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Lachmi NaraIn Das and anr. Vs. Hirdey NaraIn and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtAllahabad
Decided On
Reported inAIR1926All480; 97Ind.Cas.4
AppellantLachmi NaraIn Das and anr.
RespondentHirdey NaraIn and ors.
Excerpt:
- - the plaintiffs brought the suit for recovery of a certain amount of money said to be payable by the principal defendants and in the case of their failure to pay the plaintiffs claimed possession over the property in suit. the learned counsel failed to satisfy us on the point. 3. it has been urged on behalf of the appellants that they have a good case on the question of law and that, in any case, the question of law should not be left over to be decided again after a decision on the questions of fact. they obtained a formal delivery of possession on the 16th of january 1918 but failed to obtain actual possession as the defendants nos. they say that after remission of a good deal of the mortgage debt, a sum of rs. in other words, the plaintiffs claim possession in case the principal.....mukerji, j.1. the appellants before this court were the first two defendants in the court below and were described as the principal defendants. the respondents other than the respondent no. 9 were the plaintiffs. the respondent no. 9 was described as the pro forma defendant. the plaintiffs brought the suit for recovery of a certain amount of money said to be payable by the principal defendants and in the case of their failure to pay the plaintiffs claimed possession over the property in suit. the property in suit may be briefly described as the village of chandoi, though only a certain share in the village is in dispute. the allegations in the plaint were traversed by the principal defendants who called upon the plaintiffs to prove their case. they also raised a point of law, viz. the.....
Judgment:

Mukerji, J.

1. The appellants before this Court were the first two defendants in the Court below and were described as the principal defendants. The respondents other than the Respondent No. 9 were the plaintiffs. The Respondent No. 9 was described as the pro forma defendant. The plaintiffs brought the suit for recovery of a certain amount of money said to be payable by the principal defendants and in the case of their failure to pay the plaintiffs claimed possession over the property in suit. The property in suit may be briefly described as the village of Chandoi, though only a certain share in the village is in dispute. The allegations in the plaint were traversed by the principal defendants who called upon the plaintiffs to prove their case. They also raised a point of law, viz. the plaintiffs were not entitled to maintain the suit on the allegations made in the plaint. The learned Judge in the Court below did not decide the questions of fact involved in the case. He decided the question of law in favour of the plaintiffs and decreed the claim. In this Court the first four of the grounds of appeal are taken against the procedure of the Court below and point out that the plaintiffs did not adduce any evidence to establish their claim.

2. We called upon the respondents' counsel to explain under what circumstances the Court below felt itself justified in edecreeing the suit without going into the facts involved. The learned Counsel failed to satisfy us on the point. It appears to us that, with the consent of the parties, the point of law was allowed to be discussed as a preliminary point and the Court forgot that it had not tried the case on the facts. It is obvious therefore that in the case of the question of law being decided in the respondents' favour the case will have to go back for trial on the merits.

3. It has been urged on behalf of the appellants that they have a good case on the question of law and that, in any case, the question of law should not be left over to be decided again after a decision on the questions of fact. We heard counsel for the parties on the question of law. For the decision of the question of law, we shall take the facts stated in the plaint to be as they are described and shall see whether on those facts the present suit could be maintained.

4. The facts alleged in the plaint, omitting unimportant details, are briefly as follows: On the 25th August 1873 one Hamir Singh and his mother, Mt. Ganga Kunwar, made a mortgage of three properties in favour of one Lachmi Narain, one of the properties involved being village Chandoi. The interest of Lachmi Narain passed through several hands and ultimately came into the hands of the plaintiffs' predecessor and the plaintiffs. The mortgagors' interest in the property was sold in execution of a simple money decree and was purchased by one Raghubar Dial whose legal representative is the Respondent No. 9, the pro forma defendant in the suit. Reghubar Dial, after acquisition of the property, made a simple mortgage of the village in question, on the 17th of January 1902, in favour of one Ram Gopal, the father of the present appellants, the principal defendants in the suit. The plaintiffs or their ancestors obtained a decree for sale on foot of the mortgage of 1873 on the 9th of September 1911. The subsequent transferee, Ram Gopal, was not a party to the suit, though the mortgagors' representative, Raghubar Dial, was. Ram Gopal brought a suit to enforce his mortgage of 1902 against Raghubar Dial alone and obtained a decree on the 26th of February 1914. To this suit the plaintiffs or their predecessors-in title were no parties. In execution of his own decree Ram Gopal brought the property to sale, and purchased the same on the 20th of January 1917. He or his sons obtained delivery of possession through the Court on the 27th March 1917, and a mutation order was made in their favour by the revenue Court on the 23rd of May 1917. The plaintiffs put their decree in execution and got the mortgaged properties sold on the 26th of June 1917 including of course the property in the village in question and themselves purchased them. They obtained a formal delivery of possession on the 16th of January 1918 but failed to obtain actual possession as the Defendants Nos. 1 and 2 were in possession. The plaintiffs now claim that they are entitled to apportion the mortgage debt due to them among the three properties mortgaged to them and purchased by them. They say that after remission of a good deal of the mortgage debt, a sum of Rs. 17,000 is payable by the property of Chandoi in suit and they call upon the Defendants Nos. 1 and 2 to pay the same. In other words, the plaintiffs claim possession in case the principal defendants failed to redeem the property in suit on payment of Rs. 17,000.

5. The defendants maintain such a suit is not maintainable principally because any suit by the plaintiffs for recovery of the mortgage money as against the principal defendants would be time-barred. The question is how far this contention is right.

