Skip to content


Sundarammal Vs. Sundara Reddi and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1927Mad560
AppellantSundarammal
RespondentSundara Reddi and ors.
Cases Referred and Umed Singh v. Sobhag Mal Dhadha
Excerpt:
- .....1922. the assignee decree-holder then applied before the subordinate judge for the passing of a final decree. the subordinate judge dismissed the petition. there was an appeal to the district judge of south arcot and the district judge, reversing the order of the subordinate judge, passed a final decree as prayed for. the present second appeal is filed by the 9th defendant who was added as the legal representative of the 4th defendant, who died, by an order dated the 29th of november 1923.2. the objections were taken by the appellant to the passing of a final decree: (1) that the assignment by the mortgagees was really obtained benami for the benefit of the 5th defendant; (2) the assignment in respect of the minor 2nd plaintiff was invalid as no sanction of the court was obtained.....
Judgment:

Ramesam, J.

1. The facts of this second appeal may be stated as follows: Two persons named Lakshmanan Chetty, and Muthiah Chetty a minor represented by his next friend, obtained a preliminary decree for sale on the foot of a mortgage in O. S. No. 14 of 1919. Defendants Nos. 1 and 2 are the heirs of the original mortgagor; Defendants Nos. 3 to 8 were subsequent purchasers of the equity of redemption of separate portions of the mortgage properties. Defendants Nos. 3, 4, 5 and 8 also claim right of subrogation to some prior mortgages which they had discharged. This right was recognized in the preliminary decree which directed sale of the items purchased by them subject to the prior mortgage. An appeal against this direction was filed by the mortgagor. After the appeal was filed the rights of the decree-holders were assigned by a deed (Ex. A) dated 26th July 1920, and the assignee applied to have his name brought on record as the 3rd appellant ( Ex. 0, dated 5th of August 1921). The order of Court was 'the petitioner will be added as the 3rd appellant.' The appeal was dismissed on the 31st of March 1922. The assignee decree-holder then applied before the Subordinate Judge for the passing of a final decree. The Subordinate Judge dismissed the petition. There was an appeal to the District Judge of South Arcot and the District Judge, reversing the order of the Subordinate Judge, passed a final decree as prayed for. The present second appeal is filed by the 9th defendant who was added as the legal representative of the 4th defendant, who died, by an order dated the 29th of November 1923.

2. The objections were taken by the appellant to the passing of a final decree: (1) That the assignment by the mortgagees was really obtained benami for the benefit of the 5th defendant; (2) the assignment in respect of the minor 2nd plaintiff was invalid as no sanction of the Court was obtained under Order 32 of the Civil Procedure Code. Taking up the first point, the Subordinate Judge found that the assignment was really for the benefit of the 5th defendant. This finding was not questioned before the District Judge whose order was passed on the footing of the finding. Before me Mr. Varadachariar also argued the case on the basis of that finding. Both parties concede before me that this is not a matter arising in execution, but is a proceeding in the suit vide: Order 34, Rule 5, so that Order 21, Rule 16, of the Civil Procedure Code, does not apply. The only question is, as the suit has not yet been disposed of, what is the proper procedure to be observed? The result of the Subordinate Judge's finding is that the 5th defendant, a purchaser of the equity of redemption in one of the mortgaged properties, has now become, by the assignment, entitled to the mortgagee's rights. Only in obtaining the assignment, with a view to keep his position as a purchaser of the equity of redemption and his position as assignee of the mortgagee's rights, distinct, he obtained assignment in the name of a benamidar who for this purpose may be regarded as a trustee for the 5th defendant. The District Judge held on a strict construction of Order 34, Rule 5 that the Court is bound to pass a final decree when the defendants have not made the payment of the mortgage amount into Court.

3. Mr. Srinivasa Ayyangar, who appeared for the appellant, has suggested in some portion of his argument (though I do not think very seriously) that under Order 34, Rule 5, Clause (2) the Court shall pass a decree on application made on that behalf by the plaintiff. And here the assignee-decree-holder is not a plaintiff. The assignee- decree-holder has certainly become after being added to the record an additional appellant and in becoming an additional appellant I think he has also become an additional plaintiff. In Brij Indar Singh v. Kanshi Ram [1918] 45 Cal. 94 the Privy Council held that where a party had been brought on record as the representative of an original plaintiff in a proceeding in appeal against an interlocutory order, he must be regarded as brought on record for all the purposes of the suit and he need not be added again when the case went back to the first Court. At page 110, (45 Cal.,) they refer to the added party as a plaintiff though he was not an original plaintiff.

The plaintiff, as representative of the original plaintiff, and the defendants representatives of Joti Lal, had been introduced in the Chief Court. No doubt, that was only done in the course of an interlocutory application as to the production of books. But the introduction of a plaintiff or a defendant for one stage of a suit is an introduction for all stages.

4. I, therefore, think that the assignee has now become, for the stage between the preliminary decree and the final decree, the 3rd plaintiff in the suit, Even if it were not so, reading Section 146 in conjunction with Order 34, Rule 5,I think it is open to the assignee to apply for a final decree.

