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Bora Shib Lal Vs. Munni Lal and ors. - Court Judgment

LegalCrystal Citation
CourtAllahabad
Decided On
Judge
Reported in63Ind.Cas.604
AppellantBora Shib Lal
RespondentMunni Lal and ors.
Excerpt:
transfer of property act (iv of 1882), sections 74, 95 - mortgages--prior mortgage, discharge of, by puisne mortgagee--puisne mortgagee, right of, to be re-imbursed, when accrues--limitation--contract act (ix of 1872), section 69. - - this amount had not been paid by the transferees of the property and consequently the pre-emptor had to pay it and the second mortgage was thus satisfied. bat a suit like the present is not a suit to enforce the prior mortgage nor is it an application for the execution of the decree obtained on the basis of the prior mortgage. we fail to see how the present plaintiff can be said to be seeking to extend the period of limitation which is not the period of limitation available to the first mortgagee......on the property of the other mortgagor. on the same principle a second mortgagee who discharges a prior mortgage acquires a charge on the property which he relieves of liability for that mortgage. this is also manifest from the provisions of section 74. this charge he acquires not when the prior mortgage was made nor when that prior mortgage could be enforced but on the date on which he pays off the amount of the prior mortgage. the right also to be re imbursed accrues to him on the date on which he pays off the amount of the decree and relieves the mortgagors of the obligation which under the decree exists on them, it is clear, as already remarked, that this right could not have accrued when the original mortgage became payable. the second mortgagee who discharges the prior mortgage.....
Judgment:

