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Velugubantla Narayya Vs. Kona Venkanna and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Case NumberSecond Appeal No. 282 of 1948
Judge
Reported inAIR1954Mad264; (1954)IMLJ203
ActsDebt Laws; Madras Agriculturists' Relief Act, 1938 - Sections 7
AppellantVelugubantla Narayya
RespondentKona Venkanna and ors.
Appellant AdvocateK. Bhimasunkaram, Adv.
Respondent AdvocateC. Rama Rao, Adv.
DispositionAppeal dismissed
Cases ReferredKailasa Thevar v. Ramaswami Iyengar
Excerpt:
.....although right to redeem exists--non-agriculturist-purchaser from mortgagor also preculded from benefit of act;when an agriculturist-mortgagor is excluded from the benefit of the sealing down under madras agriculturist relif act (iv of 1938) because the personal remedy against him is barred by limitation, and he has lost all interest in the hypotheca by alienation, the non-agriculturist-purchasers of the entire hypotheca or portions of it are not entitiled to claim that the debt should be scaled down. it is true that notwithstanding that a mortgagor's personal liability became barred, and he has parted with the entire interest in the equity of redemption, he is entitled under the statute to redeem the mortgage, but that circumstance would not entitle him to the benefit of act iv of..........the decree that was already passed, it was also pointed out that though under the general law, the mortgage decree was one and indivisible, exceptions to the rule as admitted only where the integrity of the mortgage was broken at the instance of the mortgagee himself.the madras act 4 of 1938, however made a further inroad as it was not intended to give relief to debtors in general but only to debtors who are agriculturists. therefore it follows that, if some of the other debtors are agriculturists, and others are not, it was the duty of the court to pass a decree for the full amount against the non-agriculturists and for the scaled down amount against the agriculturists debtors. the supreme court accepted the principle of the decision in 'air 1941 mad 204 (g)'. but the supreme court.....
Judgment:
1. This case was referred to a Bench by Our learned brother Subba Rao J. in view of the decision of the Supreme Court in -- 'Rama-swami Iyengar v. Kailasa Thevar', (A), which was followed subsequently by the Full Bench in -- 'C. M. A. Nos. 399 and 642 of 1946 (Mad) (B)' to consider the effect of these two decisions on the earlier decisions of this Court.

2. The plaintiff is the appellant. On 29-9-1926 defendants 1 and 2 mortgaged under Ex. D-3 two items of property to defendant 9. The first item is R. S. No. 3/2, 2 acres 15 cents and the second item is a tiled house. We are concerned in this appeal only with the first item. On 8-8-1927 defendants 1 and 2 sold item 1 to defendant 3. On 5-7-1930 defendant 3 entered into an agreement with the plaintiff to mortgage the property to him. As there was default on the part of defendant 3, a suit O. S. No. 21 of 1931 was instituted by the plaintiff to enforce the agreement. The suit was decreed, and in pursuance of the decree a deed of mortgage was executed by defendant 3 in favour of the plaintiff on 8-4-1933. That was the second mortgage on the property.

To enforce that mortgage the plaintiff filed O. S. No. 21 of 1935 against defendant 3, but without impleading the first mortgagee that is defendant 9 as a party. On 28-11-1941, there was a compromise decree in the suit. In pursuance of this decree item 1 of the present plaint schedule was brought to sale and was purchased by the plaintiff on 6-10-1943. Meanwhile defendant 4 obtained a simple money decree in O. S. No. 105 of 1931 against defendant 3 and brought to sale item 1, which was purchased by him in court auction. He obtained delivery of the property on 20-3-1932. He sold his interest in the property to defendant 5 who obtained delivery for him on 26-4-1934. Defendant 9 assigned his right under the first mortgage to defendant 10, Defendant 10 thereafter filed O. S. No. 300 of 1942 to enforce the mortgage against defendant 5 and the mortgagors.

