1. This appeal arises from proceedings under Order 21, Rule 2 of the Code of Civil Procedure, in the following circumstances.
2. (a) In 1908, Rajabai executed a mortgage with possession in favour of Narayandas for Rs. 9,660/- in respect of the houses situate in Lohia Bazar and Dana Oli, Lashkar, Gwalior.
(b) On February 18, 1946, Rajabai brought a suit against Brijbhushandas (son and legal representative of Narayandas, who died in the meantime). During the pendency of the suit, Rajabai died, leaving a will behind, by virtue of which the suit property devolved on Gyasiram appellant and Sitaram, brother of Smt. Vithabai (respondent No. 2). Sitaram also died. Smt. Vithabai is his heir and legal representative.
(c) On February 30, 1954, a preliminary decree for redemption was passed in the above suit (No. 24 of Samvat 2006) in favour of Gyasiram and Smt. Vithabai. Under this decree, a sum of Rs. 21,354/3/- as principal and Rs. 13,798/11/- as interest and further interest thereon till the date of payment were payable by the mortgagor to the mortgagee within sis months from that date.
(d) On March 20, 1959, Gyasiram alone applied for a final decree to be passed in his favour. In that application, he stated that it was on October 16, 1958, that the High Court decided the appeal which had been preferred by the plaintiffs, 'and now, therefore, the plaintiffs have to make deposit as per decree. Since Mst. Vithabai plaintiff has no right to deposit the money, so appellant is making the whole deposit, i.e., 'Rupees 21,354/3/- as principal and Rs. 13,798/11/- as interest and further interest from 25th May 1946 to 20th March, 1959, being Rupees 7051/7/-, aggregating Rs. 42,204/5/-. The deposit may he accepted and the defendants be notified and required to deliver possession of the mortgaged property as also all connected deeds.'
(e) On March 27, 1959, the trial Court permitted Gyasiram to deposit the amount. It was made clear that the permission did not tantamount to extending the time and the Court reserved its judgment on the question whether the deposit would be within time. Notice was issued to Brijbhushandas. On March 28, 1959, Gyasiram deposited Rupees 42,204/5/-.
(f) On April 8, 1959, Brijbhushandas appeared and stated in paragraph 9 of his objections that the amount due under the preliminary decree came to Rs. 46,882/6/6, while the plaintiff had deposited only Rs. 42,204/5/-. Therefore, Gyasiram could not be permitted to make any deposit. An objection was also taken that the amount deposited by Gyasiram on March 28, 1959, was beyond the time fixed in the decree, so that the Court had no power to permit the plaintiff to make the deposit.
(g) On April 9, 1959, Gyasiram further deposited a sum of Rs. 4,590/- and prayed that a final decree be passed in his favour, (h) On April 18, 1959, the trial Court held that the deposit had been made beyond the time allowed and directed a final decree for foreclosure to be drawn up. Aggrieved by that order, the appellant preferred an appeal to the District Court. The appeal was rejected as being on an insufficient stamp. But the High Court allowed Gyasiram's revision and remanded the appeal to the District Court for decision on the merits.
(i) On March 23, 1963, the Additional District Judge allowed Gyasiram's appeal holding that since the amount had been paid before the final decree was passed, it was within time. Reliance was placed on Order 34, Rule 8, Civil Procedure Code, in the result, he directed a final decree of redemption to be drawn up in favour of Gyasiram.
(j) Before the Additional District Judge, it was contended that the amount which Gyasiram had deposited was still short by Rs. 88/1/-. Brijbhushandas preferred a second appeal to this Court. This Court took the view that although the amount deposit ed by Gyasiram was within time, yet as there was shortage of Rs. 88/1/-, no final decree could be passed in his favour. The appeal was, therefore, allowed and the order of the trial Court was restored.
(k) Gyasiram appealed to the Supreme Court. Their Lordships held that since the shortage was on account of the undertaking given by Gyasiram in the matter of stay, it could not be taken to be a part of the amount due under the preliminary decree. Their Lordships, therefore, held that Gyasiram was entitled to a final decree in his favour. Accordingly, their Lordships set aside the order of this Court and restored the order of the Additional District Judge (Civil Appeal No. 959 of 1964, decided on March 30, 1966). Their Lordships said in the judgment:--
'We may add that the shortage in question was made good by the appellant soon after the order of the Additional District Judge and long before the judgment of the High Court.'
(1) On the same day, that is, July 25, 1966, Brijbhushandas made an application under Order 21, Rule 2, Civil Procedure Code, and filed a copy of the agreement with it, contending that the decree had been adjusted and the same be certified. The judgment-debtor's application was allowed by the learned Civil Judge. The appeal preferred by Gyasiram was dismissed by the Additional District Judge. Aggrieved by it, Gyasiram filed a Misc. Second Appeal (No. 25 of 1971), which has been allowed today.
(m) On January 5, 1968, Smt. Vithabai made an Application under Order 21, Rule 2, C.P.C. in the Court of the Civil Judge stating that she had entered into a compromise with the judgment-debtor by selling, for a consideration of Rs. 50,000/-all her rights, title and interest in the mortgaged property, which she had acquired under the decree of redemption, for which she had executed a deed of sale dated January 1, 1968. She said that her claim in the decree had been satisfied and prayed that the adjustment and satisfaction be recorded and certified. She filed a copy of the registered sale deed.
(n) Her statement and the statement of Brijbhushandas were recorded and on the same day the trial Court certified that the claim of Vithabai in the decree had been satisfied. No notice was given to Gyasiram.
