Skip to content


Bhatt Nanalal Bhogilal Vs. Chandulal Bhailal Patel - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtGujarat High Court
Decided On
Judge
Reported in(1962)3GLR1002
AppellantBhatt Nanalal Bhogilal
RespondentChandulal Bhailal Patel
Cases ReferredNanubhai Mahijibhai v. Trikamlal
Excerpt:
- - the money lender cannot be under a double obligation both to the original debtor as well as to the purchaser of the equity of redemption......and for declaring the amount due to the money lender. it is contended that the debtor is the original mortgagor and that the original mortgagor continues to be a debtor even after the property mortgaged has been purchased at an auction in execution by another person who purchased the equity of redemption at a court auction sale. on the other hand it is contended for the opponent that the word debtor is not defined in the money lenders act and therefore it must be in a general sense as a person who is the indebted to another person. on behalf of the opponent it is contended that the decision in nanubhai mahijibhai v. trikamlal 60 bombay law reporter 1092 was under the b.a.d.r. act and that it has no application to the facts of the instant case. it is also contended that the.....
Judgment:

V.B. Raju, J.

1. This civil revision application is by a mortgagee challenging the order passed by the 6th Joint Civil Judge Junior Division Ahmedabad ordering him to submit accounts of the mortgage debt to the opponent who had purchased the equity of redemption of the mortgage at a Court sale in Darkhast No. 131/53. The opponent had given an application under Section 30(1) of the Bombay Money Lenders Act for account of the mortgage debt. This application was resisted but was allowed by the Court below on the ground that the purchaser of the equity of redemption has a right to ask for accounts from the mortgagee.

Under Section 30(1) of the Bombay Money-Lenders Act any debtor may make an application at any time to the Court whether the loan has or has not become payable for taking accounts and for declaring the amount due to the money lender. It is contended that the debtor is the original mortgagor and that the original mortgagor continues to be a debtor even after the property mortgaged has been purchased at an auction in execution by another person who purchased the equity of redemption at a Court auction sale. On the other hand it is contended for the opponent that the word debtor is not defined in the Money Lenders Act and therefore it must be in a general sense as a person who is the indebted to another person. On behalf of the opponent it is contended that the decision in Nanubhai Mahijibhai v. Trikamlal 60 Bombay Law Reporter 1092 was under the B.A.D.R. Act and that it has no application to the facts of the instant case. It is also contended that the purchaser at the Court auction sale had purchased the right title and interest of the original mortgagor in the property mortgaged and that therefore it must be deemed that the personal liability to pay the debt was also transferred from the original mortgagor to the purchaser of the equity of redemption.

No doubt the word 'debtor is not defined in the Bombay Money Lenders Act but the word 'loan is defined in Section 2(9) of the Act. Section 2 of the Act reads thus:

Principal means in relation to a loan the amount actually advanced to the debtor.

2. For the purposes of the Money-lenders Act a debtor must mean a person to whom a loan is advanced. In the case of a mortgage transaction the loan is made to the original mortgagor and the loan cannot be said to have been made to the purchaser of the equity of redemption. If there was a personal liability on the original mortgagor that liability does not cease merely because the mortgaged property has been sold in a Court auction. The personal liability if any under the original mortgage contract continues even after the sale. Under Section 68 of the Transfer of Property Act a mortgagee has a right to sue for the mortgage money where the mortgagor binds himself to repay the same. Where the original mortgagor binds himself to repay the mortgage money with a personal liability that liability cannot be said to have been transferred to the purchaser of the equity of redemption merely because the purchaser has purchased the right title and interest in the property. The right title and interest in the mortgaged property would not include the personal liability if any of the original mortgagor to pay the mortgage money. It is true that the decision in 60 Bom. L.R. 1092 referred to above is under the B.A.D.R. Act but the principle laid down therein is that a mortgage debt does not become the debt of the purchaser of the equity of redemption. It is a general principle applicable even to the facts of this case although the facts are distinguishable from the facts of the case in 60 Bom. L.R. 1092.

3. Under Section 59A of the Transfer of Property Act unless otherwise expressly provided reference in Chapter IV of that Act to mortgagors and mortgagees shall be deemed to include references to persons deriving title from them respectively. But even if this section applies it cannot be held that the personal liability if any to pay the mortgage debt is on the purchaser of the equity of redemption. Under the Bombay Money-lenders Act if there was a loan or a debt accounts have to be submitted. If there was a debt the money-lender was bound to submit a statement of accounts to the original debtor once a year under Section 19 of the Bombay Money-lenders Act. The money lender cannot be under a double obligation both to the original debtor as well as to the purchaser of the equity of redemption.

If the original Mortgagor was a trader and if the equity of redemption of the mortgaged property is purchased by an agriculturist or a non-trader it cannot be said that the provisions of the Bombay Money-lenders Act become applicable by reason of the purchase although they were not applicable to the original loan or debt.

4. For these reasons there is no doubt that the lower Court erred in ordering that the applicant should submit accounts of the mortgage money to the opponent. This revision application is therefore allowed and the order of the lower Court is set aside. The opponent to pay half the cost to the applicant.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //