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Mehdi Ali Khan and anr. Vs. Chunni Lal and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Reported inAIR1929All834
AppellantMehdi Ali Khan and anr.
RespondentChunni Lal and anr.
Cases ReferredJanki Kumar v. Sarup Rani
Excerpt:
.....hanif-un-nissa applied for restitution of properties purchased by the strangers as well as by bansi dhar but her application as against the strangers was dismissed. but on the clear language of the document there was an unquestioned liability on the part of mehdi ali khan and abdullah khan to refund the amount and there was clearly both a personal liability to do so as well as that sought to be created by the security. but the fact remains that bansi dhar had to pay in court what had been taken out by mehdi ali khan and abdullah khan as well as what had been taken out by himself. by making good that amount bansi dhar undoubtedly did a thing lawfully for mehdi ali khan and abdullah khan and there is no doubt that he did not intend to do it gratuitously. nor can there any doubt that..........of suit no. 37 of 1903. the decree was for about rs. 63,000. mt. faiz-un-nissa sold her decree to bansi dhar, the father of the present plaintiffs for rs. 40,000 prior to these proceedings mehdi ali khan and abdullah khan the appellants held a decree in suit no. 20 of 1902 for over rs. 11,500 against mt. faiz un-nissa. in execution of their decree they attached the decree held by mt. faiz-un-nissa against mt. hanif-un-nissa. this sale took place after the attachment and therefore all claims under it were subject to that attachment.2. the attaching creditors sought to execute the decree but the court ordered that the decree should be executed by bansi dhar although when the sale proceeds are realised the decree of the attaching creditors should be discharged first. in execution of this.....
Judgment:

Sulaiman, J.

1. This is a defendants' appeal arising out of a suit for sale on the basis of a security bond dated 11th July 1907, executed by the defendant-appellants. It appears that Mt. Faiz-un-nissa obtained a decree against Mt. Hanif-un-nissa from the High Court in appeal arising out of suit No. 37 of 1903. The decree was for about Rs. 63,000. Mt. Faiz-un-nissa sold her decree to Bansi Dhar, the father of the present plaintiffs for Rs. 40,000 Prior to these proceedings Mehdi Ali Khan and Abdullah Khan the appellants held a decree in suit No. 20 of 1902 for over Rs. 11,500 against Mt. Faiz un-nissa. In execution of their decree they attached the decree held by Mt. Faiz-un-nissa against Mt. Hanif-un-nissa. This sale took place after the attachment and therefore all claims under it were subject to that attachment.

2. The attaching creditors sought to execute the decree but the Court ordered that the decree should be executed by Bansi Dhar although when the sale proceeds are realised the decree of the attaching creditors should be discharged first. In execution of this decree some property was sold at auction on 26th October 1906 for Rs. 14,950 and bulk of it was purchased by strangers. One property, viz.: an Indigo Factory was purchased by Bansi Dhar himself. After this the judgment-debtor deposited nearly Rs. 6,000 in Court and later paid out of Court over Rs. 54,000. In t+his way the whole amount of the decree was paid off.

3. When Bansi Dhar wanted to take out the money from the Court he was ordered to furnish security before he took out the money (order dated 4th January 1907, p. 32). Similarly when Mehdi Ali Khan and Abdullah Khan applied to take out the money from the Court in discharge of their decree the Court ordered that without furnishing security they could not be allowed to do so (p. 35). After the passing of this order Mehdi Ali Khan and Abdullah Khan filed in Court a security bond dated 11th July 1907, which is printed at p. 41 and is the subject of controversy. On the filing of that security they were allowed to take out the whole of Rs. 14,950 realized by the sale of the property as well as a part of the amounts deposited subsequently.

4. All this time the appeal of Mt. Hanif-un-nissa was pending before their Lordships of the Privy Council. The appeal was remanded to this Court and this Court ultimately dismissed the suit and in this way reversed the decree.