5. The main point argued by Mr. Srinivasa Ayyangar is that the District Judge was wrong in construing Order 34, Rule 5, strictly. He relied on jogendra Prasad Narain Singh v. Gouri Shankar Prasad Sahu [1917] 2 P. L. J. 533 for the position that even where a payment is not made into, but outside, Court, it is open to the Court to enquire into any payments made by the defendants and to embody the result in the final decree that may be passed by it. In the present case the decree has been paid up and the charge is extinguished and no final decree has to be passed. On the other hand in Singa Raja v. Pethu Raja [1918] 42 Mad. 61 this Court held that if no payment is made into Court a final decree shall be passed. The learned Judges say:

Sub-rule 2 says where such payment is not so made, that is to say, where such payment is not made into Court, the Court shall pass a decree ordering the sale of the mortgaged property or a sufficient part thereof.....Therefore we are of opinion that the scheme of the Code, so far as mortgage-decrees are concerned is that if the amount due under preliminary decree has not been paid before the appointed day a decree for sale is to be made and the machinery for sale is to be set in motion.......The provisions of the Code are imperative.......

6. I do not think it is necessary for me to consider in this case the conflict between a decision of this Court and the Patna High Court. In the case before me there was no payment towards the decree. What has happened is, one of the defendants who was only a purchaser of the equity of redemption in one of the properties and who is, therefore, entitled to redeem the suit mortgage obtains a transfer of the mortgagee' s rights. He has not paid any amount towards the decree. Mr. Srinivasa Ayyangar contends that where one of the mortgagors pays up the mortgage amount, an intention cannot be attributed to keep the mortgage alive for his own benefit as against other mortgagors or owners of the equity of redemption in portions of the mortgage property, and his only remedy is a suit for contribution.

7. This may be so. But we are not dealing with the case of one of several mortgagors or one out of several heirs of a mortgagor. I doubt even in the case of one of several mortgagors if there is any prohibition preventing him from obtaining an assignment of the mortgagee' s rights. Where he pays up the mortgage amount and obtains no document, there is no presumption that he intended to keep the mortgage alive. But where he obtains a transfer of the mortgagee' s rights, I think that, in the capacity of such a transferee he is entitled to maintain a suit on the mortgage. It is true in such a suit he has to give a deduction for a proportionate part of the mortgage amount to which he himself was liable as one of the mortgagors, but it cannot be said that he cannot maintain a suit on a mortgage. But whatever may be said as to one of several mortgagors or one of several heirs of a mortgagor, I think it is clear that in the case of a purchaser of the equity of redemption of one of the mortgaged properties, there is no law or principle, prohibiting him from obtaining an assignment of the mortgagee's rights and it cannot be said that the effect of such an assignment is to destroy the mortgage and to give him only rights of contribution. I think the only effect of such an assignment is to reduce the mortgage amount by the proportionate part of it to which the property purchased by him was liable. Such amount should be ascertained by taking the proportion of its value to the total value of the mortgaged properties (Vide Section 82 of the Transfer of Property Act). In this case while on the one hand I agree with the District Judge in thinking that there is nothing to stop the passing of a final decree, on the other hand, I think the District Judge ought to have enquired into the question what amount has to be deducted from the mortgage amount by reason of the 5th defendant obtaining an assignment of the mortgagee's rights and then passed a final decree against the other defendants for the rest of the amount. Before passing a final decree this proportion will have to be ascertained.

8. Before passing the final order in connexion with this matter, I will now deal with the second point arising in the appeal. Mr. Srinivasa Ayyangar contended under Order 32, Rule 7 that the assignment by the minor plaintiff ought to receive the sanction of the Court and, therefore, cannot be recognized, but Mr. Varadachariar has pointed out that the only effect of the absence of such a sanction is that it is voidable at the instance of the minor: See Phulwanti Kunwar v. Janishar Das A. I. R. 1924. All. 625 and Umed Singh v. Sobhag Mal Dhadha [1916] 43 Cal. 290 where the Privy Council say that they are of opinion that the decisions of the trial Judge and of the Chief Commissioner were right. This is true, but something must be done in this case to protect the defendants from being harassed by the minor later on if he chooses to avoid the transfer for a second payment. Mr. Varadachariar says that directions indicating such protection may be made in the execution stage and it is unnecessary to consider the question at present before passing the final decree. But I do not agree. If the question is not settled now the defendants will be in an inconvenient position. They cannot pay up the amount outside Court directly to the decree-holder. This is practically compelling them not to pay and to insist on the decree-holder taking out execution through Court so that the Court may pass some order protecting them from being harassed by the minor. There is no justification for this. I think the assignee-decree-holder must be called upon to give security for indemnifying the defendants from being harassed by the original minor 2nd plaintiff for his share of the amount and only on his giving such security that the final decree should be passed. With reference to the first point I now call upon the District Judge to ascertain what amount should be regarded as discharged by reason of the 5th defendants' double position as purchaser of the equity of redemption and as assignee of the mortgagee's rights and for this purpose he will ascertain the proportion the value of his property bears to the total value of the mortgaged properties.

9. Finding in six weeks and objections ten days. Fresh evidence will be taken for this purpose. (After the return of the finding on this point by the District Judge his Lordship modified the final decree). P. R. S. Decree modified.


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