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Mahmud Hasan Khan and ors. Vs. Narain - Court Judgment

LegalCrystal Citation
Subject Property;Civil
CourtAllahabad
Decided On
Reported inAIR1949All210
AppellantMahmud Hasan Khan and ors.
RespondentNarain
Excerpt:
- - in any case, we have to consider the legal liability and not the question whether bateshwar dayal's claim, if any, against narain would ever be satisfied, either in full or in part, from the other property, if any, left by narain. miththan lal air1946all174 the question in that case was whether if a debtor left money in the hands of a transferee and required him to pay the debt and the transferee failed to make payment and the debtor was then called upon to pay it, he could claim the benefit under the u......1924. in the year 1943 the decree-holders filed an application for execution, and the judgment-debtor, narain, filed an objection. the first point taken in this objection was that the decree had been paid up, the second point was that the application for execution was barred by limitation and, lastly, it was urged that the decree as it stood was not executable and it should be amended under sections 8 and 9, united provinces debt redemption act (xiii [13] of 1940) as the judgment-debtor was an agriculturist. the decree-holders filed a reply and in that reply they said that the judgment-debtor had sold the entire mortgaged property to one bateshwar dayal under a sale deed dated 30th june 1942, and he had, therefore, no right to make an application for amendment of the decree. the......
Judgment:

Malik, C.J.

1. This case was referred to a Full Bench on the ground that the Bench decision in the case of Shiam Sunder Lal v. Data Ram : AIR1946All147 was not fully considered by the Full Bench in the case of Saran Singh v. Miththan Lal : AIR1946All174 .

2. Mr. Isbaq Ahmad has appeared on behalf of the appellants and has raised before us a very ingenious argument which was not advanced before the Bench which made the reference.

3. One Narain had executed a mortgage on 5tb July 1908, in favour of Mahmud Hasan. Khan and others. The mortgagees filed a suit. for sale and obtained a preliminary decree on 31st March 1922. The final decree was passed on 13th December 1924. In the year 1943 the decree-holders filed an application for execution, and the judgment-debtor, Narain, filed an objection. The first point taken in this objection was that the decree had been paid up, the second point was that the application for execution was barred by limitation and, lastly, it was urged that the decree as it stood was not executable and it should be amended under Sections 8 and 9, United Provinces Debt Redemption Act (XIII [13] of 1940) as the judgment-debtor was an agriculturist. The decree-holders filed a reply and in that reply they said that the judgment-debtor had sold the entire mortgaged property to one Bateshwar Dayal under a sale deed dated 30th June 1942, and he had, therefore, no right to make an application for amendment of the decree. The. judgment-debtor gave up the first two objections and it is only the third objection that has survived and which is to be decided by this Court.

4. The executing Court held that the judgment-debtor having transferred the liability the amount due under the decree was not a loan as defined by the Debt Redemption Act and, therefore, the decree could not be amended and the objection was dismissed by an order dated 15th April 1944. On Appeal the lower appellate Court came to a different conclusion and allowed the appeal on 14th September 1944, and directed that the decree be amended in accordance with the provisions of Sections 8 and 9, Debt Redemption Act. It is against that order that the decree-holders have filed this appeal.

5. It is urged on their behalf by Mr. Ishaq Ahmad that the judgment-debtor having transferred the entire mortgaged property and there being no personal liability because the suit on the mortgage was filed after six years and also under Section 21, Debt Redemption Act, the decree-holders could not proceed against the other property of the agriculturist debtor and cannot obtain a decree under Order 34, Rule 6, Civil P.C., the judgment-debtor is not 'a person liable to pay the amount due under the decree' which is the necessary qualification for a person making an application for amendment. Section 8 (1), U.P. Debt Redemption Act, provides:

Notwithstanding the provisions of any decree or of any law for the time being in force, an agriculturist or a workman liable to pay the amount due under a decree to which this Act applies passed before the commencement of this Act, may apply to the civil Court which passed the decree...,for the amendment of the decree by reduction according to the provisions of this Act and the amount due under it....

