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Veyindramuthu Pillai Vs. Maya Nadan - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported in58Ind.Cas.501; (1920)39MLJ456
AppellantVeyindramuthu Pillai
RespondentMaya Nadan
Cases ReferredChinnu Pillai v. Venkatasami Chettiar I.L.R.
Excerpt:
.....with the reason underlying order 34, rule 1, namely, that a failure to implead places the respective claimants only in status quo..........at a court sale held in execution of a money decree. after this attachment but before the sale a suit was instituted on a mortgage of the properties sold and was pending at the date of the appellant's purchase. later a decree for sale was passed and the respondent bought when the sale took place. on his claiming delivery he found the appellant already in possession and the decisions under appeal depend on the lower court's conclusion that as they were there in virture of a purchase pendente lite the respondent was entitled to oust them, their right, if any, to redeem the mortgage decree and obtain possession being enforceable if at all by means of a separate suit which they were at liberty to bring.3. argument has been based to a great extent on the fact that the attaching.....
Judgment:

Oldfield, J.

1. The opinion of the Full Bench has established that Section 47, C.P.C. is applicable to these proceedings. It is however objected further that they are covered also by Order XXI, Rule 103 and that in accordance with it in the absence of a suit the order of the Lower Court is conclusive. It is to be observed that the reference to ' any party ' in the rule is to any party to the petition, not to the decree under execution. This is clear in view of the form of the provisions in the previous Code and the division of the former Section 335 into two parts, of which the present rule represents the second. The expression ' any party ' being interpreted in the manner suggested, there is no reason for holding as has been held in connection with the similar claim petition procedure that the rule excludes the application of Section 47 to cases, such as the present, between parties or their representatives.

2. To turn next to the merits, the material facts are that the appellant is or represents the purchaser at a Court sale held in execution of a money decree. After this attachment but before the sale a suit was instituted on a mortgage of the properties sold and was pending at the date of the appellant's purchase. Later a decree for sale was passed and the respondent bought when the sale took place. On his claiming delivery he found the appellant already in possession and the decisions under appeal depend on the Lower Court's conclusion that as they were there in virture of a purchase pendente lite the respondent was entitled to oust them, their right, if any, to redeem the mortgage decree and obtain possession being enforceable if at all by means of a separate suit which they were at liberty to bring.

3. Argument has been based to a great extent on the fact that the attaching creditor, with reference to Section 91 of the Transfer of Property Act should have been made a party to the mortgage suit and that as he was not, the appellants purchasing at the sale held under his attachment are in some manner entitled to treat the proceedings in the mortgage suit as not binding on them. But neither Section 91 nor Order 34, Rule 1, which is also relied on confers on an attaching creditor any interest in the equity of redemption in the mortgaged property; they are merely statutory provisions for his right to redeem and to be impleaded in proceedings on the mortgage. Independently of these provisions and as an attaching creditor, he obtained no interest in the property and nothing to which any equity in his favour founded on the infringement of those provisions could be annexed or which could pass from him to the purchaser at the sale held at his instance, or which he could after he had purchased himself (as he has done here) rely on as improving his title. This was the view taken in Shananda Chandra Pal v. Sri Naih Roy Choudry 17 C.W.N. 871 and I concur with the learned Judges responsible for that decision in dissenting from Gulam Hussain v. Dina Nath I.L.R. (1901) All. 467 to this extent and for the reasons they give. Reliance also has been placed on Venkata-seetharamayya v. Venkaramayya I.L.R. (1912) Mad. 418 in which Ghulam Hussain v. Dina Nath I.L.R. (1901) All. 467 was followed, and on the references in it to the interest of the attaching creditor. But whilst it may be doubted whether those references were an accurate description of the attaching creditor's position, it is material that the question before the Court was whether he was entitled to bring the property to sale, not whether the purchaser at such a sale was entitled to retain possession.

4. The right of the attaching creditor to bring the property to sale, notwithstanding the pendency of mortgage proceedings may in fact be conceded without effect on the argument, on which the decision under appeal is founded. That argument is based on Section 52 of the Transfer of Property Act ; and what it does affect is not the attaching creditors's right to a sale but the extent of the interest which such a sale would pass. For Section 52 does not invalidate a sale held pendente lite but only subjects the property in the purchaser's hands to the decree in which the pending litigation may end as though no transfer has taken place. That is it makes it liable for the mortgage amount and imposes on the purchaser the same obligation to pay that amount in order to protect it, as would have been imposed by the decree if no transfer had taken place. In the present case the mortgagor has made no such payment but has allowed the property to be sold and, as he would not have been entitled to retain possession against the mortgage-decree purchaser, the appellant cannot do so either.

5. This entails acceptance of the Lower Court's conclusion, and in accepting it I endorse its refusal to express an opinion as to the appellant's right to redeem by taking separate proceedings. This result entails dismissal of all the appeals. The appellant will pay the respondent's costs in each.

6. The connected Civil Revision Petitions are dismissed but without costs.

Seshagiri Aiyar, J.

7. I agree. Notwithstanding the conclusion of the Full Bench that the question should be dealt with under Section 47 of the Civil Procedure Code, Mr. Srinivasa-gopala Chariar contended that no appeal lay because of Order XXI, Rule 103. There has been a change in the language between the old and the new Codes in this matter and a first reading of Rule 108 suggests that unless the resistance is by the judgment-debtor, the only remedy of the resisting party is by way of suit. But this Court has always held with reference to the provisions relating to claims that if the claimant comes under Section 47 the fact that a remedy by suit is given to him qua his rights as a claimant would not take away his right under Section 47. The definition section includes in the definition of decree ' the determination of any question within Section 47.' Therefore in my opinion an appeal lies. I respectfully dissent from Zipru v. Hari Snpdushet I.L.R. (1917) Bom. 10.

