1. This was a suit for the redemption of a mortgage of the Christian year 1794. Originally there had been several mortgages, executed in different years, but all these were consolidated into the mortgage now in dispute. The first question raised in this appeal is whether the right to redeem has long since been barred under the provisions of Section 13 of Bombay Regulation I of 1800. That section was the first law of limitation passed for this Presidency and was extended to Broach by Bombay Regulation II of 1805. It is contended for the respondent-mortgagee that the words in this section are wide enough to embrace suits for redemption. But whatever the conclusion we might have arrived at had the question been res Integra the section formed the subject of judicial interpretation in the Sudder Dewanee Adawlut of Bombay. In Fatima Beebee v. Moolla Abdool Futteh (1811) 1 Bom. 124 and Parvuttee v. Sooraj (1823) 2 Bom. 563 that Court held that the section did not apply to redemption or other mortgage suits and that these suits were not subject to any law of limitation. It must also be borne in mind in this connection that the provisions of Section 13 of Bombay Regulation I of 1800 correspond to those of Section 14 of Bengal Regulation 111 of 1793; and the construction put upon the latter section by the Calcutta Sudder Adalut is the same as that put upon the former by the Bombay Sudder Adalut; vide Murhonnisa Khartum v. Musummat Budamoon (1807) 1 S.D.A.185; Choteelal v. Pirbhoonarain (1809) 1 S.D.A. 292; Queiros v. Khudija Sultan (1807) 1 S.D.A 199; Bulraj Rai v. Pertaub Rai (1812) 2 S.D.A. 4. Rai; Hurnarain v. Adub Singh (1835) 6 S.D.A. 24. And this interpretation is in accordance with the dictum of the Judicial Committee of the Privy Council in Fatimalulnissa Begum v. Sundar Das 37 C. 1004, that the earliest law which placed a limit of time upon suits by mortgagors to recover the mortgaged property is Act XIV of 1859.'
2. The right to redeem the mortgage now in dispute did not, then, become barred until the year 1854; and as for time since then, the plaintiffs relied upon a series of acknowledgments, the earliest of which is of the year 1825. The learned District Judge, who tried the suit, has dealt with them at length and found in favour of the plaintiff. But it is urged for the respondent mortgagee that they are not acknowledgments within the meaning of Section 19 of the Limitation Act (XV of 1877) because (1) their language is equivocal, (2) they are not addressed to the mortgagor, (3) they do not touch the entirety of the property, (4) such admissions as they contain were not made by the mortgagee with any consciousness that he was acknowledging the right of the mortgagor. The first two of these objections were but faintly urged and have no substance. The last words of the last explanation to Section 19 are clear. The other objections to the acknowledgments centre round the following facts. The original mortgagee was Lallubhai Bhukandas. He died leaving a daughter by name Lalita and a nephew (brother's son) named Nandkishore, each claiming as his heir. These two referred their dispute to arbitration, which in 1819 resulted in an award, by which the property, held by Lallubhai Bhukandas undar the mortgage, froming the subject-matter of the present litigation, was divided into two shares, one being allotted to the daughter and the other to the nephew. They applied to the Collector to have the share of each entered in his and her name respectively in his books. (Vide Exhibit 238). It was not the villages of which the property consisted that were divided but what formed the subject of partition were the dasturi and the pasaita of the village. The Collector having granted the application and entered the names accordingly, each sharer thenceforth affixed his or her signature to the description in the Collector's books as mortgagee in respect of his or her share. That was a distinct admission by each that he Laid his share as mortgagee. It is contended that the acknowledgment in each case so made does not refer to the whole of the mortgaged property, because each sharer made the acknowledgment in respect of his or her share only: and in support of the contention the ruling in Bhogilal v. Amritlal 17 B. 173 and Dharma v. Balmakund 18 A. 458 are relied upon. The facts in those cases were different. There the acknowledgment was by one only of two co-mortgagees and it was held that one co-mortgagee cannot bind the other by his acknowledgment unless he was specially authorised for that purpose. But here the mortgaged property having been split up into two each sharer represented his own share and made an acknowledgment in respect of it and the two acknowledgments put together comprised the whole property. The argument that these are not acknowledgments within the meaning of Section 19 of the Limitation Act because they are no more then signatures to the description by Government of the status of the signatories as mortgagees ignores the presumption which we ought to make in such cases that the persons who affixed their signatures must have known to what and why they were affixing their signatures.
