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Subramanian Chettiar Vs. A.K.A. Ramachandra Reddiar - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported inAIR1947Mad255
AppellantSubramanian Chettiar
RespondentA.K.A. Ramachandra Reddiar
Cases Referred and Satyanarayanamurthi v. Sathiraju
Excerpt:
.....to make good to his vendee any loss which the latter might sustain by reason of the decree-holder enforcing his claim against the 13th defendant. the 9th defendant therefore prayed that the entire decree should be entered as satisfied by the payment into court of the decree amount as scaled down. sathiraju air1942mad525 ,namely, that when an agriculturist-mortgagor obtains the benefit of the act and pays the amount of the debt as scaled down, the entire mortgage debt is discharged against all persons interested in the security even though such persons may not be agriculturists entitled to claim relief in their own right under the act, was of opinion that the terms of the preliminary and final decrees as amended as well as the order of this court rejecting the c. 4851 of 1942 precluded..........it cannot have the effect of depriving the appellant of the benefit of the reduction of the decree debt effected at the instance of the mortgagors if the appellant is otherwise entitled under the law to such benefit, for all that this court refused to allow was the prayer of the appellant to have the decree in appeal no. 24 of 1938, expressly amended so as to give effect to the principle of the decisions referred to above even as regards his own liability under the decree. from the rejection of that prayer as having come too late, it cannot follow that the appellant cannot claim the benefit of the scaling down in other appropriate proceedings if he is entitled to such benefit under the law.4. turning now to the language of the decrees, clause 2 (i) of the preliminary decree as originally.....
Judgment:

Patanjali Sastri, J.

1. These two connected appeals arise out of an order refusing to enter up satisfaction of a mortgage decree passed against the appellants and other defendants. The mortgage was granted on the 13th September, 1925. Defendants 1 to 4 were the mortgagors and 5 to 12 were subsequent purchasers of portions of the hypotheca. The 13th defendant is a purchaser of three items out of those purchased by the 9th defendant and he has sold one of these three items to the 14th defendant.

