proceeding to answer the substantial questions of law so formulated it would be apposite to extract the provisions under Section 7D of The Assam Money Lenders' Act, 1934 as well as the definitions of "Money Lender" and "Loan" as given in Section 2(1) and (3) of the Act respectively. [Section 7D. [Section 7D. Suit not to proceed without registration certificate, etc.- No suit for the recovery of a loan advanced by a money-lender shall proceed in a Civil court until the court is satisfied that he holds a valid registration certificate or that he is not required to have a registration certificate by reason of the fact that he does not carry on the business of money-lending.] ["Money Lender" means a person who in the regular course of business, advances a loan as defined in this Act and shall include, subject to the provisions of section 6, the legal representatives and the successors in interest whether by inheritance, assignment or otherwise of the person who advanced the loan and money-lending shall be construed accordingly.] ["Loan" means an advance, whether of money or in kind, made on condition of repayment with interest and includes any bond bearing interest executed in respect of past liabilities and any transaction which is in substance a loan, but does not include - (a) a loan to, or by, or a deposit with, any Society or Association registered under the Societies Registration Act, 1860 (Act XXI of 1860) or under any other law relating to public, religious or charitable objects, (b) a loan advanced before or after the commencement of this Act - (i) by a Co-operative Life Insurance Society (ii) by a Bank which has been declared to be a notified Bank under section 2-A whether or not such Bank was declared to be a notified Bank at the time the loan was advanced, (c) a loan advanced by Life Insurance Corporation of India, Financial Corporation of India or any other Corporate body.] 6. There is indeed a statutory bar under section 7D of the Act for instituting suit for recovery of loan advanced by a money-lender unless the person holds a valid registration certificate. Section 7D further provides that no suit would also proceed in a Civil Court until the Court is satisfied that the person concerned is not required to have a registration certificate by reason of the fact that he does not carry on the business of money lending. Section 7D further provides that no suit would also proceed in a Civil Court until the Court is satisfied that the person concerned is not required to have a registration certificate by reason of the fact that he does not carry on the business of money lending. The ratio of the said provision makes it explicitly clear that no suit will lie for recovery of loan advanced by a money-lender without a valid registration certificate and/or in case of a person who does not carry on the business of money-lending the Court is satisfied that he does not require a registration certificate. Money-lender as defined under section 2(1) means a person who in the regular course of business advances a loan as defined in the Act. 'Loan' is defined as an advance made on condition of repayment with interest. 7. In the proceedings before the Court below the evidence on record clearly show that money had been advanced on condition of repayment with interest. Further the courts below proceeded without being satisfied that the respondent/plaintiff is not required to have a registration certificate in case he is not carrying on the business of money lending. 8. Besides, the finding and decision of the courts below to the extent that no plea had been taken by the appellant/defendant in its written statement to show how the suit was not maintainable, is on the face of it an erroneous finding, inasmuch as the categorical stand of the appellant/defendant in its written statement in paragraph 4 and 17 is that the suit of the plaintiff is barred as the plaintiff had no license to lend money as required under the provision of law. The findings of the courts below to that extent is wholly erroneous and perverse and goes to the root of the matter. 9. The decision of the Court below being rendered without regard to the statutory provisions of the Assam Money Lenders Act, 1934 and without regard to the specific pleadings made in the written statement, the same cannot stand the scrutiny of law. The substantial questions of law so formulated come to the aid of the appellant. 9. The decision of the Court below being rendered without regard to the statutory provisions of the Assam Money Lenders Act, 1934 and without regard to the specific pleadings made in the written statement, the same cannot stand the scrutiny of law. The substantial questions of law so formulated come to the aid of the appellant. Accordingly, the said substantial questions of law is answered in terms of the above by setting aside the judgment and decree of the Court below by remanding the matter to the first appellate Court for deciding on the point as to whether the money suit is maintainable having regard to the statutory provisions under the Assam Money Lenders' Act, 1934. 10. In view of the above, the appeal is allowed. 11. Needless to say that the decision of the first appellate Court will determine the fate of the suit. 12. No costs.