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Ramnath and anr. Vs. Karnidan and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtRajasthan High Court
Decided On
Case NumberCivil Regular Second Appeal No. 231 of 1962
Judge
Reported inAIR1963Raj116
ActsCode of Civil Procedure (CPC) , 1908 - Order 2, Rule 2; Transfer of Property Act, 1882 - Sections 59
AppellantRamnath and anr.
RespondentKarnidan and anr.
Advocates: Sumerchand, Adv.
DispositionAppeal dismissed
Cases Referred and Puran Chand v. Har Parshad
Excerpt:
.....the interest due as a personal claim and it had been decreed on the same footing as well, and the present suit has been brought on the footing of the mortgage security and for the sale thereof. but although their lordships are anxious that claims for a just debt should not be defeated by the intricacies of legal procedure, yet they are unable to hold that the plaint that was originally issued by the appellant can properly bear that interpretation. it clearly seems to me that the present case docs fall within the principle of that type of case in which their lordships were disposed to hold that a second suit would lie. in coming to this conclusion, reliance was placed on the decision of their lordships of the privy council in mohammed hafiz's case (supra). this case is, also clearly..........do in this country for an independent obligation to pay the principal and the interest, in a suit brought to obtain a personal judgment in respect of: the interest alone, the rule would have prevented a subsequent claim for payment of the principal. in such a case, the cause of action would have been distinct.......if, therefore, the plaint originally brought came to be properly interpreted as claiming only a personal relief in respect of the unpaid interest, the appellant's case would be on surer ground; but although their lordships are anxious that claims for a just debt should not be defeated by the intricacies of legal procedure, yet they are unable to hold that the plaint that was originally issued by the appellant can properly bear that interpretation. the claim, is for a.....
Judgment:

I.N. Modi, J.

1. This is a civil regular second appeal by the defendants against the judgment and decree of the District Judge, Bikaner, dated the 27th January, 1962, affirming the judgment and decree of the Civil Judge Bikaner dated the 7th November, 1960, in a suit for recovery of mortgage money by sale of the property under mortgage. The appeal raises an interesting question as to the applicability of Order 2, Rule 2, C. P. C.

2. The material facts are these. On the 5th December, 1949, Mst. Lali, widow of Rambus together with her son Ramnath, made a mortgage for a sum of Rs. 4000/- in favour of one Sobanlal Vyas with respect to the suit house. The plaintiffs are the legal representatives of the deceased Sohanlal. The defendant Mst. Tulcha is the daughter-in-law of Mst. Lali, wife of the said Ramnath, in whose favour Mst. Lali had made a will with respect to the house in question. The mortgage-deed is Ex. 1. On the 19th May, 1953, the mortgagees instituted a suit for the recovery of Rs. 797/- as interest on the mortgage money. In this suit, they prayed only for a personal decree against the defendants. This suit was admittedly decreed as prayed. Thereafter on the 8th October, 1959, the plaintiffs mortgagees brought the present suit for recovery of the principal sum of Rs. 4000/- relinquishing altogether their claim for interest on the ground that the mortgaged property was not likely to be sold for more than the principal money. The defendants Ramnath and his wife Mst. Tulcha filed separate written statements and raised a number of pleas; but it is unnecessary to mention any of them save that which mainly arises for determination in this appeal. That plea is that the plaintiffs' present suit was barred by virtue of Order 2, Rule 2, C. P. C. In view of the fact that they had brought an earlier suit in connection with the mortgage for recovery of interest only in 1953. This plea was rejected by both Courts below and the plaintiffs' suit was decreed. The defendants have now come up in second appeal to this Court

3. The main question raised by learned counsel for the defendants, therefore, is that the view taken by the Courts below that the present suit was not barred by Order 2, Rule 2, C. P. C. in the circumstances of the case is incorrect. The contention of learned counsel is that the plaintiffs could not have split up their claim against the defendants mortgagors in view of the provisions of Order 2, Rule 2 inasmuch as the cause of action in the case of both the suits was the same, to wit, the mortgage and that where a cause of action enabled a man to seek for larger and wider relief than that to which he limits his claim, he cannot afterwards seek to recover the balance by independent proceedings.

4. Now, in order to dispose of the above question properly, it is necessary to look at the terms of the mortgage-deed Ex. 1. Apart from mentioning that Mst. Lali and her son Ramnath had borrowed a sum of Rs. 4000/- from Sohanlal on the security of the suit house and that they had agreed to pay interest at the rate of one per cent, per mensem, what the deed said was that the mortgagors would pay Rs. 40/- as interest month by month and that should they fail to pay, interest for six months at any time, such interest would be treated as principal and they would be liable to pay interest on such amount at the stipulated rate. What then follows is highly important for the purposes of the controversy raised between the parties and it is this.

