1984 (3) TMI 428

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....iff") to respondent No. 1 acting on behalf of the respondents (hereinafter "the defendants"). Admittedly the amount was paid against three post dated cheques of Rs. 5000/- each but the total amount actually paid was not Rs. 1,500/- but Rs. 1,410/- only. A sum of Rs. 90/- was purported to be deducted as commission payable by the defendants to the plaintiffs. However, it is fairly conceded by Mr. Soni, the learned Advocate appearing before me for the petitioner that this was in fact a deduction of interest in advance. But his explanation is meaningless because if the interest was deducted even before the advance was made it only means that the sum advanced was the lesser amount. Mr. Soni conceded this position and the entire petition was argu....

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....Lenders Act in order to entitle him to file a suit in connection with the transaction. 5. The plaintiff led evidence to prove that the amount of Rs. 1,500/- was advanced by him as against the three post dated cheques issued by defendant No. 1 on behalf of the defendants for the sum of Rs. 1500/-. In the cross-examination it was suggested that a sum of Rs. 90/- was deducted by him while giving advance of a sum of Rs. 1500/- and this fact was admitted by him. However, nothing in the cross-examination went to suggest that only a sum of Rs. 750/- was paid by him to the defendant or that the balance of amount of Rs. 750/- was repaid by them to the plaintiff. 6. As against the plaintiff's evidence the defendants did not even step into t....

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.... learned Judge has committed a manifest error in assuming that the plaintiff was money lender or that the suit transaction was a transaction of loan within the meaning of the Act. This is so because, in the first place, no such plea was raised in the written statement by the defendants and in the second place the loan was admittedly against the three post-dated cheques issued by the defendants and as per the provisions of section 2(9)(f) of the Money Lenders Act as it stood on the date of the transaction any payment made as an advance against cheques stood removed out of the mischief of the Money Lenders Act because such payment was not a loan within the meaning of the Act. This much position is indisputable. 8. Normally speaking, theref....

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.... with evident force that till that it was a bill of exchange drawn o a banker and as such was a negotiable instrument which is all that section 2(9)(f) demanded. 10. In this connection, Mr. Soni invited my attention to the judgment of the Allahabad High Court, in the case of the Partab Chand Ratan Chand v. Gilbert, reported in AIR1934All695 . In that the trial Court had taken the view that on proper construction of section 6 of the Negotiable Instruments Act, a post-dated cheque was not a valid negotiable instrument. Reacting to the view, the learned Single Judge of the High Court observed as follows :--- "If the learned Judge were right one of the most common methods of financing commercial operations would be suddenly put an end to.....

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....e defendants as against three negotiable instruments and as the position under the Money Lenders Act then stood, a loan made against such negotiable instruments stood outside the admit of the definition of "loan" within the meaning of the said Act. The plaintiff, therefore, cannot be non-suited on the ground that the suit transaction was hit by the provisions of the Money Lenders Act. The question then arises is that how much amount the plaintiff is entitled to. In the first place, it may be noted that on his own admission he had paid to the plaintiff only a sum of Rs. 1410/- and not Rs. 1500/-. This is so, because on his won admission he had deducted a sum of Rs. 90/- from the amount of Rs. 1500/- which was to be advanced to the defenda....