1. This is an appeal by the plaintiff from a decree for sale passed in a suit for enforcement of a mortgage the amount secured by which was payable in instalments. The bond was for a principal amount of Rs. 7,500 and was dated 30th Aswin 1327=16th October 1920. The first instalment was payable in Chaitra 1327 and in default of payment thereof the whole amount was to fall due on 1st Baisakh 1328=14th April 1921. On 28th March 1922 the suit was instituted, the claim being laid at Rs. 7,500 as principal, and Rs. 862-8.0 as interest. The defendants filed a written statement challenging the bond as fraudulent and void for want of consideration and upon other grounds, and also setting up a part payment of Rs. 92. A decree was passed ex parte against defendant 1. On the same day the claim against the other defendants was given up on compromise and as against them the suit was dismissed. On 8th January 1924, defendant 1 applied for setting that decree aside under Order 9, Rule 13, Civil P.C. This application was dismissed for default on 14th June 1924, but was eventually restored and ultimately dismissed on the merits on 27th June 1925. On appeal to the High Court this dismissal was, by an order made on 12th April 1927, set aside and the suit was restored to hearing on condition that defendant 1, appellant, paid to the plaintiff all costs incurred by him in the restoration proceedings in the trial Court as also in the appeal within a given time. The condition was complied with and on 11th August 1928, defendant 1, who was now the sole defendant in the suit and 'will hereafter be referred to as the defendant, filed an additional written statement in which it was alleged:
(1) That the plaintiff had in execution of the ex parte decree got the mortgaged properties (34 items of jotes) put up to sale and purchased some of them in his own name and others in the benami of other persons; (2) that thereafter the landlord of jotes Nos. 1, 2, 3, 4, 5, 6, 7 and 21 got the said jotes sold up for arrears of rent and the plaintiff deposited the decretal amount and damages, that the landlord raised objection as to the plaintiff's locus standi to make the deposit, and a date was fixed for the hearing of the objection, but the plaintiff in the meantime secretly entered into an arrangement with the result that the sale was not set aside and the plaintiff himself took settlement of the said jotes from the landlord; and (3) that the plaintiff, without the knowledge of the defendant collusively put up jotes Nos. 29 and 32 to auction, and purchased the same himself and was in possession and making large profits out of them.
2. The Subordinate Judge found that 13 of the jotes had been sold for arrears of rent, that all of them were sold in execution of decrees for rent obtained by the landlord and shortly thereafter the plaintiff obtained settlements of them from the landlord. He held that in those circumstances it could not be said that the plaintiff was in possession of the jotes as mortgagee and so he overruled the defendant's contention that the plaintiff was bound to render account of the profits that he had taken. He found that the rent sales had taken place on 2nd September 1924 and the plaintiff thereafter purchased the mortgaged property in execution of his ex parte decree on 19th September 1924, and that therefore at the time of the rent sales the mortgage lien was in force. The ex parte decree as well as the sale thereunder were subsequently set aside and with those we are no longer concerned. He held that if the landlord desired to annul the incumbrance it was incumbent on him to issue notices under Section 167, Ben. Ten. Act, but such notices were never issued. He found that the plaintiff fraudulently and in collusion with the landlord gave up his efforts to set aside the rent sales and withdrew the deposit he had made only with a view to get settlement of the jotes from the landlord, which he did in fact obtain thereafter. In these circumstances he held that
the most equitable course would be to split up the mortgage and to hold it satisfied to the extent of the properties so taken leases of by the plaintiff.
3. As neither party had adduced any evidence to prove the values of the several jotes it was not possible to apportion the mortgage dues amongst the jotes. He directed an inquiry by a Commissioner as regards their values and in the meantime made a decree the terms of which will hereafter be set out. On the question of interest the Subordinate Judge held that the plaintiff was primarily responsible for the protraction of the suit, his view being that the constitution of the suit itself was unwarranted, and that the ex parte decree was not properly obtained, and that therefore for the four years that it took the defendant to get that decree set aside no interest should be allowed. The relevant portion of the decree, in the light of the contentions urged before us, is as follows:
The suit is decreed in part for that portion of the claim which may be found due on apportionment between the 13 jotes sold for arrears of rent and taken leases of by the plaintiff. The portion of the principal amount so decreed would carry interest at the bond rate from institution of the suit up to the period of grace minus such interest for four years... defendant 1 is given six months time for payment of the amount found due on apportionment and after the amount is declared. If no such payment is made by the defendant within the period of grace the jotes Nos. 10 to 15 and 17 to 20 and Nos. 22 to 28 and 81 to 34 or a sufficient part thereof would be sold.
4. A preliminary objection was taken on behalf of the respondent as regards the competency of the appeal, it being said that the decree is not a final decree for sale but is merely a decision embodying certain conclusions and directions under which the Commissioner is to hold 'an investigation,' and that a final decree can only be passed after the Commissioner has ascertained the values of the properties and on such valuation the defendant's liability has been fixed. We are not prepared to uphold this objection. A final decree for sale would, no doubt, ordinarily contain the ascertained amount of the mortgagor's liability. But in view of the events that had happened during the pendency of the suit the mortgage lien proportionate to the values of the jotes which came to be in the plaintiffs' possession was regarded by the Subordinate Judge as discharged and he held that it remained attached to the other jotes only proportionately to their values. In such circumstances a decree passed in a form which directs an account to be taken of what would be due to the plaintiff and orders that in default of payment of the amount so due on a day within six months from the date of declaring in Court the amount so due, the mortgaged property or a sufficient part thereof be sold, is clearly a preliminary decree for sale in accordance with Rule 4, Order 34. It may be that an application under Sub-rule (2), Rule 5 would be necessary and a final decree for sale will have to be made under that sub-rule before a sale takes place. But a decree under Rule 4 is none the less a decree from which an appeal lies. On the merits of the appeal two questions arise: First whether the order as to interest made by the Judge is right; and second whether the order as to the splitting up of the security and a proportionate mortgage lien to attach to the remaining jotes in proportion to their value is proper.
5. The second question may be dealt with first. (His Lordship then dealt with the second question and concluded that the decree made by the Court below splitting up the mortgage lien, is just and fair.) As regards the other question, namely, whether the order as regards interest made by the learned Judge is right, we are of opinion that such an order was not justifiable and should not have been made. We cannot see how the plaintiff could be held liable for the protraction of the litigation for the period taken in setting the ex parte decree aside. We do not see why the learned Judge took the view that the suit was intentionally framed with unnecessary parties as defendants or that the ex parte decree was improperly obtained. His remarks in this connexion seem to us entirely unsupportable. Indeed, there was enough said in the judgment of this Court dated 12th April 1927 which would indicate that it was more as a matter of indulgence than anything else that the ex parte decree was set aside. As therefore we must hold that this appeal which the plaintiff has preferred was not altogether without justification, we cannot with propriety make an order disallowing him interest for the period during which it has been pending. We cannot therefore find any reason on which we can support a deduction of interest for four years as the Subordinate Judge has made or for any period at all.
6. The result is that the appeal should be allowed in part, the decree of the Court below being varied by deleting the order as to deduction of interest for four years contained therein. With that variation the said decree will stand. On a careful consideration of the facts and circumstances of the case we think we should make no order for costs in the appeal.