'Should the mortgagors tail to pay the entire money due on demand, the mortgagees would be at liberty to file a suit for the recovery thereof both by sale of the mortgaged property as well as by a personal decree against the mortgagors. Besides this, the mortgagees would have the right to file a separate suit for the amount of the interest which may fall in arrear and the decree so obtained would be executable against the person of the mortgagors and their other property.'

It is thus crystal clear from a perusal of the mortgaged deed that the defendants had undertaken an independent obligation to pay such interest as may fall in arrears separately, and it was in pursuance, of this undertaking that the mortgagees had brought their earlier suit for interest only and that is the situation in which the question of the maintainability of the present suit or otherwise with reference to the provisions of Order 2, Rule 2, C. P. C. falls to be decided.

5. The first case to which reference may be made in this connection and it is on this that learned counsel for the defendants appellants mainly relies is reported as Md. Hafiz v. Mirza Md. Zakariya, AIR 1922 PC 23. By a mortgage-deed dated the 24th September, 1910, which was executed between the parties in that case, it was provided that the amount secured by the deed would be paid at the end of three years and that in the meantime interest would be paid month by month, and that if the interest was not paid for six months, the creditor would be competent to realise only the unpaid amount of interest due to him or the amount of principal and interest both before the period of three years. This time limit expired and on the 16th April, 1914, the plaintiff mortgagee instituted a suit for the recovery of the interest which had fallen in arrears and no more and a decree was granted for the recovery of that amount by sale of the mortgaged property and the sale money was paid into Court. Thereafter the representatives of the mortgagee, who had died in the meantime, brought a second suit on the 23rd January, 1915, for the recovery of the mortgage money by realisation of the security. To this suit, an objection was taken that it was not competent by reason of Order 2, Rule 2, C. P. C. The suit was decreed by the trial Court but on appeal dismissed by the High Court. Thereafter, an appeal was taken to the Privy Council. This appeal was dismissed and it was pointed out by then Lordships that the only relief that could be sought in both cases was realisation of the mortgage security as the mortgage contained no express covenant for the payment of the principal and the interest. This case, to my mind, is clearly distinguishable from the facts of the present case; for here there is a personal covenant to pay interest apart from the payment of the principal; nay, the mortgage specifically refers to an undertaking by the mortgagors that, should the amount of the interest payable by them fall in arrear, it would be perfectly Open to the mortgagees to file a suit independently of the recovery of the mortgage money for the recovery of the interest only, and the mortgagors shall have no objection to that. It also deserves to be noted that it cannot be properly postulated of the present case that the mortgagees sought for whatever relief they could in both the suits by realisation of the mortgage security, inasmuch as the first suit had been brought for the recovery of the interest due as a personal claim and it had been decreed on the same footing as well, and the present suit has been brought on the footing of the mortgage security and for the sale thereof.

6. This brings us to another case which also went before the Privy Council, and is reported at p. 412 in the same volume as Kishan Narain v. Pala Mal, AIR 1922 PC 412. It is true that their Lordships came to the conclusion that this case also was indistinguishable from the case of Mohammed Hafiz (supra), AIR 1922 PC 23 and therefore fell within its principle; but their Lordships took note of another type of case and dealing with Order 2, Rule 2 in connection therewith observed as follows:

'It does not appear to their Lordships that if the mortgage had provided, as mortgages always do In this country for an independent obligation to pay the principal and the interest, in a suit brought to obtain a personal judgment in respect of: the interest alone, the rule would have prevented a subsequent claim for payment of the principal. In such a case, the cause of action would have been distinct.......If, therefore, the plaint originally brought came to be properly interpreted as claiming only a personal relief in respect of the unpaid interest, the appellant's case would be on surer ground; but although their Lordships are anxious that claims for a just debt should not be defeated by the intricacies of legal procedure, yet they are unable to hold that the plaint that was originally issued by the appellant can properly bear that interpretation. The claim, is for a decree for the interest 'recoverable from the mortgaged property' and the other property and persons of the defendants.'

That being the real nature of the first suit, their Lordships concluded that there was no alternative but to hold that the bar of Order 2, Rule 2 did come in the way of the plaintiff in that case. It clearly seems to me that the present case docs fall within the principle of that type of case in which their Lordships were disposed to hold that a second suit would lie. As I have adverted to above, there was an independent obligation to pay interest in the present case and it was in pursuance of that undertaking that the first suit had been brought by the mortgagees and they had prayed for a personal decree in respect of their claim relating to interest in that suit. And that being so, it can be said legitimately of such a case that the cause of action on which the first suit was brought was quite distinct from that on which the second suit later came to be brought.