8. The main question is whether an auction purchaser under a money decree who has obtained possession can compel a mortgagee or a purchaser under the mortgage decree to leave his possession undisturbed provided he is willing to redeem the mortgage. The only decision in which there are observations in point on this subject is Ghulam Hussain v. Dina Nath I.L.R. (1901) All. 467. That has been dissented from in Shananda Chandra Palv. Sri Nath Roy Choudry 17 C.W.N. 871. In these circumstances it is desirable to examine the basis of the contention put forward on behalf of the auction purchaser. Under Section 91 of the Transfer of Property Act an attaching decree holder has got the right to bring a suit to redeem the mortgage. Does this give him an interest in the property The question is now settled that an attachment confers no interest in the property attached. Reading Section 91 Clause (f) with this well recognised rule the proper construction to be put on the section is that by virtue of his right to bring the equity of redemption to sale he is given the privilege of instituting a suit for redemption and no more. I do not think that any interest in property as in the case of a puisne mortgagee can be ascribed to the attaching decree-holder. Mr. Venkatarama Sastriar referred to the language of Order 34, Rule (1) and asked us to hold that Section 91 Clause (f) of the Transfer of Property Act was intended by the legislature to give an interest in the property to the attaching creditor. Rule 1 of Order 34 refers to the substantive right mentioned in Section 91 of the Transfer of Property Act and cannot and does not enlarge that right. In my opinion, the right which the attaching creditor possesses of suing to redeem is not an interest in property. The learned Vakil for the appellant contended that this conclusion would mililate against Venkata Seetharamayya v. Venkataramayya I.L.R. (1912) Mad. 418. As I understand that judgment what the learned Judges had to decide was whether a mortgagee purchaser who failed to implead an attaching creditor can sue for a declaration that the latter is not entitled to pursue his further remedies under the attachment. They held that as he was a necessary party and was not made a defendant his rights were not affected. What those rights may result in need not be considered now and was not considered then. The decision rests upon the broad proposition recognised by Section 85 of the Transfer of Property Act re-enacted in Order 34, Rule (1) that a person who ought to have been is not affected by any decree that may be passed behind his back. He can regard the result of the suit as infructuous so far as his rights are concerned and proceed to enforce them, notwithstanding the decree in the suit. The principle is that a person who ought to have been brought before the Court and was not, should be placed in status quo ante. That I understand, is the principle which underlies Mulla Vittil Seethi v. Achuthan Nair (1919) 21 M.L.J. 213. That was a case of a puisne mortgagee in possession ; it was held that the sale obtained in a suit brought by the first mortgagee without impleading the puisne mortgage did not affect the latter's possession. The decision in Lakhpst Rai v. Fakahruddin I.L.R. (1917) All. 536 may also be cited as showing that a money decree purchaser cannot claim to retain possession merely because he purchased the property first.

9. The learned Vakil contended that the true principle applicable to such cases is to be held that the first purchaser is entitled to retain possession against subsequent purchasers. This principle is no doubt well established as regards competing purchasers under money decrees. It has also been accepted as regards contending mortgage decree purchasers. Is the extension of this doctrine justifiable when the competition is between a purchaser under the money decree and a purchaser under a mortgage decree ?. Having regard to the fact that no interest is transmitted by the money decree-holder to his auction purchaser, I do not think such an extension is warranted. Let us see what the result of upholding such a contention would be. The attaching decree-holder who had the right to sue to redeem would have his rights enlarged on account of the failure to include him as a party defendant. On what principle is this addition to his rights to be justified Mr. Venkata-rama Sastriar suggested that as, if the money decree-holder had put up the equity of redemption to sale, the purchaser standing in the shoes of the mortgagor can compel the mortgagee to grant him time to redeem, the fact that he purchased during the pendency of the mortgage suit should not affect this right. This argument necessitates the examination of the theory that the attaching creditor is noc affected by Us pendens. It was contended on the authority of Krishna v. Mallayya I.L.R. 41 Mad. 458 that a person who ought to have been impleaded is not affected by the doctrine of Us pendens. That was a case of the application of the doctrine to co-defendants. The learned Chief Justice applied the analogy of res judicata to that case. I do not think it was intended to lay down that all the rights and infirmities applying to res judicata were attracted by lis pendens. No doubt Section 52 of the T.P. Act is hot in terms applicable to Court sales, the reason being that where a competent Court having jurisdiction to do so sells property that sale is not vitiated by the fact that another court had the seizin of a suit relating to the same property. But the principle underlying the section is applicable to a person who with knowledge that a suit is pending relating to the property deliberately ignores such a suit and purchases the property. True knowledge is not a factor which affects the applicability of lis pendens. But in estimating the value of the rights acquired by such a purchaser is it inequitable to say 'you knew that a suit was pending and if you purchased with knowledge of such a pending litigation, you cannot claim to supersede the rights of the mortgagee in that suit.' I am inclined to the view that the principle of first purchase is not applicable under these circumstances ; and where it conflicts with the reason underlying Order 34, Rule 1, namely, that a failure to implead places the respective claimants only in status quo ante. I am prepared to give precedence to the latter right. The decision in Chinnu Pillai v. Venkatasami Chettiar I.L.R. (1916) Mad. 77 turned upon the interest in property possessed by a puisne mortgagee and therefore is not inconsistent with the view I have taken.

10. For these reasons, I agree with the conclusions of ray learned brother that the Civil Miscellaneous Appeals should be dismissed with costs and also with the order as to the Civil Revision Petitions.


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