6. The learned Subordinate Judge has not at all discussed the point raised. He has stated in the judgment that the point raised has been differently decided by this Court in different cases and it is not for him to express any opinion of his under the circumstances. On behalf of the appellant the learned Counsel has urged that the question is really concluded by two Full Bench decisions of this Court and that any of the cases in which a contrary opinion may have been expressed went against the Full Bench decisions and should not therefore be followed. He also urged that the most recent case on the point, in this Court is in his own favour.

7. It being a fact that the point involved, in the case has been the subject of conflicting opinions, it is desirable that the point involved should be examined, at first, quite apart from authority. To put the facts briefly, they are like this: M, a mortgagor, makes a simple mortgage of his property P, in favour of A and then in favour of B. A sues M alone, omitting to join B in his suit, and obtains a decree. B proceeds to sue on his mortgage without making A a party to the suit and, suing the mortgagor M alone, obtains a decree and purchases She property himself. B's decree comes, in point of time, after A's decree, but B has purchased before A has done so, in execution of his own decree on foot of the earlier mortgage. In A's suit for sale B was not a party and, it is conceded, that if A wishes now to bring the property to sale again as against B, his suit would be time-barred. The question then is, whether A can ask for what is virtually a foreclosure decree against B.

8. It is a fundamental principle, which does not require citation of authorities to establish it, that you cannot bring a property to sale without making the owner of it a party to the suit. In fact any claim to property whatsoever, in order to be successfully maintained, must be made against the person who holds the property. A mortgage is a transfer of an interest in immovable property and is therefore an estate carved out of the mortgagors' original interest. I would avoid the use of the expression 'equity of redemption,' which has not been used in the Transfer of Property Act at all. Although it has got a definite meaning in England, the use of the expression in this country is only likely to create confusion. We can split the property P into three portions, say P1, P2 and P3, the three letters and figures representing respectively the interests of the first mortgagee, the second mortgagee and that of the mortgagor as it is left after the two mortgages. Thus the sum-total of the three interests, P1 P2 and P3 is equal to P which means the property. The mortgage in favour of A, consisting of the interest P1, entitles to recover his money by sale of the properties P1, P2 and P3. The mortgage in favour of B, as represented by P2, gives him a right to bring the properties P2 and P3 to sale. If A brings a suit against B and M, he is entitled to sell all the three rights P1, P2 and P3 and therefore the entire property P and the purchaser of the property obtains the same, free from all incumbrances, and is entitled to be put into the same position as M himself had before he created any of the mortgages. But if A omits to make B or M a party to his suit, it must follow, necessarily, that the interest of the party omitted cannot be touched, e.g., if A sues B alone and omits to sue M, all that A can sell, in execution of his decree, would be the sum-total of the interests P1 and P2. The interest P3 held by M cannot be sold in the absence of M from the suit. Similarly it must follow that by omission of B from his suit A can bring to sale the interests P1 and P3 only.

9. Now let us see what remedies B has. B is entitled under the law to sell the interests P2 and P3 by making M alone party to his suit. The law does not require (see Rule 1, Order 34, Civil P.C.) that B should make A a party to his suit for sale of the interests P2 and P3. The suit of B, as described above, would be a perfectly justifiable suit, and it follows that the decree would be a good one and the sale would be a good one. But because B had no right to sell the interest P1, the purchaser in execution of B's decree would get only the interests P2 and P3. The purchase no doubt will be subject to the interests of A, which we need hardly repeat, is one which permits him to bring to sale all three interests P1, P2 and P3. Thus, the purchaser at the sale in execution of B's decree would purchase it subject to A's mortgage. But from what we have already stated, it is dear that A cannot bring the interests P2 and P3 to sale without bringing before the Court the owners of the same. Suppose A brings a suit for sale against M alone, either ignoring or without knowing the fact that the interest P2 has already been carved out of M's interest in favour of B. Let us further suppose A brings his suit six months before the expiry of the period of limitation (which would be 12 years now and was 60 years before) and then after the expiry of limitation discovers that he ought to have made B a party to his suit. If he makes an application to the Court to implead B and even if he succeeds in his application, the suit, as against B, would nevertheless be dismissed on the ground of limitation. The result, would be that, with the best intentions, A would not be entitled to sell anything beyond the interests P1 and P3.

10. Let us apply these fundamental principles, with which nobody can quarrel, to the facts of this case. Although the plaintiffs got their decree earlier than the principal defendants, the latter proceeded to sell the properties (P2 and P3) forthwith and purchased the same themselves. The result was that at the date of the sale, held at the instance of the plaintiffs (A), the properties P2 and P3 had already passed to the principal defendants (B). B was no party to A's decree. At the date when A sought to bring to sale the properties P1 and P3 (he could never bring to sale the property P2) the interest P3 had already passed to B. The result was that at the auction-sale held in execution of the plaintiff's decree (A's decree), the plaintiffs purchased only the interest P1 and nothing else. We have already seen that B was legally entitled to bring to sale the interests P2 and P3 and therefore the sale, at his instance, of those interests cannot be said to be illegal or invalid. B was therefore rightly the proprietor of the interests P2 and P3 when the plaintiffs sought the sale of the interest P3. It follows, as already stated, that by his purchase A (the plaintiffs) acquired the interest P1 alone and neither P2 nor P3.

11. By the present suit A (the plaintiffs) seeks to recover the interests P2 and P3. He has purchased only P1 and not P2 and P3. Can he obtain possession of those two interests which he has, not purchased? The answer can only be in the negative. As already stated before, the interest P1, carried with it a right to bring to sale the three interests P1, P2 and P3. The principal defendants (B) not having been made a party in the decree of the plaintiff (A), it would be open to the latter (A) to bring to sale the interests P2 and P3 if the suit could be within time. The fact that a previous suit was instituted by (A) the plaintiffs will not prevent them from maintaining a separate suit against persons who were no parties to the previous suit. But any such suit by the plaintiffs, at the date of the present suit, would be barred by time. 12 years' rule of limitation would apply and the mortgage being of 1873 the suit would be hopelessly time barred.

