Posted On by &filed under Allahabad High Court, High Court.


Allahabad High Court
Abharan Singh And Ors. vs Lal Bahadur Singh on 11 January, 1915
Equivalent citations: (1915) ILR 37 All 165
Author: H Richards
Bench: H Richards, P C Benerji, Tudball


JUDGMENT

Henry Richards, C.J.

1. The material facts connected with this appeal are as follows : – On the 11th of June, 1881, Amir Singh and Musammat Dulra Kunwar executed a usufructuary mortgage of certain zamindari property in favour of Rani Dharam Raj Kuunwar. The real mortgagor was the said Amir Singh. Possession of the sir land was not given in accordance with the provisions of the mortgage deed and the Rani brought a suit against the mortgagors for possession and mesne profits. She obtained a decree, and in execution, for mesne profits and costs, the mortgaged property was attached, put up to sale and purchased by the Rani. The sale was subsequently confirmed and the usual certificate issued. Lal Bahadur Singh now represents the estate of Rani Dharam Raj Kunwar. The plaintiffs are the grandsons and great grandsons of Amir Singh and they have brought the present suit for a declaration that the auction sale mentioned above is null and void and that they are still entitled to redeem the mortgage. There is a further claim for a declaration that the plaintiffs, or some of them, are in any event ex-proprietary tenants of the sir land.

2. It seems to me that the only question we have to decide is what is the effect of Section 99 of the Transfer of Property Act, which was in force at the date of the purchase by Rani Dharam Raj Kunwar. It has not been contended that, if the Rani had never occupied the position of mortgagee, and if she had obtained a simple money decree and in execution of such decree purchased the property, the plaintiffs, who are the grandsons and great grandsons of Amir Singh, could now set aside the sale and get possession of the property. The contention is that the sale was in contravention of the provisions of Section 99 of the Transfer of Property Act and therefore null and void. In my opinion this case must be disposed of on the assumption that the plaintiffs have exactly the same rights that Amir Singh would have had if he had brought the suit instead of them. Section 99 is as follows:

Where a mortgagee in execration of a decree for the satisfaction of any claim, whether arising under the mortgage or not, attaches the mortgaged property, he shall not be entitled to bring such property to sale otherwise than by instituting a suit under Section 67.

3. It seems to me that the decision depends on whether a sale at the instance of a mortgagee in contravention of the section was wholly illegal. If it was, then the equity of redemption never vested in the Rani and the mortgage is still capable of being redeemed. Section 99 has been repealed and new provisions have been substituted in the Code of Civil Procedure. Order XXIV, rule 14), of the first schedule is as follows:

Where a mortgagee has obtained a decree for the payment of money in satisfaction of a claim arising under the mortgage, he shall not be entitled to bring the mortgage property to sale otherwise than by instituting a suit for gale in enforcement of the mortgage.

4. Two things will here be noticed, first that the provisions of law restraining a mortgagee from bringing mortgaged property to sale is not so wide as previously and second that the provision finds its place in an Act dealing with matters of procedure and not of substantive law. If the effect of Section 99 is that all sales in contravention of its provisions are absolutely null and void great hardship might occur in many cases, for example, a purchase might be made by a perfectly innocent third party who would have to give up the property. In considering the construction of the section I can see no distinction between a purchase by the mortgagee and a purchase by a third party. Undoubtedly the mortgagor, or any one interested in the property in cases governed by Section 99, could object to the mortgaged property being brought to sale by the mortgagee on foot of a simple money decree, and in all probability the sale could be set aside on this sole ground at any time before confirmation. But can the sale be set aside after the confirmation? This question depends on whether we regard the provisions of the section as enacting that no sale can legally be had, or as merely giving the mortgagor and persons interested in the property a right to object to the sale being had, provided the objection is taken at the proper time, that is to say, sometime before the sale is confirmed.

5. In the case of Tara Chand v. Imdad Husain (1896) 1 L.R. 16 All. 325 the plaintiff sued for partition. His title to his alleged share was a purchase by him at an auction sale at the instance of the mortgagee who had obtained a simple money decree. A Bench of this Court held that he was entitled to partition notwithstanding the provisions of Section 99. It is true that in that case the Revenue Court had already overruled the objection that the property could not be sold and had confirmed the sale. Nevertheless it is quite clear that if the sale was a nullity, the plaintiff would have acquired no title to the share upon which he based his right to partition. It is true also that the plaintiff in this case was not the mortgagee, but Section 99 restrains the mortgagee from “bringing the property to sale.” If any act is rendered illegal it is the “bringing of the property to sale.”

