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Mahraja Sir Rameshwar Singh Bahadur, K.C.i.E. Vs. Dhanpat Singh and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata
Decided On
Judge
Reported in5Ind.Cas.334
AppellantMahraja Sir Rameshwar Singh Bahadur, K.C.i.E.
RespondentDhanpat Singh and ors.
Cases ReferredGanga Pershad Sahu v. Moharani Bibi
Excerpt:
guardians and wards act (viii of 1890) section 31 - permission to morgtage minor's estate--permission not in due form--mortgagee not bound to go behind order--fraud. - .....the property and pointing, out that there was a decree against the minors and others, that the minors' property had been advertised for sale and that they would suffer great loss if the property was put up to auction sale and that it was impossible to satisfy the debt. then, on that petition the district judge gave the permission and that constituted the order on which the mortgage was executed. it has been pointed out that does not comply with the provisions of section 31 and possibly there may be force in the contention. though it does not comply, as it ought to in form, with section 31, yet i think it does in substance; because on the petition which was granted there appear the requirements which are provided for in section 31, namely, the necessity or the advantage which would.....
Judgment:

Harington, J.

1. These two appeals are preferred by the plaintiff against decrees passed by the District Judge of Durbhanga, affirming the decisions of the Subordinate Judge of that District dismissing the suits brought in respect of certain mortgages. The ground on which the suits were dismissed was that the mortgages were created on the property of some minors and that the permission granted to the guardian to execute those mortgages ought not to have been granted because the debt for which the money was borrowed was one for which the minors were not liable; that as the permission ought not to have been granted, the mortgage could not be executed under the Guardians and Wards Act and the plaintiff, therefore, was not entitled to recover the amount.

2. Against the decision of the lower Court, the mortgagee has appealed and the appellant contends that the order having been made permitting the guardians to execute the mortgages in question, the mortgagee was not bound to go behind the order and enquire whether the order ought to be made or not and as an authority for that proposition, the judgment of the Judicial Committee of the Privy Council in the case of Ganga Pershad Sahu v. Moharani Bibi 11 C. 379 : 12 I.A. 47, is relied upon. The particular passage is on page 50. In answer, the respondents rest their case in support of the judgment of the lower Court on three grounds. First, that the order does not comply with the provisions of Section 31 of the Guardians and Wards Act, because the order does not recite the necessity for which the loan was required, and, secondly, that the petition on which the order was passed contained a statement which was untrue, namely, that the minors were liable for the decree which the guardians intended to pay off. Now, with regard to these contentions, although it is stated that the statement in the petition was in fact inaccurate, no case of fraud was set up or proved in the lower Court; and it is conceded in the course of the argument in this Court that even if the minors are not liable on the decree, they might possibly be liable in a suit for contribution in respect of the liability covered by that decree. Then, the third point, which is taken by the learned Vakil, is that consideration for the mortgage was not paid or applied in the way in which the mortgagee had undertaken to pay or to apply it. With regard to the first two points arising out of the provisions of Section 31, the case stands thus. A certificated guardian appointed over the property of the minors, under Section 27 of the Act, is, subject to the provisions of the Act, bound to deal with the property as carefully as a man of ordinary prudence would deal with it if it were his own, and he is empowered to do all acts which are reasonable and proper for the realisation, protection or benefit of the property. Now it may become reasonable or proper to mortgage or charge or transfer the property, and in order to protect the interest of the minor. The Act goes on to say that 'permission to the guardian to do any of the acts mentioned in Section 29 (i.e., mortgage, charge or transfer the property) shall not be granted by the Court except in case of necessity or for an evident advantage to the ward.' Then having enacted this, the section goes on to provide that the order shall recite the necessity or advantage as the case may be, describe the property with respect to which the act permitted is to be done 'and so on.' In the present case a petition was put in before the District Judge applying for leave to mortgage the property and pointing, out that there was a decree against the minors and others, that the minors' property had been advertised for sale and that they would suffer great loss if the property was put up to auction sale and that it was impossible to satisfy the debt. Then, on that petition the District Judge gave the permission and that constituted the order on which the mortgage was executed. It has been pointed out that does not comply with the provisions of Section 31 and possibly there may be force in the contention. Though it does not comply, as it ought to in form, with Section 31, yet I think it does in substance; because on the petition which was granted there appear the requirements which are provided for in Section 31, namely, the necessity or the advantage which would accrue to the minor if the permission were granted. I think it may be assumed that in granting the application containing those statements, the Judge adopted them and though they are not in form, yet they substantially comply with the provisions of Section 31. Then, if that is so, there is' the order under Section 31 made by the Judge which on the authority of the Privy Council; the mortgagee is not bound to go behind where no case of fraud is alleged. If that is so, it seems to me that the mortgagee was entitled to an advance of the money on the security and that the property in question was lawfully burdened with the repayment of the money advanced. With regard to the statement, which is said to be untrue, I have referred to the possible liability with regard to the decree and I desire to point out that the misrepresentation is not alleged to be fraudulent and assuming that there was a doubt as to its accuracy, I do not think that that takes the case outside the law as laid down by the Privy Council in the case to which I have referred.