12. As already indicated above, the plaintiffs (A) could not have succeeded in their suit to enforce their claims against the principal defendants (B) if they had tried to bring B on the record after the expiry of limitation, although the suit had been still pending. Can the plaintiffs, then improve their position by not impleading the principal defendants (B) at all in the suit and by waiting for many years? The act of purchase on the part of the plaintiffs would not give them any fresh cause of action as against (B), the principal defendants, against whom the cause of action arose at the date of the mortgage of 1873 or on the due date fixed in the mortgage and never later. The mortgage in favour of the plaintiffs (A) does not give them a right to obtain possession. That right of possession can accrue to them only by working out the mortgage, with proper parties before the Court. They have failed to work out the mortgage, so far as the principal defendants (B) are concerned, and any fresh attempt to work out the mortgage to-day is barred by limitation.

13. On principal therefore it is clear to our mind that the plaintiffs have no right to claim the sum of Rs. 17,000 from the principal defendants; that claim being time-barred, much less have they any right to claim possession over the property.

14. Now let us consider the authorities. The earliest authority on the point in this Court is the case of Hargu Lal v. Gobind Rai (1897) 19 All 641. This is a decision by five learned Judges of this Court (the entire Court) and the facts were these. The plaintiff obtained a simple mortgage. The mortgagor, after the mortgage, sold a portion of the mortgaged property to one Govind Rai and another, the defendants in the suit. In the suit for sale brought by the mortgagee the transferees, Gobind Rai and Tulsi Rai, were no parties. In execution of the decree that followed the mortgagee's suit, the entire property mortgaged was brought to sale and was purchased by the mortgagee. He found that over a portion of the mortgaged property the purchasers were in possession and thereupon he brought the suit for recovery of possession. The Court of first instance gave the plaintiff a decree for possession but attached with it a condition that the defendants could redeem the plaintiff. On appeal by the defendants the lower appellate Court dismissed the suit in toto. The plaintiff appealed. The Full Bench of this Court remarked as follows:

The plaintiff can only succeed in this suit for possession on proof of title to a present possession at the data of his suit. His simple mortgage did not entitle him to possession as against anyone. His decree for sale, being in a suit to which these defendants were no parties, had no effect as against them, and his purchase at the sale held under the decree conferred on him no title as against these defendants.

15. In the result the appeal by the plaintiff was dismissed. It is clear from this case that the Full Bench of this Court were not even prepared to modify the decree of the lower appellate Court and to restore the decree of the first Court which gave to the plaintiff exactly the same relief which is now being sought for on behalf of the plaintiffs in the present case.

16. Two years later, this case was followed by the case of Madan Lal v. Bhagwan Das (1899) 21 All 235 (F B). There the facts were more similar to the facts of the present case than in the case of Hargu Lal (1897) 19 All 641. In this case, B mortgaged a house first to CD and subsequently to M and; CD brought a suit on the mortgage without making the subsequent mortgagees party and put up the property to sale. The auction-purchaser was one BD. Previous to the sale held at the instance of the first mortgagee the second mortgagee had instituted a suit for sale without making the first mortgagee a party and having obtained the decree had brought the property to sale and the property was purchased by one Madan Lal. Madan Lal's purchase was previous to the purchase by Bhagwan Das, the purchaser under the decree passed on the earlier mortgage. On foot of the fact that Bhagwan Das had purchased in execution of the decree passed in the earlier mortgage, he brought the suit, out of which the appeal before the Court arose, to eject Madan Lal, the purchaser, in execution of the decree under the subsequent mortgage. In this case, the first Court dismissed the suit [like the second Court in Hargu Lal's case (1897) 19 All 641], but the lower appellate Court decreed the plaintiff's suit; but subject to this condition that if the mortgage money under the earlier mortgage was paid by the defendant the suit would stand dismissed. On appeal by the defendant to this Court all the Judges (6) of the Court were of opinion that the suit was not maintainable and the suit must be dismissed. The learned Judges said that the law had been definitely laid down only two years earlier in Hargu Lal's case (1897) 19 All 641 and that it was to the effect that the earlier simple mortgage did not entitle the mortgagee to possession against anyone and purchase under a decree for sale in a suit to which the subsequent mortgagee was not a party was of no avail. The earlier case of Hargu Lal (1897) 19 All 641 was sought to be distinguished on the ground that the earlier Full Bench case did not imply that a conditional right would be wrong. The learned Judges repelled this contention and pointed out as follows:

From the paper-book in the Full Bench case [Hargu Lal's case (1897) 19 All 641] it appears that there the plaintiff in his memorandum of appeal in this Court against the lower Court's decree absolutely dismissing the suit, pleaded that he was entitled, if not to an absolute, at least to a qualified decree for possession such as the first Court had given him. The Full Bench nevertheless dismissed the appeal and did not give the plaintiff the qualified decree for possession which he asked for.

17. Then they said:

However this may be it appears to us that the Pull Bench did distinctly indicate their opinion that in a suit for ejectment, such as the present, a decree for possession with a conditional right to the defendant could not be passed.