3. I do not think that the mortgagee is entitled to credit for payments made by him in consequence of the application of the summary settlement to the mortgaged villages. The settlement was avowedly in lieu of service which, under the terms of the mortgage, he (the mortgagee) would have had to render to Government. Assuming that it was for the ultimate benefit of the mortgagor, it was also for the benefit of the mortgagee. The effect of it undoubtedly was to free the mortgagee from his liability to render service to Government and to substitute therefor a liability to pay to them a certain amount out of the income of the property. It was, there-fore, for his benefit and it was, moreover, the result of his own agreement with Government he cannot now turn round and say that the mortgagor ought to pay or that the property should be held liable for all the sums he had to pay to Government in accordance with the terms of the settlement.
4. The local fund cess stood, however, on a different footing. It was not and could not be in the contemplation of the parties at the time the mortgage now sought to be redeemed was executed; and the principle of the decision of this Court in Ahmed Fakir v. Dayabhai Narandas (1896) P.J.P. 710 applies. There it was held that where a mortgage is with possession and profits are to be enjoyed in lieu of interest, the mortgagee is entitled to add to the mortgage debt any amount paid by him as local cess, which when the mortgage was passed, had not been imposed upon the mortgaged property and was not within the contemplation of the parties.
5. The learned District Judge has declined to award interest on the debts due to the mortgagee on the money bonds from the date of the suit till the satisfaction of the decree, upon the ground of damdupat. It has indeed been held by this Court in Dhondshet v. Rarji 22 15. 86 that the discretionary power of the Court under Section 209 of the Code of Civil Procedure may be exercised without reference to the law of damdupat, but the question is one of discretion and we are unable to hold that the learned Judge has exercised it unreasonably in the particular circumstances of this case.
6. The question of the mortgagee's right of pre-emption has been decided adversely to the mortgagee by the learned Judge in the Court below and I agree with his conclusion on that point. The covenant as to pre-emption occurs in two of the earlier mortgages (Exhibits 45 and 46) but it is not to be found in either Exhibit 50 or Exhibit 154 on which this suit is founded. And there is nothing in the evidence to bring home to plaintiffs Nos. 2 and 3 knowledge of the covenant in Exhibits 45 and 46, at or before their purchase, so as to make them transferees with notice of the covenant liable to a suit for specific performance of the covenant at the instance of the mortgagee: Ramasami Pattar v. Chinnan Asari 24 M. 449. It is also an important feature of the case that the defendants (mortgagees) did not set up this right of pre-emption in their written statement or express their willingness and readiness to exercise that right.
7. On the question whether the redemption money should be calculated at the value on the ordinary Shikkai coins, it is contended for the mortgagor that the advance of the mortgage money in suit having been made in Shikkai rupees, he is entitled to redeem on payment of money in British Currency calculated according to the value of the Shikkai coin; and in support of that the decision in Trimbak Jivaji Deshamukha v. Sakharam Gopal 16 B. 599 is relied upon. But it is a question in each case what was the contract between the parties. Here the Court below has, held upon the evidence of surrounding circumstances that the debt taken and to be repaid is in the current and face value of the coin, not in the value of the metal in it,' and I see no sufficient reason for differing from that view.
8. There is a condition in Exhibits 48, 49 50 and 154 that the mortgagor shall not redeem before he has paid off the debts due from the mortgagee personally. It is contended, on the authority of English rulings, that the condition in question should not be enforced, being a clog on the equity of redemption. That such a condition would be a clog and not enforceable under the Transfer of Property Act is clear from the terms of Section 60 of that Act. That section provides that a mortgagor is entitled to redeem on repayment of 'the mortgage money' at any time after it has become payable. The absence of the words in the absence of any contract to the contrary,' which are to be found -in some of the other sections, makes it obvious that no agreement of the kind now in question, which compels the mortgagor to redeem only after payment of a debt not due upon the mortgage, shall be given effect to in law. But the present case being not governed by the Transfer of Property Act, the decisions of this Court in Hari Mahadaji Savarkar v. Balambhat Raghunath Khare 9 B. 233 Sundar Malhtir Patel v. Bapuji Shridhar 18 B. 755 and Krishriaji v. Maheshwar Lakshman Gondhalekar 20 B. 346 apply. A doubt was thrown on the correctness of these decisions by a Division Bench of this Court in Rajmal Motiram v. Shivagi Anandrao 27 B. 154 having regard to the judgments of the House of Lords in Noakes Co. LA. v. Bice (1902) A.C. 24 : 71 L.J. Ch. 139 : 66 J.P. 147 : 60 W.R. 305 : 86 L.T. 62 : 18 T.L.R. 196 bat the judgment in Rajmal Motiram v. Shivaji Anandrao 27 B. 154 wentupon another ground and the reference to this point was not necessary for the adjudication of the case. We cannot depart from the law laid down in the three cases of this Court above mentioned without the authority of a Full Bench ruling on the point; but as the law has been settled by the Transfer of Property Act for mortgages after 1893 and the number of mortgages prior to that in which this condition occurs must be comparatively small, I do not think it desirable to refer the question to a Full Bench and 1 adhere to the law which this Court has applied to the latter class of cases hitherto.
