1. We are invited in this appeal to set aside an order by which the Court below has directed execution to proceed on the basis of a mortgage-decree made on the 3rd June 1898. The sole point in controversy between the parties is, whether the payments admittedly made by the judgment-debtor amounted in law to a satisfaction of the decree. The decree was made by consent for Rs. 836 payable in nine annual instalments. The first eight instalments were for Rs. 93 each and the last for Rs. 92. The sums were to be paid on the 12th February of each year from 1899 to 1907. The first and second instalments were paid in time. The third instalment was not paid and the question arises whether under the terms of the decree the decree-holders did not become entitled to realise the whole of the judgment-debt. The decree was in these terms: 'The suit is decreed in accordance with the solenamah for Rs. 836. The defendants do pay to the plaintiffs the above sum in instalments specified in the schedule. If default is made in the payment of any instalment, the decree-holders will be entitled to realise the whole sum with interest at the rate of 12 per cent. per annum and such sum may be realised by the sale of the mortgaged properties.' After the first default an application for execution was made on the 4th March 1901. This is not on the record and we have not been informed whether the application was for the recovery of the whole sum due. The application, however, was dismissed for non-prosecution on the 26th March following. On the 12th February 1902, the judgment-debtor deposited in Court the sum due for the instalment of the previous year with interest thereon as also the sum due for the year 1902. On the 30th April 1902, the decree-holders took out the sums deposited. In the following year 1903, the instalment was deposited in time. On the 12th February 1904, the amount due for that year was deposited,. This was followed by an application for execution on the 4th March which was dismissed for non-prosecution on the 6th August. On the 15th September 1904, the decree-holders withdrew the sum which had been deposited on the 12th February 1902. On the 8th February 1905, the judgment-debtor applied for leave to deposit the instalment due for that year. This application was granted and the deposit was made on the 11th February (sic). The sum so deposited was taken out by the decree holder on the 17th April following. The sum due for 1906 was deposited on the 12th February 1906, and was taken out by the. decree-holders on the 17th August. The last instalment was deposited on the 23rd January 1908, but we are not informed whether this has been taken out by the decree-holders, On the 3rd January 1908, they filed an application for execution which is the foundation of the present proceedings. They prayed for recovery of Rs. 341-6 on the ground that as default had been made in payment of the third instalment, the whole of the judgment-debt had become recoverable with interest at 12 per cent. per annum, that the subsequent payments must consequently be treated as part payments in satisfaction of the decree and that consequently there was a large sum due on account of interest. The judgment-debtors resisted the application on two grounds; first, that the sums paid had been accepted by the decree-holders in satisfaction of the different instalments in spite of the default in payment of the third instalment and, secondly, that the, application was barred by limitation. The Court of first instance found in favour of the judgment-debtors upon both the points and: dismissed the application for execution. Upon appeal the learned Subordinate Judge has set aside this decision. He has held that the application is not barred by limitation by reason of the acknowledgment contained in the application of the 8th February 1905. He has also held that the acceptance of the sum deposited on account of the overdue instalment did not constitute a waiver of the right of the decree-holders and that they are accordingly entitled to realise the whole sum with interest from the date of the first default. We are invited in this appeal to discharge the order of the Subordinate Judge on the ground that he has taken an erroneous view of the question of waiver as also of limitation. In our opinion it is needless to examine the objection of limitation because the appellant is clearly entitled to succeed on the ground that there was a waiver on the part of the decree-holders of their right to enforce the terms of the decree on the occasion of the first default.'
2. It may be observed in the first place that on the occasion of every deposit made by the judgment-debtors it was expressly stated in their application that the deposit was made on account of a specified instalment. We shall take the first application which was presented after the default, namely, the application of the 12th February 1902. In this petition the judgment-debtors stated that the instalment for the previous year-had been paid out of Court to the decree-holders, but as they had fraudulently omitted to certify payment to the Court it was necessary to pay the sum again into Court and that consequently the judgment-debtors were about to deposit Rs. 93 on account of the instalment for 1001 with interest thereon for one year amounting to Rs. 11-2 also Rs. 93, the amount due for the instalment for 1902. The sum so deposited was taken out by the decree-holder on the 30th April 1902, At the time when the sum was paid-out tb the decree-holder, an order was recorded to the effect that payments had been made on account of the instalments for 1901 and 1902. It is not necessary for our present purpose to set out in detail the circumstances in connection with the subsequent deposits. It is sufficient to observe that on each of these occasions a petition was presented by the judgment-debtors specifying the particular instalment in respect of which the payment was made, and an order was recorded by the Court to the effect that the money had been deposited for such instalment. It must be assumed, therefore, that the decree-holders withfull knowledge of the circumstances under which the different deposits had been made by the judgment-debtors accepted payment of the money. The question arises under these circumstances whether there had been on the part of the decree-holders a waiver of their right to enforce the terms of the decree by reason of the first default. Reliance has been placed on behalf of the judgment-debtors upon the cases of Girindra Mohun Roy Chowdhury v. Bocha Das 1 Ind. Cas. 49 : 9 C.L.J. 226 : 13 C.W.N. 1004. 