18. After this pronouncement of opinion not once but twice by this Court, one shouted have thought the law had beer laid down definitely for the province. But it appears that a similar question was definitely decided in a different way in the case of Babu Lal v. Talakia AIR 1917 All 359. The facts of the case were as follows: There were two successive mortgages over the same property, one in favour of A and the other in favour of B. Each of the mortgagees obtained a decree for sale without impleading the other. A himself purchased the property in execution of his own decree while one C purchased the property in execution of B's decree. C had purchased earlier and was in possession. Then A brought his suit against B and C and prayed that his mortgage money might he paid to him by the defendants and in default, he might be put in possession of the property. The learned Judges of this Court Piggott and Lindsay, JJ.) were of opinion that the suit was maintainable. This case is clearly in favour of the respondents and the question is how far this decision was justified in face of the Full Bench cases already referred to. It appears that it was found as a fact that while the earlier mortgagee was proceeding with his remedy and suit in a leisurely fashion, the subsequent mortgage proceeded quickly, (the mortgagors were allowed only fifteen days' time to pay up) and ultimately brought the property to sale earlier than the first mortgagee. On these facts the lower appellate Court was of opinion, and that opinion was accepted by Piggott, J., that the subsequent mortgagee Kedarnath, was in collusion with the mortgagor and that the auction-purchaser Babu Lal was probably a benamidar for the subsequent mortgagee himself. The learned Judge then put the following question before him and proceeded to answer the same. 'Whether on the facts found, the plaintiff is entitled to any, and if so, to what relief?' It was contended before the learned Judge that the only remedy open to the plaintiff was by way of a second suit for sale on her mortgage, but it was pointed out such a suit would be, at the date of the suit in question, time-barred. The learned Judge remarked as follows:

The legal questions involved are of some complexity and have given rise to differences of opinion in various High Courts. Probably the beat discussion of the entire question is to be found in the case of Mullah Veetil v. Achuthan Nair : (1911)21MLJ213 . But it is more immediately in point to consider the published decisions of this Court. The case most nearly in point is that of Ram Prasad v. Bhikhari Das (1904) 26 All 464 which applies and expounds the principles laid down in two older rulings [Hargu Lal v. Gobind Rai (1897) 19 All 641 and Madan Lal v. Bhagwan Das (1899) 21 All 235 (F B) quoted above ].

19. Then the learned Judge proceeded to point out that in the case of Ram Prasad v. Bhikhari Das (1904) 26 All 464 the defendant had purchased at auction sale held in execution of a simple money decree and had done so before any suit was instituted on the original mortgage. In thus stating the facts of the case of Ram Prasad v. Bhikhari Das (1904) 26 All 464 the learned Judge made a material error. In that case the defendants had actually purchased after the institution of the suit by the mortgagee and indeed after a decree had been passed in favour of the mortgagee. It is not clear who, but possibly, the defendants, Bhikhari Das and another, had obtained an attachment of the mortgaged property in execution of a simple money decree prior to the institution of the mortgagee's suit. It was under those circumstances that this Court decided that the plaintiff who had purchased in execution of the mortgage decree would have a right to the property, if the defendant, the auction-purchaser, in execution of the simple money decree, failed to redeem him. The mortgage was bound to prevail as against the attachment;. It is probable that, if the correct facts had been properly brought to the notice of Piggott, J., he would have found the case to be entirely distinguishable. An attachment of property confers no title and does not amount to a transfer of an interest in property as is the case with a mortgage. It is true that Bhikhari Das, the auction-purchaser, could not have been made a party to the suit which had already been decided at the date of his purchase. The attaching creditor, however, had not been made a party to the decree. The case of Ram Prasad v. Bhikhari Das (1904) 26 All 464 was, therefore, not a sure guide. Then the learned Judge (Piggott, J.) was of opinion, that the suit before him had been brought on a different cause of action, namely, the plaintiff's failure to obtain actual possession of the property purchased at the sale. I have already indicated, in discussing the principles, that the plaintiff's failure to obtain possession could not give him any fresh cause of action against the subsequent transferee and the cause of action against the subsequent transferee arose only out of the mortgage in favour of the mortgagee and at the date when the mortgage became repayable. The learned Judge was of opinion that it was the duty of the Court to work out the equities between the parties. This expression of 'working out the equities' is really a catch phrase which is more likely to mislead than to lead. We have to see what are the initial rights of the parties and if they have been materially altered in the circumstances that had happened. In our opinion the subsequent sale an purchase by the auction-purchaser under the prior mortgage gave him nothing as against the earlier purchaser under the subsequent mortgage, the latter being no party to the suit under the prior mortgage. So far as the second mortgagee was concerned, the prior decree did not at all exist. You cannot say, in the same breath, that the subsequent mortgagee is not bound by the decree passed in favour of the prior mortgagee and yet, for the purposes of 'working out the equities,' the decree is good enough for the subsequent mortgagee, or the purchaser under his decree, being called upon to pay the amount of the decree.

20. The learned Judge also expressed the opinion, though rather doubtfully, that the auction-purchaser under the subsequent mortgage was a purchaser pendente lite, because at the date of his purchase, the decree on the earlier mortgage had already been passed. With all respect, I differ from this opinion. There was no transfer in favour in Babu Lal v. Jalakia AIR 1917 All 359 after the institution of the prior mortgagee's suit. The transfer took place in favour of the second mortgagee and at a date long prior to the institution of the suit by the first mortgagee. The sale under the subsequent mortgage was only an aftereffect and an inevitable effect of the second mortgage, and it would be wrong to describe the auction sale as anything independent of the second mortgage. I notice that Mr. Justice Brett in the case of Har Prasad Lal v. Dal Mardan Singh (1905) 32 Cal 891 was inclined to bold that the principle of lis pendens might apply to a case like this. But the third Judge, Mitra, J., to whom the case was referred on a difference of opinion between Brett and Rampini, JJ., was not prepared to uphold the opinion of Brett, J,, on that point: see at page 907. The learned Judge (Mitra) said:

I am not, however, disposed to separate in this country the mortgagee's right to the property and the equity of redemption of the mortgagor as if they are distinct entities in law with reference to the same property.