9. We see no reason to depart from the District Judge's order as to costs and the application for fresh evidence must be refused. The result is that the decree of the Court below must be confirmed except as to the local fund cess and must be varied accordingly. We send down the following issue:
(1) What is the amount of the local cess under Bombay Act III of 1869 which has been paid by the mortgagees and which they are entitled to recover?
10. Finding to be returned within three months.
11. The question of costs will be determined on the return.
12. This is a suit to redeem a mortgage. The predecessors of the plaintiffs and those of the defendants had dealings which culminated in a deed of mortgage Exhibit 154 in the case, of about 1794 A. D. There had been earlier transactions both by way of mortgage and personal loan but they are all summed up in Exhibit 154 and the lower Court has decreed redemption on payment of an amount arrived at by taking the sum entered in Exhibit 154 as the loans to be repaid. It is not contended in appeal by either party that we should go behind Exhibit 154 to any earlier transaction in order to calculate what should be paid by the mortgagors. The District Judge has written a careful and detailed judgment in which ho has dealt with many different contentions, some only, not all of which are raised in appeal.
13. The property mortgaged comprised two things the desaigiri dasturi or right to receive annual payments from the villagers and certain pasaita lands. Since those early days the nature of the security has changed. In 1869 there was a watan settlement under which the right of Government to demand service was surrendered, a judi was imposed on the pasaita lands and the right to collect from villagers was commuted into a lesser cash payment from the Government treasury. These payments have been further reduced by deducting income tax. The pasaita lands have also become liable to the payment of the Local Fund Cess.
14. The mortgage debt proper according to the Exhibit 154 was Rs. 6719 1/2 of new Sikkai Currency and the property was with the mortgagees who took the profits in lieu of interest. Besides this there was a personal debt of Rs. 4,003 of the same currency bearing interest. According to the agreement between the parties recorded in Exhibit ] 54 this personal debt with interest was to be paid before the mortgage debt was paid and the property redeemed.
15. I now come to the matters argued in appeals. The first is the question of limitation. Defendant urges that the claim to redeem became barredin virtue of Section 13 of Regulation I of 1800 which provided a period of limitation of twelve years for all suits and which was applied to the Broach District by Regulation II of 1805; and that when the right to redeem was once lost it was not revived by a subsequent regulation which repealed Section 13 of Regulation I of 1S00 and declared that there was no limit of time for a suit to redeem a mortgage. The terms of Section 13 of Regulation I of 1800 are susceptible of different meanings. The words used leave it open to argument' and conjecture that suits to redeem were not contemplated by the section. The law as understood by the Sadar Adaulat in 1.810, that is before Section 13 of Regulation I of 1800 was explained or repealed by a later Regulation was that the right to redeem a mortgage was not barred by twelve years limitation. See Fatima Beebee v. Moolla Abdul Futteh and Sorabjee Kaoosjee v. Hubeebukhanun (1811) 1 Bom. 124. That being so, and as it is evident that the Judges of that time were far more competent than are we, to understand laws made and given effect to in those days, I hold that Section 13 of Regulation I of 1800 did not affect suits to redeem mortgages. Consequently it is unnecessary to discuss any other point raised as to the period of limitation in those days.
16. Up to the Act of 1859 the only other laws of limitation imposed on this Presidency provided that there was no limit of time to a suit for redemption. Therefore until the Act of 1859 came into force the mortgagor could have sued for redemption. After that Act came into force this suit would be barred unless saved by an acknowledgment of the kind indicated in that 'or the subsequent Acts. There are in this case many documents termed acknowledgments which are sufficiently described and discussed in the judgment of the District Judge. It is not denied in this Court that some of them do bring the suit within the period allowed by law unless they are ineffectual for reasons similar to those indicated in the case of Bhogilal v. Amritlal 17 B. 173. The fact is that the mortgagees or their successor divided the mortgaged property and held it in severalty and that the acknowledgments were not signed at one time by all the mortgagees of that time or by each in respect of the whole of the mortgaged estate. There were separate acknowledgments each relating to a portion only of the whole property and each signed by the person interested in that portion. It seems to me that acknowledgments of the kind described were precisely those appropriate to the condition of things created by the mortgagees themselves. On a consideration of the facts and of the law as to acknowledgments by mortgagees laid down in the Limitation Acts, I should hold that the acknowledgments in this case fulfil the requirements of the law. But it is argued that Bhogilals case settles the question and does so against the opinion just expressed. A careful perusal of the judgment does not lead me to that conclusion. The facts in Bhogilals case were essentially different. There the question was whether one of several could sign for all. Here it is whether the requirements of the law are met where all the mortgagees holding separate portions of the mortgaged property have on different occasions signed separate acknowledgments that they were mortgagees holding from the plaintiff's predecessor in title. On this part of the case the District Judge, in my opinion, is right and has given satisfactory reasons for his decision.
