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Govinda Mohapatra Vs. T. Venkatakrishnayya and ors. - Court Judgment

LegalCrystal Citation
Decided On
Case NumberAppeal from Original Decree No. 5 of 1944
Reported inAIR1950Ori6
ActsDebt Laws; Orissa Money-lenders Act, 1939 - Sections 2, 2(1) and 10; Contract Act, 1872 - Sections 43; Code of Civil Procedure (CPC) , 1908 - Order 21, Rules 58 to 66
AppellantGovinda Mohapatra
RespondentT. Venkatakrishnayya and ors.
Appellant AdvocateP.V.B. Rao, Adv.
Respondent AdvocateP.C. Chatterji, ;R.K. Das, ;G.C. Das and ;D.V. Narsing Rao, Advs.
Cases ReferredShah Ramchand v. Prabhu Dayal
- motor vehicles act, 1988 [c.a. no. 59/1988]section 173(1) proviso; [d. biswas, amitava roy & i.a.ansari, jj] appeal without statutory deposit but within limitation/or extended period of limitation maintainability - held, if the provision of a statute speaks of entertainment of appeal, it denotes that the appeal cannot be admitted to consideration unless other requirements are complied with. the provision of sub-section (1) of section 173 permits filing of an appeal against an award within 90 days with a rider in the first proviso that such appeal filed cannot be entertained unless the statutory deposit is made. the period of limitation is applicable only to the filing of the appeal and not to the deposit to be made. it, therefore, appears that an appeal filed under section 173 cannot.....ray, c.j.1. this is defendant 8's appeal in a suit for enforcement of a mortgage dated 27th july 1926 for a consideration of rs. 12,000 executed by defendants 1 and 2 and their father late narain gantayat. the aforesaid mortgage was executed in full discharge of a prior mortgage dated 16th december 1911 for a consideration of rs. 8000. the latter consideration was made up of cash advances from time to time under promotes and the interests that accrued due thereon. it is undisputed that out of the consideration of rs. 12,000, rs. 6000 represented interest accruing due on the pronotes and the prior mortgage bond, the balance being the amounts advanced in cash. defendants 1 and 2 are the primary mortgagors. defendants 3, 4 and 5 are the sons of defendant 1. defendants 6 and 7 are sons of.....

Ray, C.J.

1. This is defendant 8's appeal in a suit for enforcement of a mortgage dated 27th July 1926 for a consideration of Rs. 12,000 executed by defendants 1 and 2 and their father late Narain Gantayat. The aforesaid mortgage was executed in full discharge of a prior mortgage dated 16th December 1911 for a consideration of Rs. 8000. The latter consideration was made up of cash advances from time to time under promotes and the interests that accrued due thereon. It is undisputed that out of the consideration of Rs. 12,000, Rs. 6000 represented interest accruing due on the pronotes and the prior mortgage bond, the balance being the amounts advanced in cash. Defendants 1 and 2 are the primary mortgagors. Defendants 3, 4 and 5 are the sons of defendant 1. Defendants 6 and 7 are sons of defendant 2. Defendant 8, the present appellant is a, purchaser of Schedules B-1 and B-2 properties subject to the mortgage. Defendants 9 to 12 are also subsequent purchasers of certain minor items of mortgage properties. Defendants 18 and 14 are two eosharers of defendants 1 and 2 being in possession of certain items of the mortgage properties who set up a paramount title. The mortgagor defendants have subsisting interest in and are in possession of a substantial portion of the mortgage properties not affected by the subsequent purchases of defendants 8 to 12.

2. The plaintiff claimed recovery of rupees 22,514 as mortgage money, either from all the defendants or in the alternative from defendant 8 alone particularly on the ground that his auction purchase, to be set out in greater detail, presently, was 'subject to the mortgage'.

3. None of the defendants resisted the suit by way of attacking either the validity or the execution of the mortgage. The main defence was that the plaintiff having been paid Rs. 13,000 was not entitled to recover anything as he was not entitled to more than double the amount actually advanced. Other minor defences have lost their significance as they have not been pressed before us having been set at rest by the decree under appeal. The plaintiff's suit has been dismissed against all but decreed in full against defendant 8.

4. As already stated, the issue, main if not the only, between the plaintiff and the defendant 8 is whether the latter is a purchaser at a Bale in execution of a decree of a Court of the part of the properties subject to the mortgage, the purchase having been made prior to the coming into force of the Act, and as such, if entitled to the benefits available to a debtor under the Orissa Money-lenders' Act. This is the only issue with which we are concerned in this appeal. The pleadings of the parties in relation to this issue are as follows : Paragraph 6 of the plaint alleges the circumstances and the conditions under which the appellant came to purchase a part of the mortgage properties. The paragraph reads thus :

'Subsequent to the suit mortgage bond and some payments thereon one Sadhu Gantayatani obtained a compromise decree in a suit for partition O. S. 42/29 on the file of the Subordinate Judge's Court at Berhampur against defendants 1 and 2 and their late father Narayan Gantayat and some other members of the family. For realising the amount due under the money portion of the said compromise decree the said Sadhu Gantayatani attached and brought the lands of the mortgagors in the village of Dhobadi to sale in E. P. 43/35 on the file of the Ganjam District's Court and defendant 8 her cousin brother, purchased in court auction the properties mentioned in Schedules B-1 and B-2 hereto annexed for Rs. 6500 subject to the Suit mortgage bond amounting to Rs. 15,000 and took delivery thereof. All this was done on the decree-holder's representation and defendant 8 was really conducting the proceedings on behalf of the decree-bolder (Sadhu Gantayatani) who is his cousin sister.'

Paragraph 9 of the plaint as amended reads ;

'The plaintiff instituted this suit for the recovery of Rs. 22,514 from defendant 8 and the properties purchased by him in court auction as described in Schedules B-1 and B-2 he having purchased the same subject to the payment of the whole of the suit mortgage debt in court auction in E. P, 43 of 1935 on the file of the District Court of Ganjam. Defendant 8 and the properties purchased by him are, therefore, liable to pay the entire suit amount both in law and in equity. If for any reason the Court finds that such a decree cannot be passed on the ground of indivisability of the mortgage or otherwise the plaintiff submits that B decree may be passed including the remaining mortgaged properties of the suit.'

The prayer in the plaint as cast in para. 13 thereof is in accord with the aforesaid averments, in paras 6 and 9. In answer thereto, the appellant is his written statement avers as follows :

'It is true that this defendant purchased the properties mentioned in Schedules B-1 and B-2 at court auction as alleged in para. 6 of the plaint but the allegation that Rs. 15,000 was due under the suit mortgage bond at the date of sale or that this defendant knew the actual amount due by then is denied. The allegation that be was conducting the proceedings on behalf of Sadhu Gantayatani is not correct. The plaintiff represented to this defendant that more than double the amount advanced by him had been repaid by the mortgagors and that interest only was due on the bond and this defendant was accordingly pursuaded to bid for the property. Even after the auction sale the plaintiff offered to return the suit document if he was paid Rs. 7000 in full discharge of the suit debt. But the defendants did not agree. The present claim is highly Speculative and is purposely inflated without giving; credit to several other payments made by the mortgagors and in collusion with them to deprive this defendant of the properties purchased by him.'