2. The suit (O.S. No. 20 of 1936) was brought to enforce the mortgage against all these defendants and a preliminary decree for Rs. 1,13,836-4-10 was passed on the 13th September, 1937. The Madras Agriculturists' Relief Act, 1938, having been passed in March, 1938, the mortgagors applied under Section 19 to the Court which passed the decree for scaling down the debt in accordance with the provisions of the Act claiming to be agriculturists. Defendants 9 to 12 as well as defendants 5 to 8 also applied by separate petitions for similar relief. The applications of the mortgagors and of the defendants 9 to 12 were allowed and the amount was scaled' down to Rs. 36,000. The application of defendants 5 to 8 was rejected on the ground that they were not agriculturists within the meaning of the Act. They appealed to this Court in A.S. No. 295 of 1939 which was heard with A.S. Nos. 23 and 24 of 1938 preferred against the preliminary decree on questions determined in the suit. These two appeals were dismissed and the preliminary decree was confirmed on 3rd February, 1942. A.S. No. 295 of 1939 was allowed, the Court holding on the strength of a series of decisions, that the mortgagors being agriculturists even though the purchasers of portions of the hypotheca were non-agriculturists, the statutory reduction of the debt under the Act at the instance of the mortgagors enured to the benefit of such purchasers, not by virtue of any provisions of the Act, but under the general law. Vide Machiappa Chettiar v. Ramachandra Reddiar : AIR1942Mad527 . The liability of defendants 5to 8 also was thus reduced to the scaled down amount, namely, Rs. 36,000 and the preliminary decree was amended accordingly. The 13th defendant who is the appellant before us in C.M.A. No. 410 of 1944 did not make any application of his own for relief under the Act, although he was an agriculturist because, as he says, he was under the impression that he would have the benefit of the scaling down ordered at the instance of his vendor, the 9th defendant. After the reduction of the decree amount as a result of these applications, the final decree was passed on the 18th March, 1939. The final decree gave effect to the scaling down of the amount only so far as defendants 1 to 4 and 9 to 12 Were concerned as the appeal by defendants 5 to 8 was disposed of only on 3rd February, 1942. It is common ground that, consequent on the decision of this Court, the decree was further amended in respect of defendants 5 to 8 also. The 13th defendant and the 29th defendant who was brought on record as the legal representative of the 14th defendant subsequently filed an application (C.M.P. No. 4851 of 1942) in this Court in Appeal No. 24 of 1938 preferred against the preliminary decree and already disposed of as aforesaid, praying that this Court should ' amend the decree herein by adding the words 'defendants 13 and 29' in paras. 1 and 2 of the decree of this Honourable Court, dated 3rd February, 1942.' The Court rejected that application on the ground that it was' much too late to give effect to defendant 13's contentions now.' Subsequently, the decree-holder initiated execution proceedings and in the course of such execution proceedings the scaled down amount, namely, Rs. 36,000 with subsequent interest and incidental charges was deposited in Court at the instance of the defendants 1 to 4 and others who had obtained relief under the Act, and satisfaction of the decree was entered so far as they were concerned. The 13th defendant then filed E. A. No. 91 of 1944 out of which C.M.A. No. 410 of 1944 arises for entering up satisfaction of the decree even as against himself on the ground that the mortgage debt being indivisible and having been discharged by the payment of the scaled down amount by the mortgagors, the whole debt was wiped out and the property purchased by him became automatically freed from the encumbrance. The 9th defendant applied in E.A. No. 104 of 1944 for a similar relief pointing out that in his sale to the 13th defendant there was an indemnity clause under which he was liable to make good to his vendee any loss which the latter might sustain by reason of the decree-holder enforcing his claim against the 13th defendant. The 9th defendant therefore prayed that the entire decree should be entered as satisfied by the payment into Court of the decree amount as scaled down.

3. The Subordinate Judge while recognising the principle laid down by the decisions of this Court in Arunachalam v. Seetharam (1941) 1 M.L.J. 561 : I.L.R. 1941 Mad. 930, Marina Ammayi v. Mirza Bakhar Beg Saheb : AIR1941Mad557 and Satyanarayanamurthi v. Sathiraju : AIR1942Mad525 , namely, that when an agriculturist-mortgagor obtains the benefit of the Act and pays the amount of the debt as scaled down, the entire mortgage debt is discharged against all persons interested in the security even though such persons may not be agriculturists entitled to claim relief in their own right under the Act, was of opinion that the terms of the preliminary and final decrees as amended as well as the order of this Court rejecting the C.M.P. No. 4851 of 1942 precluded the 13th defendant from claiming that the decree was satisfied by the payment into Court of the reduced amount by the other defendants. Mr. Muthukrishna Aiyar, learned counsel for the 13th defendant, appellant in C. M. A. No. 410 of 1944, contests this view claiming that there is nothing in the decrees to preclude the application of the principle of the decisions referred to above in favour of his client at this stage when the decree amount as scaled down has been paid into Court, and that the order of this Court in C. M. P. No. 4851 of 1942 cannot have the effect of denying to the appellant the relief which he now seeks on the basis of such payment in the execution proceedings. We are inclined to agree that, so far as the order of this Court in C. M. P. No. 4851 of 1942 is concerned, it cannot have the effect of depriving the appellant of the benefit of the reduction of the decree debt effected at the instance of the mortgagors if the appellant is otherwise entitled under the law to such benefit, for all that this Court refused to allow was the prayer of the appellant to have the decree in Appeal No. 24 of 1938, expressly amended so as to give effect to the principle of the decisions referred to above even as regards his own liability under the decree. From the rejection of that prayer as having come too late, it cannot follow that the appellant cannot claim the benefit of the scaling down in other appropriate proceedings if he is entitled to such benefit under the law.