6. In the case of Muhammad Abdul Rashid Khan v. Dilsukh Rai (1905) I.L. 27 All. 517 the mortgagees had brought the equity of redemption to sale in execution of a simple money decree for mesne profits and costs and purchased it themselves. The plaintiffs brought suit to redeem the property treating the sale to and purchase b the mortgagees as a nullity. A Bench of this Court was opinion that the sale was not a nullity. The sale in this case was apparently before the passing of the Transfer of Property Act. But it seems a clear authority for the proposition that if the mortgagor allows the equity of redemption to be sold and the sale, confirmed without objection, he cannot later on take exception it.

7. In the case of Mangli Prasad v. Pati Ram (1904) 1 A.L.J. 360 the question arose as to whether or not the plaintiff had a right to redeem a subsequent mortgagee. His claim was based on purchase at an auction sale of the equity of redemption in execution of a simple money decree obtained by a mortgagee. A Bench of this Court held him to be entitled. The Court was clearly of opinion that the auction sale was not a nullity.

8. Again in the case of Madan Makund Lal v. Jamna Kaulapuri (1898) 2 A.L.J. 123 a Bench of this Court laid it down that where a sale has been had of mortgaged property in execution of a simple money decree and the sale confirmed, the title of the auction purchaser becomes complete. In a case reported in I.L.R. 30 All. 146 exactly the same view was taken.

9. A contrary view seems to have been taken by Dillon, J. the case of Jhabba Lal v. Chajju Mal (1907) 4 A.L.J. 787, but the case of Tarl Chand v. Imdad Husain (1898) I.L.R. 18 All. 315 and the cases reported in Volume I and Volume II of the Allahabad Law Journal do not seem to have been brought under the notice of the learned Judge. It seems me that with the exception of this last mentioned case Id another recent decision to which I shall presently refer all the decisions of this Court have been in favour of the view that the sale, at the instance of a mortgagee, of mortgaged property is not a nullity, and that if no objection is taken before the confirmation such objection cannot be taken later.

10. In the case of Sardar Singh v. Ratan Lal (1914) 2 A.L.J. 36 All. 516 the facts were as follows : – Nandan Singh executed a mortgage in favour of Ratan Lal. Ratan Lal sued in 1898, but only asked for a simple money decree, which was granted. In execution of this decree he purchased the property himself. The sons of Nandan Singh were not made parties to the suit in which the decree had been obtained and they then brought a suit to redeem the mortgage and get possession. A Bench of this Court was of opinion that the plaintiffs were entitled to redeem. With regard to this case I can only say that I consider that in cases governed by Section 99 the restrictions on a mortgagee acquiring the equity of redemption ought to be confined to the provisions of the section, and that in future the substituted provisions of the Code of Civil Procedure should regulate the rights of mortgagors and mortgagees in this respect. If, however, the learned Judges who decided the case of Sardar Singh v. Ratan Lal (1904) I.L.R. 36 All. 516 intended to decide that a sale in contravention of Section 99 was, oven after confirmation, a complete nullity, such a decision was contrary to the cases previously decided in this High Court with the exception of the one case I have already mentioned. While I admit that the question is not free from difficulty, I think we ought not, without grave reason, to depart from a series of rulings of this High Court, and for this reason I do not intend to refer to the rulings of the other High Courts at any great length.

11. The case of Ashutosh Sikdar v. Behari Lal Kirtania (1903) I.L.R. 35 Cale. 611, was a reference to the Full Bench of the Calcutta High Court. The questions were (1) whether, when a sale has been held in contravention of the provisions of suction 99 of the Transfer of Property Act, the sale is a nullity or an irregular and voidable sale, and (2) whether the right of redemption of the mortgagor is or is not affected by such sale. Rampini, A.C.J.; said in answer to the first question:

I think we must, after the expression of opinion of their Lordships of the Privy Council in Khairajmal v. Daim (1904) I.L.R. 32 Cle. 296 reply that a sale held in contravention of the provisions of Section 99 of the Transfer of Property Act is not a nullity, but an irregular and voidable sale. In my opinion such a sale can be avoided before confirmation of sale by an application under Section 244 of the Code of Civil Procedure without its being necessary for the applicant to show more than that the provisions of the Transfer of Property Act have been contravened. But after confirmation the sale can only be avoided by an application under Section 244, provided that the applicant proves that owing to fraud or other reasons he was kept in ignorance of the sale proceedings preliminary to sale.

The case should therefore be remanded to the Subordinate Judge to be disposed of after enquiry into these matters and after decision of any other issues that may arise in the case. The costs will abide the result.

It seems neither necessary nor advisable for us to answer the second question put by the referring Bench.

