Patna High Court
Bishun Chand vs Babu Audh Bihari Lal on 21 March, 1917
Equivalent citations: 40IND. CAS.350, AIR 1917 PATNA 533
JUDGMENT Atkinson, J.
1. The plaintiff sues the defendant for recovery of the principal sum of Rs. 1,109 on foot of a hand-note, dated the 2nd of November 1910. There is no dispute that the amount of the principal stated in the note of hand is due and owing by the defendant to the plaintiff. The note of hand, however, is quite silent as to the payment of interest. The hand-note is, in terms, a hand-note payable on demand. The plaintiff, in his plaint, in paragraph 2, claims interest at the rate of 12 per cent, upon the principal sum advanced to the defendant. The learned Judge, however, held that the plaintiff was not entitled to any interest whatever, because in the hand-note interest was not provided for. It is contended before us that the learned Judge was wrong in arriving at that conclusion in point of law, because, even though the hand-note contained no provision as to interest, yet under Section 80 of the Negotiable Instruments Act, XXVI of 1881, the plaintiff would be entitled to interest at the rate of 6 per cent, from the date on which the amount secured by the hand-note ought to have been paid. The learned Judge was not referred to Section 80 of the Negotiable Instruments Act; because I feel sure that if his attention had been directed to the provisions of that Act he would have passed a decree in favour of the plaintiff for interest at the rate of 6 per cent.
2. The only question of difficulty which arises in this case is the time from which the rate of interest began to run. I think that it must be admitted, having regard to the authorities, that where a hand-note is silent as to the rate of interest payable, under Section 80 of the Negotiable Instruments Act the lender is entitled to interest at the rate of 6 per cent, from the date when the money ought to have been paid. The case reported as Ghan-shiam Lalji v. Ram Narain 29 A. 33 : 11 C.W.N. 105;17 M.L.J. 35 : 4 A. L.J. 29 : 1 M.L.T. 427 : 9 Bom. L.R. 1 : 5 C.L.J. 7 (P.C) and also the case reported as Basanti Bibi v. Shea Mangal Parshad 2 Ind. Cas. 199 : 6 A.L.J. 233 undoubtedly favour that construction. There is a case reported as Bhupati Ram v. Sourendra Mohun Tagore 30 C. 446 : 7 C.W.N. 412 which seems to take a different view, but in that case the learned Judge who decided the case never considered or discussed the effect of Section 80 of the Negotiable Instruments Act. Therefore, we consider that en the true construction of Section 80 of the Negotiable Instruments Act interest was payable on the note in suit.
3. The next question is, from what date the interest became due. The note " of hand expressly purports to be a note of hand payable on demand" and it is contended by Mr. Mullick that where a hand-note is payable on demand it is payable immediately on its execution; and Mr. Mullick relies, in support of his argument, upon a case reported as Perumal Ayyan v. Alagirisami Bhagavathar 20 M. 245 at p. 248 : 7 M.L.J. 222 : 7 Ind. Dec. (N.S.) 174 and at page 248 their Lordships say: "The words on demand' must, we think, be regarded as a technical expression equivalent to 'immediately' or 'forthwith'. That, we think, was the intention of the parties." That case was considered in the case reported as Perianna Goundan v. Muthuvira Goundan 21 M. 139 : 7 M.L.J. 315 : 7 Ind. Dec. (N.S.) 455 and their Lordships say: There can be no doubt but that, under the general law, money lent, payable on demand, is due from the date of the loan; in other words, there is a cause of action on the date of the loan." To the like effect are the authorities in England; and the law may be summed up, according to the decision of Blackburn, J., as follows: In general, where money is payable on demand, the law holds that the debtor is bound to find out the creditor and pay him; and this the debtor is liable to do at once. Therefore, a promissory note payable on demand' is payable at the instant the note is made. No demand is necessary prior to an action." The authorities for this proposition laid down by Blackburn, J., are to be found in Norton v. Ellam (1837) 2 M. & W. 461 : M. & H. 69 : 6 L.J Ex. 121 : 1 Jur. 433 : 46 R.R. 646 : 150 E.R. 839; Maltby v. Murrells (1860) 29 L.J. Ex. 377 : 5 H. & N. 813 : 2 L.T. (N.S.) 362 : 157 E.R. 1405 : 120 R.R. 839 and George In re, Francis v. Bruce (1890) 44 Ch. D. 627 : 59 L.J. Ch. 709 : 63 L.T. 49 : 38 W.R. 617. Therefore the words "payable on demand" have a legal meaning and sense which convey that the note is payable on the date of its execution. It must be remembered that the words "on demand" are distinct and separate from the words' after demand". If the words used are "after demand", then a demand is necessary; but if the words are on demand", then no ' demand is necessary. Accordingly we are of opinion that the note in suit was liable to interest as and from the 2nd of November 1910, that is the date on which it was executed; and that the plaintiff is entitled in this case to interest at the rate of 6 per cent, from the 2nd of November 19i0 until the date of realization of the debt.