36 C. 394, Jadab Chandra Bakshi v. Bhairab Chandra Chuckerbutty 31 C. 297 and Kashi Ram v. Pandu 27 B. 1. On behalf of the respondents reference has been made to the decision of this Court in the case of Hurri Pershad Chowdhury v. Nasib Singh 21 C. 542. It has further been suggested that the question is one of fact and that it is not competent to this Court to examine in second appeal the propriety of the conclusion of the learned Subordinate Judge. For the solution of the question raised, it is not necessary to examine the various decisions of this Court which may be difficult to reconcile and which are all analysed in the case of Girindra Mohan Roy Chowdhury v. Bocha Das 1 Ind. Cas. 49 : 9 C.L.J. 226 : 13 C.W.N. 1004. 36 C. 394. It is sufficient for. our present purpose to refer to the decision of a Full Bench of the Bombay High Court in Kashi Ram v. Pandu (3), where the principle applicable to cases of this description was lucidly set forth by Sir Lawrence Jenkins, C.J. as follows: 'The true view appears to us to be, that though there may be a failure to pay punctually under an instalment decree, still the subsequent conduct of the parties may preclude either of them from afterwards asserting that payment was not made regularly and in satisfaction of the obligation under the decree.' In support of this view reference was made to the observations in the cases of Norton v. Wood 1 Russ. & Mylne 178 : 32 R.R. 181 and Thompson v. Hudson L.R. 4 H.L. 1 : 33 L.J. Ch. 431 : 2 Eq. 612. In the first of these cases Lord Lyndhurst said: The question whether payment of interest tendered after it is due and accepted by the creditor is or is not a regular payment, is one which at law would be left to the jury. As to the construction to be put upon the memorandum I agree with the Vice-Chancellor and then the only remaining question will be, whether this amounts to a regular payment of an interest. I think if money is tendered after the period when it becomes due and the person to whom it has been due, does not see fit to refuse it, it is a waiver of the objection; it must be taken as a regular payment if the person receives it the day after without making any objection.' In the second case Lord Hatherley observed as follows: It is simply that, upon one of the conditions being broken, a concession is made in respect of that one condition with regard to which the appellants could never again insist upon their complete rights.' In other words, the real test is to determine whether there has been a renunciation or an abandonment of a right by the execution creditor. Whether there has been such a renunciation or not must be def ermined by a reference to the circumstances of each case. But two useful tests may be applied. In the first place, we may examine whether the payment which has been made may be treated as a valuable consideration for the renunciation or abandonment on the part of the decree-holder; secondly, we may consider, whether the execution creditor has by his act intentionally caused the other to believe that the payment was received in satisfaction of the obligation and whether the parties, have acted on that belief, because if they have done so, they cannot afterwards question their legality. In the case before us, both the tests point to a conclusion in favour of the appellants. The judgment-debtors, when they deposited the overdue instalment on the 12th February 1902, paid not only the sum due but also the interest due thereon at the rate specified in the decree. It is further clear that although they repeatedly, on subsequent occasions, deposited money in Court on the allegation that the payments were made in satisfaction of certain specified instalments, the decree-holders withdrew the sums after orders had been made to the effect that the payments had been made in satisfaction of the instalments specified. It is impossible to hold, under these circumstances, that it is open to the decree-holders subsequently to turn round and contend that the payments were made only on account and in part satisfaction of the decree, and that they are entitled to claim interest upon the entire judgment-debt. It might have been open to them on the occasion of the first deposit after default to contend that they are not bound to accept the payment on the condition on which it had been made. If they resisted the payment on that ground, there would have been an adjudication and itis conceivable that in the event of a decision favourable to the decree-holders, the judgment-debtors might have repaid the whole of the judgment-debt with such interest as was then due. The conduct of the decree-holders, however, lulled the judgment-debtors into a sense of security. They proceeded on the assumption that the decree-holders had waived the default and accepted the deposit and they continued to make from time to time other deposits in satisfaction of the subsequent instalments. It does not lie in the mouth of the decree-holders now to contend that they accepted the payments on an entirely different footing. But the learned Vakil for the respondent has contended that a mere omission to sue does not constitute waiver. This has not been disputed by the appellants who have, however, relied upon the authority of the cases of Hurri Pershad Chowchury v. Nasib Singh (4) and Jadub Chandra Bakshi v. Bhairab Chandra Chuckerbutty (2), to show that although mere omission to sue may not constitute waiver the acceptance of an over due instalment by a creditor may constitute a waiver of his right to recover the entire debt due on account of the default, but the fact that he has done so may not prejudice his right to declare the whole debt to be due on a subsequent occurrence of a similar default in the payment of interest. It is clear, therefore, that the view taken by the learned Subordinate Judge cannot be supported.
3. The learned Vakil for the respondent has, as a last resort, suggested that it is not competent to this Court to interfere with the conclusion of the learned Subordinate Judge as it is one of fact. In answer to this argument, it is sufficient to refer to the observation of Sir Lawrence Jenkins, C.J., in the case of Kashi Ram v. Panda (3), where the learned Chief Justice observed as follows:
Notwithstanding that it is a second appeal, the Court is entitled to hold that there has been a waiver, for it is a mixed question of law and fact that is involved.
4. The result, therefore, is that this appeal must be allowed, the order of the Court below discharged and that of the Court of first instance restored. The application for execution is dismissed with costs throughout. We assess the hearing fee in this Court at five gold mohurs.