1. This appeal arises in a suit brought by the appellant for sale upon a mortgage, dated the 10th January 1889, executed by the first defendant, Bakhtawar Singh, and his father, Partap Singh, for self and as guardian of his son, Risal Singh, the defendant No. 2, who was at that time a minor. The amount secured by the mortgage is Rs. 10,000, but the plaintiff alleges that she has paid only Rs. 8,337-9-0, which she seeks to recover with interest by sale of the mortgaged property. There was a prior mortgage in respect of the same property in favour of Munna Lal, the father of the third and fourth defendants. The plaintiff alleges that this mortgage has been discharged by her. Those defendants have purchased the mortgaged property from the first two defendants under a sale-deed, dated the 18th of July 1896, and have, therefore, been made parties to the suit. The fifth defendant, Banarsi Das, is the grandson of one Shibban Lal, who also held a prior mortgage in respect of the property mortgaged to the plaintiff. The plaintiff alleges that she paid a part of the mortgage-money due to Shibban Lal and seeks to redeem that mortgage by payment of the balance. The sixth defendant, Dalip Singh, is the purchaser of a portion of the mortgaged property from the defendants Nos. 3 and 4. The defendants Nos. 1 and 2 urge in answer to the claim that Rs. 1,000, only out of the consideration for the plaintiff's bond was paid and that the said amount has been realized by the plaintiff from the usufruct of the mortgaged property. The defendants Nos. 3 and 4, the only defendants who have seriously contested the claim, plead that the plaintiff's mortgage is fictitious and nominal and that it was executed in her favour by Partap Singh with a view to protect his property. This contention of the defendants has been accepted by the lower Court which has dismissed the plaintiff's claim. The plaintiff has preferred this appeal.
2. The principal question to be determined in the appeal is whether the mortgage in favour of the plaintiff was a fictitious transaction.
3. [After considering the evidence their Lordships proceeded as follows:]
4. For the above reasons, we are of opinion that the conclusion at which the learned Subordinate Judge arrived as to the nature of the transaction is not warranted by the evidence, and that the mortgage in the plaintiff's favour was a genuine mortgage.
5. We have now to consider what payments have been actually made by the plaintiff. It was stated in the mortgage deed that out of the amount of the consideration for the mortgage, the plaintiff was to withhold Rs. 8,293 for payment to prior creditors. Out of this sum, Rs. 3,250 was, as we have already stated, due to Munna Lal and was set off against the amount of the sub-mortgage executed by the plaintiff in his favour, so that this sum of Rs. 3,250 has been paid by the plaintiff. It has also been proved that she paid to Bhawani Prasad on account of Shibban Lal's mortgage Rs. 1,500 on the 11th January 1889, and Rs. 1,365-9-0 on the 13th March 1889, in all Rs. 2,865-9-0. It has also been proved by the evidence of Kishan Sahai that he was paid Rs. 500 in discharge of a promissory-note held by him. The payment of Rs. 15 out of the sum of Rs. 515, mentioned in the plaint as paid to Kishan Sahai, has not been established. It is recited in the mortgage-deed that the plaintiff took credit for a sum of Rs. 549 due to her on account of a note of hand, dated the 14th March 1888. It was contended before us that no evidence existed on the record as to Partap Singh having executed any promissory-note in favour of the plaintiff for which Rs. 549 was due by him. The learned Advocate for the respondents contended that the recital contained in the mortgage-deed in regard to that promissory-note was not admissible in evidence against the respondents, defendants Nos. 3 and 4, purchasers from the mortgagors. We are unable to agree with this contention. There can be no question that the recital is admissible in evidence as against the mortgagors themselves, and as the defendants Nos. 3 and 4 derive their interest in the subject-matter of the suit from the mortgagors, Sections 18 and 21 of the Evidence Act make the recital admissible in evidence against them also as admission. What the probative value of that admission may be is a different question, but we are clearly of opinion that the statement may be used as evidence against defendants Nos. 3 and 4.
6. [After considering the evidence their Lordships proceeded as follows: ]
7. For the above reasons we have come to the conclusion that the plaintiff has advanced under her mortgage-deed a sum of Rs. 8,322-9-0.