5. Then followed protracted proceedings for restitution. Mt. Hanif-un-nissa applied for restitution of properties purchased by the strangers as well as by Bansi Dhar but her application as against the strangers was dismissed. We are informed that she recovered the Indigo Factory from Bansi Dhar. Later she applied for restitution of the amount against Bansi Dhar and to these proceedings she also impleaded Mehdi Ali Khan and Abdullah Khan. The learned Subordinate Judge dismissed her application (p. 79). On appeal the High Court remanded the Case holding that Bansi Dhar was liable personally under Section 144, Civil P.C. to her for restitution. Piggott, J., further remarked:

In the event of Bansi Dhar satisfying the claim of the appellants he will be entitled to enforce as against Mehdi Ali Khan and Abdullah Khan the liability undertaken by these gentlemen as sureties on his behalf.

6. This remark, however, was not directed to any point which was specifically in dispute at that time.

7. The result of all these proceedings has been that Bansi Dhar and now his sons have had to pay all the sums taken out of Court and in that way have made complete restitution to Mt. Hanif-un-nissa and her representatives.

8. The present plaintiffs, viz.: the sons of Bansi Dhar, did not apply to the Court before which the security was furnished for any remedy but instituted the present suit claiming to enforce the charge created by the security bond. The defence raised on behalf of the appellants was that no charge existed and that the bond could not be enforced by the plaintiffs as against them. There was a further plea of limitation.

9. The learned Subordinate Judge has held that the bond in question does not amount to a mortgage and cannot be enforced as such. But he has held that it created a charge on the property in favour of Bansi Dhar which would be enforced by the present plaintiffs. He has held that no part of the claim is barred by limitation and has accordingly decreed the whole claim.

10. We agree with the Court below that in view of the pronouncement of their Lordships of the Privy Council in the case of Raj Raghubir Singh v. Jai Indra Bahadur Singh A.I.R. 1919 P.C. 55 the security bond in question does not amount to a mortgage-deed. It is printed at p. 41 and under this document Mehdi Ali Khan and Abdullah Khan who described themselves as sureties agreed to be liable to the Court that if Mt. Hanif-un-nissa and others or their heirs be successful in the Privy Council and M. Faiz-un-nissa or her representatives have to refund the sale proceeds they shall refund Rs. 15,134-11-2 and shall comply with the order which might ultimately be binding upon them. They further agreed that they and their heirs shall pay the said sum amounting to the figure quoted above and as a security for the payment of the said amount they mortgaged by way of security the zimindari property detailed in the document. The object of furnishing this security was to enable them to take the money out of Court which was lying there and was in dispute. The document does not expressly say that it is a hypothecation or mortgage in favour of Mt. Hanif-un-nissa or her heirs. The executants did not undertake to pay to Mt. Hanif-un-nissa or her representatives the amount mentioned therein in case they succeeded. There was an undertaking to be liable to the Court for the refund or return of the amount which they were going to take out of Court. As observed by their Lord ships in the case referred to above at p. 167 there is in this instrument no person mentioned to whom the security is given. They undertook liability to the Court, but the Court is not a juridical person and it can neither sue nor take property nor assign it. But on the clear language of the document there was an unquestioned liability on the part of Mehdi Ali Khan and Abdullah Khan to refund the amount and there was clearly both a personal liability to do so as well as that sought to be created by the security. Such unquestioned liability must undoubtedly be capable of being enforced.

11. In the document before their Lordships there had been no personal liability at all and no question of enforcing it under Section 145, Civil P.C., arose. The suit was purely one to enforce the charge said to have been created by the document. Their Lordships remarked that was not the mode of enforcing the liability and the proper course was to apply to the Court for making an order in the suit upon an application to which the sureties are parties, that the property charged be sold unless before a day named the sureties find the money (p. 167). This was the practice of this High Court in similar cases as is evidenced by the ruling in Janki Kumar v. Sarup Rani [1895] 17 All. 99. It follows therefore that the document cannot be treated as a mortgage deed within the meaning of Section 53, T.P. Act, because there is here no mortgagee to whom the property is transferred.