I do not think it necessary to pursue the argument about lis pendens further, as I think the decree of the lower appellate Court is sustainable irrespective of it.

21. Lindsay, J. In Babu Lal's case AIR 1917 All 359, delivered a separate judgment. He purported to follow the Calcutta case already quoted. Expressing his own opinion the learned Judge remarked:

It is, I think, impossible to ignore the fact that these sales have taken place and to deal with the matter in issue as if they have not in fact occurred. The title of either party is immediately traceable to his purchase in execution and reference to the rights under the mortgages is only necessary for the purpose of ascertaining the equities existing between them. Each has an imperfect title acquired by purchase and we have to determine which has the stronger equity in his favour.

22. With due respect we are of opinion that this attempt at working out equities is really shutting out of consideration the necessary result of omission on the part of the prior mortgagee to do what was incumbent on him. We need not repeat what we have already stated namely, the auction-purchase by one mortgagee gave no additional right to him as against the other mortgagee, As between the two mortgagees, both stood for their rights and liabilities, only on their respective mortgages and on nothing else. We have tried to show that if the prior mortgagee had attempted to make the subsequent mortgagee a party, while the former suit was still pending, but after the period of limitation had expired, the prior mortgagee's suit would have failed undoubtedly and irretrievably. How can he, then, acquire better rights by waiting further, although any suit on his mortgage against the second mortgagee would be time barred at the date of the subsequent suit? A party cannot improve his position by delay, and yet this is what the decision comes to if closely analyzed.

23. It has been urged that the second mortgagee's right is only one of redemption and nothing else, and if he gets that right, he ought to be contented. We think that this is a fallacious argument. A subsequent mortgagee has not only a right to redeem but he has a right, as against his mortgagor and subsequent encumbrancers, to enforce his mortgage. This latter right might be exercised and has been exercised in this case. The right to redeem possessed by a subsequent transferee is a right which can be exercised only at his option and at his will. He cannot be forced to redeem against his will. Yet a relief like the one sought at present amounts to nothing more than that. With respect, we are unable to follow the case of Babu Lal v. Jalakia AIR 1917 All 359.

24. It was urged on behalf of the respondent that the Full Bench case of Hukum Singh v. Lallunji AIR 1921 All 339, quoted with approval the decision in Ram Prasad v. Bhikhari Das (1904) 26 All 464, and that, therefore, Ram Prasad's case received further support. But the case of Hukum Singh AIR 1921 All 339, if closely analysed, will go to establish that the present plaintiffs have no right either to recover money or to recover possession and that the only right which he may have is one of redeeming the second mortgage in the hands of the principal defendants of the present case. In Hukum Singh's case AIR 1921 All 339 the prior mortgagee obtained a decree for sale without impleading the subsequent mortgagee. The subsequent mortgagee then brought a suit for sale on his own mortgage and impleaded the prior mortgagee and, as against that mortgagee, claimed a declaration that the prior mortgage decree was as of no effect as against him, on the ground that he, the subsequent mortgagee, was no party to the prior mortgagee's decree. It was discovered that, at the date of this suit, any fresh suit by the prior mortgagee against the subsequent mortgagee would be time barred. The learned Judges, thereupon, granted the prior mortgagee an opportunity to redeem the second mortgage and thereby free the property of it. The ratio decidendi in this case is that the decree of the prior mortgagee was a piece of waste paper, so far as the second mortgagee was concerned. The prior mortgage, by being time barred as against the second mortgagee, became postponed in favour of the second mortgagee and the status of the prior mortgagee became that of a subsequent mortgagee. The prior mortgagee, therefore, became entitled to redeem the second mortgagee and this is all that the case decided. It is true that the learned Judge who delivered the judgment of the Court, used the expression of 'equities between the parties being worked out.' But it was not at all necessary to think of equities, where the law was clear. It is true that the learned Judge in delivering the judgment quoted with approval a portion of the judgment in Ram Prasad's case (1904) 26 All 464, but Ram Prasad's case (1904) 26 All 464, with respect, had no direct bearing on the case before the Full Bench.

25. There is thus only one case in this Court that may be said to be directly in point that has been brought to our notice in favour of the respondents. On the other hand, the much more recent case of Ram Narayan v. Somi AIR 1923 All 449, which is also directly to the point, followed the Full Bench case of Madan Lal v. Bhagwan Das (1899) 21 All 235 (F B), and although the case of Babu Lal v. Jalakia AIR 1917 All 359 was quoted before the learned Judges, they did not think it necessary to discuss it.

26. The authorities in this Court, so far as they have been brought to our notice, have not in any way abrogated the decisions in 19 Allahabad and 21 Allahabad and we are bound to follow them in preference to the case in Bahimunnissa v. Badra Das (1911) 33 All 368. The case of Ram Prasad (1904) 26 All 464 is clearly distinguishable.

27. A Full Bench of the Madras High Court, Mullah Veetil v. Korambath : (1911)21MLJ213 , have clearly held that where a second mortgagee was in possession and he was not made a party to the first mortgagee's suit for sale, the second mortgagee could not be ousted by the auction-purchaser under a decree passed on the first mortgage, nor could he be forced to redeem the earlier mortgage, against his will. The learned Judges distinctly held that a right of redemption is a right and not a liability and that, therefore, nobody can force a subsequent mortgagee or his representative to exercise that right against his will.