He claimed in the suit an amount which was due after scaling down the debt in accordance with the provisions of Madras Act 4 of 1938. To this suit, however, the plaintiff was not made a party. On 2-10-1942 there was a preliminary decree in the suit which was followed by a final decree on 10-3-1943. Ultimately in pursuance of the final decree defendant 10 purchased the Hem in court sale on 19-11-1943. The plaintiff, who had purchased this item in an earlier court sale instituted this suit out of which this second appeal arises, to declare that the debt due under the mortgage of 29-9-1926-was discharged or in the alternative to determine the balance of the amount due thereunder so that the plaintiff might redeem the mortgage. His main contention was that by reason of the fact that he was not impleaded in O. S. No. 300 of 1942 as a party, his right to redeem the first mortgage either as a puisne mortgagee or as a purchaser of the item in court sale was not affected and that he is entitled now to redeem the mortgage and is bound to pay only the scaled down amount, for which the decree was passed in O. S. No. 300 of 1942 and no more. This contention was negatived by both the Courts on the ground that the plaintiff and defendant 5 were not agriculturists and since the personal covenant was barred and the entire interest of the property was lost to the mortgagors, the mortgagors also could not claim the benefit.

3. In this second appeal by the plaintiff it was strenuously contended by Mr. Bhimasankaram, the learned advocate for the appellant that as the mortgagors are agriculturists, whatever may the position as regards defendant 5, and as the benefit of the scaling down was admitted by defendant 10 in the earlier mortgage, he is entitled to that benefit by reason of his "lucky purchase".

4. It has been well established by decisions of this Court that if the mortgagor is entitled to the benefit of scaling down of the debt under Act 4 of 1938, that benefit would also enure to the alienee of the hypothec a in whole or in part whether he is an agriculturist or not. The benefit enures under general law, by reason of the property being relieved of the burden of the sealing down of the debt at the instance of the agriculturist mortgagor. See -- 'Arunachala v. Seetharam', AIR 1941 Mad 584 (C); -- 'Marina Ammaji v. Mirza Bhaker Beg', AIR. 1941 Mad 557 (D); -- 'Satyanarayanamurthi v. Sathiraju', AIR 1942 Mad 525 (E); -- 'Nachiappa Chetti v. Ramachandra Reddiar', AIR 1942 Mad 527 (F).

If, however, the mortgagor is not an agriculturist and the question arose between purchasers of different portions of hypotheca, the fact that one of such purchasers is an agriculturist, who is entitled to the benefit of the provisions of the Act, would not enable the other non-agriculturist purchaser to claim the benefit of such scaling down. This was the principle also enunciated by this Court and finally established now by various decisions beginning from -- 'Ramier v. Srinivasiah', AIR 1941 Mad 204 (G) and -- 'Sri-nivasa Thathachariar v. Sivasubramania Chettiar', AIR 1943 Mad 196 (H). If the agriculturist mortgagor is, however, not entitled to the benefit of the scaling down because the personal remedy against him is barred by limitation, and as he lost all that interest in the hypotheca by alienation, the non-agriculturist purchasers of the entire hypotheca or portions of it are not entitled to claim that the debt should be scaled down. It is no doubt true that notwithstanding the fact that a mortgagor's personal liability became barred and that he had parted with the entire interest in the equity of redemption he is entitled under the statute to redeem, the mortgage, but that circumstance would not entitle him to claim the benefit of the provisions of Act 4 of 1938. This principle was laid down in --'Subbaraya Gounden v. Nachimuthu Mudaliar', AIR 1944 Mad 82 at p. 83 (I), which was followed and applied to a recent case, -- 'Suryaprakasa Rayanimgar v. Balarami Reddi', (J).