3. Aggrieved by that order, Gyasiram preferred appeal in the District Court and urged that Smt. Vithabai had no right to enter into the compromise, as the final decree was not in her favour and, secondly, the adjustment could not be certified without notice to Gyasiram. The appeal was dismissed. This is second appeal by Gyasiram.
4. At the outset, learned counsel for the appellant laid stress on the recital in the sale deed about payment of consideration to Vithabai. Although apparently, the sale was for a consideration of Rs. 50,000/-, she was paid only Rs. 6,000/-, and, for the balance Rs. 44,000/-, it was agreed between the parties that she would be paid Rs. 200/- per month for three years and by the end of the third year, the entire sum of Rupees 44,000/- would be paid. It was suggested that this was a collusive transaction. Her signature was obtained for a price of Rupees 6,000/- at the most, I think, all that is not material for the decision of this appeal.
5. It is first contended for the appellant that there was no final decree in favourof Smt. Vithabai, although the preliminary decree was in favour of both the plaintiffs, Gyasiram and Smt. Vithabai. All that the learned Additional District Judge has said about this point is this:--
'It is apparent that the final decree was passed in favour of the plaintiffs. Vithabai was also a plaintiff, and preliminary decree was also in her favour. On perusal of the plaint, judgments and subsequent decrees, it is crystal clear that the final decree for redemption was also passed in favour of Vithabai along with Gyasiram.'
In my opinion, this finding is clearly erroneous and disregards material facts. No doubt the preliminary decree was passed in favour of both Vithabai and Gyasiram. Under that decree, a sum of Rs. 21,304/3/- as principal and Rs. 13,798/11/- as interest, and a further interest thereon till the date of payment were payable by the mortgagors to the mortgagee within six months from that date. However, on March 20, 1959, Gyasiram alone applied for a final decree to be passed in his favour. On March 28, 1959, he alone deposited Rs. 42,204/5/-. On April 9, 1959, he alone deposited Rs. 4590/- and prayed for a final decree to be passed in his favour alone. Again, it was Gyasiram alone who made up the shortage of Rs. 88/1/-. Gyasiram could do so, and he did so. Brijbhushandas filed an objection on April 8, 1959, that Gyasiram alone could not deposit the decretal amount. That objection was eventually rejected, Gyasiram was thus subrogated to the rights of the mortgagee under Section 92 of the Transfer of Property Act, by virtue of which 'any co-mortgagor shall, on redeeming property subject to the mortgage, have, so far as regards redemption, foreclosure or sale of such property, the same rights as the mortgagee whose mortgage he redeems, may have against the mortgagor'. It is nobody's case that Smt. Vithabai had deposited anything for payment to the mortgagee under the preliminary decree. She was, therefore, not entitled to a final decree for redemption. The law permits one of the co-mortgagors to pay the mortgage money under the preliminary decree for redemption, in which case he is subrogated to the rights of the mortgagee in respect of the co-mortgagor who has not paid the decretal amount. It is true that in the cause title, Vithabai has also been described as 'plaintiff' but the words in the final decree show that it was awarded in favour of the plaintiff, who deposited the decretal amount. It may be mentioned that in the decree also, the word 'plaintiff' is throughout used in singular number and it is not out of place to further mention that in the decision of the Supreme Court it was said:--
'It must be held that the appellant was entitled to final decree in his favour.'
It is true that before their Lordships, there was no dispute between Gyasiram and Vithabai.
6. What is important is that on April 11, 1962, Vithabai had made an application in the trial Court for a final decree to be passed in favour of both the plaintiffs, just as the preliminary decree had been passed in favour of both the plaintiffs. This was not accepted by the trial Court. It must, therefore, be held that there was no final decree in favour of Vithabai. The learned Additional District Judge went by surmises and lie only basis of his finding is that the preliminary decree was in favour of both the plaintiffs. He ignored the provisions of Section 92 of the Transfer of Property Act.
7. It was contended by the learned counsel for Vithabai that Section 92 of the Transfer of Property Act cannot be applied to this case inasmuch as that Act was not applicable to the territories of the erstwhile Gwalior State on the date of the suit. This contention is not right. The Transfer of Property Act, Gwalior State, Samvat 2001 (Act No. 4 of Samvat 2001) had come into force on January 22, 1945. Section 91 of the Gwalior State Act is exactly in the same Words as Section 92 of the Indian Transfer of Property Act (as inserted by Section 47 of the Transfer of Property Amendment Act, No. 20 of 1929). Even before the enactment of the Gwalior State Act, the principles of the Indian Transfer of Property Act had been made applicable by virtue of Circular No. 5 of Samvat 1979 by the Gwalior Ruler.
8. It follows from the above conclusion that Vithabai was not competent to enter into a compromise with the judgment-debtor about the final decree and get any adjustment certified.
9. Gyasiram stood subrogated to the rights of Brijbhushandas, whose mortgage he redeemed so that the relationship between Gyasiram and Vithabai altered into that of mortgagee and mortgagor respectively. In other words, Vithabai had the equity of redemption and what she could transfer was this equity of redemption alone. Therefore, the effect in law of the sale executed by her in favour of Brijbhusandas is that Brijbhushandas has become the mortgagor in relation to Gyasiram in respect of the rights of Smt. Vithabai in the mortgaged property. In this view of the matter, the sale deed executed by Smt. Vithabai was merely of her rights and interest in the mortgaged property and those in the preliminary decree passed in the suit for redemption against Brijbhushandas. No doubt, the sale purports to transfer to Brijbhushandas all rights of Smt. Vithabai, but that does not extinguish the decree.
10. The appeal is accordingly allowed. The order of the Civil Judge dated January 5, 1968, certifying satisfaction of the decree, and the order of the Additional District Judge are set aside. The appellant shall get his costs in all the three Courts from the respondents.