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Lala Ram Chandra Singh and anr. Vs. Smt. Sasibala Devi and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtOrissa High Court
Decided On
Case NumberMisc. Appeal No. 120 of 1962
Judge
Reported inAIR1964Ori228; 30(1964)CLT329
ActsCode of Civil Procedure (CPC) , 1908 - Order 34, Rule 1; Banking Companies Act, 1949 - Sections 45 and 45B
AppellantLala Ram Chandra Singh and anr.
RespondentSmt. Sasibala Devi and ors.
Appellant AdvocateB.K. Pal, ;D.P. Mohapatra and ;G.B. Patnaik, Advs.
Respondent AdvocateU.N. Rath, Adv. (for No. 3) and ;A.K. Tripathy, Adv (for No. 4)
DispositionAppeal allowed
Excerpt:
.....or in the equity of redemption that nave necessarily to be made parties to a suit under order 34, rule 1. an attaching decree-holder in execution of a money decree is not a necessary party to a suit by the mortgagee for the recovery of the mortgage money......no jurisdiction to entertain the suit because one of the defendants in the suit is a liquidator of puri bank.2. the matter arises thus -- on march 1, 1949 defendants 1 and 2 executed a mortgage bond in favour of the plaintiffs' father for rs. 300/-. puri bank had obtained a money decree against the mortgagors (defendants 1 and 2). in execution of the said money decree the mortgaged properties were put to sale at the instance of puri bank in execution case no. 14 of 1951. on april 16, 1960 defendant no. 4 purchased the property in execution sale. on february 27, 1962 a mortgage suit was filed by the plaintiffs-mortgagees against the legal representatives of the mortgagors, purchaser in execution sale defendant no. 4 and attaching creditor puri bank defendant no. 3. in the mortgage suit.....
Judgment:

S. Barman, J.

1. Plaintiffs are appellants from an order of the learned Subordinate Judge, Bhubaneswar, whereby the plaint was directed to be returned to the plaintiffs for prosecution in proper Court on the ground that the Subordinate Judge has no jurisdiction to entertain the suit because one of the defendants in the suit is a Liquidator of Puri Bank.

2. The matter arises thus -- On March 1, 1949 defendants 1 and 2 executed a mortgage bond in favour of the plaintiffs' father for Rs. 300/-. Puri Bank had obTained a money decree against the mortgagors (defendants 1 and 2). In execution of the said money decree the mortgaged properties were put to sale at the instance of Puri Bank in Execution Case No. 14 of 1951. On April 16, 1960 defendant No. 4 purchased the property in execution sale. On February 27, 1962 a mortgage suit was filed by the plaintiffs-mortgagees against the legal representatives of the mortgagors, purchaser in execution sale defendant No. 4 and attaching creditor Puri Bank defendant No. 3. In the mortgage suit Puri Bank took the defence that it is not a necessary party in the mortgage suit. The learned Subordinate Judge decided that the Subordinate Judge has no jurisdiction to entertain the suit and the plaint was returned to the plaintiffs for presentation in proper Court. The legal position on which the question of jurisdiction was decided as aforesaid is that under the Banking Companies Act, the High Court alone has exclusive jurisdiction in all matters in which a claim is made by or against Banking Company which is being wound up. It is not disputed that Puri Bank is now under Liquidation. The learned trial Court however did not decide the issue as to whether Puri Bank defendant No. 3 is a necessary party to the suit.

3. The plaintiff's contention in this appeal is that Puri Bank is not a necessary party as no relief can be claimed against Puri Bank who accordingly should be expunged from the suit. The plaintiffs' point is that if defendant Puri Bank is expunged then the Subordinate Judge will have jurisdiction to entertain the suit. The plaintiffs also filed an application under Order 1, Rule 10 Civil Procedure Code for expunging the name of defendant No. 3 Puri Bank from the suit and for remand of the suit to the Subordinate Judge for decision according to law.

4. As regards parties in a mortgage suit, before amendment of Section 91 of the Transfer of Property Act the judgment-creditor of the mortgagor, when he has obtained execution by attachment of the mortgagor's interest in the property is one of the persons who might redeem or institute a suit for possession of the mortgaged property. After the amendment attaching creditor is not a necessary party to a mortgage suit. The well-settled position is that the cases contemplated by Section 91 (a) and (b) exhaust the class of cases contemplated by Order 34, Rule 1, Civil Procedure Code and it is only persons interested in the mortgage security or in the equity of redemption that nave necessarily to be made parties to a suit under Order 34, Rule 1. An attaching decree-holder in execution of a money decree is not a necessary party to a suit by the mortgagee for the recovery of the mortgage money.

5. That apart, here there is no relief claimed against Puri Bank in the mortgage suit. In order that the High Court may have jurisdiction to entertain an application under Section 45B, there should either be a claim by or against the Banking Company or a question should arise which should relate to or arise in the course of the winding up. Only those matters that will facilitate the winding up of the Banking Company, namely, realisation of its assets and distribution of the same amongst the various people entitled to them that could properly Be the subject-matter of an inquiry under Section 45-B.

6. In this view of the position I am of opinion that Puri Bank against whom: no relief is claimed is not a necessary party in the mortgage suit.

7. The plaintiffs-appellants are, accordingly, permitted to correct the cause title of the plaint by expunging the name of the defendant No. 3 Puri Bank Limited from the suit on the ground that the said Puri Bank Ltd. is not a necessary party to the suit, in view of the decision that Puri Bank Limited is to be expunged from the suit, the question of jurisdiction will not arise. It is open to the learned Subordinate Judge to entertain the suit. The order of the learned Subordinate Judge returning the plaint to the plaintiffs is set aside. This suit is directed to be sent back, on remand, to the learned Subordinate Judge, Bhubaneswar, for decision and disposal according to law. This appeal is allowed.

As regards costs of this appeal, in the circumstancesof the case, each party will bear his own costs.


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