4. The defendant, as against the principal sum and interest due from him to the plaintiff, seeks to set off certain sums which he claims as the value of his services rendered to the plaintiff as a Pleader. He sets out in his claim various items, ranging alphabetically from A to H, which aggregate in all to nearly Rs. 2,000, and he seeks to have the full sum set off as against the plaintiff's claim. As a matter of fact, however, the defendant is not entitled to claim the entire sum set out in his claim. He is only entitled to a share jointly with other Pleaders who were associated with him in the cases in which he represented the plaintiff. He is thus only entitled to claim a fractional part of the amounts shown by him. Therefore it can in no sense be said that the defendant's claim is for an ascertained amount within the meaning of Order VIII, Rule 6. Indeed that his claim is not for an ascertained sum is demonstrated by the fact that the learned Judge had himself to ascertain and declare the proportionate share of the sum claimed by the defendant to which he (the defendant) was in fact entitled. The learned Judge has assessed this share at Rs. 176-9-0; but the fact that the learned Judge has arrived at this conclusion does not entitle the defendant to say that he is legally entitled to recover this sum without giving proof that it was legally recoverable at the date of the institution of the suit. The learned Judge has come to the conclusion that Rs. 176-9-0 is due to the defendant by the plaintiff for the value of services rendered by him as a professional legal gentleman. But we think that the plaintiff cannot claim this sum as a legal or an equitable set-off; and certainly not as an equitable set off because the claim does not arise out of the same transaction. We have carefully considered the effect of the law laid down in the case reported as Diltor Koer v. Karkhoo Singh 37 Ind. Cas. 367 and vse are of opinion that the defendant in this case is not entitled in point of law to the set-off which he claims. Therefore, strictly speaking, the decree of the lower Court should be varied and the defendant's claim for a set-off should be dismissed. However, it appearing to us that something must be due by the plaintiff to the defendant for services rendered, we threw out the suggestion that the plaintiff as an honest man should pay an honest debt, more especially as the creditor is a Pleader who is usually one of the most deserving creditors in the world. However, Mr. Mullick had some diffidence in acceding to cur suggestion; but we consider that it is desirable that this litigation should, if possible, be brought to a termination. Therefore, although we think that the defendant is not entitled to a set-off in point of law, nevertheless we think that we should, on the principle of justice, equity and good conscience, settle this litigation on a fair and equitable basis; and we would, therefore, allow the defendant, as against the plaintiff, credit for the amount to which he is entitled for services rendered by him as a Pleader and we fix this sum at the figure arrived at by the learned Judge, viz., Rs. 176-9-0. We accordingly set aside the decree of the lower Court and declare that the plaintiff is entitled to a decree for the full sum claimed by him by way of principal, viz., Rs. 1,109; and that he is further entitled to interest on this sum at the rate of 6 per cent per annum as and from the 2nd of November 1910 until the date of realization. As against, this sum of principal and interest the defendant will get credit for Rs. 176-9-0 as and for the value of services rendered by him to the plaintiff plus Rs. 400, being the sum already paid by him to the plaintiff, i.e., in all Rs. 570.
5. The appeal is accordingly allowed with costs.