After several other averments, the defendant claimed protection under the Orissa Money-lenders Act, and contended that the plaintiff was not entitled to compound interest as claimed in the suit. In this state of pleadings, it is contended by Mr. G.C. Das, the principal respondents' counsel that the appellant was not entitled to avail of the contention that he now urges, namely, that his purchase was 'not subject to mortgage'. This submission carries some force, supported, as it is, by para. 6 of the written statement already referred to. But the paragraph, read with the latter portion of the written statement, cannot be held free from an amount of ambiguity. The parties, however, joined as issue as the one emerging out of the averments and counter-averments set forth above, in the following terms :

'3. Whether the suit in so far as it seeks to recover the suit mortgage amount from defendant 8 and the properties purchased by him as shown in Schedules B-1 and B-2 annexed to the plaint, he having purchased the said properties subject to the payment of the amount due under the suit mortgage is one in which defendant 8 can seek relief under the provisions of the Orissa Money lenders Act ?'

For the purpose of determination of this issue, the supplementary issue 10 was also framed. '10 is the plaintiff a money-lender within the meaning of the Orissa Money-Lenders Act ?'

5. It was pointed out in course of argument, in further support of the submission of the respondents' counsel, that on account of absence of denial of the position that his purchase was subject to mortgage, in his written statement, defendant 8 did not press issue 8 the only issue relevant to this point. This submission, however, is wrong. As I have already pointed out, issues 3 and 10 are the relevant issues in relation to this part of the parties' case. Issue 8 arose out of the objection embodied in para. 5 of the appellant's written statement.

'The plaintiff cannot substitute the Schedules B-1, B-2 and C for properties mortgaged to him and throw the entire burden of the mortgage-debt on a portion of the mortgaged property.'

The circumstances relating to this issue are that the mortgage was executed by defendants 1 and 2 and their father in respect of their undivided alleged 1/4th share of certain villages. During the subsistence of the mortgage, the widow of one of the cosharers, Sadhu Gantayatani, brought a suit for partition of the family properties, and on partition Schedules B-1, B-2 and C properties of the plaint fell to the share of the mortgagors in lieu of their alleged share already mortgaged to the plaintiff. The plaintiff thereupon wanted to enforce his mortgage against the aforesaid properties as substituted security. As these properties were less in extent and value, than the properties mortgaged, the appellant, as well as, other defendants raised the issue 8 which was subsequently abandoned. The abandonment, therefore, does not amount to the appellant's withdrawal from the contest that his purchase was not subject to mortgage in the sense contemplated in Exception 3 of Section 2 (i), Orissa Monty-Lenders Act. The appellant's contention in this Court therefore cannot he said to have been concluded by the pleadings. The fact that the purchase was made apparently 'subject to mortgage' is not so much denied as that the position therein indicated was not the one contemplated in the exception.

6. Mr. P. V. B. Rao, the learned counsel for the appellant, in presenting his appeal, has formulated three contentions : (i) The Court below has found that the mortgagee's claim as against the mortgagors has been tally satisfied and that the suit against them has been dismissed ; in the circumstances, a decree for recovery of the mortgage money by sale of a part of the mortgage properties purchased by the appellant is not permissible under the law, the mortgage-debt being one and indivisible; (ii) The validity and the subsistence of the mortgage, and the amount due thereunder, as it stood at the date of the auction sale, were not determined under Order 21, Rule 62, Civil P. C. hence notification of the mortgage, and the mortgage amount of Rs. 16,000 in the sale proclamation will not make the sale 'subject to mortgage' within the mischief of Exception 3 Clause (i) of Section 2, Orissa Money lenders Act (Orissa Act III [3] of 1939); and that (iii) conceding that the defendant 8's purchase was at a sale of the mortgage properties 'subject to mortgage' within the exception clause, it would except only the proportionate amount as mentioned in the said clause payable in respect of the properties purchased ; in that view, the decree, as passed for the entire mortgage-money by sale of Schedules B 1 and B-2 properties irrespective of the ratio it bears to the entire mortgage properties in value in the hands of the appellant, is not sustainable.

7. I shall deal with the contentions in the order in which they have been stated.

8. Point No. (1)--The Court's finding which is referred to in the contention is :

'21. It is not disputed that an amount much in excess of the original loans advanced has been realised and as such under Section 10, Orissa Money lenders Act, plaintiff is not entitled to realise anything else on the basis of the suit mortgage subject however to the question whether the subsequent purchasers, namely, defendant 8 and defendants 9 to 12 can plead for reliefs under that Act. As against the non-transferees that is the members of the mortgagor's family the claim has therefore to be found as already fully satisfied and as such the suit shall be dismissed against them.'

9. It may be noted that there is slight inaccuracy in the expression of the finding. What has been intended to be found is that the amount in excess of twice the original amount advanced having been realised, the Court could not pass a decree against the non-transferee-defendants for the claim advanced in excess thereof. The finding has, no doubt, been unhappily phrased hut we are concerned with the substance and not the form. The substance of the finding is that under Section 10, Money-lenders Act, the Court cannot pass a decree against the original debtors for recovery of any claim in excess of twice the amount originally advanced. There is nothing in law that the liability which is joint and several as amongst several debtors can be fully enforced against some to the exclusion of others. A finding to that effect does not involve inconsistency or repungnancy, particularly when such a finding is warranted in law. But for the Money-lenders Act and hut for the fact that defendant 8 by his purchase, 'subject to mortgage,' undertook, as it were, to pay the entire mortgage dues, the liability for the mortgage-money was joint and several as against the mortgagors and the subsequent transferees, and as against the several mortgage properties in their hands. That the liability cannot he enforced against some of them on account of a bar in law will not-exonerate others. Similarly, it is open to the mortgagee to enforce the mortgage liability against a part of the mortgage; properties absolving the rest. It is an incident of liabilities which are joint and several. The question has been set at rest by their Lordships of the Privy Council in the case of Shah Ram Chand v. Prabhu Dayal, 69 I. A. 98: (A.I.R. (29) 1942 P. C. 50). The position may be made clear by an illustration. Say. A, B, C and D incurred certain loan in course of one transaction so that their liabilities were joint and several. It is discovered that A was not sui juris at the relevant time The debt does not freeze as a whole. The creditor's suit against all of them can be validly dismissed against A and decreed against the rest. The decree, in the instant cade, does not differ in principle from the illustration above.

10. Besides the Privy Council case already referred to, the decision of a Division Bench of Madras High Court (Wadsworth and Sastri JJ.) in the case of R. Srinivasa Thatachariar v. Sivasubramania Chettiar reported in A.I.R. (30) 1943 Mad. 196: (I. L. R. (1943) Mad. 665) is in point. Mortgage properties in this case, had been purchased separately by defendants 22 and 18 of whom the former was an agriculturist. The original mortgagor whose interest in the mortgage properties ceased was a non-agriculturist. On the application of the agriculturist defendant, the decree as against him was scaled down and the same was not scaled down as regards the other defendant. The former deposited the decretal amount as scaled down and contended that he should be allowed to redeem the entire mortgage, the decree being entered as satisfied so as to enable him to sue for contribution from the other defendant. His contention having been negatived in the Court below, the matter was finally agitated in the High Court, the effect of the lower Court's order was characterised by his Lordahip Patanjali Sastri J., as splitting up of the decree in order to give effect to the provision of the Act (Madras Agriculturists' Relief Act iv [4] of 1938), so as to benefit only the agriculturiat-debtors but not so as to affect the remedies of the creditors against such other debtors as were not agriculturists. This position was upheld by his Lordship as against the contentions, that the mortgage was one and indivisible and that it cannot be held discharged as against one and undischarged and hence enforceable against another ; and that it did not matter if in giving; effect to the Act in favour of an agriculturist, a non-agriculturist was also benefited. The authorities relied upon by the appellant were Arunachalam v. Seetaram, I.L.R. (1941) Mad 930 : (A. I. R. (28) 1941 Mad. 584); Nachiappa Chettiar v. Bamachandra Reddiar, A. I. R. (29) 1942 Mad. 527 : 203 I, C. 417) and Marina Ammayi v. Mirza Baker Beg Sahib, A. I. E. (28) 1941 Mad. 557 : 200 I. C. 246). I Consider, worth quoting the observations of Patanjali Sastri J., by way of refuting the aforesaid contention :