1. The facts of this case are these: In 1886 certain persona mortgaged their property to one Shadi Lal. In 1906 they mortgaged the same property to the present plaintiff, Shib Lal. Shadi Lal brought a suit upon his mortgage and obtained a decree for sale against the mortgagors and the second mortgagee, the present plaintiff, on the 17th of January 1912. The decree was not discharged by the mortgagors and therefore, on the 24th of January 1914, that if, before the decree had bosoms time barred, the prudent plaintiff paid on account of the aforesaid decree and in discharge of it, a gum of Rs. 2,297. After the discharge of the decree by the above mentioned payment the mortgagors sold a part of their property to one Mohan Lal. The defendant Panna Lal brought a suit for pre-emption in respect of this sale and obtained a decree. He deposited in Court an amount which discharged the second mortgage held by the plaintiff. This amount had not been paid by the transferees of the property and consequently the pre-emptor had to pay it and the second mortgage was thus satisfied. After this the present suit was brought by the plaintiff to recover Rs. 2,297 principal and Rs. 811-8 interest from the mortgagors and from the property against which the mortgage decree had been passed and a part of which is admittedly in the possession of Pana Lal, defendant, Various defenses were railed in the Courts below, but both those Courts have dismissed the suit on the ground of limitation. The learned Subordinate Judge who tried the suit was of opinion that the plaintiff stepped into the shoos of the first mortgagee, Shadi Lal, and that as Shadi Lal's mortgage could be enforced only after 1388 the plaintiff could not recover his money after the lapse of twelve years from that year. This view also found favour with the lower Appellate Court. The learned Judge of that Court says in his judgment that the right of the plaintiff to recover the money arose at the time when the first mortgagee's right to recover it accrued. We do not agree with this view. In our opinion the right of the plaintiff to recover the amount claimed by him accrued to him only on the date on which he made the payment. He was a second mortgagee of the property comprised in the first mortgage and was, therefore, interested in paying off the amount of that mortgage and the decree obtained on the basis of it. There was a liability for the amount of the decree on the mortgagors personally and also on the property mortgaged. Of this liability the plaintiff relieved the mortgagors and their property by payment on the 24th of January 1914 when the decree was still enforcible. By such payment and by relieving the defendants' mortgagors and their property of the liability which existed on them, he, by virtue of the provisions of Section 69 of the Contrast Act, acquired a right to be reimbursed the money which he had paid for the benefit of the mortgagors and for the protection of their property. As he was the second mortgagee he was interested in seeing that the property was not sold in execution of the decree on the first mortgage as otherwise he would not have been entitled to enforce his own mortgage on the property. As there was a charge on the mortgagors property in favour of the first mortgagee and the second mortgagee, the present plaintiff, discharged that charge, he acquired a charge on the property. On the principle of Section 95 of the Transfer of Property Act which has been held not to be exhaustive, a co-mortgagor who discharges a mortgage is entitled to a charge on the property of the other mortgagor. On the same principle a second mortgagee who discharges a prior mortgage acquires a charge on the property which he relieves of liability for that mortgage. This is also manifest from the provisions of Section 74. This charge he acquires not when the prior mortgage was made nor when that prior mortgage could be enforced but on the date on which he pays off the amount of the prior mortgage. The right also to be re imbursed accrues to him on the date on which he pays off the amount of the decree and relieves the mortgagors of the obligation which under the decree exists on them, it is clear, as already remarked, that this right could not have accrued when the original mortgage became payable. The second mortgagee who discharges the prior mortgage and the decree obtained on that mortgage is not an assignee of the decree and he is not entitled to execute the decree. This was held by their Lordships of the Privy Council in the case of Gopi Narain v. Bansidhar 27 A. 325 9 C.W.N. 577 : 2 A.L.J. 336 : 2 C.L.J. 178 : 7 Bom. L.R. 427 : 15 M.L.J. 191 : 32 I.A. 123 : 8 Sar. P.C.J. 799 (P.C.). In view of this ruling of their Lordships of the Privy Council the Court of first instance was right when, on the 1st of August 1914 it refused the application of the present plaintiff for the making of a final decree in his favour in respect of the decree obtained by the first mortgagee. The lower Court has relied upon the decision of the Judicial Commissioner of the Central Provinces in the case of Nathuram v. Sheolal 42 Ind. Cas. 796 : 13 N.L.R. 217. That ruling no doubt to a great extent supports the view of the learned Judge, but with great deference we are unable to follow it. It is impossible to hold that the right of the plaintiff accrued before he made any payment at all. In that ruling the learned Judge seems to have assumed that the plaintiff was the assignee of the decree. Under Section 74 of the Transfer of Property Act he, no doubt, acquired the rights and powers of the mortgagee whom he redeemed, but the fast of this redeeming the prior mortgage does not make him an assignee of the mortgage. His rights may be akin to those of an assignee but be is not the actual assignee. If he had been the assignee of the mortgage and no suit had been brought on the basis of the mortgage by the prior mortgagee he would have been bound to bring his suit to enforce that prior mortgage within the period of limitation which was available to the prior mortgagee. Bat a suit like the present is not a suit to enforce the prior mortgage nor is it an application for the execution of the decree obtained on the basis of the prior mortgage. This is conceded by the learned Vakil for the respondents but he urges that the plaintiff is seeking to extend the period of limitation. We fail to see how the present plaintiff can be said to be seeking to extend the period of limitation which is not the period of limitation available to the first mortgagee. He is entitled to bring his suit within the period of limitation which would govern the claim to recover money paid by him for the defendants or to enforce a charge which he has acquired on the property of the defendants. So far as the suit is a suit of this nature the claim is admittedly within time. If the suit were treated as a suit personally against the mortgagors the limitation would be three years from the date of payment. (See Article 61, Schedule I, of the Limitation Act). If it is a suit to enforce a charge, as it obviously is, or for a declaration that he has a charge on the property, it is still within time. In this view, no question of acknowledgment arises. There are several other questions involved in the case which the Court of first instance did not try in consequence of its decision on the question of limitation. We accordingly allow the appeal, set aside the decrees of the Courts below and remand the case to the Court of first instance with instructions to restore it to its original number in the register and to try and dispose of the other questions which arise in the case. Costs here and hitherto will be costs in the cause and will in this Court include fees on the higher scale.


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