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Chatru Abaji Patil Vs. Kondaji Vithal Patil - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai
Decided On
Case NumberSecond Appeal No. 833 of 1912
Judge
Reported inAIR1914Bom191; (1913)15BOMLR1129
AppellantChatru Abaji Patil
RespondentKondaji Vithal Patil
DispositionAppeal dismissed
Excerpt:
.....against the defendant who was an agriculturist. the degree was settled by the execution of a mortgage bond for the amount of rs. 900 which was made up of the decretal amount and bs. 10-4-0 paid in cash to the mortgagor when the mortgage bond was executed. the mortgage bond provided that the amount was to be paid in nine instalments and that, on the failure to pay an instalment, interest was to be paid at upper cent per mensem. the plaintiff sued to recover rs. 900 as principal and rs. 900 as interest by sale of the mortgaged property. the defendant no. 2, who had purchased the mortgaged property at a sale in execution of another degree against defendant no, 1, contended that the mortgage bond, which was executed without the sanction of the court, was void under section 257 a of the..........and separate agreement, does not affect the right to sue for the recovery of the mortgage-debt; bhagchand v. radhakisan i.l.r. (1903) 28 bom. 62 : 5 bom. l.r. 672. this case has been referred to with approval in raichand v. naran i.l.r. (1904) 28 bom. 310 : 6 bom. l.r. 62.4. the contention that 'bhagchand's case is in conflict with heera nema v. pestonji i.l.r. (1898) 22 bom. 693 and bhagabai v. narayan i.l.r. (1907) 31 bom. 552 : 9 bom. l.r. 950 is untenable. in heera nema's case the decretal-debt was satisfied by a payment in cash and by the passing of a promissory-note which carried interest. the promissory-note was u renewed from time to time by adding interest to it as the tree i same accrued due. the amount due under the promissory-note for which the suit was instituted.....
Judgment:

Heaton, J.

1. We are of opinion that the mortgage bond is not an agreement to give time.

2. My second submission is that the mortgage-bond is not for a sum in excess of the decretal-debt. Both the lower Courts have found that the sum of Rs. 10-4-0, which is in excess of the decretal-debt, was paid in cash by the respondent-plaintiff to the appellant-defendant when the mortgage-bond was executed. The amount for which the mortgage-bond was executed is thus made up of the decretal debt of Rs. 889-12-0 plus the sum paid in cash. The mortgage-bond is consequently not for payment of a sum in excess of the decretal-debt.

3. Thirdly, I submit that the agreement to pay interest does not render the mortgage-bond void under class. (2) of Section 257A. In the mortgage-deed it is stated that interest is only to be paid if there is a failure in the payment of an instalment ; and even then interest is chargeable from the date of the default. The agreement to pay interest was therefore . conditional. It was a separate agreement. The true test whether the agreement to pay interest was separate or not is this: Suppose all the instalments were regularly paid, could the mortgagee have claimed interest? If there was no default in payment of any instalment, no interest could have been claimed. There are thus two distinct agreements in the mortgage-deed: first, to pay the principal amount which is found to be not in excess of the decretal-debt, and, secondly, to pay interest if there was a default in payment of an instalment. The primary agreement was to pay a sum of money which was not in excels of the decretal debt. The provision as to interest was not a part of this agreement. The invalidity of the second agreement does not render the mortgage-bond, so far as the payment of the principal amount is concerned, void. The agreement to pay interest, which is a conditional and separate agreement, does not affect the right to sue for the recovery of the mortgage-debt; Bhagchand v. Radhakisan I.L.R. (1903) 28 Bom. 62 : 5 Bom. L.R. 672. This case has been referred to with approval in Raichand v. Naran I.L.R. (1904) 28 Bom. 310 : 6 Bom. L.R. 62.

4. The contention that 'Bhagchand's case is in conflict with Heera Nema v. Pestonji I.L.R. (1898) 22 Bom. 693 and Bhagabai v. Narayan I.L.R. (1907) 31 Bom. 552 : 9 Bom. L.R. 950 is untenable. In Heera Nema's case the decretal-debt was satisfied by a payment in cash and by the passing of a promissory-note which carried interest. The promissory-note was U renewed from time to time by adding interest to it as the tree I same accrued due. The amount due under the promissory-Note for which the suit was instituted was therefore in 11 I excess of the decretal-debt. In Bhagabai's are the terms [of the mortgage-bond were quite different from the terms of the mortgage-deed in this case. The mortgage-deed in that case covenanted that interest was to run on the decretal amount, which was a part of the mortgage-amount, from the very day on which the deed was executed and not on the failure in the payment of an instalment as in the mortgage-bond in this case. The intention of the parties in that case was therefore to pay something in excess of the decretal-debt. Here the intention of the parties, when the mortgage-deed was executed, was to pay only the principal amount, which was not in excess of the decretal-debt.