17. It was further argued that as some of the deeds of mortgage provided that if the mortgagors were to sell the property they would sell it to the mortgagees and to no one else and as they have sold the property to some one else who is a plaintiff on the record that sale conferred no right on the purchaser to redeem. This point was, however, not made good and was not, I understand, very seriously pressed. It seems to me clear that the sale was not necessarily inoperative though it may have given the mortgagees a cause of action which they can, if so advised, seek to make good in a separate suit. In any event as the mortgagors themselves as well as the purchaser sue to redeem, redemption cannot be refused.
18. Then interest was claimed by the defendants' on the amount of the personal debt, from date of decree until payment. This is a matter of discretion. The District Judge did not award interest and I do not think the circumstances disclosed by the evidence suggest that interest ought justly to be awarded.
19. In my opinion the District Judge was right in refusing to allow the mortgagees to add to the mortgage money the settlement expense and judi paid by them. When they accepted the watan settlement they of themselves changed the nature of the security. It is not shown that acceptance of the settlement was essential to the preservation of, or that the change in its character depreciated, the security.; for though there was no doubt a reduction of the amount annually derived, the mortgagees were relieved of all liability to service, were enabled to obtain the money by the easy method of receipt from the Government treasury, instead of by collecting from the villagers personally; and further by the recognition by the Government, involved in the settlement, they obtained a more secure tenure of the cash payments and of the lands than they had previously held. The settlement expenses and the judi were incident to the change in the nature of the security made with the consent of the mortgagees and not shown to have depreciated the security and so they should not be added to the mortgage debt.
20. The Local Fund Cess, however, is different. It is certainly a payment not within the contemplation of the parties. It had to be paid by the mortgagees, for by the terms of the contract they could not terminate the mortgage by suing for the debt. They had to await the pleasure of the mortgagors to redeem. It seems to me they are entitled to add these payments to the debt, for they were not voluntarily undertaken in order to secure a corresponding benefit but were forced on them.
21. Apart from this I think the District Judge was right also in the estimate he arrived at of the amount to be paid on account of the mortgage debt. No sufficient reason is shown for disturbing his finding that the rupees used in the transactions between the parties were Broach and not Ahmedabad rupees. That being so, it is to be decided whether the equivalent to be decreed is the equivalent in silver as metal or as Indian Currency. As the dealings were in currency the equivalent should, in my opinion, be that amount of the present currency which would correspond with the amount of the currency constituting the mortgage debt. This the decree has awarded.
22. In my opinion the order of the lower Court as to costs is correct.
23. This exhausts all the points argued before us except as to whether the mortgagees are entitled to the personal as well as the mortgage debts. It seems to me that they are. For though the personal debts were not in specific terms made a charge on the property mortgaged, repayment of those debts was made a condition of the right to redeem. There is no doubt as to the intention of the parties and the meaning of the deeds. The contract entered into was simple in its terms and it is not shown to be inequitable. But it is proposed by the mortgagor to delete a portion of the contract and to leave only a portion operative, because it is said that the condition of repayment of the personal loan is a clog on the equity of redemption. It may be, but it has not been shown that the Courts in England would indubitably sot aside that condition in such a contract. It is clear that the decided oases of our own High Court are against so doing. For my own part I hold that by the terms of the deeds, the mortgaged properties were security for the repayment of the principal of the personal debts, because according to the terms of the deeds those properties were not to be redeemed until the personal debts were paid. That condition seems to me to be a simple, effective and intelligible method of making the mortgaged properties security for the personal as well as the other debts. It is true that a security in this form is not so effective as a security which enables the mortgagee to sell the property in order to recover the money, but it is a very good security if the Courts will fulfil the intention of the parties and give effect to it. Therefore, I do not think that there is in this case any clog on the equity of redemption which the Court should concern itself with.
24. I agree to the order proposed.