'Although it has been held by this Court that the liability of a purchaser of a part of the hypotheca who 19 an agriculturist to pay the mortgage money out of the property purchased is a 'debt' within the meaning of the Madras Agriculturists' Relief Act, it cannot be said that he stands in relation to the mortgagee in the same position for all purposes as the original mortgagor who borrowed the debt. In the case of the latter, if he pays the scaled down amount, the contractual relation of debtor and creditor is put an end to and no part of the debt can subsist thereafter, with the result that the property which under the mortgage contract, is charged with the due payment of that debt becomes into whosoever hands it may have passed, freed from the burden of the charge. The decisions referred to above proceed on this principle. But when a purchaser of part of the hypotheca, being an agriculturist, pays the scaled down amount of the debt, there is no obvious reason why the debt should be regarded as wiped oat even as against the mortgagor, or a person deriving title from him, who is not an agriculturist; for the Agriculturists' Relief Act is clearly intended to benefit only agriculturists debtors and it nullifies the rights of creditors and overrides the general law only to the extent necessary for giving effect to its provisions and no further.'

* * * * 'Be that as it may, we cannot agree that the mortgagee's right to recover the full a amount of the debt from the properties in the hands of defendant 18 should be nullified in order to safeguard the appellant's possible right of recovering contribution from defendant 19. It may be, that in certain circumstances the relief provided in the Agriculturists' Relief Act is of no practical benefit to an agriculturist debtor but the latter cannot claim in seeking such relief that the creditor's rights should be prejudiced to a greater extent than the provisions of the Act clearly warrant'

11. With these observations, their Lordships did not consider that the principle of the decisions relied upon for the appellant should be extended to cases like the one where the mortgagor is not an agriculturist and the question arises between purchasers of different portions of the hypotheca some of whom are and others are not agriculturists. Mr. Rao, however, relied upon this decision as laying down a principle that when the borrower is freed from the debt, no other debtor by virtue of the purchase of equity of redemption can be made liable. This contention overlooks the specific provision of the Orissa Money-lenders Act which expressly discriminates one against the other.

12. The next case, in point, is that of C. S. Bamier v. B. N. Srinivasiah, A. I. R. (28) 1941 Mad. 204 ; (I. L. R. (1941) Mad. 836). In this Wadsworth and Patanjali Sastri JJ., upholding their earlier views that the representative of a pursue mortgagee was entitled to be regarded as a debtor under Section 7 and to scaling down of the decree under Section 19 of the Act, observed :

'It is argued by Mr. Ramaswamy Aiyangar for the decree-holder that the right of an agriculturist judgment-debtor to scale down a decree should not be allowed to enure for the benefit of a non-agriculturist judgment-debtor, a proposition with which we are in agreement. But we find it difficult to accede to the further contention that, the mortgage being one and indivisible, it is wrong in theory and difficult in practice to scale down the decree against the agriculturist-judgment-debtor, while leaving it unamended as against the non-agriculturist judgment-debtors. The theoretical argument is based on the absence from Section 19 of any words excluding the application of the general law governing mortgages. But Section 19 is only the machinery section. The substantive provisions are contained in Section 7 which says :

Notwithstanding any law .... or decree of Court to the contrary, all debts payable by an agriculturist at the commencement of this Act, shall be scaled down ....

Having regard to our previous decisions, we must hold that the applicant is a judgment-debtor and that the decree debt is payable by him. It follows that this debt is to be scaled down, notwithstanding the decree and notwithstanding the provisions of the general law which prevent the person who acquires a partial interest in the hypothecs, from denying the liability of his interest to satisfy the whole of the mortgage debt. We are unable to accept the contention that a debt which is payable by an agriculturist falls outside the purview of the Act merely because it is also payable by a non-agriculturist and it seems to us obvious that the mere fact that the applicant has sub-mortgaged his interest to a non-agriculturist will not deprive the applicant of any benefits to which he may be entitled under the Act as a person liable to satisfy the decree.'

13. This decision countenances decrees for different amounts against different judgment-debtors liable under one mortgage according as one is entitled to the benefits under the Relief Act and the other is not. Their Lordships directed modification of the form of the decree resulting in splitting the decretal amount into two parts, one being the amount payable by the pursue mortgagee and the other payable by the other non-agriculturist-judgment-debtors. It will be observed from the last portion of the observation that even though a debt was payable both by an agriculturist and by a non-agriculturist what was payable by the former was a debt liable to be scaled down though what wa3 pay. able by the latter would not be so. The case, very strongly relied upon by Mr. P. V. B. Rao is that of Marina Ammayi v. Mirsa Baker Beg Sahib, A. I. E. (28) 1941 Mad. 557: (200 I. C. 245). It was a redemption suit by an agriculturist mortgagor with whom were impleaded as co-plaintiffs the purchasers of the portions of the hypotheca who held reserved with them a part of the consideration money for payment to the mortgagees. The debt was scaled down in accordance with the provisions of Section 19 read with Section 8 of the Act and redemption was decreed subject to payment thereof. The mortgagee contended, in the High Court, that some of the debtors, namely, purchasers of portions of the mortgage properties whose purchase was 'subject to mortgage' were non-agriculturists and that the Court should not have entered full satisfaction, of the debt even as against them as they were not entitled to the benefits of the Act. The case of Ramier v. Srinivasiah, A.I.R. (28) 1941 Mad. 204: (I. L. R. (1941) Mad. 336), was cited in support of the contention; but it was distinguished on the ground that as the mortgagors who were entitled to redeem the mortgage, as a whole, were agriculturists, the relief of redemption could not be denied to them. In answer to the contention that the non agriculturists debtors were to be benefited as a result, the reply given was that the mortgagors were entitled to get a refund of the portions of purchase money which the purchasers as a result of the scaling down of the decree, would not be required to pay to the mortgagee thus the total benefit being rendered to the agriculturists and not necessarily to the non-agrilturists. They however, disapproved of the lower Court's observation that there could not be any partial amendment of a decree under the Act with regard to some only of the judgment-debtors who were agriculturists leaving alone the others on the basis of the decision in Ramier's case, (A.I.R. (28) 1941 Mad 204; I.L.R (1941) Mad. 836). This case, however, is not an authority against splitting up a decree into two parts so as to give the benefits of the Act to some of the judgment-debtors and to deny the same to the others. Mr. Rao, however, contends that according to this decision, the purchaser-judgment-debtors would share the same fate as the mortgagors and that, in that event, the suit having been dismissed against the mortgagors in the instant case, it should have been dismissed against all. This, however, is not the ratio decidendi of the decision. Even if it be so, I find it somewhat difficult to reconcile it with the decisions already quoted with which, with great respect, I am in entire agreement. In my judgment, in a case where a subsequent purchaser should, by the terms of his purchase, undertake to pay the mortgagee, he becomes the principal debtor primarily liable to pay the mortgagee and it is his status that ought to determine whether the debt should be scaled down or otherwise. To my mind it appears that the logics of indivisibility of a mortgage has been pushed too far in some of the Madras decisions herein referred to. It is optional with the mortgagee to release a part of the mortgage properties without any consequent alteration of the fundamental right to hold the rent of the property liable for the entire debt. As pointed out by Sir G. Ramkin in Shah Ramachand v. Prabhu Dayal. 69 I. A. 98 : (A. I. R. (29) 1912 P. C. 50), this release does not free the released property from the liability of contribution under Section 82, T. P. Act. The utmost that the Relief Act can achieve is to free it from contribution if the debtor is an agricultutiat and accordingly allow compulsory abatement of a part of mortgagee's claim.