5. The case of Davlatsing v. Pandu I.L.R. (1884) 9 Bom. 176 has no application to the facts of the present case, first, because the parties themselves treated void as well as valid debts as a lump sum and the contract was therefore an integral one; and, secondly because interest not awarded by the decree was made payable under the bond. There was no conditional payment of interest.

6. The reasoning in Bhagchand v. Radhakisan I.L.R.(1903) 28 Bom. 62 : 5 Bom. L.R. 672 is subsequently explained in Govind v. Sakharam I.L.R. (1904) 28 Bom. 383 : 6 Bom. L.R. 344 by the same learned Judge who decided the former case and it fully covers the facts of the present appeal. Bhagchand's case is also k referred to with approval by Sir Lawrence Jenkins, C. J., in Raichand v. Naran I.L.R. (1904) 28 Bom. 310 : 6 Bom. L.R. 62.

Heaton, J.

7. This is a case under the Dekkhan Agriculturists' Relief Act and it involves the construction of the terms of Section 257 A of the old Civil Procedure Code. The mortgage-bond, with which we are concerned, as found by the Courts below, is for the payment of Rs. 900. Of this Rs. 889-12-0 was on account of a decretal-debt and Rs. 10-4-0 was for fresh consideration, and the agreement was not made with the sanction of the Court. Therefore, if it offends against the provisions of Section 257 A, it is void.

8. Both the lower Courts have found this agreement is not void. The words of the agreement itself are these:-' Altogether Rs. 900, as mentioned above, I shall pay off all the money at the stated period in nine years from the aforesaid date. The instalments shall be paid every year by me. In case of default in payment of the instalment, I shall pay interest at the rate of 1J per cent a month.'

9. The decree made no provision as to payment of interest, and therefore if the mortgage-bond is in fact an agreement to pay the decretal-debt with interest, it does offend against the provisions of Section 257 A. Had there been no authorities bearing on the meaning of Section 257 A, I should be disposed to go contrary to the views expressed by the lower Courts here ; but there is an authority and that is the case of Bhagchand v. Radhakisan I.L.R. (1903) 28 Bom. 62 : 5 Bom. L.R. 672 as explained in the case of Govind v. Sakharam I.L.R. (1904) 28 Bom. 383 : 6 Bom. L.R. 344. That authority, although as I say I might if the matter were open decide differently, is absolutely intelligible and appears to me to be based on this principle. In that case, as in this, the primary and main agreement was to pay a sum of money which was not in excess of the decretal amount, and it was only on failure to fulfil this agreement that any interest would be charged, i.e., the provision to pay interest is not a part of the agreement for the satisfaction of the decretal debt; it is only something which comes into operation when there is a breach of that agreement. Therefore the primary and main agreement is not void. I can find nothing in this application of the law which conflicts with the Full Bench decision in Heera Nema's case I.L.R. (1898) 22 Bom. 693 or in the case to which I myself was a party, that is, Bhagabai v. Narayan I.L.R. (1907) 31 Bom. 552 : 9 Bom. L.R. 950. It may be that the reasoning adopted is rather fine and makes distinctions which a more robust or plain reading of the section would ignore, but these distinctions have been made in the past, and it appears to me to be better to follow them at least to the extent of the reasoning which leads to the result arrived at in the case of Bhagchand v. Radhakisan I.L.R. (1903) 28 Bom. 62 : 5 Bom. L.R. 672, especially, as to do so, it seems to me, does not work any injustice and does not militate against what after all is the main purpose of

10. For these reasons, though I confess not without hesitation, I would confirm the decree of the lower Court and dismiss the appeal with costs.

Shah, J.

11. I concur. Having regard to the terms. of the bond in this case I am of opinion that the present case is governed by the ruling in Bhagchand v. Radhakisan I.L.R. (1903) 28 Bom. 62 : 5 Bom. L.R. 672. After considering the cases cited at the bar, I have come to the conclusion that there is no conflict between the ruling which I have referred to and the cases of Heera Netna v. Pestonji and Bhagabai v. Narayan. The ratio decidendi in Bhag-chand's case as explained by the learned Judge, who decided that case, in the subsequent case of Govind v. Sakharam I.L.R. (1904) 28 Bom. 383 : 6 Bom. L.R. 344 is quite clear; and I am not able to see anything in the words of Section 257 A or in any of the cases cited to us which can justify the argument that the ruling tends to defeat the object of Section 25 7A.


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