1. This is a cross-objection filed under Order 41, Rule 22 of the Code of Civil Procedure by Srimati Susila Bala Dasi who is the wife of Bhuban Mohan Ghose.
2. The suit was brought against Surendra Nath Pramanio and Bhuban Mohan Ghose carrying on business under the name, style and firm of ' Eastern Trading and Engineering Co.' The third defendant was Srimati Susila Bala Dasi, and the fourth was Priag Das Jamuna Das, who alleged to be puisne mortgagees. One of the allegations of the plaintiff Bank was that premises No. 56, Amherst Bow had been mortgaged to the plaintiffs by deposit of the title deed as additional security for the amount owing to the Bank on an account called 'O' which the defendants Nos. 1 and 2 had with the Bank.
3. Bhuban Mohan Ghose and his wife Susila Bala Dasi alleged in their written, statements that these premises belonged to Susila; on the other hand, the plaintiffs alleged that Susila was merely the benamidar of defendants Nos. 1 and 2.
4. The learned Judge held that the premises were the property of the firm, i.e., of the defendants Nos. 1 and 2 and that Susila was merely the benamidar in respect of the said premises. He gave a declaration that the Bank was entitled to a charge on the said premises; and he directed accounts to be taken, and in default of payment of the amount found due he directed a sale of the premises. There were other questions decided in the suit, but the cross-objection relates to 56, Amherst Bow, only. Judgment was given on the 10th of April, 1923 and on the 16th of June, 1923 Bhuban Mohan Ghose filed an appeal against the said judgment.
5. On the 25th of June, Susila applied for leave to file a memorandum of appeal. It appears that the time for filing the appeal had expired, and her application was refused.
6. On the 3rd of July, Susila is alleged to have been served with notice of her husband Bhuban Mohan Ghose's appeal; and on the 1st of August she filed the cross-objection which is the subject-matter of this appeal.
7. On the 20th of August, 1923 Bhuban Mohan Ghose applied for extension of time to file the paper-book. He was allowed two months' further time, but he was directed to furnish security to the extent of Rs. 1,500 on or before the 14th of September, 1923. This security was not given, with the result that on the 11th of March, 1924 Bhuban Mohan Ghose's appeal was dismissed for default.
8. Susila Bala obtained leave to print the paper-book and to proceed with her cross-objection but this was subject to any objection which might be taken at the hearing.
9. The learned Counsel for the Bank took a preliminary point that the objection of Susila was not a cross-objection within the meaning of the above mentioned rule and urged that the objection should not be entertained by this Court. After hearing the arguments on the preliminary point, my learned brother and I decided to hear the objections of Susila on its merits and we postponed our decision on the preliminary point. I propose to deal with the merits in the first instance. The first point made by the learned Counsel, who appeared for Susila, was that assuming that the premises No. 56, Amherst Bow were the property of the defendants Nos. 1 and 2 there was no valid mortgage. He argued that when the title deed was deposited by Bhuban Mohan Ghose with the Manager of the Bank, a letter, dated 31st October, 1918 was given by Bhuban Mohan Ghose to the Manager, which constituted the bargain between parties, that it was not registered under the Indian Registration Act and consequently it was not admissible in evidence and that no oral proof of the mortgage was admissible.
10. The learned Judge held that registration was not necessary because it could not be said that it was the letter of 31st October, 1918 and nothing else that created the charge: he based this decision on the evidence of the Bank Manager which he accepted as truthful and reliable evidence. The principle which is applicable to this point was stated by Lord Carson in Subramanian v. Lutchman A.I.R. 19143 P.C. 50. After examining the authorities relating to the matter, Lord Carson is reported to have said as follows: ' Applying the principles thus laid down to the present case what this Board has to determine is, did the document of 15th July, 1908, constitute the bargain between the parties, or was it merely the record of an already completed transaction?' In my judgment that is the test which should be applied to the question involved in this case. The effect of the evidence of the Manager of the plaintiff Bank is that Bhuban Mohan Ghose told him that he was purchasing the property, 56, Amherst Row, for the firm, that Bhuban Mohan Ghosa asked him to assist by advancing the money necessary for the purchase, and that when the property was purchased it would be used as additional security to the Bank for the advances made by the Bank to the defendants Nos. 1 and 2.
