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The Bank of Hindoostan, China and Japan Limited Vs. Shoroshibala Debee and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata
Decided On
Judge
Reported in(1877)ILR2Cal311
AppellantThe Bank of Hindoostan, China and Japan Limited
RespondentShoroshibala Debee and anr.
Cases ReferredSarasibala Debi v. Namla Lall Sen
Excerpt:
mortgage - reg. xvit of 1806--service of notice of foreclosure. - .....will be finally foreclosed and the conditional sale will become conclusive.' now in this case notice of foreclosure was sent by the officiating -judge of chittagong to the high court on the original side on the 14th of february, 1871. it is also clear that a, copy of the applicant's petition for foreclosure was forwarded with that notice. the notice was entrusted to a peon, by name kishto roy, for service. he made the following return: 'the within-mentioned defendants could not be found. on saturday, the 25th of february, 1871, 1 affixed a copy of the notice on the outer-door of the house no. 11, rut ton sircar's garden street, jorasanko, the dwelling-house of the defendants.' the return of the sheriff was to the following effect: 'i do hereby certify and return that 1 have made.....
Judgment:

Kemp, J.

1. The main point argued before us for the Bank, the plaintiff's, appellants, was, whether there had been a legal service upon the defendants. Section 8, Reg. XVII of 1806, provides, 'that whenever the receiver of holder of a deed of mortgage and conditional sale may be desirous of foreclosing the mortgage, and rendering the sale conclusive on the expiration of the stipulated period, or at any time subsequent before the sum lent is repaid, ho shall, after demanding payment from the borrower, or his representative; apply for that purpose by a written petition, to be presented by himself, or by one of the authorized vakeels of the Court, to the Judge of the shall or city in which the mortgaged land or other property may be situated; and that the Judge, on receiving such application, shall cause the mortgagor or his legal representative to be furnished, as soon as possible, with a copy of it, and shall at the same time notify to him, by a perwanna under his seal and official signature, that if he shall not redeem the property mortgaged in the manner provided for by the foregoing section within one year from the date of the notification, the mortgage will be finally foreclosed and the conditional sale will become conclusive.' Now in this case notice of foreclosure was sent by the Officiating -Judge of Chittagong to the High Court on the Original Side on the 14th of February, 1871. It is also clear that a, copy of the applicant's petition for foreclosure was forwarded with that notice. The notice was entrusted to a peon, by name Kishto Roy, for service. He made the following return: 'The within-mentioned defendants could not be found. On Saturday, the 25th of February, 1871, 1 affixed a copy of the notice on the outer-door of the house No. 11, Rut ton Sircar's Garden Street, Jorasanko, the dwelling-house of the defendants.' The return of the Sheriff was to the following effect: 'I do hereby certify and return that 1 have made diligent search after the within-named Sreemntty Shoroshibala Debee and Ilemendro Nath Mookerjee, but they are not, nor is either of them, found. I did, therefore, on Saturday, the 25th day of February instant, affix copies of the written notice on the outer-door of the house No. 11, Rutton Sircar's Garden Street, in Calcutta, whore the said Sreemutty Shoroshibala Debee and Hemendro Nath Mookerjee are residing. Dated this 28th day of February, 1871.' Therefore, from the returns of the peada and the Sheriff it is clear that no copy of the application of the mortgagee was furnished to the mortgagors. (After reading the evidence of the peon Kishto Roy, his Lordship continued): This return of the peon and the Sheriff's answer, taken with the peon's evidence, in my opinion, establish the fact that the notice was served on the mortgagors Shoroshibala and Hemendro Nath.

2. We have then to consider a further question,'--namely, whether the absence of the service of a copy of the written application for foreclosure is fatal to the plaintiff's claim to foreclose. It was contended by the learned Counsel for the appellant, that the Court must presume that the peon did his duty; and that as the notice winch was sent down by the Zilla Judge shows that a copy of the application accompanied that notice, the Court must presume that the peada did his duty, and that the mortgagors were also furnished with a copy of the application to foreclose. It was further contended that the words of Section 8, so far as they relate to the duty of the Judge to furnish the mortgagors with a copy of the application for foreclosure, are directory and not mandatory; and that the Court must, therefore, presume that a copy of the application to foreclose was duly furnished to the mortgagors.