28. It is important to mention that we asked Mr. Narayan Prasad Asthana, the learned Counsel appearing on behalf of the respondents, if his clients would care to redeem the second mortgage. He told us that he had no instructions on the point and could say nothing on the matter. Thus we are not called upon to consider whether, in the circumstances of the present case, the plaintiffs could redeem. The result is that the suit must fail, the plaintiffs not being entitled to the reliefs they have asked for. In this state of our opinion it is no longer necessary to send back the case for trial of the question of facts involved. The suit fails on the allegations of facts mentioned in the plaint by the plaintiffs themselves. I would, therefore, dismiss the suit, allowing the appeal.

Boys, J.

29. (His Lordship after stating facts as given in the judgment of Mukerji, J., proceeded as follows:) For the defendants-appellants it has been contended here that the plaintiffs can only succeed by showing that they have some title to present possession; that the plaintiffs simple mortgage gave them no title to possession; and that the decree obtained by them for sale had no effect against the defendants-appellants as they had not bean made a party to the suit in which that decree had been obtained. The argument is, in fact, a restatement of the grounds upon which relief was refused to the plaintiff in the case of Hargu v. Gobind (1897) 19 All 641, and also in the case of Madan v. Bhagwan (1899) 21 All 235 (F B), by which decisions it is contended that the present case is governed. Reliance was further placed on Ram Narain v. Somi AIR 1923 All 449 in which Madan v. Bhagwan(1899) 21 All 235 (F B) was followed, and on Mullah Veetil v. Korambath : (1911)21MLJ213 . Finally it was contended that the present suit was also barred by limitation.

30. For the plaintiffs-respondents reliance has been placed on the decision in Babu Lal v. Jalakia AIR 1917 All 359 in which, under very similar circumstances, a Division Bench of this Court held the plaintiff entitled to a decree for the amount of his mortgage or, in the alternative, possession. Reference was further made to Ram Prasad v. Bhikari (1904) 26 All 464. In answer to the plea of limitation, reliance was further placed on the doctrine of lis pendens.

31. I will first consider the question for decision apart from judicial authority. Prior to either of the suits being brought it is clear that the prior mortgagee and the puisne mortgagee each had a right to bring the property to sale. In the event of the prior mortgagee bringing the property to sale, the puisne mortgagee would have the right to redeem him, or in the event of his choosing not to exercise his right to redeem he would have to be satisfied (to the extent of the amount due to him) with any surplus of the Bale price after satisfaction of the amount due to the prior mortgagee. In the event of the puisne mortgagee bringing the property to sale, that sale would be subject to the prior mortgage. In the event of a suit for sale by the prior mortgagee, it was imperative on him to make the puisne mortgagee a party. But there was no such liability on the puisne mortgagee in the event of his bringing a suit for sale (Order 34. Rule 1).

32. In the present case, the first step was taken by the representatives of the prior mortgagee who, on the 26th of April 1911, brought a suit for sale against the representatives of the original mortgagor and obtained a decree on September 9,1911, without having made the puisne mortgagee a party. Subsequently they brought the property to sale on Jane 20, 1917, and purchased it themselves.

33. So far as these proceedings are concerned, it is clear that by virtue of Order 34, Rule 1, Civil Procedure Code, the puisne mortgagee's rights remained unaffected, and it will have to be considered what this proposition imports. To turn to the other suit, on January 9, 1914, the puisne mortgagee brought a suit for sale against the representative of the mortgagor and, on February 26, 1914, obtained a decree for sale without having made the prior mortgagee a party. In view of the explanation to Order 34, Rule 1, Civil Procedure Code, there was no obligation on him to make the prior mortgagee a party. On January 20, 1917, the property was sold and purchased by the representatives of the puisne mortgagee themselves. They acquired the rights of the mortgagor subject to the rights of the prior mortgagee, if at that date any such rights did still exist. The crucial question is as to the effect of Order 34, Rule 1, Civil Procedure Code. The question may be stated as it was stated in Hukum Singh v. Lallanji AIR 1921 All 339:

What is the effect of the failure of a prior mortgagee to implead a subsequent incumbrancer in his suit for sale?

34. It is clear that under Order 34, Rule 1 it was obligatory on the prior mortgagee to make the puisne mortgagee a party to his suit; while it was not obligatory on the puisne mortgagee to make the prior mortgagee a party. The rule is silent as to what consequences are to follow if the puisne mortgagee is not made a party to a suit by the prior mortgagee. But it is clear from the cases of Broja Nath v. Khelut Chunder (1871) 14 MIA 144, Umes Chander v. Zahur (1891) 18 Cal 164 and Gobind Lal v. Ram Janam (1894) 21 Cal 70. that the puisne mortgagee's rights are not to be 'affected in any way.' What rights had the puisne mortgagee? He had not only a right to redeem the prior mortgage but he had also a right to bring the property to sale and he was entitled to have that right and the results of its exercise, if he exercised it, unaffected in any way. He chose to exercise the latter aright and the auction purchaser got the property subject to any existing rights of the prior mortgagee.

35. Further, it cannot be said that, provided that the right of the puisne mortgagee to redeem is preserved to him, his interests are not prejudiced by recognizing as against him the decree under the prior mortgage; for that is in effect to deprive him of his right to bring to sale and force him to redeem, i.e., to deprive him of one of his rights. Ha might further be actually prejudiced by recognizing as against him the sale under the prior mortgage, even if his rights could be recognized to be recouped by the amount of his mortgage to the extent of the surplus of the sale price after satisfying the prior mortgage, since it is clear that in a sale pursuant to a decree obtained by the prior mortgagee the latter would only be interested in securing a price to meet his own claim; whereas, if the sale were under a decree obtained by the puisne mortgagee himself, he would be able to take all possible steps to obtain a price adequate to meat his own claim also after satisfying the prior mortgage.