11. This happened in August, 1918. Accordingly the money was advanced to the extent of about Rs. 12,000 on the understanding that it would be used for the purchase of the property and that the property would be given as an additional security to the Bank. The property was' in fact purchased in August, 1918. On the 31st October, 1918 the Manager of the Bank was in the office of Bhuban Mohan Ghose, and I have no doubt that the object of the visit was to obtain the title deeds of the premises No. 56, Amherst Bow. On that day Bhuban Mohan Ghose handed the conveyance to the Bank Manager. The Bank Manager was examined as to what happened on that occasion, several answers were obtained to questions of a leading character. Eventually ha was asked to state what happened on that date. His evidence was as follows:
Q.-Tell me what happened on the date on which this letter was made over to you and the title deeds were handed over?
' A.-He handed over the title deeds to me and I wanted from him a letter. I said you must give me a letter to say that this deposit is an equitable mortgage and he sent this letter to me.
' Q.- The Court:-How long after the handing over to you of the document was this letter given to you?
' A.-It may have been on the same day or a day or two after this was brought to me. This was to be brought to me from time to time and whenever required 'he would hand over the document to me, and that day he handed it over to me, but whether it was on the same or a day or two after that, I do not exactly remember.
12. Again in cross-objection the Manager -was asked.
Q.- Until a letter was given you considered there would be no valid mortgage? Why not?
' A.-I knew it was the firm's property.
13. The money was taken from me on the understanding that the property would be purchased for the firm and I would get that property as security. Bhuban told me that distinctly many times.
Q.-At this interview did you tell Bhuban that according to Bank's laws a married woman's property could not be taken as security unless she has been fully explained the nature of the security and -the consequence thereof?
' A.-There was no such talk. He only laughed at me when I wanted his wife's letter.
' Q.-Who drafted this letter which was signed by Bhuban, this letter of 31st October, 1918?
'A.-I do not remember. I do not think I did. I only gave general directions as to what should be mentioned in that letter.
'Q.-You were satisfied that the letter was in order?
'A.-I got that letter from him subsequently and I kept it in the safe. I did not carefully go into it. I thought it was all right.'
14. It therefore appears to ma on the evidence of the Bank Manager, which the learned Judge accepted and the truth of which has not been seriously attacked in this Court, that the money was advanced in August 1918 by the Bank on the understanding that the property would be purchased by the firm of the defendants Nos. 1 and 2 and that when purchased the property would be utilised as additional security for the Bank's advances. It was in pursuance of this arrangement that the title deed was handed to the Bank Manager on the 31st October, 1918 by Bhuban Mohan Ghose. There was no record of the arrangement which had been made and it was therefore only reasonable that the Bank Manager should ask for a letter from Bhuban Mohan Ghose.
15. Consequently the letter of the 31st October, 1918 was given as a record of the agreement which had been made.
16. The wording of the letter is not only consistent with but in my opinion supports this view.
17. The phrase 'we beg hereby to keep with your Bank' seems to point to the fact that the deed had already been placed in the hands of the Bank, and the letter was written for the purposes of stating the object for which the Bank was entitled to keep the same.
18. The fact that the Bank Manager subsequently drafted a letter which he desired Susila to sign does not in my judgment militate against this view. The Bank Manager said that he came to know that the conveyance was in the name of Susila when he received it on the 31st October, 1918, and the Manager, when he discovered this naturally desired a letter from Susila; be stated: ' Though he said it was the firm's property, yet I thought it safe to have his wife's permission in writing.' I understand from this that he was told the property belonged to the firm but the property appeared to be in the name of Susila. Consequently ex majore cautela he desired a letter from Susila. The result is that in my opinion the letter of the 31st October, 1918 did not constitute the bargain between the parties: on the contrary, it was merely the record of a transaction which had already been completed. Consequently, oral evidence of the transaction was admissible.
19. The next point relied upon by the learned Counsel for Susila was that she should not have been made a party to the suit and that the suit should have been dismissed as against her.
20. It was argued that the only proper parties to a suit on a mortgage in which the prayer is amongst other things for a sale, are the mortgagor and mortgagee and any parties who may have acquired an interest from them subsequently to the mortgage, and that no adverse party who is a stranger to the mortgage should be joined as a party to the suit or, in other words, that the only proper parties to such a suit are persons interested in the equity of redemption.
21. Speaking generally, it may be said that a suit to enforce a mortgage in which the adverse claims of persons not privy to the mortgage and setting up a title paramount to that of the mortgagor and the mortgagee are sought to be investigated, is open to objection on the ground of misjoinder and inconvenience: see Radha Kunwar v. Thakur Reoti Singh A.I.R. 1916 P.C. 18.