14. The next case relied upon is that of Arunachalam Pillay v. Seetaram Naidu, (I.I.R. (1941) Mad. 930 : A. I. R. (28) 1941 Mad. 684). That was a case in which a non-agriculturist purchased the equity of redemption in court auction, The mortgagor, was however, an agriculturist. The decree was scaled down at the instance of the mortgagor to the benefit of respondent 12, the aforesaid purchaser. It was argued for the appellant (decree-holder) that inasmuch as all the mortgage properties were in the hands of respondent 12 who was a non-agriculturist and as a decree was sought only against such properties, the Act had no application and the decree for sale for the full amount due under the mortgage ought to have been passed against respondent 12. Reliance was placed upon the case if Ramier v. Srinivasiah, A. I. R. (28) 1941 Mad 204 : (I. L.R. (1941) Mad. 336). That case was distinguished only on the ground that, that was a case where the mortgagor was not an agriculturist. Comparing the raison deter of this case with that of Srinivas Thatachariar v. Sivasubramania Chettiar, A.I.R. (30) 1943 Mad. 196: (I. L. R. (1943) Mad. 665), it will he apparent that Patanjali Sastri J. had since changed his view, Besides (this), Aurunachalam Pillay's case, (I. I. R. (1941) Mad. 930 : A. I. R. (28) 1941 Mad. 684), can be explained on the ground of applicability of Section 8, Relief Act to the facts of that case which provided for a statutory discharge of the debt. This case, however, is no authority which would be relevant to the instant case which is governed by the special provisions of the Orissa Money-lenders Act. The basic conception under the Act is that the liability of a purchaser 'subject to mortgage' is not to be deemed to arise out of a loan within the meaning of the Act. It was not followed by Sastri J. in the case of Srinivas Thatachariyar v. Sivasubramania Chettiar, A.I.R. (30) 1943 Mad. 196 ; (I. L. R. (1943) Mad. 666) in which the debt was allowed to be split up so as not to affect creditor's remedies against non agriculturist-debtors vis-a-vis the agriculturist ones.

15. The next case relied upon on behalf of the appellant is that of Nachiappa Chettiar v. Ramachandra Reddiar, A. I. R. (29) 1942 Mad. 527: (208 I. C. 417). That case was decided on the theory that if the debt is scaled down at the instance of an agriculturist-mortgagor, no decree for a higher amount can be passed against non-agriculturist-purchasers, 'subject to mortgage', mainly on account of the defect in the general law of splitting up of the mortgage or the debt. This case too is beside the point in consideration of the special provisions of the Orissa Moneylenders' Act. I should, however, observe with very great deference to the learned Judges who decided this case that a purchaser subject to mortgage places himself in the position of a debtor to the complete effacement of the mortgagor whose interest in the property thereby ceases. The creditor should not be made to lose the benefits of his rights under the mortgage against the mortgage property in the hands of a non-agriculturist who is entitled to no protection under the Act. It should be noted that within the four corners of the Madras Agriculturists' Relief Act, there is no room for distinction between a real and genuine debtor and a speculator-purchaser. Within it the purchaser of a mortgage property is an good a debtor as a mortgagor, provided he is an agriculturist Under the Orissa Money lenders Act, however, the purchaser of a mortgage property is a debtor entitled to the benefits or not according as he has undertaken the liability of paying off the the mortgage or otherwise. In cases where he takes the liability to redeem the mortgage off the shoulders of the original debtor, the mortgagor for consideration he holds the money, as it were, for being handed over to the mortgagee. He is thus saddled with a liability the source of which is not money borrowed but property purchased. Basically he cannot be held entitled to a debtor's relief. Where however the subsequent purchaser has to pay with the result that he fulfils the indemnity condition of the mortgagor and is in the ultimate end entitled to call upon the mortgagor to compensate him for the payment to mortgagee in order to secure his purchase free from mortgage, his liability must be scaled down to the ultimate benefit of the original debtor in respect of his undertaking to indemnify. Respective operations of the Acts will call forth widely different considerations and no analogy can be drawn between the two. The statutes cannot be called part materia, the matters dealt with having widely divergent boundaries. Those decisions of the Madras High Court, which proceed on the assumption that under the general law the mortgage debt is one and indivisible and cannot be so split up as to enable the mortgagee to get a decree for higher amount as payable under the mortgage against some judgment-debtors than as against others, are not only in conflict with certain decisions of that very Court already noticed but that they overlook the general law, as propounded by their Lordships of the Privy Council in Shah Ramchand v. Prabhu Dayal, 69 I. A. 98 : (A. I. R. (29) 1942 P. C. 50), according to which the mortgagee can enforce the entire mortgage debt against a part of the mortgage properties in the hands of one of the debtors liable under the mortgage and release the rest. He can select his own debtor. Acting upon these considerations, I hold that the contention No. (i) is unsubstantial and cannot be acceeded to. So long and so far the general law of mortgage governing relation between the mortgagee, the mortgagor and anybody deriving title from the latter not free from the burden of mortgage has not been trenched upon by the Special Act relating to money-lending and money-lender, it must be given its full operation.

16. Point No. 5.--This concerns us with the meaning that has to be attached to the words 'subject to mortgage' occurring in exception (iii) of Clause (i) of Section 3, Orissa Money-lenders Act. It may be pointed out here that the learned Subordinate Judge is wrong in his observation that the words 'subject to mortgage' govern 'properties' and not ''sale' used in the exception clause. The exception evidently means that the sale muse have been 'subject to mortgage,' Here one has to bear in mind that every sale made subsequent to a mortgage is ''subject to mortgage' in the sense that the mortgagee's claims against the property must take priority over the rights of the purchaser in the property purchased. But the phrase has a limited sense too, e. g., where the purchaser expressly or otherwise undertakes to redeem the mortgage with a part of the consideration of his purchase or when a court sale takes place for a favourable price on account of its being subject to a binding condition that the purchaser shall have to pay off the mortgage money due at the time. The full and unlimited operation of the Money-lenders Act does aim at divesting the creditor of some of his remedies correspondingly with the result of divestment of his rights in order to relieve the debtors of the burdens of their debts. Like every other statute, it must be construed very strictly so as to avoid, in its application, such divestment unless it is so intended and, as well, so expressed clearly. In a case where on account of the sale in question, the mortgagor or any of his representatives is relieved of the liability under the mortgage, it is not the intention of the Act, that the creditor should be disarmed in respect of his remedies against one who has to pay, if at all, in discharge of an obligation which, either by an agreement between the parties or by an order of Court having the like effect, he has undertaken. As I have already stated, the cases where the ultimate incidence of mortgage liability still continues to lie on the mortgagor, notwithstanding a sale of the mortgage property e. g., when be binds himself by an indemnity clause to secure the purchaser's title free from the encumbrance and where on account of such indemnity condition the purchaser is entitled to call upon the mortgagor to make good the loss that he suffers on account of paying off the mortgage in order to free his purchased property a relief to such a purchaser under the Act is a relief to the mortgagor. In such a special case, the mortgagee is deprived by the Act, of his open and free choice of enforcing mortgage against the subsequent purchaser for the full amount due under it irrespective of the consideration of the concommitant hardship, that accompanies such enforcement caused to the original debtor in respect of the loans originally advanced. It appears very clear to me that the words 'subject to mortgage' are used in the limited sense already adverted to. The relative position between a vendor and purchaser of mortgage property at a sale 'subject to mortgage' has been authoritatively laid down in the case of Izzat Un Nisa Begam v Pertab Singh, 81 ALL. 583 : (36 I. A, 203 P. C.) That decision arose out of a suit by the vendor against the purchaser to recover the amount due on mortgages subject to which the sale was effected, which mortgages had since been declared invalid, as vendor's unpaid purchase money. Their Lordships non suited the plaintiff holding