36. It is clear, therefore, that if he has not been made a party the puisne mortgagee Is entitled to have ignored as against him the very existence of the suit of the prior mortgagee and the decree and sale therein in their entirety.

37. The auction-purchaser, therefore, in the sale on the puisne mortgage is entitled to the property subject to any existing rights of the prior mortgagee excluding any rights that he might otherwise have by virtue of his suit, decree and sale.

38. It is this subjection to existing rights, if any, of the prior mortgagee to which Lindsay, J., presumably referred in Babu Lal v. Jalakia AIR 1917 All 359, when he spoke of the imperfect title' of the auction-purchaser at the sale under the puisne mortgagee's decree. What then were the existing rights of the prior mortgagee? It is urged for plaintiff-appellant that the prior mortgagee had a decree for sale which must, at its worst, be held to be a decree for sale subject to the puisne mortgage. But it has already appeared that decree can have no effect whatever as against the puisne mortgagee and that it must be, as against him, treated as non-existent and, if that is so, it follows that no relief based on the decree and sale in the prior mortgagee's first suit can be given to the prior mortgagee or the auction-purchaser in the present suit. It is then urged that, if the suit of the prior mortgagee, and the decree and sale thereon, are to be wholly ignored as against the puisne mortgagee, then the prior mortgagee must, at least, be held to have his rights under his prior mortgage. But those rights had at the date of the present suit become barred by limitation and this fact further renders it unnecessary to consider whether, if his mortgagee rights were not barred by limitation, he could enforce them in a suit framed as in the present case, or whether if he could not get relief in the present suit, he could bring another suit properly framed to enforce his mortgage.

39. Finally, it is urged that limitation is saved by the doctrine of lis pendens. I find myself unable to accede to this contention. The sale to the auction-purchaser in the decree upon the puisne mortgage cannot be regarded as a new transfer; the title of the auction-purchaser must be taken, at any rate where, as in this case, the decree-holder was himself the purchaser, as dating back to the mortgage; and I find myself in agreement in this respect with Mitra, J., in Har Prasad v. Dal Mardan (1905) 32 Cal 891, where he says:

as the defendant's title related back to a date anterior to the first mortgagee's suit there was no alienation pendants lite and the doctrine does not apply.

40. The prior mortgagee having then no rights as against the puisne mortgagee on his decree and sale, and his rights under his mortgage being barred by limitation, he had no rights remaining.

41. I will now refer to the authorities on which reliance has been placed. As to Hargu v. Gobind (1897) 19 All 641 and Madan Bhagwan (1899) 21 All 235 (F B), which the defendant-appellants urged governed the present case, it was held in the former that where the plaintiff asked only for possession he could not be given possession, and in the latter, following the former, that the former case was also authority for the proposition that where the only relief asked for was possession, not only could unqualified possession not be given but even a decree for possession conditional on failure of the defendant to redeem could not be given.

42. In Madan v. Bhagwan (1899) 21 All 235 (F B), interpreting the earlier Full Bench, the learned Judges say:

The Full Bench did distinctly indicate their opinion that, in a suit for ejectment such as the present, a decree for possession with a conditional right to the defendant should not be passed.

43. Neither of the cases appear to me to be authority for the proposition that in a properly framed suit asking for a conditional decree the relief could not be given.

44. I find support for this view of the limited scope of these decisions in the very brief references to them, and the nature of those references, in Ram Prasad v. Bhikhari (1904) 26 All 464, Mulla Veetil v. Korambath : (1911)21MLJ213 , Babu Lal v. Jalakia AIR 1917 All 359; by the absence of all reference to them in Hukum Singh v. Lallanji AIR 1921 All 339; and by the distinguishing of cases in which only possession was claimed in Har Prasad v. Dal Mardan (1905) 32 Cal 891, in all of which cases the relief or, at any rate, the principal reliefs asked for was for possession conditional on failure to discharge the plaintiff's mortgage. Only in one such case were these Full Benches relied on to support the finding that even where a conditional decree was asked for, such decree could not be given. That case is Ram Narayan v. Somi AIR 1923 All 449 in which the learned Judges held that the case before them, where one of the reliefs asked for was a conditional decree, was 'on all fours' with the case in Madan v. Bhagwan (1899) 21 All 235 (F B). In that view of the two cases I do not find myself able to agree. The reliefs asked for were wholly different. The irrelevancy of these two Allahabad Full Bench decisions to the case before us, where a conditional decree is asked for, appears to me then clear. I have referred to them so fully only because we were much pressed with them on behalf of the defendant-appellants.

45. Ram Prasad v. Bhikhari (1904) 26 All 464, to which we were referred for the plaintiff-respondent, is clearly distinguishable. There a mortgagee had only impleaded in his suit the holder of a simple money decree who had attached the property. He could not have impleaded the auction-purchaser under that decree for the sale did not take place till after the decree for sale under the mortgage decree.

46. In Ram Prasad v. Dal Mardan (1905) 32 Cal 891, among other reliefs, plaintiff asked for a conditional decree for possession and was given that relief by the lower appellate Court. Brett, J., and Mitra, J., agreed in dismissing the appeal. Rampini J., would have allowed it. I am unable to appreciate fully the reasoning of Mitra, J., on the main question;but Rampini, J., would apparently have agreed with Brett, J., in dismissing the appeal, but for the fact that he held the suit to be barred by limitation.