This is also the 'ratio decidendi' of the decision in -- 'Viswasundararao v. Kusalaramayya', AIR 1946 Mad 434 (K), in which case the mortgagors abstained from claiming relief under Act 4 of 1938. Defendant 6 in that case who was an alienee, however, claimed on their behalf that they were entitled to the relief as agriculturists that relief should be granted at his instance so as to enure to his benefit though he was not an agriculturist. The answer given at page 437 may be quoted in the own words of their Lordships:

"They do not claim any relief under Madras Act 4 of 1938. It has been urged by defendant 6 that the Court should, without any claim on their behalf, find that they are entitled to relief as agriculturists, so that the relief which is given to them as mortgagors may enure to the benefit of defendant 6 who is not an agriculturist. We have no doubt, held that when the mortgagors are given relief under Madras Act 4 of 1938 and the burden upon the property is thereby lightened, the fortuitous benefit of that relief will be enjoyed by a subsequent purchaser, though, the latter is not himself entitled to claim the benefits of the Act. This fortuitous benefit, however, cannot be claimed as of right by the purchaser who is not an agriculturist. It is the accidental result of a claim successfully advanced by the mortgagors. In the present case, the mortgagors have not claimed such a benefit nor have they adduced any evidence to show that they are agriculturists. We therefore cannot accede to the request of defendant 6 that the right of the mortgagors to relief should be investigated merely with the object of giving an accidental relief to the non-agriculturist purchaser."

These principles, in our opinion, have not in any manner been affected or altered by the decision of the Supremo Court in -- ' (A)' which was an appeal against the decision of

Happoll and Govindarajachari JJ. in -- 'Kailasa Thevar v. Ramaswami Iyengar', AIR 1949 Mad 238 (L). The question that arose in that case was in execution of a decree which was of a composite character. The decree against defendant 1 was for a larger sum, that is the full amount due under the mortgage. But as against defendants 2 to 7 the debt was scaled. down, and there was only a decree for a lesser amount as against them. Defendant 1 made an application in the executing Court after depositing a sum of Rs. 3250 that as the amount deposited by him together with the payments already made by him discharged the debt as scaled down by the High Court in favour of defendants 2 to 7, full satisfaction should he entered. The High Court took the view that the benefit which defendants 2 to 7 obtained could be claimed also by defendant 1 and that satisfaction of the decree should be entered as with the deposit made by defendant 1, the scaled down amount was paid up. But this view was not accepted by the Supreme Court. It was observed that it is not open to the executing Court to go behind the decree, and it was its plain duty to give effect to the terms of the decree that was already passed, it was also pointed out that though under the general law, the mortgage decree was one and indivisible, exceptions to the rule as admitted only where the integrity of the mortgage was broken at the instance of the mortgagee himself.

The Madras Act 4 of 1938, however made a further inroad as it was not intended to give relief to debtors in general but only to debtors who are agriculturists. Therefore it follows that, if some of the other debtors are agriculturists, and others are not, it was the duty of the Court to pass a decree for the full amount against the non-agriculturists and for the scaled down amount against the agriculturists debtors. The Supreme Court accepted the principle of the decision in 'AIR 1941 Mad 204 (G)'. But the Supreme Court expressly refrained from expressing any opinion on the general question whether a non-agriculturist purchaser of a portion or whole of the equity of redemption is entitled to the benefit of the scaling down at the instance of the agriculturist mortgagor.

This was particularly so because in the case before their Lordships the question arose only in execution of the decree and not in the suit itself. This decision therefore does not in any way alter or affect the principles, which have been established by a number of cases already referred to in this Court. It is not open to us, therefore, to go behind a catena of decisions which have formally established the principles applicable to cases of this kind.

5. In the present case it is an admitted fact that the agriculturists mortgagors own now no interest in the property & that the personal covenant against them became barred long ago. Though they may be persons entitled to redeem the mortgage under the general law, they are not however, according to the decisions already referred to, entitled to seek the aid of the Act to have the debt scaled down. If they are not entitled to invoke the benefits of the Act, we fail to see how the plaintiff can get any aa-vantage under the principles, which have been established in this case. The facts of the case, which came up before the Full Bench of this Court, are analogous to the facts in) the case, which was before the Supreme Court. For the reasons already stated, we think the Full Bench decision also does not affect any change in the principles above stated. The plaintiff is therefore not entitled to redeem the mortgage by paying only the scaled down amount as decreed in O. S. No. 300 of 1942.

6. The decision of the Court below is affirmed and the second appeal is dismissed with costs.


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