'On the sale of property subject to encumbrances the vendor gets the price of his interest whatever it may be whether the price be settled by private bargain or determined by public competition together with an indemnity against the encumbrances affecting the land. The contract of indemnity may be express of implied. If the purchaser covenants with the vendor to pay the encumbrances, it is still nothing more than a contract of indemnity. The purchaser takes the property subject to the burden attached to it. If the encumbrances turn out to be invalid, the vendor has nothing to complain of. He has got what he bargained for. His indemnity is complete. He cannot pick up the burden of which the land is relieved and seize it as his own property.'

It follows that the vendor-borrower is under no liability of a debt, his liability being taken over by the purchaser in the case illustrated above. He is no longer entitled to debtors' relief with the consequence of divesting the creditor of his money. This case, however, has been cited by Mr. P. V. B. Rao in support of his contention as to the meaning of the words 'subject to mortgage.' Relying upon this, be wants to contend that notification in the sale proclamation of a sale that a property was to be sold 'subject to mortgage' does not necessarily create an estoppel as against the auction-purchaser from challenging the validity of the notified mortgage. The case, at any rate, does not appear to me to have decided the point. The view, contended for, had been expressed in the High Court by Burkitt J., but their Lordships of the Privy Council decided the limited case before them approaching it from a different angle of vision. The narration that the encumbrances notified were found to be invalid is not sufficient to warrant the contention. The invalidity might have been due to illegality. Nobody is estopped by his own statement or conduct as against a statute in law. The decision therefore is of no help to the appellant's contention; but as I have already discussed, it illuminates and buttresses the point of view taken by me as above. I have no hesitation in holding that in the circumstances of this case, which I am going to get out presently in greater detail, the appellant's purchase was 'subject to mortgage' within the meaning of the exception, under interpretation.

17. The circumstances are as follows : The disputed properties along with certain others had been mortgaged to the plaintiff on 27th July 1926. During the currency of the mortgage, Sadhu Gantayatani secured a decree for money against the mortgagors in a partition suit. In execution of that decree, she attached mortgage properties and brought them to sale. The sale, however, attracted no bidders. Thereafter, she filed a fresh execution petition on 26th August 1936 (EX. 7), In this petition, she prayed :

'That the Hon'ble Court be pleased to attach under Order 21, Rule 54, Civil P. C., the lands specified in the Bohedulea attached hereto, subject to the mortgage, dated 27-7-26 of Tadeipalli Venknta Krishnaya Pantulu for the realisation of the amounts specified .... and pay the plaintiff the proceeds thereof.'

Later in the execution case initiated with the aforesaid petition, the decree-holder said in a petition :

'The second reason ia that since the plaintiff applied for sale of the lands subject to the mortgage of T. V. K. P. and since the details of his dues on account of principal and interest have not been specified in the previous K. P. 72/34, purchasers were not forthcoming to purchase the properties. For these reasons, the sale of the properties in E. P. 72/34 could not be done.'

and prayed,

'for sale in auction for Rs. 700 relating to her decretal dues subject to the mortgage of T. V. K. P. for Rs. 15,000 of the lands comprising the aforesaid lot Nos. 1 to 5.' (Exhibit 7 (d) dated 3rd December 1935 read with Ex. 7 (c).)

18. Exhibit 7 (b) is the order disposing of the aforesaid applications passed by the District Judge on 9th December 1936. It appears therefrom that the subject-matter of the petition was adjudicated upon in the presence of decree-holder and the judgment-debtors who were represented by a pleader. The upset price of Rs. 700 was fixed by the Judge in consideration of the fact that the sale was 'subject to mortgage' for Rs. 15,000. The learned Judge describes the petition, the subject of his decision, as one by decree-holder under Order 21, Rule 66 and Section 151, Civil P. C. In pursuance of the order the terms of the sale proclamation (Ex. 7a) were settled. There are two parts of the sale proclamation, one purports to be a notice of the sale, date, hour and place thereof, and the other, conditions of sale. The notice portion contains, 'the property will be put up for sale in the lots specified in the schedule. The sale will be of the property of the judgment-debtors above named as mentioned in the schedule subject to mortgage dated 27th July 1926 of T. V. K. of Chatrapur for a sum of Rs. 12,000. The liabilities and the claims attached to the said properties have been ascertained from the Office of the Sub-Registrar. . . . . '

Amongst the conditions of sale the fourth condition is of particular significance. It is,

'this property or part thereof will be sold in auction subject to the above-named mortgage or date month year 19 and subject to all claims under the above written mortgage. Condition No. 7 directed the attention of the bidders to certain documents mentioned therein subject to the further condition'

whether the purchaser is or has not inspected them. Accordingly he will be deemed to have given up the objections thereto by bidding. In the schedule to the said proclamation, it was stated,

'the lands covered by lots 1 to 5 have been mortgaged to Rai Bahadur T. V. K. Pantulugaru of Chatrapur for Rs. 15,000. In E. P. 43 of 35 and E. A. 162 of 35, it was ordered that the sale will be made subject to the mortgage dues of Rs. 15,000 for Rs. 700. The sale will be held according to the order.'

19. Before proceeding to construe the effect of the execution proceedings it has to be noted that the appellant auction-purchaser was him self conducting the execution proceedings on behalf of the decree-holder being her near relation. In this background it has to be considered whether; the said auction-purchaser can be allowed to urge that the property was not sold 'subject to mortgage.' Equitably his position is in no way different from the decree-holder auction-purchaser. His repayment of the mortgage loan shall be in discharge of a lien upon the obligation imposed upon him by the purchase.