3. The result is this. The mortgagee has parted with his money on the faith of a mortgage executed by a person appointed by the Court as guardian of the property of the minors whom the law gives certain powers with regard to that property and further on the faith of the permission granted by the' Court to that guardian to exercise the power created by the mortgage. That permission was not obtained by fraud and in my opinion the mortgage executed under it is perfectly a good mortgage and the estate must beat the burden of the loan.

4. Another point that there had been no consideration, all I need say about that is that question does not appear to have been seriously contested in the Court below and I do not feel pressed by the point for this reason. In my opinion, there must be a decree in favour of the plaintiff on the mortgage and an account must be taken by the Court of first instance of the money due on the mortgage and when that account is taken it will be for the accounting officer to find what money has been advanced on the mortgage, and the mortgagee will not be entitled to recover any large sum than what he has actually advanced. We remand the case on this point. For these reasons, I think the appeals should be allowed, the judgment dismissing the plaintiff's suit set aside and in lieu thereof a decree shall be made in favour of the plaintiff directing that an account be taken of what is due on the mortgage in question.

Chatterjee, J.

5. The decree made by the lower appellate Court in this case cannot stand. It is admitted on behalf of the respondents that the respondents are the owners of Purgunah Pachhi. It is also admitted that the decree of Maharaja Lachmeshwar Singh Bahadur was for the revenue of Purgunah Pachhi and although the decree obtained by the Maharaja was not expressly against the respondents, they would most probably have been liable in a suit for contribution if their co-sharers paid up the decree. There was, therefore, some sort of ultimate liability of the minors in respect of the demands of the Maharaja. The respondents have, therefore, no case on the merits so far as this question is concerned. As regards the permission granted by the District Judge for the execution of the mortgage in question, it was, no doubt granted upon inaccurate facts and without, perhaps, the consideration of all the circumstances which the Judge was bound to make under Section 31 of the Guardians and Wards Act. But there are no materials upon which I can decide that the Judge did not consider all the points that were laid before him. Of course, if he had seen the decree, he would have found that the minor was not a party to the same, but if the real facts of the case had been represented to him he might have been of opinion that considering the ultimate liability of the minors and also the chances of an unsuccessful litigation in opposition to the claim for contribution, that might he made against them by their co-sharers, it would be proper that the order should be made in the interest of the minors. On the whole, therefore, there does not seem to be any valid objection to the order and that being so, the mortgagee is entitled to rely upon this order as the basis of his right to claim satisfaction from the minor's estate.

6. It has, however, been contended that although the mortgagee in the mortgage deed shows that the consideration for the mortgage was kept in deposit with him for the payment of the decrees, he did not make the payment and the decrees were satisfied otherwise than by the consideration for the mortgage deed. This was not clearly the case of the defendants in the lower Courts. There was, however, an issue as to the passing of the consideration, but that is a matter which must be gone into in considering the accounts that are directed to be taken under this decree in respect of the amount due on the mortgage deed; for if the mortgagee did not advance any part of the consideration money, he would not be entitled to get the same from the minor's estate notwithstanding that the same is entered in his mortgage deed.


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