3. On the other hand, it was contended by the pleaders for the respondent, that the present objection is not a technical one; and that it has boon uniformly held, both by the Sudder Court and this Court, that the procedure laid down in Section 8, Reg. XVII of 1806, must be strictly followed. The pleader also referred to the decisions in the cases of Denonath Gangooly v. Nursiny Proshad Dass 14 B.L.R. 87 and Santee. Ram Jana v. Modoo My tee 20 W.R. 363 where Markuy, J., in a case in which singularly enough the same peada, Kishto Roy, was entrusted with the service of the process, held that the procedure according to the Regulation not having been strictly followed, the foreclosure could not be declared. I am clearly of opinion that it is absolutely necessary that the mortgagor should be furnished with a copy of the written application of the mortgagee to foreclose, for the Regulation enacts that a party who is desirous of foreclosing a mortgage shall apply to the Zilla or City Judge, and that the Judge, on receiving such application, shall cause the mortgagor or his legal representative to be furnished, as soon as possible, with a copy of it, that is of the application, and shall at the same time notify to him, the mortgagor, by perwanna under his seal and official signature, that if he shall not redeem the property mortgaged in the manner provided for by Section 7 within one year' from the date of the notification, the mortgage will lie finally foreclosed and the conditional sale will become conclusive. Now there may be a case in which there is more than one mortgage: and, therefore, it is very necessary that the mortgagor should be informed of the nature, and contents of the written application made; by the mortgagee; and the Regulation enacts that a mortgagee who is desirous of foreclosing a mortgage must carry out the requirements of the law further it is also necessary, that the mortgagor should be precisely informed as to the property or properties respecting which the mortgagee is desirous to foreclose. It is argued that, inasmuch as in the Court below, the written statements of the principal defendants Shoroshibala and Hemendro Nath did not so much question the fact of a copy of the application having been furnished to them, as it did the fact of the service on them of the notice of foreclosure, if we can find that the notice was served, we ought, in the absence of any objection on the other side, either in the Court below or, as disclosed in the written statement, to hold that simple service of the notice, even if not accompanied by a copy of the application for foreclosure, is sufficient to meet the requirements of the law. Now it is true that the fifth issue raised in the Court below was, Has notice of foreclosure been served on the defendants in this suit and if the case had been tried on that issue alone, it might be that we should have come to a different decision as to the sufficiency of the service. But it is very clear that, at the hearing of the suit, both parties went to trial on a modified issue. The plaintiff accepted the modification of the issue originally drawn, and both parties argued in the Court below with reference to the question whether it was necessary that a copy of the application for lore-closure should accompany the notice, and whether in fact such copy of the application did accompany the notice, and was furnished to the mortgagors. It was the duty of the plaintiffs, having accepted this modification of the issue, to prove that the mortgagors were furnished with a copy of this application. No interrogatories were sent down to the peon who served the notice as to whether a copy of the application accompanied the notice, and was made over by him to the mortgagors. The plaintiffs never attempted to prove that a copy of the application either accompanied the notice, or was furnished to the mortgagors. We hold that it is absolutely necessary that a copy of the application should be furnished to the mortgagors; and as it is clear that such copy was not furnished, we must hold in this case that the claim of the plaintiffs to foreclose as against Hemendro Nath and Shoroshibala must fail; and we agree with the Judge on that part of the case.

4. Then it is contended that, at all events, this Court ought to declare that the plaintiffs are entitled to possession as against Hemendro Nath and Shoroshibala subject to the plaintiffs accounting for the usufruct, and leaving to the defendants the right of redemption. With reference to this contention, we find that this was not the prayer of the plaintiffs in the Court below, nor was any such relief sought for in the plaint. We, therefore, cannot pass any order with regard to the question of possession.

5. It was further argued that, as against Nundo Lall Sen, who has not appeared in this Court, the plaintiffs arc, at all events, entitled to a decree; and that the Court below was wrong in making the plaintiff's pay the costs of Nundo hall Sen. We think, with reference to the judgment of the late Chief Justice Sir 'Rtctiahd Couch sac, 11 B.L.R. 311 note, that foreclosure should be declared as against Nundo Lall Sen, subject to the decree for reconveyance on repayment, which was made by this Court on appeal from the decision of Macphkkson, J., on the 12th of May, 1873, as therein directed. We do not think it right to award any costs as against Nundo Lall Sen.

6. The appeal of the plaintiffs is dismissed with costs.

Ainslie, J.

8. The first question in this case is whether service of a copy of the application for foreclosure, together with the notice required by Section 8 of Reg. XVII of 1806, is absolutely essential. It was held by Markby and Birch, JJ., in Santan Ram Jana v. Modou Mytee 20 W.R. 363 that it was a condition precedent; and by Mahkby and Mittuw, JJ., in Denonath Gawgooly v. Nursing Proshad Dass 14 B.L.R. 87 that it was absolutely necessary. It has been said in the; latter case, the language used by markby, J, shows that lie did not then go quite so far as he did in the first case. He said that, 'if it be necessary to establish the service of a copy of the application, it has not been done.' From this the inference is drawn that there was some doubt in the mind of the learned Judge on the subject. It seems to me that this was not so, for if the preceding passage of the judgment be read with the penultimate passage, it is perfectly clear that he lays down that, without service of a copy of the application for foreclosure, there can be no foreclosure, and the same is broadly stated by Mr. Justice Mitter. The form of expression referred to probably resulted from the fact that, in that particular suit, it was necessary to dismiss the plaintiff's claim apart altogether from the question of due service of notice.