20. Mr. P. V. B. Rao, however, very strongly contends that the question raised by him is one of law and he cannot be held estopped from raising the same. But shortly, his contention ia that the order of the District Judge in pursuance whereof it was mentioned in the sale proclamation that the attached property was to be sold 'subject to mortgage' was of an administrative and interlocutory character being one passed under Order 21, Rule 66 as distinguished from Order 21, Rule 62 of the Code. Such an order, he contends, hag been unanimously held not to have the effect of selling the property 'subject to mortgage' but selling it with notice of mortgage. Pushed to its logical conclusion, the position contended for is that the auction-purchaser is free to challenge the validity, genuineness and existence of the mortgage and the amount payable thereunder. Approached from this standpoint, he urges, the sale at which the appellant purchased was not one 'subject to mortgage' within the meaning of the exception clause. This contention, to my mind, is not strictly relevant to the issue and does not carry conviction having in view the intention of the Legislature and the language employed by them in enacting 'the exception.' The intention is to exclude the amount payable by a purohaserl 'subject to mortgage' from the benefits of the Money-lenders Act. In order to give effect to the intention the words ought to receive the widest possible meaning not altogether foreign to the language employed. In that view, the cms of the question is whether the auction-purchaser has paid the full price of the property or has only paid the difference between the market price thereof minus the sum payable under the encumbrance. The order of the District Judge though passed in ascertaining the value of the property was one which made allowance for the margin of Rs. 16,000 representing the extent of the liability which the auction-purchaser should have had to discharge in order to make good his title, in fixing the upset price at Rs. 700. Besides, the exhibits already referred to, the fact of the subsistence of the mortgage and the amount of Rs. 15,000 payable there-under were also notified by the auctioneer to the bidders and the same has been mentioned in the sale warrant (bid sheet-Ex. 7 (e)). After the sale, there was a proceeding under Order 21, Rule 90 of the Code by one judgment-debtor on the ground, inter alia, of insufficiency of the upset price and the price fetched. To this proceeding, the decree-holder as well as the auction, purchaser were parties. It was still open to the auction-purchaser to resile from the sale on the ground that the judgment-debtor had no saleable interest or in other words no marketable right of any value. The petition of the judgment debtor was rejected by an order of the Court (Ex. 7k). This later proceeding fortifies the position that the auction-purchaser was fully alive to the responsibility that he had purchased 'subject to mortgage' and that the particulars which according to Mr. Rao were merely for the purpose of information and could be the subject-matter of further consideration were determined judicially in the presence of the auction-purchaser. The contention of the appellant must, therefore, be considered in the light of these circumstances. Before proceeding to deal with the authorities cited by the appellant's learned counsel, I should refer to a decision of the Patna High Court, directly in point, that is, Govind Dani v. Purushottam Mahapatra, 9 out. l. t. 42 : (A. I. R. (30) 1943 Pat. 430), The facts of the case except with regard to immaterial details were on all fours with the facts of the instant case. The ratio of the decision was :

'The vendee (in that case the auction-purchaser) having undertaken to repay the mortgage debt and having as a consideration for this undertaking obtained the advantage of not having to pay the vendor the fall price of the property, the Legislature has not seen fit to relieve him in respect of this undertaking.'

21. His Lordship Agarwala J. (as he was then) has illustrated the position by way of elucidating the Legislature's intention by a trite instance at page 45, col. 1 of the Report. His Lordship concludes his judgment with the observation :

'If the contention of the appellant in this case were accepted it would amount to the terms of the contract between the parties being altered and the benefit of the alteration would not be going to the person for whose advantage the Legislature enacted it but to the advantage of another, who, In most cases, is merely a speculative purchaser.'

22. Mr. P. V. B. Rao, however, urges that the decision is not an authority for the proposition inasmuch as their Lordships have not considered the meaning of the words 'subject to mortgage' in the light of the decisions cited by him, nor as it does not appear from the report if the subsistence of the mortgage was determined in the execution proceedings by an order either under Order 21, Rule 62 or 66.

23. Mr. Rao first contends on reference to the certificate of sale (Ex. d) that it does not contain any mention of 'subject to mortgage' and, therefore, this is not a sale 'subject to mortgage.' He refers us to a decision of the Pull Bench of the Bombay High Court in the Nagindas Jeychand v. Halalkore Nathwa, 5 Bom. 470(F.B.). Westropp C. J. while considering whether a sale certificate had been adequately stamped ad valorem, observed :

'We are not prepared to hold that the mere mention of a mortgage claimed in the proclamation of sale would warrant a reply in the affirmative to the question of the Subordinate Judge whether a certificate of sale granted to the purchaser of property sold by public auction by our Courts, and which property is proclaimed, under Section 287 (corresponding to Order 21, Rule 66) Civil P. C., to be encumbered with the mortgage right of a third party, should be charged under Article 16 of Schedule 1 (Indian Stamp Act I [1] of 1879), with a stamp duty for a consideration equal to the amount for which the auction purchaser purchases the property only, or for a consideration equal to that amount plus the amount of the mortgage to which the property is liable.'

The facts of the case bear no analogy to the present one. Besides, the basis of this decision was a circular order of the Bombay High Court as will appear from the observation quoted below :

'It would, we think, be a wholly erroneous practice to charge stamp duty on the amounts of claims against the property mentioned only in the proclamation of sale; inasmuch as, by the circular orders of the Court the proclamation of sale must contain an express intimation that the Court does not warrant the title of the judgment-debtor or any other claimant specified in the proclamation to any lot set forth in it or any interest therein or charge or claim thereon.'

The decision cited is not in point. In the case of F. F. Christian v. Prasad Raut, 4 Pat. 760 : (A. I. R. (12) 1925 pat. 615), it was held ' 'there is nothing in the Code of Civil Procedure, 1908, which makes a certificate of sale conclusive as to the property sold......' Where, therefore, the petition of execution, the writ of attachment and the sale proclamation are clear and unambiguous, and discrepancy between the description of the property contained in these documents and that which occurs in the sale certificate can have no effect.'

24. In the instant case, the execution petition, the sale proclamation, the sale warrant and the order of the Court are clear and unambiguous enough to show that what was intended to be sold and was 'in fact' sold was the property 'subject to mortgage' liability of Rs. 15000. Non-mention of 'subject to mortgage' in the sale certificate, in view of the provisions of Order 21, Rule 94 which requires to mention only the properties sold but not details of the rights and incidents therein is of no consequence.

25. Mr. Rao has cited a large number of authorities to establish the distinction between an order under Order 21, Rule 62 and an order directing the particulars to be cited in a sale proclamation under Order 21, Rule 66. His submission 19 that the present order is of the latter kind and has not the consequence of effecting the sale 'subject to mortgage.' The authorities cited by him lend ample support to that contention and in the face of a large number of them it is too late in the day to doubt their correctness. I have considered each one of them and I do not think it worthwhile to deal with it at length. The true question before us is one of construction of the order, in question. In my opinion, the order of the Court purporting, as it does, to adjudicate upon the decree-holder's prayer to sell the property 'subject to mortgage' is of such a character as would compel the judgment-debtors in whose presence the order was passed to bring a suit within the period of limitation as provided in Article 11, Limitation Act, to have it set aside under Order 21, Rule 63 of the Code. Decisions are not unanimous that all orders passed at the stage of settling the terms of proclamation are administrative and not judicial. According to the rule, the sale proclamation is required to contain particulars of two different kinds. Those indicated in Sub-rule 2 (a), (b), (c) and (d) are of one kind and in Rule 2 (e) another. Those required under Rule 2 (e) are for the purpose of intending purchasers' information while the former ones must be those that are required to be stated and from their very nature have to be stated with an amount of accuracy amounting to certainty. 'Any incumbrance to which the property is liable' is what from the very language of the rule would be a certain and definite particular. The only limit that can be put to its finality subject to the result of a suit, is that it does not affect a third party's interest. In that sense, in the facts of the present case, the mortgagee would be entitled to challenge the order so far as and, if at all, it goes against his interest; but neither the decree-holder nor the judgment-debtor and, for the matter of that, the auction-purchaser whose title is relatable to the attachment and sale effected in the execution proceedings. To hold otherwise would amount to suffer a prejudice to the mortgagee. Mr. Rao contends that the order would have had the desired effect had that been passed on a motion of claim or objection by the mortgagee under Order 21, Rule 58. But if the parties to the execution acknowledged and gave effect to the mortgagee's rights, he had no cause of action for such A motion. He has, by the conduct of the parties, been lulled into a sense of security. To a certain extent I am supported by some decided cases in this view of mine. I would in this connection refer to a decision of the Rangoon High Court in the case of Mauny Aung Myint v. Maung Tha Hmat, 9 Rang 367 : (A.I.R. (18) 1931 Rang. 310). It was held there that when the Sub-divisional Judge directed that the existence of a mortgage and of the decree based thereon should be mentioned in the sale proclamation he was in fact passing an order against the decree-holder such as is contemplated in Rule 63. The mortgagee's application that his mortgage should be mentioned in the sale proclamation to the effect that the property was to be sold 'subject to mortgage' was considered to be such a claim as is contemplated under Order 21. Rule 58. Carr J. observed :

