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Ramaswami Gounder, Son of Appachi Gounder and ors. Vs. Ramaswami Gounder Son of Sankara Gounder and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Reported in(1974)1MLJ350
AppellantRamaswami Gounder, Son of Appachi Gounder and ors.
RespondentRamaswami Gounder Son of Sankara Gounder and ors.
Cases ReferredBank of Poona v. N.C. Housing Society
Excerpt:
- .....a revised preliminary decree after determining the amount payable by the plaintiffs towards the suit mortgage for redemption of their share only. it is against this order of remand that the present civil miscellaneous appeal has been filed.2. the intriguing question that arises for consideration is whether the subsequent purchaser of the equity of redemption in a part of the hypotheca, who had not been impleaded as a party to the mortagage action filed by the mortgagee, is, after the mortagage decree has resulted in court sale in favour of a third party, entitled to redeem the whole of the mortgage, or only part of the hypotheca, purchased by him. rule 1 of order 34, civil procedure code provides:subject to the provisions of this code all persons having an interest, either in the.....
Judgment:

S. Maharajan, J.

1. The appellants, who were plaintiffs 1 to 4 in the trial Court, instituted a suit against defendants 1 to 6 (respondents 2, 1 and 3 to 6) for redemption of a simple mortgage dated 8th July, 1949 for Rs. 1,600. This mortgage had been granted by defendants 3 to 6 and one minor Ramasamy Gounder, represented by his guardian, the third defendant, in favour of the first defendant in respect of 6 acres, 43 cents of land. Subsequent to the date of the mortgage, the fifth defendant sold 5 cents out of the hypotheca in favour of the first plaintiff for Rs. 600 on 17th September, 1962. On 22nd October, 1962, the fourth defendant sold 5 cents out of the hypotheca in favour of the second plaintiff under a registered deed of conveyance. On 19th November, 1962, defendants 3 to 6 conveyed 10 cents out of the hypotheca in favour of the plaintiffs 3 and 4 under a registered deed of conveyance. Some time in 1963, that is to say, after these three conveyances relating to small portions of the hypotheca, the first defendant mortgagee instituted O.S. No. 648 of 1963 on the file of the District Munsif's Court, 'Gobichettipalayam, for recovery of the money due under the mortgage dated 8th July, 1949. Evidently, by inadvertence he failed to implead in the suit the subsequent alienees of parts of the hypotheca, viz., the plantiffs 1 to 4. The mortgagee obtained a preliminary decree, and then a final decree, and in execution of the final decree, brought all the items of the hypotheca including the alienated items to sale. At a judicial sale held on 16th January, 1967, the second defendant, who was a third party to the proceedings, purchased all the items of the hypotheca for Rs. 3,500 and obtained delivery of possession (Vide Exhibit B-2 dated 18th December, 1967). Later, the plaintiffs, who were subsequent purchasers of portions of the hypotheca, instituted the suit for redemption out of which this appeal arises. The basis of their claim was that inasmuch as they had not been impleaded as parties to the mortage action the decree and sale in O.S. No. 648 of 1963 were not binding upon them, and that they were entitled to redeem the entire suit items although they were purchasers of part only of the equity of redemption from the original mortgagor. The learned District Munsif granted the plaintiffs a preliminary decree as prayed for with costs. Against this judgment and decree of the trial Court the second defendant preferred an appeal in A.S. No. 193 of 1968 on the file of the Sub-Court, Erode. The learned Subordinate Judge held that though the plaintiffs were not impleaded in the mortgage action, they were entitled to redeem, not the whole of the mortgage, but only the shares that had been alienated in their favour. Upon this view, the first appellate Court set aside the judgment and decree of the trial Court and remanded the suit to the trial Court with a direction to pass a revised preliminary decree after determining the amount payable by the plaintiffs towards the suit mortgage for redemption of their share only. It is against this order of remand that the present civil miscellaneous appeal has been filed.

2. The intriguing question that arises for consideration is whether the subsequent purchaser of the equity of redemption in a part of the hypotheca, who had not been impleaded as a party to the mortagage action filed by the mortgagee, is, after the mortagage decree has resulted in Court sale in favour of a third party, entitled to redeem the whole of the mortgage, or only part of the hypotheca, purchased by him. Rule 1 of Order 34, Civil Procedure Code provides:

Subject to the provisions of this Code all persons having an interest, either in the mortgage-security or in the right of redemption shall be joined as parties to any suit relating to the mortgage.