12. The learned Subordinate Judge has thought that if it is not a mortgage it must amount to a charge. It is impossible to accept this view. If the document is not a mortgage for want of any mention of a specific person in whose favour it is made it equally does not create a charge. Section 100 requires that where immovable property of one person is by act of parties or operation of law made security for the payment of money to another and the transaction does not amount to a mortgage, the latter person is said to have a charge on the property. Here Mt. Hanif-un-nissa and her representatives are not named as being the persons to whom the money is to be paid. Thus the case does not fulfil the conditions required by Section 100. I am therefore of opinion that the learned Judge is in error in thinking that it creates a charge and can be enforced. No doubt it is not necessary that the beneficiary should be a party to the transaction under which the charge is created, But he must be specifically named as being the person in whose favour the charge exists. This is not the case here. It follows therefore that the plaintiffs' remedy to recover the money by enforcement of any supposed security either in the nature of a mortgage or of a charge must fall to the ground; and they cannot take advantage of the 12 years period of limitation which is allowed for such remedies.

13. Bansi Dhar had to pay large sums of money by way of restitution in the year 1914. The payments ranged from 1st April 1914 to 30th April 1914 and amounted to over Rs. 71,000, Unfortunately the claim to recover any part of this amount is hopelessly beyond time because Article 132, Lim. Act, does not apply.

14. There remains the sum of Rs. 15,950 which was paid by Bansi Dhar or his heirs between January 1923 and July 1923. The present suit is within three years of that payment. When the Court ordered that neither Bansi Dhar nor the attaching creditors could be allowed to take out the money without first furnishing security and they were allowed to take out portions of the amounts lying in Court on furnishing such security it is obvious that when the decree in execution of which the sums had been realised was reversed, they were in duty bound to refund the amount. There can be no doubt that there was the undoubted liability of Mehdi Ali Khan and Abdullah Khan to refund this amount which they had taken out. Similarly Bansi Dhar was bound to restore what he had taken out. This was the express personal undertaking by Mehdi Ali Khan and Abdullah Khan in their bond dated 11th July 1907.

15. But the attaching creditors were not considered as principal parties to the proceeding relating to restitution, and the High Court in its judgment dated 27th February 1919, held that Bansi Dhar was personally liable under Section 144 though he may have his own remedies against Mehdi Ali Khan and Abdullah Khan. But the fact remains that Bansi Dhar had to pay in Court what had been taken out by Mehdi Ali Khan and Abdullah Khan as well as what had been taken out by himself.

16. Section 70, Contract Act, lays down that when a person lawfully does anything for another person not intending to do so gratuitously and such other person enjoys benefit thereof the latter is bound to make compensation to the former in respect of the thing so done. Now there was a liability on Mehdi Ali Khan and Abdullan Khan to restore the amount which had been taken out by them and that liability was in the first instance discharged by Bansi Dhar. By making good that amount Bansi Dhar undoubtedly did a thing lawfully for Mehdi Ali Khan and Abdullah Khan and there is no doubt that he did not intend to do it gratuitously. Nor can there any doubt that Mehdi Ali Khan and Abdullah Khan to that extent have enjoyed the benefit thereof. They had attached a decree which was subsequently set aside and became a nullity, and yet under colour of it they realized an amount and have appropriated it. It therefore seems to me that the latter are bound to make compensation to the former in respect of the thing so done. It seems only just and fair that Bansi Dhar or his representatives should have the right to claim the amount which they have paid which in reality ought to have been paid by Mehdi Ali Khan and Abdullah Khan because they alone had taken out that sum.

17. The learned advocate for the respondents has strongly contended that the liability of Mehdi Ali Khan and Abdullah Khan could only arise after the amount had been refunded by the representatives of Mt. Hanif-un-nissa. This contention is correct in this sense that the present plaintiffs could not possibly have sued unless they had at first had to refund the amount. But there can also be no doubt that the liability of Mehdi Ali Khan and Abdullah Khan existed all along and they were bound to restore the amount. The cause of action for suing under Section 70 cannot be said to have arisen when the Privy Council decision was given, but only when the restoration was made by Bansi Dhar for it is on that account that he and his representatives can claim compensation. I am therefore of opinion that this appeal should be allowed in part and the decree of the Court below modified in this way that the plaintiffs should be given a decree only for Rs. 15,950 with interest at 6% per annum simple from 23rd July 19(sic)3, the last date on which Bansi Dhar made the payment till realization, and the rest of their claim should be dismissed.

Pullan, J.

18. I agree with the views expressed and the order proposed.


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