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Daluchand Balaram Marwadi Vs. Appi Khema Saste - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai
Decided On
Case Number Second Appeal No. 281 of 1919
Judge
Reported inAIR1921Bom282; (1920)22BOMLR1093
AppellantDaluchand Balaram Marwadi
RespondentAppi Khema Saste
DispositionAppeal dismissed
Excerpt:
.....the plaintiff as parts of the same transaction, the plaintiff sued only on one of them under the dekkhan agriculturists' relief act and obtained a decree. in execution of the decree, the mortgaged property was sold free of all incumbrances, and not subject to the other mortgage charges, the sale realised an amount which was in excess of that due under the decree, the plaintiff filed another suit on the two remaining mortgages mid sought a decree against the balance of the sale proceeds of the mortgaged property: -;that the suit was barred under order ii, rule 2, of the civil procedure code coupled with the provisions of sections 12 and 13 of the dekkhan agriculturists' belief act; inasmuch as the plaintiff' having omitted to sue on the two mortgage bonds when ho sued on the first..........which decreed the 1st suit, having notice of the two mortgages executed at the same time as the suit mortgage, should have inquired into the history of those mortgages. however it did not do so. but it is quite clear that this is exactly the case to which mr. justice hayward referred in his remarks which i have just quoted, which in that case may have been obiter. one can imagine that it might easily lead to fraud, and also to evasion of the objects of the dekkhan agriculturists' relief act, if a party in the position of the plaintiff in this suit could sue on one mortgage, leaving aside other mortgages of the same date which together with the first mortgage really made up one transaction. he could thus avoid an account being taken of the whole transaction between the parties, and.....
Judgment:

Norman Macleod, Kt., C.J.

1. The plaintiff took three mortgage bonds on the 6th July 1900 for Rs. 99 each over the same property from the 1st defendant, the consideration being the balance of Km. 274 due on the previous account, and Rs. 23 paid in cash. He sued on one of the bands in 1911 and obtained a decree thereon. He did mention in his plaint that he held two other mortgages over the property, and that he would take separate steps on them. The property was sold in execution of the decree on the one bond, but was not sold subject to the other mortgage charges. It was sold free of any incumbrances, and realised more than the amount due on the bond in that suit. The plaintiff has now filed this suit on the remaining two mortgage bonds. He cannot ask for sale of the mortgaged property. That has already been sold free of the mortgages in the previous suit. But he does ask for a decree for the amount due on the remaining two mortgage bonds, which ho contends will be effective as regards the. balance of the sale proceeds of the mortgaged property.

2. Both Courts have dismissed his suit on the ground that it was barred by Order II, Rule 2, of the Civil Procedure Code, and Sections 12 and 13 of the Dekkhan Agriculturists' Relief Act. The case of Dhondo v. Bhikaji (1914) 17 Bom. L.R. 144 was referred to. There a person holding two different mortgages on the same property from the same person sued on the second mortgage without impleading the. first mortgage, and obtained a decree. He then sued on the 1st mortgage, and it was hold that the 2nd suit was barred by reason of the decree in the 1st suit on the subsequent mortgage as res judicata under Section 11, Explanation IV, of the Civil Procedure Code. Mr. Justice Hayward in his judgment expressed an opinion that 'if It had been found as a matter of fact that the transactions were transactions 'out of which the suit had arisen', then they would have constituted the same cause of action, and the subsequent suit would have been barred under Order II, Rule 2, by reason of the special provisions of Section 13 of the Dekkhan Agriculturists' Relief Act.'