22. The question, however, is not one of jurisdiction, and at most the misjoinder is an irregularity or inconvenience; in this case the plaintiffs' case was that the mortgage was made by Bhuban Mohan Ghose on behalf of the firm and that Susila was merely the benamidar and consequently she was joined as a party. That question was investigated in the suit. Evidence was called in respect thereof and the learned Judge found that the plaintiffs' case was true. I am not satisfied that in the facts of this case it was improper for the plaintiffs to join Susila as a party. Assuming, however, for the moment that it was irregular for the plaintiffs to join Susila as a party to the suit, it is clear that she has not suffered any prejudice by reason of the course which was adopted. In my judgment the irregularity, if any, is not such as would justify this Court in setting aside the decree. The learned Judge on the facts came to the conclusion that the premises were the property of the firm and that Susila was merely the benamidar. I see no reason for disagreeing with the learned Judge in this respect.
23. The result is that I am of opinion that this appeal should be dismissed.
24. In view of the conclusion, at which I have arrived on the merits of the objections raised by Susila, it is not necessary to give any decision on the preliminary point raised by the learned Counsel for the plaintiff Bank. It is sufficient for me to say that as at present advised and without deciding the question, I am not satisfied that the objection of Susila was one which ought not to be entertained and adjudicated upon by the Court. For the above reasons in my judgment the cross-objection of Susila must be dismissed with costs.
25. I propose to deal first with the question whether the cross-objection taken by Susila ought to be entertained on the merits.
26. Mr. Langford James for the respondent-Bank contends that her objections are not cross-objections, that they are directed solely against the plaintiffs and that they repeat Bhuban's own grounds of appeal-He says that Susila should have filed her own independent appeal in time and that to allow her cross-objections in this case is to defeat the limitation law. He relies upon the principle deduced from certain decided cases that cross-objections as between respondents are not as a rule-admissible. It appears to me that the difficulty on this part of the ease arises; entirely because Bhuban in his grounds of appeal made a certain number of complaints against the judgment of the learned Judge which did not lie in his own mouth at all. He complained that the interest of Susila had been held to belong to himself or to his firm. He complained that the property of Susila was being taken from her to the extent of the mortgage notwithstanding she had never authorised the mortgage and he complained further that it was being taken from her although the mortgage was void for want of registration of the memorandum.
27. Now one can understand that a man has an interest to object to a declaration that he has mortgaged his wife's property without her permission, but the judgment of the learned Judge in this case was given in the presence both of Bhuban and of Susila. If the judgment stands, Susila could never sue her husband on the ground that he had, in fraud of her,, intermeddled with her property. Accordingly, on this part of the case most of the grounds of Bhuban's appeal ware grounds which might be good or bad in the mouth of Susila but which on the face of them had nothing really to do with him.
28. Now, it is quite plain that the rights of Susila, whatever they may be, cannot be taken from her because her husband has wrongly chosen to fight her case as well as his own. She must be entitled to fight her own case. Looking at it from that point of view one has to ask oneself whether Susila's cross-objections are really objections directed against Bhuban. In my opinion, whatever Bhuban may admit and whatever Bhuban may assert, Susila's contentions, that the property was hers and not Bhuban's and that if Bhuban mortgaged it at all he did it without her authority, are contentions adverse to Bhuban's interest. They may not be contrary to what Bhuban says; but the learned Judge has disbelieved both Bhuban and Susila altogether. Seeing that her claim in this appeal to substantiate that the property was hers and that she never authorised a mortgage is a claim to have that established as against Bhuban as well as against the plaintiff Bank, it appears to me that the cross-objections are cross-objections in the full sense of the word. She is establishing or seeking to establish a right of her own adverse to Bhuban's right. That fact has consequences as against the plaintiff-respondent. But this is not a purely lateral cross-objection between the respondents in which the appellant is not interested.
29. For these reasons it appears to me that the case does not come within the decisions which say that in the case of a purely lateral objection as a rule the Court will not permit it to be urged. I think, therefore, that Mr. Langford James's preliminary point fails.