12. It seems to me the reason why the learned Acting Chief Justice did not answer the second question was that the answer to the first question answered the second unless the applicant should prove that he was kept in ignorance of the sale proceedings preliminary to the sale.

13. Bektt, Mittra and Woodroffe, JJ., all agreed. Mookerjee, J., referred, in a more elaborate judgment, at length to the various rulings on the question, but I have no reason to think that lie intended to differ from the other members of the Bench.

14. It is true that woodroffe, J., was party to a subsequent decision in the case of Pancham Lal Chowdhury v. Kishun Pershad Misser (1910) 14 C.W.N. 579. With great respect I must confess to be quite unable to reconcile the two decisions. It seems to me that if the equity of redemption is sold in execution of a decree and purchased either by a third party, or by a mortgagee with the leave of the court, the equity of redemption is transferred from those persons who previously held it, to the purchaser and that the result is that if that sale is neither void nor set aside, there is no longer a right to redeem left in the previous owners of the equity of redemption. On the whole, I see no sufficient reason for overruling the previous decisions of this High Court, and I would, therefore, allow the appeal, stating at the same time, though it is perhaps hardly necessary to do so, that we express no opinion on the question whether the plaintiffs have ex-proprietary rights in the sir lands. The claim clearly is not a matter for the Civil Court.

Banerji, J.

15. I am entirely of the same opinion and have very little to add. The learned vakil for the respondents laid considerable stress on the fact that the plaintiffs wore no parties to the suit in which the decree against Amir Singh was obtained, in execution whereof the equity of redemption in the property in question was put up for sale and purchased by the mortgagee. In the recent rulings of this Court and of their Lordships of the Privy Council, it has been held that in the case of a joint Hindu family the manager of the family represents the whole family. The present plaintiffs must, therefore, be deemed (if they existed at the time) to have been represented by Amir Singh in the suit which was brought against him, and they were thus parties to that’ suit. As the learned Chief Justice has observed, the plaintiffs cannot claim a higher title than that which Amir Singh could have set up in respect of the mortgage made by him. If Amir Singh could not maintain the present suit, no more can the plaintiffs.

16. This leads to the question whether by reason of the provisions of Section 99 of the Transfer of Property Act, the auction sale at which Rani Dharam Raj Kunwar purchased the equity of redemption was a nullity. As has been pointed out by the learned Chief Justice, the course of rulings in this Court has been that such a sale is merely voidable, and not having been avoided before confirmation it binds the mortgagor and those whom he represented as the manager of the joint family. I deem it unnecessary to refer to those rulings. The only case in which a contrary view was held was that of Jhabba Lal v. Chajju Mal (1907) 4 A.L.J. 787, decided by Mr. Justice Dillon. With all respect I am unable to agree with him.

17. The next case on which the learned vakil for the respondents relies is the recent ruling in Sardar Singh v. Ratan Lal (1914) I.L.R. 36 All. 516. In that case Mr. Justice Rafjq distinguished the cases reported in I.L.R. 18 All. 325, I.L.R. 27 All. 450 and I.L.R. 30 All. 146, on the ground that the sale in those cases was not in favour of the mortgagee but in favour of a third party. With great deference I fail to see any distinction between the case of a purchase by the mortgagee and that of a purchase by a third party. What the section declares is that a mortgagee shall not be entitled to bring to sale the equity of redemption of his mortgagor in execution of any claim which he may have whether arising under the mortgage or not. It does not prohibit the purchase of the property by the mortgagee, if the court permits him to purchase it and allows a sale to take place. If Section 99 does not render a sale in violation of the section absolutely null and void, there is nothing to prevent a mortgagee purchasing under such a sale with the leave of the court. It has been held by their Lordships of the Privy Council that a mortgagee who purchases with the leave of the court is exactly in the same position as any other purchaser. Therefore the fact of the purchaser being a person other than the mortgagee, in my opinion, makes no difference so far as the application of Section 99 is concerned. The learned Judges in that case do not, as it seems to me, go the length of holding that a sale in contravention of Section 99 is absolutely void. If that is so, and if such a sale is only voidable, it not having been avoided before confirmation, the title of the mortgagor or of those whom he represents, or of those who derive title from him passes absolutely to the purchaser and no right remains in those persons by virtue of which they can claim redemption.

Tudball, J.

18. I concur.

19. The order of the Court is that the appeal is allowed and the plaintiffs’ suit is dismissed with costs in all courts.


Leave a Reply

Your email address will not be published. Required fields are marked *

* Copy This Password *

* Type Or Paste Password Here *

Loading Facebook Comments ...
Loading Disqus Comments ...