'I note that in Mulla's C. P. C. in the notes to Rule 62 under the head 'subject to mortgage,' the learned author says; 'The Code clearly makes a distinction between a case in which the property is expressly gold subject to a mortgage and a case in which notice to mortgage is given in the proclamation or sale. The former ia provided for by the present rule and the latter by Rule 66 below.' With all respect for the learned author I am unable to agree that the Code makes any such distinction. Rule 66 (2c) requires that the proclamation shall specify as fairly and accurately as possible any incumbrance to which the property is liable. I direct special attention to the use of the words 'is liable.' There is nothing whatever in the rule to suggest that the proclamation should specify any incumbrance to which the property is merely alleged to be liable. Having regard to these provisions my view is, as I have already said, that the Court should investigate all claims to the possession of a mortgage or a charge or other encumbrance over the attached property before allowing mention of such encumbrance in the sale proclamation.'

With great respect I and in entire agreement with this view.

26. The decision in the case of Kalidas Chowdhury v. Prasanna Kumar Das, 47 Cal. 446 : (A.I.R. (7) 1920 Cal. 354) affords a sound and compelling guidance in the matter of solution of the problem before us. In short, the facts of that case were that a mortgagee decree holder commenced an execution proceeding. The sale was proclaimed in due course. But the mortgagor judgment-debtor preferred an objection, inter alia, that the property described as the 5th lot in the sale proclamation was under a prior mortgage, but it had not been mentioned. Two of the decree-holders presented a petition praying that the property, in question, might be put to auction upon declaration that it was subject to a mortgage for Rs. 1900 held by .... The Subordinate Judge delivered judgment directing that the property mentioned be sold on declaration that it was subject to the mortgage mentioned, The sale was held on the same day. Under these circumstances the question arose whether it was open to the decree-holders auction purchasers to contend that they have taken the property free of the mortgage. It was held that they were bound by the doctrine of estoppel and could not take up a position inconsistent with what they adopted in the execution Court. It was further held

'it a person purchases an estate subject to a mortgage whether under a voluntary conveyance or under 'sale in invitum' he cannot be held to, deny the validity of the mortgage subject to which he made his purchase.'

27. At p. 457 of the Report, his Lordship Mukherji J. considered the distinction between Rules 62 and 66 of Order 21 of the Code and on construction of the execution proceedings before him held :

'The language used in the petition of the decree-holders and the order of the execution Court may well lend support to the contention that the decree-holders agreed to have the property sold as subject to a genuine mortgage, They had not suggested that the purchaser should buy the property merely with notice of a mortgage claimed, subject to such risk as the notice might involve with liberty to contest the mortgage and to redeem it only if it was established to be really a subsisting mortgage. '

28. The ratio of this decision applies mutatis mutandis to the present cage. The facts are almost identical except that in the present case the decree-holder rather than the judgment-debtor prayed to sell the property subject to mortgage and the judgment-debtor though contesting the proceeding on other grounds did not take up a contrary position or in other words consented' to an order that the sale should be subject to a genuine mortgage for Rs. 15,000 then due. The judgment-debtor, in the present case, was vitally interested in the matter as, but for the mortgage, the sale could have fetched much higher price which should have gone to wipe out the debt or reduce it considerably to the removal of risk of sale of their other properties mortgaged. In the case of Gurdit Singh v. Hakumat Rai, A.I.R. (19) 1932 Lah. 56: (135 I.C. 201), where the mortgage decree-holder had asked the Court to sell the property subject to a charge whereon the Court had passed orders for selling it subject to the incumbrance, it was held by Bhide J. that it wa3 perfectly clear that the judgment-debtor's interest in the property was sold subject to that charge. In the case of Debi Das v. Rupchand, 49 ALL. 903: (A.I.R. (14) 1927 ALL. 693), an application by the holder of a mortgage to the executing Court that his mortgage might be notified in the sale proclamation in respect of a property which was already subject to an attachment was considered to be one which attracted the provisions of Order 21, Rule 63. In this case Asworth J. distinguishes an order under Rule 62 from an order under Rule 66 by saying that the words 'as fairly and accurately as possible' in the latter rule clearly indicate that this entry of an incumbrance in the sale proclamation cannot prejudice the rights of a third person. His Lordship is of opinion that any investigation into the existence of an incumbrance should fall within the purview of Rule 62 and will be final as between the parties subject to the result of a suit without any prejudice to the rights of a third person even though the object of it was to notify the encumbrance. In the case of Vellu Padayachi v. Arumugum Pillai, 38 M.l.j. 397: (A.I.R. (7) 1920 Mad. 191), Spencer J., while construing an order pissed on a petition purporting to be under Order 21, Rule 66 of the Code, said :

'We must look at the substance of the application. It was one to have it recognised by the Court that the property about to be sold was subject to an encumbrance.'

All these precedents do bear me out that mortgagee concerned is not a necessary party to the proceedings under review nor need it be that it should be in terms of one under Order 21, Rules 58.62. It may as well be an order purporting to be one passed while settling the terms of sale proclamation under Order 21, Rule 66. The test is whether the matter has been judicially determined as between the parties then before the Court and like as to any other order of Court, a third party shall stand out of it but not the parties themselves nor anybody deriving interest from them. In consideration of what I have said above and relying upon the decisions cited therein, I am of opinion that properly construed the order of the District Judge though passed on a petition purporting to be under Order 1, Rule 66 and Section 151, Civil P. C., was none the less an expression of a judicial adjudication. It may be, in the context of the circumstances, construed as one under Order 21, Rule 62. As shown above, it is not necessary that the mortgagee himself should come forward to advance a claim under Order 21, Rule 58. The adjudication may be called for either by a claim or by an objection to the attachment. In the present case, it was an objection propounded by the decree-holder and was decided judicially. The order, therefore, cannot be brushed aside as a pure administrative order but ia a judicial order binding upon the parties before the Court and their privies, namely, the decree-holder, the judgment-debtor and the auction-purchaser who purchased a right not higher than that of the judgment-debtor. To quote Mukherji J. of the Calcutta High Court (Debendra Nath v. Abdul Samad, 10 C. L. J. 160 at pp, 164 and 166: (1 I.C. 264).)

'does it then make any difference if the purchaser acquires title not by a private sale but by a sale held in execution of a money decree In our opinion, it does not. That this view is correct cannot of course he disputed where the sale is made expressly subject to the martgage or where only the equity of redemption is seized and the purchaser bids only the value of such equity. But it cannot be limited to this class of cases ; the purchaser at the execution sale is bound by the came rule of estoppel as the judgment-debtor on the principle that the former has purchased merely the right, title and interest of the latter and does not consequently occupy a position of greater advantage .... We must therefore hold upon the decision of the Judicial Committee in Mohammed Mozufer v. Kishori Mohun, 22 Cal. 909 : (22 I. A. 129 P. C.) that the execution purchaser of the interest of the mortgagor is as much bound by the rule of estoppel not to dispute the validity of the mortgage as the mortgagor himself.'