The section, therefore, requires that an application for amendment of the decree may be made only by an agriculturist 'who is liable to pay the amount due under a decree.' Mr. Ishaq Ahmad's submissions are that as the judgment-debtor has transferred the entire mortgaged property and as the decree-holders can proceed only against that property and not against the person or other property of the judgment-debtor, after the sale to Bateshwar Dayal the judgment-debtor was no longer 'liable to pay the amount due under the decree.' The argument, as we have said, is very ingenious, and at one stage it appeared to us that there would be no answer to it. We have, however, looked into the sale deed executed in favour of Bateshwar Dayal and we find that Narain sold the property to Bateshwar Dayal by the sale deed dated 30th June 1912, subject to an earlier mortgage of 11th June 1908, but he made no mention of the mortgage dated 5th July 1908, or the decree passed on the basis thereof. The result of this concealment is that Narain has become liable to pay to Bateshwar Dayal, the amount due under the decree, if Bateshwar Dayal has to pay it. Under Section 55, Sub-section (g), T. P. Act, it is the duty of the vendor to discharge all encumbrances on the property existing on the date of the transfer unless the property was sold subject to the en-cumbrance. In the sale deed there is a stipulation to the effect that if any other encumbrance is discovered and the vendee has to pay the same he will be entitled to recover the money from the person and other property of the vendor. The fact, therefore, that Narain remained liable to pay the amount due under the mortgage dated 5th July 1908, and the decree passed on the basis thereof cannot be doubted and the point is settled by a decision Of their Lordships of the Judicial Committee in the case of Bhagioati alias Bhagwan Dei v. Banarsi Das A.I.R. (15) 1928 P.C. 98. If the money is realised by a sale of the property, and we are informed that the property was put to sale, and to avoid the sale of the property Bateshwar Dayal has deposited the whole of the decretal amount, there is no doubt that he will be entitled to claim the money from Narain. It is argued that the amount cannot be recovered by Bateshwar Dayal from Narain by execution of the mortgage decree, but Bateshwar Dayal will have to file a fresh suit and obtain a fresh decree.

6. The contention of the learned Counsel for the appellants is that the expression 'liable to' pay the amount due under the decree' refers, only to a liability that may be enforced by the execution of the decree and does not refer to the ultimate liability for the payment of the amount decreed. If this contention is upheld, the expression 'a person liable to pay the amount due under a decree' should be interpreted to mean 'a person liable to satisfy a decree' or 'a person liable under a decree.' If the legislature meant what the learned Counsel suggests it did mean by the use of the expression under consideration, there seems to be no reason why it should not have used one of the expressions suggested. The Courts have to interpret the language used by the legislature in its plain grammatical sense. The expression is wide enough to include a person immediately liable to pay and also a person ultimately liable to pay. We are unable to discover any reason why a narrow construction should be placed upon it and why its full connotation should be limited. The interpretation sought to be put by the learned Counsel, instead of advancing the avowed object of the Act, namely, to afford relief to agriculturist debtors and workmen, hampers it by excluding some of the agriculturist debtors and workmen from the benefits of the Act. No reasons have been made out to suppose that the legislature intended to exclude from the benefits of the Act an agriculturist debtor or workman Who was to shoulder the ultimate liability for the repayment of the loan. It is not necessary that the amount should be recoverable only by execution of the decree. If Bateshwar Dayal has to pay the amount due under the decree, the ultimate liability to reimburse him and to pay the amount is of Narain, the judgment-debtor. Narain is thus not only a person who is a party to the decree but also the person on whom the ultimate liability to pay the amount due under the decree lies. In these circumstances it appears to be improper to prevent him from making an application for amendment under Section 8, U.P. Debt Redemption Act. Even if it be assumed that the language employed is ambiguous an interpretation that advances the object of the Act should be preferred to an interpretation that limits the fulfilment of that object. The provisions of the U.P. Debt Redemption Act were enacted for the benefit of an agriculturist debtor and, if an agriculturist debtor has to pay the amount due under a decree and he is a party to the decree, it appears to be in keeping with the spirit of the Act that he should be allowed to apply for the amendment of the decree and get the benefit under the Act.

7. Mr. Ishaq Ahmad on behalf of the appellants has urged that Narain is now dead and is represented by his widow and he has left no property from which Bateshwar Dayal can recover the money. This fact was not mentioned in any of the Courts below and, therefore, whether Bateshwar Dayal will or will not be able to recover the money from the other 'property of Narain and whether Narain left any Other property or not was never considered by the lower Courts. In any case, we have to consider the legal liability and not the question whether Bateshwar Dayal's claim, if any, against Narain would ever be satisfied, either in full or in part, from the other property, if any, left by Narain. That point, to our minds, is not relevant for purposes of the decision of the question before us.

