1. This is an appeal from the judgment of my learned brother Mr. Justice C.C. Ghose delivered on the 4th of February 1924 whereby ho dismissed an application which had been made by the plaintiff.
2. The application was for an order that the properties set out in Part II of Schedule A. annexed to the report of the Assistant Referee, dated the 24th of July 1922, should be sold by the Registrar to the best purchaser or purchasers that could be obtained for the same free from all encumbrances, and that the sale proceeds should be applied in the first instance in payment of the amount due to the plaintiff under the decree passed in the suit and dated the 22nd of April 1919.
3. The facts, which it is necessary for me to state for the purpose of my judgment, are as follows: On the 16th of January 1908 the plaintiff lent a sum of Rs. 5,000 to one G.K. Deb with interest at 12 per cent and this loan was secured by the pledge of certain jewelleries handed to the plaintiff by G.K. Deb. On the 22nd of January 1916, G.K. Deb died intestate leaving three sons, Byomkesh Deb, Hrishikesh Deb and Srikesh Deb, as his heirs; and it was not disputed that under the law applicable to this family the sons were liable to pay the debts of their father out of the estate of G.K. Deb.
4. On the 22nd of March 1917, the plaintiff brought a suit against the three sons claiming a sum over Rs. 10,000 from the estate of G.K. Deb, this sum representing the loan and interest which was due up to that date.
5. The prayers in the plaint were as follows:
First, 'that the defendants do out of the estate of the said Girindra Krishna Deb pay to the plaintiff the said sum of Rs. 10,619 together with such farther interest as this Hon'ble Court may be pleased to allow and the costs of this suit'.
Secondly, 'that the said articles of jewellery pledged as aforesaid be sold by and under the directions of tins Court and the proceeds of sale be applied to wards payment of what is due to the plaintiff for principal, interest and costs'.
Thirdly, 'that if necessary the estate of the said Kumar Girindra Krishna Deb be administered by and under the directions of this Court'.
Fourthly, 'that a receiver be appointed of the said estate', and
Finally, 'that all necessary enquiries be made and accounts taken as to this Hon'ble. Court may seem fit'.
6. The three defendants agreed with the plaintiff to refer all disputes in the suit to two arbitrators: and, on the 3rd of April 1919, these arbitrators made their award.
7. The material part of the award was as follows: We direct that the defendants shall out of the estate of their father Girindra Krishna Deb pay to the plaintiff within three months from the date of this award the sum of rupees eight thousand three hundred and seventy-five with interest at the rate of six per cent per annum, and the costs of this suit to be, if necessary, taxed by the Taxing Officer of the High Court on scale No. 2 with interest at six per cent per annum from date of taxation until realisation. In default of the defendants paying the said sum within three months the articles of jewellery pledged with the plaintiff and mentioned in the plaint shall be sold by the Registrar of the High Court without any further order of Court and the proceeds of sale shall be paid into Court to the intent that the same should be applied in payment of the costs of, and incidental to, the sale and of the moneys directed by us as aforesaid to be paid to the plaintiff. If there is any surplus after the said payments, such surplus shall be paid to the defend ants. But if the proceeds of sale shall not be sufficient for payment of the moneys payable to the plaintiff as aforesaid, the defendants shall out of the estate of Girindra Krishna Deb pay the same, and the plaintiff will be at liberty to apply to Court for the appointment of a receiver of the said estate and for administration thereof by and under the directions of this Hon'ble Court in order that directions may be given for the enquiries usual in an administration suit and the usual order for distribution of assets may be made.'
8. On the 22nd of April, the learned Judge on the Original Side made a decree to this effect: 'It is declared that the said award ought to be carried into effect and the same is ordered and decreed accordingly'.
9. The Registrar sold the jewellery and the net amount Rs. 2,591 was handed to the plaintiff. This left a considerable balance owing to the plaintiff, and, on the 2nd of July 1920, the plaintiff obtained a preliminary order which has been called the 'administration order' providing, with the consent of the parties, for certain accounts to be made, one of which was an account of the estate, movable and immovable, of G.K. Deb, and the order proceeded: It is further ordered and decreed with the like consent that the estate of the said deceased be applied in payment of his debts and funeral and testamentary expenses in due course of administration.'
10. The Assistant Referee made a report: He found that there was due to the plaintiff by the estate of the deceased man the sum of Rs. 6,366-14 together with interest thereon from the 22nd day of June 1920 till the date of realisation, and that there was no evidence before him as to there being any encumbrances affecting the immovable estate or any parts thereof, of the said deceased: and in the schedule he set out the immovable properties, the first item of the second part being described as the entirety of the house and premises No. 30, Raja Naba Kissen Street.
11. It was alleged that various mortgages had been created by the sons of the deceased man; the details thereof are set out at page 5 of the Paper-Book. Five of them were created before the order of my learned brother Mr. Justice Ghose on the 2nd of July 1920. Two of the mortgagees appear as respondents in this appeal, one being Upendra Mohan Roy Chowdhury who is alleged to have a mortgage created in his favour by two of the sons on the above mentioned premises for Rs. 16,000, dated the 13th of December 1919. The other respondent in this appeal is Upendra Mohan Pal Chowdhury who is alleged to have a mortgage executed in his favour by one of the sons on the above mentioned premises for Rs. 5,500, dated the 3rd of March 1920. There were three other mortgages which are alleged to have been created before the 2nd of July 1920, and two subsequently to that date.