30. The next question is whether or not this suit was bad for mis-joinder of causes of action and cannot be entertained. It appears to me that there is a certain danger, in dealing with the decided cases, of omitting to notice that the form of this question has been very greatly changed since the case most relied upon before us was decided. I refer to the case of Joggeswar Dutt v. Bhutan Mohan Mitra (1906) 33 Cal. 425. It is the leading authority in this Court upon this subject. The case was decided in 1906 and the case proceeded upon the Code of 1882 and upon certain prior decisions in the Privy Council and elsewhere. In 1896 a change was made in O.16, Rule 1 of the Rules of the English Supreme Court. It was made as a consequence of a decision in the House of Lords in Smurthwaite v. Hannay (1894) A.C. 494. [Compare also Sadler v. Great Western Railway Company (1896) A.C. 450]. In the English Rules, as in the present Code, there is one order dealing with joinder of parties-O. 16. There is another order dealing with joinder of causes of action-O. 18. The change was made by inserting certain words into Order 15 and, I do not think, it can be said to have been well settled that the change enlarges the right to join causes of action until the decision in Bulloch v. London General Omnibus Company (1907) 1 K.B. 264. It was followed by the case of Compania Sansi-nena de Carnes Congeladas v. Houlder Brothers & Co., Limited (1910) 2 K.B. 354.
31. It is now, however, well-settled that the change in Order 16, Rule 1 does extend to enlarge the right to join causes of action. In England as regards defendants Rule 4 of Order 16 was not dealt with, but by course of decisions it is now established that the change in Rule 1 impliedly makes a corresponding change in Rule 4. That took a considerable further time to establish, but the authority for that may be seen in such a decision as Thomas v. Moore (1918) 1 K.B. 555.
32. Now, until 1908 the law in India under the Code of 1882 was the old law of Smurthwaite v. Hannay (1894) A.C. 494, but in 1908 the legislature not only carried into effect the English change of 1896 by altering the words of what is now Rule 1 of Order 1 but it carried into effect also an express alteration of Rule 3 of Order 1 applying the change specifically to defendants. Rule 3 now reads: ' All persons may be joined as defendants against whom any right to relief in respect of or arising out of the same act or transaction or series of acts or transactions is alleged to exist, whether jointly, severally, or in the alternative, where if separate suits were brought against such persons any common question of law or fact would arise.'
33. It may be observed that when the Code intends that certain causes of action should not be joined at all or except with special leave, it says so. Certain causes of action cannot be joined with suits to recover immovable property. There is another Rule precluding the joinder of causes of action against an executor, but there is no such Rule in the case of mortgage suits. There is further in Order 34, Rule 1, a revised edition of what used to be Section 85 of the Transfer of Property Act and that Rule is to the effect-' All parsons 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 old phrase in Section 85 'having any interest in any property comprised in a mortgage' gave rise to a considerable difficulty and was altered in 1908. Whether one is dealing with Section 85 or with Order 34 (1)-the purpose of the Rule is to state what parties are necessary parties in a pure mortgage suit and the Rule is in no way directed to the question whether any causes of action may be joined with a claim upon a mortgage or, if so, in what circumstances.
34. I would like here to make a parenthetical observation. In a case such as the present the plaintiffs' cause of action against Susila was not in substance or otherwise a cause of action in ejectment. They had no claim and they made no claim to possession of the property. So far as the plaintiffs were concerned, they were bound to suppose that if they got a mortgage decree Susila or her husband or anybody else interested in the equity of redemption might very well pay off the mortgage in which case the plaintiffs never would have a claim to possession either by themselves or through any auction-purchaser taking under a sale in their suit.
35. These matters being premised it seems to me that the present case must be governed not by the old Rules of the Old Court of Chancery but by the Cods. It seems to me further that the case for the present purpose is highly exceptional. I am not going into the facts, but the question whether a mortgage had bean concluded or not was in that ease inextricably bound up with the question of benami. It was also bound up with the question whether or not Bhuban was a partner of Surendra. That question of partnership in turn affects the question whether the property was given by Bhuban to his wife. In turn that affects the question whether or not the document of the 31st October was itself the repository of the argument to mortgage or was a mere record of a completed transaction. If in this case the plaintiffs had sued upon their mortgage raising no question of Susila's title to the property and if afterwards they brought a suit for a declaration that she was a mere benamidar and that her interest was bound by the mortgage, not one but several identical questions of fact would have had to be litigated twice. The mortgage in the case, if Susila was not a benamidar, was in everybody's view a pure nullity. It was suggested at the Bar that the proper course was to bring a simple mortgage suit, sell the interest of the plaintiffs (which might very well be nothing) under the decree, and then let the auction-purchaser litigate with Susila the question of her title. Whatever is right or wrong, that undoubtedly would have been calamitous. The only possible way to ensure that the property should not be wasted from the point of view of the mortgagors and the mortgagees would have been to bring a declaratory suit against Susila to a conclusion before this mortgage interest was sold. In these circumstances, and these being the provisions of the law as to joinder, it appears to me that the correct view in this matter is to ask whether the case does or does not come under Rule 3 of O.1. However painful it may be to old fashioned equity lawyers to find causes of action lying together in one suit, if such a case comes under Order 1, Section 3, it cannot be held to be incompetent. In my opinion, the case is very plainly within O.1, Rule 3. If there were any objection on the ground of convenience, it must be observed that this case was tried in the High Court and not before a Munsif, with the apparatus of settlement of issues at the first hearing. Susila could, either before the finding of the written statement, or immediately after, have applied to the Judge under Order 2, Rule 6 to have a separate trial if she wanted to make that application. As I understand what she did she acted just as if the case was being tried in the mofussil. She took the ground of misjoinder in her written statement and the matter only came before the learned Judge when the parties were prepared for trial. The point was taken not as a point of convenience under Order 2, Rule 6, but as a point of law which the learned Judge as a matter of procedure was bound to give affect to. The learned Judge rejected that argument, as I think correctly. He was satisfied that there was no reason or prejudice to Susila in the course of the trial, and rightly did not regard the joinder of the causes of action in the circumstances of this case as incompetent.
