1. The facts of the small cause suit out of which this revision petition arises may be briefly stated as follows: . Certain properties were mortgaged jointly to Chandan (the 1st defendant) and Bapputi (now represented by the 3rd defndant). Chandan submortgaged his interest to Damayanti (the plaintiff) and Bapputi, his interest to Rarichan (the 2nd defendant). The jenmi (Ayyappan) brought a suit to redeem the mortgage in O.S. No. 145 of 1916. In that suit Damayanti was not a party; but Rarichan was impleaded as 4th defendant and claimed compensation for a shop on the footing that it was in the portion submortgaged to him by Bapputi, and in appeal this question was decided in his favour (A.S. No. 138 of 1917 of the Temporary Subordinate Court of Palghat).
2. Damayanti filed the present suit on the ground that the shop was in the portion submortgaged to her and not in the portion submortgaged to Rarichan, that O.S. No. 145 of 1916 was wrongly decided on account of the collusion and fraud of Chandan and Rarichan, that the amount of compensation ought to have been awarded to Chandan and that she is now entitled to it as his submortgagee. The District Munsif found there was no collusion but also found 'that the shop was in the portion belonging to the 1st defendant and gave plaintiff a decree. The 2nd defendant (Rarichan) filed this revision petition.
3. Before me it is contended by the petitioner (1) that after the decree in O.S. No. 145 of 1916, the rights of the submortgagee were extinguished (2) even if they were not) the plaintiff's remedy is against the 1st defendant.
4. In support of the 1st proposition, the petitioner relied on Singaravelu Udayan v. Ramier : (1903)13MLJ306 and Poosarala Chinnaswami v. Katta Moon Vankata Ramakrishnayya (1916) 4 L.W. 502 . The former decision was dissented from in Venkatarama Iyer v. Esumsa Rowthan 120 M.L.J. 330 which followed Gosto Behary Pyne v. Shib Nath Dutt I.L.R. (1892) Cal. 241. As to the latter case, all that was meant by it is that the submortgagee, after redemption of the mortgage, has no further rights against the mortgaged property and his remedy, if any, is against the submortgagon It is clear from Gosta Behary Pyne v. Shib Nath Dutt I.L.R.(1892) Cal. 241 that the submortgagee can still pursue his rights against any property in the hands of the submortgagor into which the security was converted.
5. But, does it follow from this that the plaintiff is entitled to a decree against the 2nd defendant on the ground that he obtained the compensation which ought to have been paid to the 1st defendant? There is no privity of any kind between plaintiff and 2nd defendant. It is true that the findings in O.S. No. 145 of 1916 do not bind plaintiff. But the decree therein binds 1st defendant. While it may be open to the plaintiff to show against Chandan that the findings in O.S. No. 145 of 1916 are erroneous and that he got in redemption a much smaller amount than he was entitled to, (assuming that it serves any useful purpose). I do not think she can earmark the compensation in the hands of 2nd defendant as money still belonging to 1st defendant and still available to plaintiff as security for her submortgage, by reason of such error. The facts in Gosto Behari Pyne v. Shib Nath Dutt I.L.R. (1892) Cal. 241 are distinguishable. There the money decree holders of the patnidars drew out the sale-proceeds in execution of their decrees against the patnidars to whom they were considered to belong, apart from the decrees. In the present case, it cannot be said that the compensation originally belonged to the 1st defendant and that the 2nd defendant drew the money on account of some decree or other right he was seeking to enforce, It was held, as be tween the 1st and 2nd defendants, that the amount did not belong to the 1st defendant and this decision is binding on the 1st defendant. Except on the ground of fraud or collusion, which the District Munsif has found against the plaintiff cannot regard the amount in the hands of the 2nd defendant as money belonging to the 1st defendant so as to be available as security for her submortgage. The plaintiff as submortgagee can, as against a stranger, subrogate herself only to such rights as her submortgagor can have as against the stranger and is bound by the decree between her submortgagor and the stranger and cannot get rid of it by showing it was erroneous.
6. The petition is allowed and plaintiff's suit is dismissed with costs throughout so far as 2nd defendant is concerned. The plaintiff will have a decree for the amount sued for against the 1st defendant with costs in the First Court.