29. Had the order been prejudicial to the mortgagee, who was not- a party to the proceeding giving rise to it, he could dispute it collaterally and not necessarily by a suit. But the judgment-debtor, if he wishes to dispute the order as against the title traceable to the attachment and sale, he must, under the provisions of Order 21, Rule 63 of the Code, have to do it by a suit within the prescribed time limit. In this case the auction purchaser cannot contend against the judgment-debtor who is no other than the mortgagor that it is the mortgagor and not he who is liable to redeem up the mortgage. I have, therefore, no hesitation in holding that the appellant is a purchaser 'subject to mortgage,' Mr. Rao invites us to decide the question by the test whether it was not open as between the mortgagee and the mortgagor-judgment-debtor. I am not prepared to answer this hypothetical question as it does not arise in the case. The question hypothesised may have to be considered on widely different considerations one of which is that the question had never been adjudicated upon between the mortgagee and either the judgment-debtor or the auction purchaser. I shall reserve my opinion on this aspect of the question. We are here limited to the much narrower question as to whether the question is still open or closed as between the judgment-debtor and the auction-purchaser. The applicability of the exception clause of the Orissa Money-lenders Act does not require that the mortgagee should have been party or privy to the purchase subject to mortgage. The status contemplated is one emerging from an established relationship between the mortgagor and the purchaser at a sale either private or in invitum. It is quite indifferent whether the mortgagee is a party or not. The liability of the purchaser owes its existence to the purchase that he makes and the purchase money that he holds in trust for the mortgagee and not to any borrowing from him. The test always is whether the benefit under the Money-lenders Act if conferred upon a purchaser or an auction purchaser, as the case may ; be, would ultimately enure to that of the original debtor, namely, the judgment-debtor.

30. I shall now proceed to consider a few of the decisions. Reliance has been placed upon Daso Polai v. Narayana Patro, A. I. R. (20) 1933 Mad. 879; (57 Mad. 195) in which Madhavan. Nair J. (as he was then) observes :

'The Code makes a clear distinction between a case where the property is sold subject to a mortgage asunder Order 21, Rule 62 and a case in which the notice of an alleged encumbrance is given in the proclamation of sale as under Order 21, Rule 66. In the former ease the Court is satisfied of the existence of the mortgage and sells only the judgment-debtor's equity of redemption and the purchaser has to redeem the mortgage. In the latter case, the purchaser, buys the property with notice of the mortgage subject to such risks as the notice might involve, in other words, the executing Court does not decide whether the mortgage subsists or not and the purchaser is not precluded from questioning the validity of the mortgage.'

31. There is nothing to dispute the correctness of this proposition. The question always depends upon whether the existence of the mortgage and the amount due under it have been judicially determined. The question is always one of construction, whether what was seized by the executing Court-and ultimately sold was only the equity of redemption. The next case referred to is that of Shib Kunwar Singh v. Sheo Prasad Singh, 28 ALL. 418 : (3 A. L. J. 200), This too is of more or less as academic interest in view of the facts of this particular case. The present case is not a case of merely notifying the mortgage but is one of selling only the equity of redemption 'subject to mortgage.' In the same chain of reasoning Mr. Rao has invited our attention to the cases reported in Mohit Narain Jha, v. Thakan Jha, 4 pat. 731 : (A. I R. (12) 1925 Pat. 500' S. B.) and Siragmi Achi v. Subrahmania Ayyar, 27 Mad. 259 : (14 M. L. J. 57 F. B.) for the proposition that orders passed under Order 21, Rule 66 are not final as between the parties being merely interlocutory orders and are not appealable. The reason for such view as given by Dawson Miller C. J. in the case of Sourendranath Mitra v. Mritunjay Banerji, 6 p. L. J 270 : (A. I. R. (7) 1920 Pat. 249), affords the key. According to his Lordship, the position will be different if an order determines, even under Order 21, Rule 66, the rights of the parties with regard to the all or any of the matters in controversy. In this view, the present case is clearly distinguishable from those cited by Mr. Rao. He has also relied on Fakeer Bux v. Chullurdaree, 14 W, R. 209 at p. 210 : (12 Beng. L.R. 513n). This does not go to help him in any extent. Couch C. J. attached importance to what 'in fact' had been sold in that case.

32. By 'in fact' his Lordship meant whether the sale was so subject by the contract of sale and not that there was merely a legal right existing which might be capable of being enforced. If it lays down anything it is that there exists a distinction between the two positions as formulated. We are also of the same opinion. But what is the position here has been decided by us on the basis that there has been a contract of sale by which the appellant is bound.

33. Point 3.--The last contention, as formulated, does not arise for consideration in view of the conclusion already reached. The sale was 'subject to liability of the entire mortgage money that was then due.' There is nothing wrong in law if a subsequent purchaser purchases a part of the mortgage property with an undertaking to redeem the entire mortgage. As a contract it is perfectly valid. Purchase at an auction sale is also a form of contract. The auction purchaser by his bid offers to make the purchase at the price proposed by him subject to the conditions laid down in the sale notice and when the bid is knocked down and the sale is confirmed the offer is accepted. As I have already said there is nothing in the indivisibility of the mortgage which should prevent a mortgagee from realising the entire mortgage money From a part of the mortgage property : vide Shah Ramchand v. Prabhu Dayal, 69 I.A. 98 : (A. I. R. (29) 1942 P. C. 50). If there are other properties sold subject to the same mortgage, the appellant's remedy is by way of contribution. There is nothing in the language of the exception clause, so as to compel the Court to apportion the mortgage liability as between the several purchasers at a sale 'subject to mortgage'. That question, if it arises, shall be governed by the general law which is not, in the least, abrogated or modified by the exception clause. There may be cases where such purchaser has undertaken or is to be deemed to have undertaken to part only of the mortgage money proportionate to the property purchased, such an undertaking is binding on the mortgagee only by consent or under prescribed circumstances but not always. In such a hypothetical case it is only the proportionate amount which is exempted from the category of loan as defined in the Act In such a contingency if the mortgagee wants to enforce the entire debt against a part purchaser of a mortgage property, his claim in excess of the proportionate amount might be subjected to reduction or scaling down under the Act. Such a hypothetical case is not before us nor are we called upon to decide it. This contention therefore fails.

34. Lastly, it is contended that it is a fit case in which the Court should reduce the plaintiff's claim so far as the interest claimed is usurious. It has been found by the trial Court, and not controverted before us, that the plaintiff had originally advanced Rs. 6000 in cash. The rest of the mortgage money, subject to which the property was sold, represented interest thereon. Interests that accrued on the promissory notes were capitalised in the first mortgage bond. Such capitalised amount also bore interest which was included in the sum of Rs. 12,000 adopted as the principal money of the mortgage bond, in suit. Under the circumstances, the plaintiff's claim does include interest upon interest upon principal. In view that the purchase was subject to payment of Rs. 15,000, the Court in exercise of its discretion to relieve the debtor of the mischief of usurious loans cannot go behind it. It would be oppressive, however, to allow interest to run on the principal money of Rs. 12,000 since the date of the auction purchase. That would be allowing interest upon interest. Since that date the interest should run on Rs. 6000 as principal. Subject to this modification the plaintiff's claim will be decreed.

35. In consideration of what I have said above, the appeal is dismissed and the decree of the Court below is upheld subject to such modification as to calculation of interest as is indicated above. In the circumstances of the case, the appellant shall be liable to pay costs of the contesting respondents other than the minors. There shall be one set of hearing fee.

Narasimham, J.

36. I agree with my Lord the Chief Justice.

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