7. Learned counsel for the appellants nest invited my attention to Chunnilal v. Amir Ahmedi Bee, AIR 1958 Andh Pra 608. It was held in this case that the previous suit having been filed by the plaintiff for recovery of the interest amount and as the principal had also become due at that time and the plaintiff had not included the principal in the previous suit, the subsequent suit for the recovery of the principal amount was barred by Order 2, Rule 2, C. P. C. In coming to this conclusion, reliance was placed on the decision of their Lordships of the Privy Council in Mohammed Hafiz's case (supra). This case is, also clearly distinguishable from the case before me inasmuch as the relief claimed there in both suits was against the mortgaged property. A second suit was, therefore, clearly not competent on the principle laid down by their Lordships in Mohammed Hafiz's case,. (supra).

8. As instances of a few other cases which fall in the same category as the present case, reference may be made to Sawmy Rao v. Official Assignee of Madras, AIR 1925 Mad 1120, Lalta Prasad v. Puran Lal, AIR 1930 All 286 and Puran Chand v. Har Parshad, AIR 1915 Lah 672 (FB).

9. The principle which can thus be deduced from a review of the case-law bearing on the subject may be summarised somewhat as follows:

10. Order 2, Rule 2, C. P. C. requires that a plaintiff shall include in his suit the entirety of the claim based on a particular, cause of action, and if he does not do so, the penalty is that he is debarred from bringing a second suit for the portion so omitted or relinquished in the first suit. It has, therefore, been laid down that where there is a single obligation to pay interest and principal under a mortgage, and the principal has fallen j due or even where there is a separate undertaking; for the payment of the interest only and the mortgagee files a suit for merely interest and wishes to realise it by sale of the mortgage security, then he cannot thereafter bring a second suit for the recovery of the principal by sale of the mortgaged property, as such a splitting of the remedies on the same cause of action Is not permissible. But where, the mortgagor has entered into an independent personal covenant to pay interest and the mortgagee brings a suit against him for the recovery of interest only, and prays for and obtains a personal decree in that connection, as contra-distinguished from a decree against the hypothecation itself, then a second suit for the realisation of the principal money together with interest as may still be in arrears, will not be barred inasmuch as the two suits are based on two distinct causes of action and Order 2, Rule 2 is not attracted into application in such a case. With these principles, if I may say so, with respect, I am in entire agreement.

11. Viewed by this test, I have no hesitation in coming to the conclusion that the Courts below were perfectly right in holding that the plaintiffs' suit was well founded. There was an independent or distinct obligation on the part of the defendants in the present case to pay interest even if the principal had not fallen due, and it was distinctly provided in the mortgage deed itself that it would be open to the mortgagees to bring a separate suit for the recovery of the interest which may be in arrears. The first suit for interest which was brought by the plaintiffs prayed for a personal decree only and had nothing to do with the mortgage security as such. The present suit which is brought only for the recovery of the principal amount incidentally without interest seeks the recovery of the mortgage money by sale of the mortgage security. This suit, therefore, is clearly saved from the impact of Order 2, Rule 2, C. P. C. and is perfectly maintainable.

12. The only other point which learned counsel sought to raise in this appeal was that the mortgage-deed was not proved to have been properly attested and was therefore invalid in accordance with Section 59 of the Transfer of Property Act. The short answer to this contention, however, is that we are concerned here with a mortgage which was made on the 5th December, 1949, with respect to a property and between parties belonging to the covenanting State of Bikaner, and that the Transfer of Property Act had not been brought into force in that State until it was integrated with the United State of Rajasthan. It is well to remember in this connection that by virtue of Section 3 of the Rajasthan Administration Ordinance, 1949 (No. 1 of 1949) which came into force on the 7th April, 1949, all the laws in force immediately before the commencement of this Ordinance in any of the Covenanting States which united to form the then State of Rajasthan, were to continue in force in that area until they were altered, repealed or amended by a competent Legislature or other competent authority. The position, there-Core, is that the Transfer of Property Act was not in force in that area at all until it was brought into force by the Rajasthan Adaptation of Central Laws Ordinance (No. IV) of 1950 on the 24th January, 1950.

13. There are two principles which are well established and which may be stated thus. The first is that the Transfer of Property Act as such cannot apply to pre-Act transactions. The second is that the rule laid down in Section 59 of the Transfer of Property Act regarding attestation is in the nature of a technical provision and can by no means be construed as a matter of principle. For if it were a matter of the latter kind, it might have still been attracted into application on a series of decisions given by the highest Courts in the Covenanting States that even though the Transfer of Property Act may not be in force, its principles should govern the transactions falling thereunder. The correct view however being that the rule laid down by Section 59 of the Transfer of Property Act that a mortgage in order to be a valid one must, among other things, be attested by at least two witnesses, is in the nature of a technical provision and is not a matter of principle, the contention raised by learned counsel is devoid of all force.

14. For the rest, it is sufficient to point out that there is a concurrent finding of the two Courts below that the deed was proved to have been executed by Mst. Lali and Ramnath and that is a finding of fact which is fully binding on this Court in second appeal.

15. The result is that there is no force in this appeal and I hereby dismiss it but there will be no order as to costs as the plaintiffs respondents have not put in appearance in this Court.


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