1. This appeal arises out of a suit by the respondent to declare his title and recover possession of the property mentioned in the plaint.
2. The facts are shortly these: The plaintiff obtained two mortgages on this property and other properties, and obtained a mortgage-decree. He brought the property to sale in execution of the mortgage-decree, and purchased the property on 21st January 1921. Defendants 1 and 2, who are the appellants, purchased the property in execution of a rent decree. The sale was on 27th November 1920. The rent decree was passed by a revenue Court and it declared that the property was subject to a first charge for the rent. On 22nd November 1920 the plaintiff filed a claim petition which was dismissed as too late without any enquiry. In the claim petition, Ex. 4, all that he prayed was for
an order on the plaintiff to get the property sold in execution subject to the mortgage-decree
obtained by the petitioner. He sets out in the petition his mortgage and it does not appear from the record that the petitioner's mortgage was denied. He only wanted priority and the question was which of the two persons was entitled to priority. Whether the plaintiff who got a decree on his mortgage, or whether the appellants who purchased it in execution of the rent decree. There was no adjudication on the question, because the order was:
The sale comes on to day. The application comes too late. The claim is rejected as too late.
3. The present suit was filed on 8th July 1922, more than one year after the order which was passed on 22nd November 1920.
4. The first question argued before us is whether the suit being filed more than one year after the order on the claim petition, any of the plaintiff's rights are barred. After the decision of the Full Bench in Venkataratnam v. Ranganayakamma  41 Mad. 985, we think that we are bound to hold in this case that an order such as the present one, simply dismissing the claim as too late, is an order which has to be set aside within one year. No doubt there are observations in some cases before and after the Full Bench ease, that such an order is not an adjudication, but we do not think that those observations will enable us to dissent from the ruling in Venkataratnam v. Ranganayakamma  41 Mad. 985. The chief contention on this part of the ease by Mr. Satyanarayana for the respondent is that both the decrees being decrees giving a mortgage or charge no attachment can be made; that the attachment actually made in this case was illegal and that an order on any claim put in upon that attachment would not attract the provisions of the Limitation Act or the Civil Procedure Code as regards the duty to set it aside. Although an attachment is not necessary in the case of mortgages we do not think that it can be held that such attachments are illegal and void; and in cases where on such attachment a claim is put in, and an adjudication is made upon the claim, it is difficult to hold that the party who gets the adjudication on that claim is not bound to come to Court within one year. We think that the decision of the Full Bench in My. Mra Tun v. U Kaing  8 L.B.R. 215 of the Rangoon Chief Court is in point. It was there held that, though proceedings by way of attachment are not applicable to mortgage-decrees, yet, if the decree-holder applies for and obtains an order for attachment, and the properties are attached and claims and objections are put in under Order 21, Rule 58, Civil P.C., the Court is bound to hear such claims and adjudicate upon them. We may also point out that in the case of Krishnan v. Chadayan Kutti Haji  17 Mad. 17, where there was an attachment and the claim was on a mortgage decree, it was held that the order on the claim was binding and should be set aside within one year.
5. The decision in Muthiah Chetty v. Palaniappa Chetty A.I.R. 1922 Mad. 447 is to the effect that where, even if there is no attachment, a party comes to Court and files a claim on the footing of there being an attachment and gets an adjudication, he cannot be heard to say afterwards that there is no order against him which ought to be set aside because there was no attachment and the adjudication of the claim is ultra vires or infructuous. There are observations of Oldfield, J., which suggest that the plaintiff is bound, before he files a claim, to search the records in the Court and to see whether there is a valid attachment; but we doubt whether there is any such duty cast upon the person to find if there is any valid attachment issued by a competent Court; and we think it is difficult to see why, if there is an attachment, he should not assume it to be valid and file a claim, and, if, it turns out that there was no valid attachment, he should be estopped. We think the ease ought to be confined only to cases where a parson, knowing that there is no attachment, chooses to come to Court and take the chance of an adjudication. Otherwise it is difficult to see how there is an estoppel. However, in this case there was an attachment and it is not necessary to discuss this case any further.
6. Reference has been made to Ratan Lal v. Bala Parshad  58 P.R. 1918, by the respondent's vakil. That was a decision of the Punjab Chief Court, and it was there held that, where property was directed to be sold under a mortgage-decree, no objection under Order 21, Rule 58, could be entertained to the attachment of the property; that the Court had no power to entertain or pass an order upon a claim petition; and that Order 21, Rule 53, only applies to attachments in execution of a decree and not to attachments made before decree. It, however, appears from the report that the petition was put in, not under Order 21, Rule 58, but under Section 151, and the Court held that the lower Court had no power to pass any orders under that section where there was no attachment. That decision does not help us very much. The balance of authority is that, where there is an attachment even if it is passed in execution of a mortgage decree, such attachment cannot be said to be wholly void and ineffective, and that, where a person puts in a claim by reference to such attachment, the order on the claim can be made binding on him and it must be set aside within one year. We think that, so far, the appellants are right in their contention that the order on the claim is binding, and, as it has not been set aside by a regular suit within one year, the next question is what is the effect of the orders. In the present case, as already pointed out, there was no dispute as regards the mortgage decree in favour of the plaintiff or the charge in favour of the defendants. All that the plaintiff wanted was to get himself declared to be the prior incumbrancer and the rent decree-holder to be a puisne incumbrancer. Even if the claim had gone on, and there was a regular adjudication, that was the only point that the Court would have to decide. We are of the opinion that in a case like this, where a person claiming to be the prior incumbrancer files a claim which is resisted by another encumbrancer on the ground that he is entitled to the property, all that the dismissal of the claim would entail would be to make the decree-holder who attaches and wants to execute the decree the prior encumbrancer for the purposes of adjusting the rights between the parties. We can find no authority for the view that in such cases the mere dismissal of the claim would wipe out the original mortgage especially where there is no dispute between the parties. Reference has been made to Ramalingayya v. Velluri Naryanappa : AIR1926Mad593 , but that was obviously a case where a mortgagee wanted a declaration of his mortgage right and that right was denied. This is a case of a quarrel pure and simple between two encumbrancers as to who has got priority, and there is nothing which militates against the view we have taken. In the present case the only course would be to direct that the sale to the appellants do stand, and say the only right which the respondent has is to redeem the appellants by paying off the amount due on the appellant's charge.
7. We reverse the decree of the Subordinate Judge and direct that, in lieu of it, a decree be passed allowing the respondent to redeem the appellants by payment of the amount for which the property was purchased by the appellants with interest at 6 per cent on the principal sum mentioned in the decree from the period in which he was out of possession after, the sale. Time for redemption will be six months from the date of the ascertainment by the Subordinate Judge of the amount which is due to the appellants. The appellants will be entitled to costs throughout on the principal sum due to them under the decree.