36. After discussing English cases and American cases Mr. Justice Mookerjee in She case of Joggeswar Dutt v. Bhuban Mohan Mitra (1906) 33 Cal. 425 gives two sets of reasons as the basis of his judgment. He says: 'In our opinion the rule is founded on two broad and intelligible grounds. In the first place, it is based on the reason that a suit to enforce a mortgage, in which the adverse claims of persons not privy to the mortgage, and setting up a title paramount to that of the mortgagor and mortgagee, are sought to be investigated, is open to objection on the ground of misjoinder and multifariousness. Under Sections 44 and 45 of our Civil Procedure Code there cannot be joinder of causes of action of this description.' Subsequently the legislature has token that ground away. 'In the second place,' says the learned Judge, 'if adverse claims be allowed to be litigated in a mortgage suit, such claims may obviously be determined by a Court, which would have no jurisdiction to entertain a suit for their determination, if properly framed. The, valuation of a suit to enforce a mortgage is dependent upon the amount claimed by the plaintiff, which may obviously have no relation to the value of the property in respect of which an adverse claim is set up,' and he gives illustrations to show that there would be difficulty in these circumstances. The present case was tried on the Original Side where there is no question of valuation and no question of Court-fee. The property was a property situated within the jurisdiction of the Original Side and there is, under the second ground mentioned by Mr. Justice Mookerjee, no difficulty at all in the present case. I would point out, however, that the position in such a case as the present is not simply that of an ordinary mortgage claim. The plaintiffs in effect sought against Susila a declaration that she was only a benamidar. They got such a declaration. Under Section 17 of the Court Fees Act you can join two or more things as far as the Code allows: and, the amount of fees will be the accumulated amount you have to pay for each cause of action. Under the Suits Valuation Act in a case of declaration where there is no right to consequential relief it would appear that the case is not one where the charge is ad Valorem and consequently the matter is governed by Section 9 which allows the High Court to make rules. It is quite clear that a cause of action cannot be joined unless the Court has jurisdiction to deal with it. I see no special difficulty or complication when we come to join a cause of action in a mortgage suit as distinct from any other suit. For these reasons I do not think that the objection as to misjoinder requires us to 'allow the present appeal. I must not however be understood to throw doubt upon the need for a high degree of caution before permitting questions of paramount title to be investigated in a mortgage suit. Both as to competence and convenience there will generally be much to consider.
37. Reference has been made to the case of Radha Kunwar v. Thakur Reoti Singh A.I.R. 1916 P.C. 18. There the observation is that the adverse claim was entirely independent of the mortgage transactions. Their Lordships stated that they thought that the joinder of these parties was irregular and that it would only tend to confuse. I only desire to observe that if we look at the terms of Order 1, Rule 3 we find that joinder is not always permitted where a right to relief arises out of the same transaction: there is a further condition, namely, 'where if a separate suit were brought against such a person any common question of law or fact would arise.' It appears to me that the dictum with reference to the case of Radha Kunwar v. Thakur Reoti Singh A.I.R. 1916 P.C. 18 affords no justification for refusing to apply the terms of Order 1, Rule 3.
38. As regards the question of registration of the document of 31st October I entirely agree with the judgment of the learned Chief Justice and have nothing to add.