47. In Mullah Veetil v. Korambath : (1911)21MLJ213 , the prior mortgagee having got a decree for sale without making the puisne mortgagee a party purchased it himself and sued the puisne mortgagee for possession or the amount of his mortgage debt. The second mortgage was usufructuary. It was held that the prior mortgagee suing for possession or his money was not entitled to a decree for possession subject to the right of the puisne mortgagee to redeem him, apparently because redemption was a right of the puisne mortgages and not a liability which he could be compelled to discharge.

48. In Babu Lal v. Jalakia : (1911)21MLJ213 it was held by Piggott, J., and Lindsay, J., that the plaintiff was entitled to a conditional decree in default of redemption by the puisne mortgagee. This is the case with which we have been most strongly pressed for the plaintiffs-respondents. In this also the plea of limitation was raised by the defendant. Piggott, J., held that the suit was not one for foreclosure or sale; that the prior mortgage had been extinguished; that the suit was brought on a different cause of action, i.e., the failure to get possession after purchase;. that as the suit was not on the mortgage, there was no bar of limitation. Lindsay, J., held that it was impossible to ignore the sales that both plaintiff and defendant had 'imperfect titles,' that the only effect of not impleading the puisne mortgagee was to preserve his right of redemption. I have already, in stating my own view at the commencement of this judgment, expressed my opinion on most of these points If the suit was brought on the plaintiff's purchase, it ought to have been dismissed forthwith in view of the fact that the puisne mortgagee was entitled to plead that he could not be in any way affected by the suit, decree or sale brought and obtained without impleading him. It was impossible of course to ignore the Bale under the decree of the puisne mortgage which had been arrived at by due process of law, but it was not only possible but incumbent on the Court to ignore as against the puisne mortgagee the sale under the plaintiff's decree which had only been reached, in the words of Piggott, J. by 'an initial departure' (by the plaintiff) 'from the plain course prescribed by the law.' In view of this finding of Piggott, J., that the legal complications 'had been brought about by this initial departure' by the plaintiff, I am unable, with the greatest respect for so able a Judge, to appreciate how 'it was the duty of the Court simply to work out the equities' merely because it now had both parties before it.

49. It is clear that the learned Judge was of opinion on the findings that the puisne mortgagee had been guilty of sharp practice in rushing his suit, decree and sale through in collusion with the mortgagor and the auction-purchaser, and there is at least a hint of something of the same sort in the present case in the long period (nearly six years) between the decree and the sale in the plaintiff's first suit and the plea in paragraph 8 of the plaint that the pro forma defendants were taking false objections to the execution of his decree; but in both cases the defendant proceeded by due process of law while in both cases the plaintiff was guilty of an initial and continued 'departure from the plain course prescribed by the law.' Under such circumstances it appears to me there are 'no equities to work out,' and we have only to apply the plain law.

50. The decision appears to me to deny almost entirely its proper effect to Order 34 Rule 1. Hukum Singh v. Lallanji AIR 1921 All 339 I think it is unnecessary to discuss. The facts were quite different. There is, however, a passage in the judgment which has a material bearing on the present case. Approval was expressed of the statement in Deokali Kunwar v. Alim-un-nissa Bibi [1901] AWN 22 that the puisne mortgagee is

to be protected by putting him as nearly as possible on the same footing as if he hud been made a party under Section 85 of the Transfer of Property Act.

51. As I have said elsewhere in this judgment that appears to me to be giving the puisne mortgagee something which might prove considerably less than his rights. He is entitled to have as against himself the whole suit and proceedings therein treated as non-existent.

52. In Ram Narain v. Somi AIR 1923 All 449 the decision purported to follow Madan v. Bhagwan (1899) 21 All 235 (F B), which case it declared to be 'on all fours.' I have already referred to this case when discussing Madan v. Bhagwan (1899) 21 All 235 (F B). It would appear that in the nature of the reliefs claimed the suits were very different. But is the view that was taken it was not considered whether the suit could be treated as one for foreclosure. The case does not really help the puisne mortgagee, the defendants-appellant, before us. If it is suggested that our finding possibly results in a puisne mortgagee reaping the benefit of collusive action between himself and the mortgagor (I do not suggest that there is in the present case anything approaching evidence of such collusive action), the answer is that there is no opening for that particular type of collusive action if the prior mortgagee complies with the plain direction of the law and impleads the puisne mortgagee.

53. My conclusions then are as follows:

That the first suit of the plaintiffs and the decree and sale are as against the puisne mortgagee of no effect whatever; that the right of the puisne mortgagee is not confined to being put now in the same position that he would have had if he had been made a party (for on that assumption he would never have been able to bring his own suit for sale; there would have been already in existence against him the decree of the prior mortgagee for sale in a suit to which he the puisne mortgagee, was a party); that the puisne mortgagee was entitled to have the very existence of the prior mortgagee's suit, decree and sale ignored; that the plaintiff-appellant, prior mortgagee, had against the puisne mortgagee no rights of any sort whatever based on their suit, decree and sale.

54. That the defendant-appellant, puisne mortgagees, are entitled to have their suit, decree and sale upheld in their entirety and as auction-purchasers acquired the property subject only to the existing rights, if any, of the prior mortgagee.

55. That any rights based on the prior mortgage that the plaintiffs-respondents, prior mortgagees, might have had against the defendants-appellants were at the date of the present suit barred by limitation.

56. That it is therefore unnecessary for us to consider whether the plaintiffs-respondents could have enforced those rights in a suit framed like the present; or whether, if they could not have so enforced them, they could have brought another suit framed otherwise.

57. I find myself, therefore, unable to hold that the plaintiffs-respondents in this appeal had any rights remaining to them as against the puisne mortgagee and the auction-purchaser (in this case the same person) and his suit should have been dismissed.

58. I would, therefore, allow the appeal and set aside the decree of the Court below.

59. I agree to the order proposed.


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