Skip to content


Thayyanayaki Ammal by Agent Viswalingam Chettiar Vs. Minor Sundarappa Alias Apath Sahaya Kandiar, by His Mother and Guardian Alamelu Ammal (Dead) and ors. - Court Judgment

LegalCrystal Citation
SubjectLimitation
CourtChennai
Decided On
Reported inAIR1942Mad200; (1941)2MLJ913
AppellantThayyanayaki Ammal by Agent Viswalingam Chettiar
RespondentMinor Sundarappa Alias Apath Sahaya Kandiar, by His Mother and Guardian Alamelu Ammal (Dead) and ors
Cases Referred and Badri Das v. Pasupati Banarji I.L.R.
Excerpt:
.....purchased all the properties comprised in the mortgage as well as some other properties in court auction in execution of a money decree against the mortgagor in december, 1925 and that he subsequently sold the properties so purchased other than items 1 to 5 back to the mortgagor by a sale deed dated 16th june, 1928 reserving the bulk of the consideration with the mortgagor for discharging this mortgage, which, however, the mortgagor failed to do......privy council in lewin v. wilson (1886) 11 a. c. 639 are here pertinent:it must be remembered that payment and acknowledgment are two very different things. as regards the person making them, acknowledgment may, as pointed out in balding v. lane (1863) 1 de g. j. & section 122 : 46 e.r. 47 be made by a person who, though a party to the mortgage contract, has ceased to have any substantial interest in it, and has nothing to lose by the acknowledgment; whereas, payment is certain to be made only by those who have some duty or interest to pay. as regards the recipient, so long as he is paid according to the intention of the contracting parties, he is in full enjoyment of his bargain, and is not put upon any further assertion of his rights, but not so if he only receives acknowledgment. if,.....
Judgment:

Patanjali Sastri, J.

1. This appeal has been preferred by the plaintiff from a decree of the Subordinate Judge, Kumbakonam, dismissing a suit brought to enforce a mortgage executed by one Rajagopala Kandiyar on 4th June, 1913. Plaintiff claims title to the mortgage under the will of her father Sabapathi Chetti who was the son of the mortgagee and died in December, 1934. The first defendant is the son of the mortgagor and the sixth defendant is the Official Receiver of Tanjore in whom the estate of the mortgagor has become vested on his adjudication as insolvent. The other defendants claim interest as purchasers in different items of properties comprised in the mortgage. The suit was filed in 1937 and certain part payments alleged to have been made from time to time and endorsed on the bond by the mortgagor were relied on as extending the period of limitation. The Court below held that some of these alleged payments and endorsements were not genuine and dismissed the suit as barred by limitation, and the main question argued in the appeal is whether this finding is correct.

2. There are five endorsements on the mortgage bond (Ex. A) and these have been marked as Exs. A-l to A-5. Of these, the first three endorsements evidencing payments of Rs. 521-11-6, Rs. 100 and Rs. 10 made respectively on 11th December, 1914, 9th April, 1916 and 6th April, 1922, are admitted to be genuine, and the dispute relates to the last two (Exs. A-4 and A-5), dated respectively 23rd February, 1928 and 13th November, 1932. (After discussing the evidence His Lordship concluded:)

* * * * *

3. We are therefore unable to agree with the Subordinate Judge's conclusion that the endorsements Exs. A-4 and A-5 were fabricated in order to save the suit from the bar of limitation.

4. It was next argued on behalf of the second defendant the alienee of the tenth item, that even if the disputed payments and endorsements were genuine, they could not operate to save the right of suit against this defendant, as he had purchased the property in 1917 long before these payments and endorsements were made by the mortgagor. Reliance was placed in support of this contention on the recent Full Bench decision of this Court in Pavayi v. Palanivelu I.L.R. (1940) Mad. 872 of which the head-note runs thus:

A mortgagor who has lost all interest in the mortgaged property cannot bind by an acknowledgment under Section 19 or by a payment of principal or interest under Section 20 of the Indian Limitation Act, 1908, the person on whom his interest has devolved, whether the devolution is of the whole of the mortgaged properties or only of a part thereof. In order to be binding on the assignee, the acknowledgment or payment must be made before the person making it has parted with his interest in the property to the assignee.

This would seem, no doubt, to support the contention, but it appears from the facts stated by the Full Bench who were dealing with a case placed before them and not answering a question of law referred to them that when the mortgagor made the payment there was no subsisting liability to pay as the enforcement of the personal covenant had become barred and the mortgaged property had been alienated before the date of such payment. In view of this fact, it could hardly have been maintained that there was a payment by the debtor or the person liable to pay within the meaning of Section 20 of the Act, and no question could therefore arise with reference to that provision. This was pointed out at page 886 where it was observed:

A payment of interest to start a fresh period of limitation must be made by the person liable to pay the. debt or by his agent duly authorised in that behalf. If the personal remedy against the mortgagor is barred he is no longer liable to pay the debt.