4. Turning now to the language of the decrees, Clause 2 (i) of the preliminary decree as originally passed

ordered and decreed that defendants 1 to 4, 5 to 13, 15 and 25 to 29 do pay into Court on or before the 13th March, 1938, or any later date up to which time for payment may be extended by the Court, the said sum of Rs. 1,13,836-4-10 with interest as above.

5. It then followed the usual lines laid down in the Code and contained directions as to the sale of the properties in case of default, etc. After the applications of the mortgagors, defendants 5 to 8 and 9 to 12 were allowed and the amount was scaled down as aforesaid, to Rs. 36,000 a paragraph was added in the decree in the following terms:

It is further ordered and decreed that the debt due by defendants 1 to 4, 9th defendant and defendants 5 to 8 is scaled down to the principal sum of Rs. 36,000 with interest at 6 1/4 per cent. per annum from 1st October, 1937, till 13th March, 1938, and thereafter at six per cent. per annum with full costs of Rs. 3,146-13-6 with interest on costs at six per cent. per annum from 13th September, 1937, to the date of realisation.

The words 'defendants 5 to 8' are not found in the printed decree, but it is admitted that they have been added in the decree as finally amended. In the final decree passed on 18th March, 1939, also the amendments were carried out by the insertion of paragraph 3 whereby it was:

ordered and decreed that out of the items of the hypotheca, the items which are in the possession of defendants 1 to 4 and 9 to 12 be and are liable only for the sum of Rs. 36,000 with interest thereon at 6 1/4 per cent. per annum from 1st October, 1937, to 13th March, 1938, and thereafter at six per cent. per annum with full costs as allowed under the preliminary decree.

Here too we are told that the words 'defendants 5 to 8' have been subsequently added in that para. The rest of the decree as originally passed was in the usual terms. It is argued by the learned Advocate-General for the decree-holder-respondent, that the true effect of these decrees was to fix the liability of each set of defendants separately and independently, so that, when the lability of one set of defendants was reduced by the application of the provisions of the Act and a similar reduction was not expressly made as against other defendants, the decree must be construed as operating in respect of the full amount as originally decreed as regards the latter. We are unable to agree with this view. Reading the decrees as a whole it is clear to our minds that there is no apportionment of the liability under the mortgage as between the several sets of defendants. The decree was for a single amount even as the amount due under the mortgage was a single liability. The amount has no doubt been reduced as regards persons who sought and obtained relief under the Madras Agriculturists' Relief Act. But according to the decisions to which reference has been made already, if the reduced debt of the mortgagor is paid, the hypotheca is freed from the encumbrance as against every person who claims interest in any part thereof. We are unable to see anything in the language of the decree which prevents us from giving effect to that principle now that the scaled down amount has been admittedly paid by or at the instance of the mortgagors. The effect of such payments must accordingly be held to be to discharge the decree as a whole even as against the others including the 13th and 29th defendants who did not actually apply for the benefit of the Act in their own right as agriculturists. In this view, C.M.A. No. 410 of 1944 must be and is hereby allowed.

6. As regards C.M.A. No. 582 of 1944, preferred by the 9th defendant, he, as already observed, sought and obtained relief under the Act, and so far as he is concerned, only the scaled down amount was payable under the decree as amended. It cannot therefore be executed for any larger sum against the properties remaining in his possession. But it is difficult to see how he can apply for entering up satisfaction of the decree in respect of the properties sold by him and now in the hands of his vendee the 13th defendant. It may be that the result of rejecting the application of the 13th defendant would give rise to a claim by way of indemnity against the 9th defendant but we do not consider that that is sufficient to entitle the 9th defendant to make an application for entering up satisfaction of the decree as against the 13th defendant. As, however, We are allowing the appeal of the 13th defendant, the 9th defendant practically gets the relief that he wants. His appeal however must fail and we dismiss it. In the circumstances we make no order as to costs in either of the appeals.


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