The plaintiffs, who are alienees of parts of the hypotheca, are undoubtedly persons having an interest in the mortgage-security, and under Section 91 of the Transfer of Property Act, they are entitled to redeem the mortgage property. It would, therefore, follow that the plaintiffs ought to have been joined as parties to the mortgage action. What, then, is the legal effect of the failure of the mortgagee to implead the plaintiffs as parties to the suit? Where a person, who ought to have been joined as a party under this rule, is not joined as a party and a decree is passed in the suit, the decree cannot affect his rights. Though the mortgage decree and the sale held in execution thereof would be clearly binding upon the parties thereto including the primary mortgagors, it would not bind the plaintiffs, who were the subsequent purchasers of a portion of the hypotheca and j who were not impleaded in the mortgagee's suit. In other words, their right of redemption of the mortgage in favour of the first defendant would remain intact notwithstanding the fact that the mortgagor's right to redeem had been extinguished by the sale under the hammer of Court. Is this right of the plaintiffs to redeem partial or total? Redemption is as much a right as a disability. A purchaser of a part of the hypotheca would ordinarily be interested in redeeming only his share of the hypotheca. But the law would not allow him to do so, for the reason that the disintegration of the mortgage-security would result in great injustice to the mortgagee. The Judicial Committee in Nilakant v. Suresh Chandra I.L.R. (1886) Cal. 414. observed as follows:

It would put him (the mortgagee) to a separate suit against each purchaser of a fragment of the equity of redemption, though purchasing without his consent, and he would have to bring separate suits against each of them, and suits in which no one of the parties would be bound by anything which took place in a suit against another. Different proportions of value might be struck in the different suits, and the utmost confusion and embarrassment would be created.

The proviso to Section 60 of the Transfer of Property Act runs as follows:

Nothing in this section shall entitle a person interested in a share only of the mortgaged property to redeem his own share only, on payment of a proportionate part of the amount remaining due on the mortgage, except only where a mortgagee, or, if there are more mortgages than one, all such mortgages, has or have acquired in whole or in part, the share of a mortagagor.

The language of the proviso shows that piecemeal redemption, which is an advantage from the point of view of 'a person interested in a share only of the mortgaged property', is interdicted, and the liability of. a total redemption of the mortgage is imposed even upon persons like the plaintiff, who are interested in a minor share only of the hypotheca. When I questioned Mr. M.S. Venkatarama Iyer, learned Counsel for the appellants, as to why his clients should prefer a total redemption of the mortgage to partial redemption of their share of the hypotheca, he said that the hypotheca had been sold for a song and that the appellants are really fighting the battle of the original mortgagors. It is unnecessary to investigate whether this motivation for the plaintiffs' suit for total redemption is legitimate. It may be recalled that the plaintiffs have purchased from the mortgagors only 20 cents out of 6 acres, 43 cents of the hypotheca. The entirety of the hypotheca has been sold in execution of the decree, and the second defendant, who is a third party, has purchased the same in Court-auction. This purchase, as I have already held, is not binding upon the plaintiffs, because they were not parties to the mortgage action. What then is the relative position of the plaintiffs and the third party auction-purchaser? The third party auction-purchaser is now the owner of the entire hypotheca other than the items purchased by the plaintiffs. The mortagage, in so far as it related to the items purchased by the plaintiffs, must still be deemed to be subsisting. As for the plaintiffs, they are owners of the equity of redemption of a part of the hypotheca and they are entitled to ignore the mortgage decree and the sale in pursuance thereof and claim to redeem the whole mortgage. In other words, the property subject to mortgage now belongs to two different persons (the plaintiff and the second defendant) having distinct and separate rights of ownership therein. Section 82 of the Transfer of Property Act prescribes as follows:

Where property subject to a mortgage belongs to two or more persons having, distinct and separate rights of ownership therein, the different shares in or parts of such property owned by such persons are, in the absence of a contract to the contrary, liable to contribute rateably to the debt secured by the mortgage, and for the purpose of determining the rate at which each such share or part shall contribute, the value thereof shall be deemed to be its value at the date of the mortgage after deducting of the amount of any other mortgage or charge to which it may have been, subject on that date.

The rule of contribution would, therefore, be applicable as between the share purchased from the mortgagors by the plaintiffs and the share purchased by the second defendant at the Court-auction. If the plaintiffs are allowed to redeem the entirety of the mortgage, the second defendant, as purchaser of the property at the Court sale and as owner of the equity of redemption of the bulk of the hypotheca, would be entitled to file a suit for redemption against the plaintiffs, who have been subrogated to the mortgagee's right. In such a case, the Court would be called upon to decide the contribution to be made by the two part owners of the property in respect of the mortgage debt and allow the second defendant to redeem the entire property minus the 20 cents purchased by the plaintiffs from the mortgagors. As observed by a Division Bench of the Bombay High Court in Bank of Poona v. N.C. Housing Society A.I.R. 1968 Bom.109. if the very purpose of Order 34, Rule 1, Civil Procedure Code is to prevent multiplicity of suits, it is difficult to see why in this very suit by the plaintiffs the same result cannot be brought about by holding that the plaintiffs are entitled to redeem only that portion of the property which they have purchased on payment of the proportionate amount of the mortgage money. The first appellate Court has relied upon this ruling of the Bombay High Court in Bank of Poona v. N.C. Housing Society, and held that the plaintiffs arc entitled to redemption of their share only. 1 think the solution offered by the Bombay High Court is in accord with equity and the true legal position. It follows the ruling and confirm the findings of the first appellate Court, and. dismiss this appeal with costs. Leave refused.


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