3. Now there can be no doubt that these three mortgages were really part of the same transaction, whereby the plaintiff got security for the balance due on the old account together with the fresh cash advance, and when the first suit was filed, the Court was bound to inquire into the history and merits of the case, from the commencement of the transactions between the parties and the persons (if any) through whom they claimed, out of which this suit had arisen. The Court which decreed the 1st suit, having notice of the two mortgages executed at the same time as the suit mortgage, should have inquired into the history of those mortgages. However it did not do so. But it is quite clear that this is exactly the case to which Mr. Justice Hayward referred in his remarks which I have just quoted, which in that case may have been obiter. One can imagine that it might easily lead to fraud, and also to evasion of the objects of the Dekkhan Agriculturists' Relief Act, if a party in the position of the plaintiff in this suit could sue on one mortgage, leaving aside other mortgages of the same date which together with the first mortgage really made up one transaction. He could thus avoid an account being taken of the whole transaction between the parties, and then at a future time file a suit on the remaining causes of action, which as a matter of fact really made up one entire cause of action. I think, then, that the plaintiffs having omitted to sue on these two mortgage bonds when he sued on the let mortgage bond, cannot now, ask the Court to pass a decree on those two mortgage bonds, ho as to be able to execute that decree against the balance of the sale proceeds of the property, which was sold in execution of the first decree. He is barred in my opinion under Order II, Rule 2 of the Civil Procedure Code, coupled with the provisions of Sections 12 and 13 of the Dekkhan Agriculturists Relief Act. The appeal, therefore, I think, must be dismissed.

Heaton, J.

4. It is well understood now, and for many years has been, that when a Court takes an account as provided by. Section 13 of the Dekkhan Agriculturists' Relief Act, it does not start the account with the particular bond or mortgage deed, or whatever it may be, which is. pleaded as the basis of the Suit. The account is taken of the transactions between the parties to the suit, and if those, transactions began at an earlier date than a particular bond, whether a money bond or a mortgage bond, and if, the transactions led. up to that particular bond then the account is taken from the earliest of the preceding transaction and is continued right up to the date of the suit. - That is too well understood to need further comment We have in this case an instance, of conscious or unconscious evasion of that principle of the Dekkhan Agriculturists Relief Act. The plaintiff was, a mortgagee .who had had before these mortgages other transactions with the defendant. A balance was made up apparently, or at any rate it was asserted that there was a balance remaining payable by the defendant to the plaintiff. The plaintiff made a small further advance, and to secure the total debt took three separate mortgage bonds from the same mortgagor, in each case relating to the same property. He brought a suit on one of the mortgage bonds and obtained a decree. When that suit was brought, of course accounts had to be taken under Section 13 of the Dekkhan Agriculturists' Relief Act, and ought to have been taken in the way 1 have described. The account ought to have gone back to the earlier transaction, and ought to have arrived at the balance duo when the three mortgage deeds were made, and have proceeded to embrace all the three mortgages. The account, however, did nothing of the kind. It was limited to the one mortgage deed on which the plaintiff then sued.

5. In so permitting the account to be taken, the plaintiff was in grievous error. For there is another matter which is perfectly well understood, and has boon for yours, and which has repeatedly been pointed out: it is that the Court often finds itself powerless to take an account as contemplated by Section 13 without the contentious assistance of the creditor: so it is the duty of the creditor to furnish the Court with what he asserts to be a true statement of the account: and where a creditor does, as this creditor did, in that earlier mortgage suit, deliberately refrain from presenting a complete account, and limits the account he presents to one transaction, when it ought to have embraced all, he if putting at naught the intention of the provisions of the Dekkhan Agriculturists' Relief Act.

6. Applying then the words of Rule 2, Order II, of the Civil, Procedure Code to that particular condition of affairs Which arises under the Dekkhan Agriculturists Relief Act, we find that when a plaintiff brings a suit, he is usually bound to sue for the total debt due under all his transactions with the creditor. There may be exceptions, but that is a general rule where the Dekkhan Agriculturists' Relief Act applies. There certainly was no need to make any exception in this case. Here therefore we have circumstances which supply one of the simplest instances the application of Rule 2, Order II to the state of affairs contemplated by the Dekkhan Agriculturists' Relief Act. The suit should have included the whole of the claim. It did not do so. It included only a part of the claim, and a decree was . obtained on that basis, and the only thing consistently with the law which we can do, is to take it that the plaintiff relinquished the rest of his claim. That being taken, this suit must of necessity be dismissed, and I think the appeal should be dismissed.


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