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Shridhar Narayan Vs. Krishnaji Vithoji - Court Judgment

LegalCrystal Citation
SubjectCivil;Property
CourtMumbai
Decided On
Judge
Reported in(1888)ILR12Bom272
AppellantShridhar Narayan
RespondentKrishnaji Vithoji
Excerpt:
insolvency - civil procedure code (act xiv of 1882), sections 354, 355 and 356--receiver selling a mortgaged property of insolvent--purchaser at such sale--right of mortgagee unaffected by such sale. - .....receiver to convert the property into money, must be read with section 354 and as referring to the property vested in the receiver by that section. it is true that section 356 contemplates the payment of the debts secured by mortgage out of the proceeds of the conversion of the insolvent's property in priority to the general creditors; but this must be taken in connection with the preceding section, and must be understood as referring to those cases in which the mortgaged premises have actually been sold after coming to an understanding with the mortgagee. the language of section 31 of the indian insolvent act (stat. 11 and 12 vic., cap. xxi) directing the official assignee to sell the property and effects of the insolvent, was so treated by the supreme court of calcutta: see the remarks.....
Judgment:

Charles Sargent, C.J.

1. The language of Sections 354, 355 and 356 is far from being as clear as might be wished; but we think that the Assistant Judge was wrong in holding that the mortgaged property could be sold by the receiver without either the consent of the plaintiff, (the mortgagee), or paying him off. By Section 354 the equity of redemption, which was the only interest the insolvent had in the mortgaged premises, vested in the receiver, and Section 356, which directs the receiver to convert the property into money, must be read with Section 354 and as referring to the property vested in the receiver by that section. It is true that Section 356 contemplates the payment of the debts secured by mortgage out of the proceeds of the conversion of the insolvent's property in priority to the general creditors; but this must be taken in connection with the preceding section, and must be understood as referring to those cases in which the mortgaged premises have actually been sold after coming to an understanding with the mortgagee. The language of Section 31 of the Indian Insolvent Act (Stat. 11 and 12 Vic., cap. XXI) directing the official assignee to sell the property and effects of the insolvent, was so treated by the Supreme Court of Calcutta: see the remarks of Sir L. Peel in Llewellyn v. O'Dowda Taylor's Reports, 169. Govind, therefore, only purchased the equity of redemption in the one field; and the defendant, who now stands in Govind's shoes with notice of plaintiffs claim, although he may possibly be entitled to redeem the entire nine fields comprised in the mortgage, must deliver possession to the plaintiff, (the mortgagee), until that is done. We must, therefore, reverse the decree, and order that plaintiff be put into possession. Appellant to have his costs here and in the Courts below.


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