It is thus clear that the Full Bench were not concerned on the facts before them with the question whether a part payment by a mortgagor who has parted with the mortgaged property but is personally liable to pay on his covenant saves the right of suit against the purchaser of the equity of redemption. It will be seen that the payment there in question was towards interest and was endorsed on the bond, the endorsement being signed by the mortgagor. It was therefore argued that the payment so endorsed could be considered to be a valid acknowledgment under Section 19 as it fulfilled the requirements of that provision and the question arose--this was the point which the Full Bench had really to determine--whether for purposes of Section 19 which requires that an acknowledgment of liability in respect of any property or right must, in order to be effective, be given by ' the party against whom such property or right is claimed or by some person through whom he derives title or liability,' the derivation of title or liability should take place after the acknowledgment has been given. It was held that it should, following certain English and Indian decisions. But no such question can arise on the language of Section 20, which so far as it is material here runs thus:

Where interest on a debt or legacy is, before the expiration of the prescribed period, paid as such by the person liable to pay the debt or legacy, or by his agent duly authorised in this behalf, or where part of the principal of a debt is, before the expiration of the prescribed period, paid by the debtor or by his agent duly authorised in this behalf, a fresh period of limitation shall be computed from the time when the payment was made.

It will be observed that this section does not require, unlike , Section 19, that interest or part of the principal should be paid by the party against whom the debt or legacy is claimed or by some person through whom he derives title or liability, but enacts simply that a fresh period of limitation shall be computed where interest or part of the principal has been paid by the person liable to pay or by the debtor. A fresh period of limitation for what suit? Evidently for such suit as the creditor might have brought before the expiration of the prescribed period. That is to say, the right of suit is saved in its integrity against all the persons who might have been sued within the prescribed period. This difference in language is the more remarkable as Section 20 follows immediately on Section 19 which has made an acknowledgment binding only on the party making it or some person in privity with him, The following observations of the Privy Council in Lewin v. Wilson (1886) 11 A. C. 639 are here pertinent:

It must be remembered that payment and acknowledgment are two very different things. As regards the person making them, acknowledgment may, as pointed out in Balding v. Lane (1863) 1 De G. J. & Section 122 : 46 E.R. 47 be made by a person who, though a party to the mortgage contract, has ceased to have any substantial interest in it, and has nothing to lose by the acknowledgment; whereas, payment is certain to be made only by those who have some duty or interest to pay. As regards the recipient, so long as he is paid according to the intention of the contracting parties, he is in full enjoyment of his bargain, and is not put upon any further assertion of his rights, but not so if he only receives acknowledgment. If, therefore, we find that the legislature has used different language about the two cases, we must not readily conclude that it has done so by accident or without meaning it.

The view we have expressed is in accord with the decision of the Calcutta High Court in Dom Lal Sahu v. Roshan Dobay I.L.R.(1906) Cal. 1278 the principle of which has also been followed in Roshan Lal v. Kanhaiya Lal I.L.R.(1918) All. 111 and Badri Das v. Pasupati Banarji I.L.R.(1932) Pat. 93.

5. We may here observe that even under the English Statutes of Limitation it has been recognised that payment stands on a different footing from an acknowledgment as regards its effect in saving rights of action. After reviewing the various statutory provisions and the decisions bearing upon them, Lightwood observes:

The statutory provisions although varying slightly in their language are all subject to the same rule; the payment if so made as to be effectual at all is effectual to keep alive the creditor's remedies generally. Thus a payment by a person entitled to make it will keep alive the remedy on a mortgage or charge against the land although the person making it is not in possession of the land or in possession of a limited interest only; it will keep alive the personal remedy on a covenant although the remedy is to be enforced against another than the person paying; and after the death of a mortgagor or specialty debtor a payment by any one person interested in the estate will keep alive the liability of all other persons interested. (The Time Limit on Actions, page 365).

6. It was further contended for the second defendant that the property purchased by him, that is, item 10 of the plaint schedule, should be directed to be sold last as he purchased it in 1917 paying full consideration to the mortgagee. Similarly, the learned advocate for the fifth defendant urged that the properties in which he is interested, namely, items 1 to 5 should be sold after items 6 to 8 purchased by the seventh defendant from the Official Receiver and transferred, to the eighth defendant. It was pointed out that the fifth defendant purchased all the properties comprised in the mortgage as well as some other properties in Court auction in execution of a money decree against the mortgagor in December, 1925 and that he subsequently sold the properties so purchased other than items 1 to 5 back to the mortgagor by a sale deed dated 16th June, 1928 reserving the bulk of the consideration with the mortgagor for discharging this mortgage, which, however, the mortgagor failed to do. It was, therefore, urged that items 6 to 9 which were among the items thus sold to the mortgagor and which have subsequently passed by transfer to the eighth and the ninth defendants should be sold before items 1 to 5. We consider that the equity claimed by the second and fifth defendants should prevail and we accordingly direct that items 6 to 8 held by the eighth defendant and item 9 purchased by the third defendant should be sold before items 1 to 5 in the hands of the fifth defendant and item 10 in the hands of the second defendant are brought to sale.

7. It only remains to deal with the claim of the defendants 2, 4, 5 and 8 to relief under the Madras Agriculturists' Relief Act. The Court below has held that inasmuch as the debt was incurred originally by an agriculturist, these defendants are entitled to the benefits of the Act as transferees from him, whether they are themselves agriculturists or not. This view is not correct as we have held that a person who claims to be entitled to the benefits of the Act must prove that he is an agriculturist within the meaning of the definition in Section 3 (ii). As the issues relating to this matter have not been determined by the Court below, they must now be investigated and if these defendants are proved to be agriculturists, the debt will have to be scaled down so far as they are concerned.

8. In the result, the decree dismissing the suit is set aside and a preliminary mortgage decree will be passed by the Court below in the light of this judgment after determining issues 5 and 8. The appellant will have her costs here and below. The court-fee paid by the appellant will be refunded to her. As against defendants 2, 4, 5 and S, the appellant will be entitled only to proportionate costs in the trial Court and here.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //