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M.P. Krishnaswami Pillai Vs. Chockalingam Chettiar and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported inAIR1943Mad455; (1943)1MLJ169
AppellantM.P. Krishnaswami Pillai
RespondentChockalingam Chettiar and ors.
Cases ReferredVenkatesa Aiyangar v. Manikkavachakam Chetty
Excerpt:
.....passed his claim was satisfied by the mortgagor and it was held that in those circumstances the .prior mortgagee, although a defendant in the suit, had no right under the terms of order 34, rule 12 to ask the court to sell the property in order to discharge the debt due to him. this was because the decree which contained a direction to sell the property had been satisfied and the direction could not but have been found to be exhausted. it provides for the frame of the suit relating to mortgages, for the decrees, preliminary and final, to be passed in such suits and generally for the substantive rights of the mortgagees to be satisfied in respect of their debts out of their mortgage securities. if it was not pressed or abandoned, it should have been so stated very clearly in the..........a preliminary decree in a suit for sale brought by a puisne mortgagee should be passed when the prior mortgagee was impleaded as a party to the action and was willing to have the property sold free from his incumbrance on the condition that he should be paid first out of the proceeds of the property mortgaged with him. the trial court passed such a decree but on appeal by the puisne mortgagee, the district judge of trichinopoly modified it and ordered (he property to be sold subject to the prior incumbrance. he did so as he was of opinion that order 34, rule 12, civil procedure code, could be of no avail to the prior mortgagee, and that he could not, according to a decision of this court reported in venkatesa aiyangar v. manikkavachakam chetty : air1935mad660 make an application under.....
Judgment:

Abdur Rahman, J.

1. The only question that awaits to be determined in this appeal relates to the form in which a preliminary decree in a suit for sale brought by a puisne mortgagee should be passed when the prior mortgagee was impleaded as a party to the action and was willing to have the property sold free from his incumbrance on the condition that he should be paid first out of the proceeds of the property mortgaged with him. The trial Court passed such a decree but on appeal by the puisne mortgagee, the District Judge of Trichinopoly modified it and ordered (he property to be sold subject to the prior incumbrance. He did so as he was of opinion that Order 34, Rule 12, Civil Procedure Code, could be of no avail to the prior mortgagee, and that he could not, according to a decision of this Court reported in Venkatesa Aiyangar v. Manikkavachakam Chetty : AIR1935Mad660 make an application under that rule. The prior mortgagee, who figured as the 7th defendant in this litigation, appeals.

2. It might be mentioned at the outset that only one (the first) item of the property was mortgaged with the prior mortgagee while several other items were mortgaged with the plaintiff-respondent. The question to be decided is thus in respect of the first item alone. It might also be mentioned although it is not necessary for the decision of this case, that the first item was subsequently purchased by the 7th defendant in the name of his servant, the third defendant, on the 20th August, 1931, out of which a sum of Rs. 2,900 was to go towards the discharge of the first mortgage and the balance of Rs. 100 was paid in cash. The plaintiff (puisne mortgagee) and the 7th defendant had agreed on the 14th November, 1939, that the latter would be entitled to priority to the extent of Rs. 2,900 against item 1. The plea raised on behalf of the puisne mortgagee in regard to the application of the Agriculturists' Relief Act to the debt due to the 7th defendant was repelled by the trial Court and it was ordered that a sum of Rs. 2,900 be paid first to the 7th defendant from the sale proceeds of item 1. This was done as the 7th defendant had not only no objection to the entire property being sold but had himself at one stage of the case asked for that course to be adopted.

3. The assumption underlying the judgment of the learned District Judge that but for the provision contained in Order 34, Rule 12 (even if it were construed in the manner in which he had), the decree of the lower Court could not be sustained is erroneous. The Civil Procedure Code is not exhaustive and unless there was a prohibition, the trial Court was fully entitled to make such orders and pass such decrees ex debito justitiae--even if not provided by the Code--as appeared to be necessary in the circumstances of the case. The principle underlying Rule 12 is that the rights of a prior mortgagee could not be adversely affected and the property mortgaged with him could not be sold without his consent. The second condition of this rule is that the property must be such as to which an order for sale has been either given by a Court or is to be given. The rule does not provide, as I read it, that a decree for sale must necessarily have been passed before the date of the consent of the prior mortgagee. There can be no objection in my view in construing it in such a way as to take within it the consent of a prior mortgagee preceding the decree for sale. The decision in Venkatesa Aiyangar v. Manikkavachakam Chetty : AIR1935Mad660 , referred to by the learned District Judge has no application to the facts of the present case. In that case a puisne mortgagee had brought a suit for the sale of the property, but after the decree had been passed his claim was satisfied by the mortgagor and it was held that in those circumstances the . prior mortgagee, although a defendant in the suit, had no right under the terms of Order 34, Rule 12 to ask the Court to sell the property in order to discharge the debt due to him. This was because the decree which contained a direction to sell the property had been satisfied and the direction could not but have been found to be exhausted. This is different from the present case. The decision in Venkatesa Aiyangar v. Manikkavachakam Chetty : AIR1935Mad660 although not on all fours, is more to the point. The provisions contained in the form of decrees, Appendix D, form 10 go to support my conclusion that the preliminary decree for the sale of the entire property was, in view of the consent of the prior mortgagee, more regular than that passed by the lower appellate Court. After all Order 34, Civil Procedure Code, does not relate to execution of decrees. It provides for the frame of the suit relating to mortgages, for the decrees, preliminary and final, to be passed in such suits and generally for the substantive rights of the mortgagees to be satisfied in respect of their debts out of their mortgage securities. These and other considerations of convenience as also the construction of Rule 12 leave no doubt in my mind that the order passed by the lower appellate Court could not be sustained. I would for the above reasons set it aside.

4. This does not however dispose of the appeal. Another point was taken in the grounds of appeal by the respondent which became, in view of the decision by the learned District Judge, unnecessary to determine. Learned Counsel for the appellant contended before me that that point must be taken to have been abandoned on behalf of the respondent. But I am not of that opinion. A ground of appeal was specifically raised on that point. If it was not pressed or abandoned, it should have been so stated very clearly in the judgment of the Court below. In all probability the other question was not discussed by the lower appellate Court as it was regarded to be unnecessary. If the sale was to be ordered as being subject to the first mortgage, as it was, the other question raised on behalf of the respondent did not call for a decision. Now that I am taking a different view and am of opinion that the decision of the first Court on that point was correct, the other question has to be considered and decided by the lower appellate Court. For the above reasons, I would accept the appeal, set aside the order of the lower appellate Court and send the case back to that Court for decision on the other point that had been raised on behalf of the respondent in the memorandum of appeal but was not considered and decided by the lower appellate Court.

5. The appellant will be entitled to his costs in this appeal. The costs of the lower appellate Court will be in the discretion of the learned District Judge.

6. Court-fee paid in the second appeal will be refunded to the appellant.


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