12. The mortgagees were made parties to the application which was made by the plaintiff and which I read at the beginning of my judgment. The application was heard in chambers, and, as I have already said, was dismissed by the learned Judge.
13. The question was raised during the course of the argument as to whether this was the proper method of raising the question; and it was argued on behalf of the respondents that a suit should have been brought by the plaintiff for a declaration that the encumbrances created by the alleged mortgages should rank subsequently to any order made for sale of the premises in the suit. I do not think it necessary for me to express any opinion upon that question of procedure as at present advised.
14. The learned Judge based his judgment upon certain principles of Hindu Law as being applicable to this matter, and, in this appeal, the ground upon which the learned Judge relied has not been attacked.
15. The learned Counsel for the appellant based his argument on. [one ground, namely, Section 52 of the Transfer of Property Act to which I shall have to refer directly. His argument was that the estate was in the course of administration by the Court; and that consequently the mortgagees holding their title by the mortgages created by the heirs would be subject to any disposition which had been or might be made by the Court in the course of administration: and he argued that the heirs had, in fact, nothing to transfer to the mortgagees until the administration was concluded and the debts of the deceased man were paid.
16. As at present advised I am of opinion that as regards the mortgages which were created after the order of the 2nd of July, the argument of the learned Counsel for the appellant is correct. I refer to what was said by Lord Davey in the case of Chatterput Singh v. Maharaj Bahadur (1904) I.L.R., 32 Calc. 198, 217, the passage to which I refer is at the bottom of page 217 and is as follows: 'But their Lordships agree with the broader proposition stated. y Air. Phillips that when the estate of a deceased person is under administration by the Court or out of Court, a purchaser from a residuary legatee or heir buys subject to any disposition which had been or may be made of the deceased's estate in due course of administration. In fact the right of the residuary legatee or heir is only to share in the ultimate residue which may remain for final distribution after all the liabilities of the estate including the expenses of administration have been satisfied'.
17. It has not been disputed that after the order of my learned brother, Mr. Justice Ghose, on the 2nd of July the estate was under administration by the Court: and consequently any mortgage created by the heir would be subject to any disposition that had been or might be made by the Court of the deceased's estate in the course of administration.
18. But that does not dispose of this appeal because, as I have said, the two respondents, who have appeared in this case, are alleged to be mortgagees, and the mortgages in their favour created by the son or sons of the deceased man, were made before the 2nd of July 1920.
19. In my judgment, the question which arises upon this part of the case is whether it can be said that in the suit to which I have referred any right to immovable property was directly and specifically in question within the meaning of Section 52 of the Transfer of Property Act.
20. The facts of this case, in my judgment, are peculiar and are not governed by any of the cases which were cited to us during the course of the argument. The decree of the learned Judge which was made on the 22nd of April 1919 which embodied the award was not in my judgment, an order for administration. The terms of the award which in my opinion must be taken as part of the decree make that clear, for the award stated: 'If the proceeds of sale shall not be sufficient for payment of the moneys payable to the plaintiffs as aforesaid the defendants shall out of the estate of Girindra Krishna Deb pay the same and the plaintiff will be at liberty to apply to Court for the appointment of a receiver of the said estate and for administration'. It is therefore clear to me that the award and the decree contemplated that this was no more than a decree against the defendants for money which was payable by them out of the estate of the deceased man; and, it was such a decree as was dealt with is the case of Ram Dhun Dhur v. Mohesh Chunder Chowdhry (1882) I.L.R. 9 Calc. 406.
21. The above mentioned decree left the question as to whether a receiver should be appointed and whether an order should be made for administration, an open question which would be decided by the Court thereafter if the plaintiff thought fit to make an application to the Court for that purpose.
22. It is, therefore, clear to me that that order created no charge upon any property; and, the only other question in respect of this part of the case is--can it be said that merely because the plaintiff included in his plaint a prayer that, if necessary, the estate should be administered by and under the direction of the Court, there was a right to immovable property directly and specifically in question? There was no specific property mentioned in the plaint or the prayer; and the general prayer was that if it became necessary, an order of the Court for the administration of the estate should be made.
23. Under these circumstances, in my judgment, it cannot be said that there was a right to immovable property directly and specifically in question within the meaning of Section 52 of the Transfer of Property Act, and, consequently, in my judgment, so far as it applies to mortgages which are alleged to have been created by the son or sons of the deceased man before the 2nd of July 1920, the argument which has been presented by the learned Counsel for the plaintiff must fail and as far as those mortgages are concerned the learned Judge's decision must be upheld.
24. It is only right to say that this point was not dealt with by the learned Judge in his judgment although we were informed that the question was raised.
25. The decree of the learned Judge must therefore be varied to this extent, namely, that the premises will be sold free from all encumbrances created after the date of the administration order made on the 2nd of July 1920. As regards the two respondents who appeared, Upendra Mohan Roy Chowdhury and Upendra Mohon Pal Chowdhury, the plaintiff must pay their costs of the appeal.
26. As regards Kshirode Sundari Debi it appears that the learned Judge directed the plaintiff to pay her costs of the proceedings in the Court of first instance Having regard to our judgment that order should be reversed, inasmuch as the mortgage alleged to have been made in her favour was after the administration order of 2nd July 1920.
27. The order of the Court of first instance as regards costs will be varied in this way. The plaintiff must pay to the parties appearing in the application their respective costs of and incidental to the application (including the fees to counsel) with the exception of Kshirode Sundari Debi. If Kshirode Sundari has already realised her costs, those costs will be refunded to the plaintiff.
28. I agree.