8. Learned Counsel has further urged that by reason of the transfer dated the 30th June 1942; the liability to pay the debt was transfer-seed to Bateshwar Dayal by an implied contract and, therefore, the amount due under the decree ceased to be a loan. This was the only point that was urged before the Division Bench and the lower Courts. The point is covered by the decision of the Full Bench in the case of Saran Singh v. Miththan Lal : AIR1946All174 The question in that case was whether if a debtor left money in the hands of a transferee and required him to pay the debt and the transferee failed to make payment and the debtor was then called upon to pay it, he could claim the benefit under the U.P. Debt Redemption Act. There was no doubt-that the debtor was called upon to make the immediate payment, but he had a recourse Against the transferee and could claim the money from the transferee. It was held in that case that whether a debt remained a loan depended not upon the transfer of the property mortgaged, whether in whole or in part, bat upon whether the ultimate liability for its repayment rested on the transferor or was shifted cm to the shoulders of the transferee by a contract between the borrower and his transferee. This decision is binding on this Bench. It, therefore, follows, on the finding already recorded to the effect that the ultimate liability for the repayment of the loan rests with Narain and has not been transferred to Bateshwar Dayal that the debt has not ceased to be a loan'. In this view of the case it is not necessary to decide whether 'contract' in Section 2, Sub-section (9), U.P. Debt Redemption Act, includes both express and implied contracts, or is confined to express contracts only. The Bench that has referred this case has expressed the view that the proviso refers to express contracts only. There are two broad divisions of implied contracts. Contracts which are inferred from the conduct or presumed intention of the parties and obligations imposed by implication/of law, quite apart from and without regard to the probable intention of the parties, and sometimes even in opposition to their expressed or presumed intention. Section 9, Contract Act (No. IX [9] of l872) defines promises -express and implied -- as follows:

In so far as the proposal or acceptance of any promise is made in words, the promise is said to be express. In so far as such proposal or acceptance is made otherwise than in words, the promise is said to be implied.

It may be that the expression 'contract' includes one class of implied contracts and not another, or it may be that it includes both or neither. We would leave the question open to be considered and decided whenever occasion arises. Narain had not disclosed this mortgage to Bateshwar Dayal, had represented that the property was free from all encumbrances other than the liability under a mortgage, dated the 11th June 1908, and had undertaken to pay other liability that may be found to exist on the property. There was, therefore, if anything, a contract to the effect that Narain remained liable for the amount due under the mortgage and the liability for the amount due under this decree was not transferred by a contract and it did not cease to be a loan as defined under the U.P. Debt Redemption Act. The decree can, therefore, be' amended under S3. 8 and 9, U.P. Debt Redemption Act.

9. The ground on which reference to a larger Bench was made is, as we have already said, that the decision in Shyam Sunder's case : AIR1946All147 ) was not fully considered by the Full Bench in Saran Singh's case : AIR1946All174 , It was held in Shyam Sunder's case : AIR1946All147 ) that 'liability' in the proviso to Section 2 (9), U.P. Debt Redemption Act, means the whole liability' and further the original borrower not having transferred either the liability to repay the debt or the whole of the mortgaged property, remained liable for its repayment and, therefore, the debt did not cease to be a 'loan' and the borrower could get the benefits of the Act. We find that both the points decided in Shyam Sunder's case : AIR1946All147 were fully considered in Saran Singh's case : AIR1946All174 by the Full Bench. The view of the Bench in Shyam Sunder's case : AIR1946All147 that 'liability' meant the whole of the liability was upheld, but its view that the transfer of the entire mortgaged property might have a bearing was not accepted. The Full Bench held that the decision of the question whether a debt continues or ceases to be a loan did not depend upon the transfer of the mortgaged property but upon the transfer of the liability for its repayment. Shyam Sunder's case : AIR1946All147 was referred to and distinguished on the ground that in that case the liability to repay the loan had not been transferred.

10. The appeal has no force and is dismissed with costs.


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