9. It has been argued that Reg. XVII of 1806 is a Regulation in relief of a mortgagor, whose title, but for the Regulation, is absolutely at an end by the contract on the expiry of the time limited in the contract; and that the order prescribing service of a copy of the application is directory merely, and not essential for the purpose of the Regulation, such purpose being simply to give due warning to the borrower that the lender intends to enforce his rights.

10. Under Reg. I of 1798 conditional sales were undoubtedly, considered as binding contracts to he enforced according to their terms. But it seems to me that Reg. XVII of 1806, by barring the operation of the contract until the application for foreclosure; and for a year thereafter, has in effect changed their character instead of being sales subject to a limited right of redemption, they have become contracts of security subject to be converted into absolute sales. This being now the nature of the transaction, we can only look upon foreclosure as a means of summarily terminating the rights of the mortgagors. It is, therefore, necessary for the Courts to hold that no part of the formalities prescribed by the Regulation is unessontial. Two cases under the Patni Regulation VIII of 1819 have been cited, one, the case of Ramsabuk Bose v. Kaminee Dossee 14 B.L.R. 394 and the other, Gouree Lall Singh v. Joo-dhisteer Kazm I.L.R. 1 Cale. 359 as being analogous to the present case. It seems to me that neither, of those cases are in point. In the first case, which was before the Judicial Committee of the Privy Council, it was held, that inasmuch as actual service of the notice bad been proved, that actual service could not be defeated by a defect in the form of the return, And the second case rather went upon the particular words of the 14th section of the Regulation, and the sale there was held good, although it was admitted that the law bad not been strictly complied with; because it was said that there were no circumstances of prejudice, and that if was necessary for the purpose of setting aside the sale that, to use the language of the law, a 'sufficient plea' should be made out; the Court held that the plea set forth was not sufficient.

11. The second point to lie considered is, whether the notice was actually sewed, and if so, whether it was accompanied by a copy of the application for foreclosure.

12. (The learned Judge, after discussing the evidence, and finding it sufficient to prove the service of the notice, but not of the copy of the application for foreclosure, proceeded :)

13. We are, therefore, thrown back on the recital in the notice issued from the Judge's Court, that a copy of the application accompanied it, as the sole evidence in the case to establish the; delivery of a copy of the application required by the Regulation; and it has been strongly contended that we ought to presume that everything that Court ought to have done was done.

14. In the case of Denonath Gangooly v. Nursing Proshad Dass 14 B.L.R. 87 Makkhy, J. distinctly refused to recognize this argument. It is said that ho based his judgment on the practice of the Original Side of this Court; hut that in respect of mofussil processes, the practice till recently was not to mention a copy of the application for foreclosure either in the Judge's order directing service, or in the Sheriff's answer to it, It may be that the practice was as stated. But even if so, I think we ought not to rest the whole case of the plaintiffs on this presumption; foreclosure being an act which puts an end to the right of the mortgagor, it must be carried out strictly in accordance with the Regulation. It rests upon such notice as the law requires to be given, and it is eminently the duty of the mortgagee to see that everything is done in conformity with the law, and to secure proper and sufficient evidence to show that the notice has been served in due compliance with the requirements of the law, in case he should be forced to come into Court to obtain a decree for possession in order to give full effect to the foreclosure. If this has not been done, he alone is to blame for if, and must take the consequences.

15. It is further said, that although the plaintiff may not be entitled to foreclosure in this case, ho is entitled as mortgagee to an order for immediate possession subject to accounting to the mortgage). In the case of Sarasibala Debi v. Namla Lall Sen 5 B.L.R. 389 a similar application was made, but the Court then declined to order possession to be given to the mortgagee on the ground that it was a distinct cause of action from that on which he had sued. It seems to me clear that we cannot in this suit make the order asked for from us. This is a suit brought on the allegation that a mortgage formerly subsisting had been terminated in consequence of the service of notice of foreclosure and the expiry of the year of grace. The plaintiff came into Court suing as actual owner of this property. What he now asks for is a right which can only be exercised by one who is a mortgagee, and not the actual owner of the property. His position is altogother changed; that which gives a cause of action in one case does not necessarily do so in the other. I, therefore, think we ought to refuse the application. To prevent any difficulties hereafter in any further litigation which may take place in respect of this mortgage, I think that there should be a distinct declaration that Nun do hall's interest in the property under mortgage to his father is foreclosed, subject of course to such conditions as may be imposed on that foreclosure by the decree made in the suit of the plaintiff against him disposed of in this Court on the 12th of May, 1873.

16. I, therefore, concur in the order made by my learned colleague.


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