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Rai Bahadur Bansidhar Dhandhania … vs Hazari Ram Marwari And Ors. on 6 February, 1933

Patna High Court
Rai Bahadur Bansidhar Dhandhania … vs Hazari Ram Marwari And Ors. on 6 February, 1933
Equivalent citations: 143 Ind Cas 542
Author: M Noor
Bench: C Terrell, M Noor


JUDGMENT

Mohammad Noor, J.

1. The simple question involved in this appeal 13, whether a mortgage-decree for sale obtained by the appellants against Jai Krishna Barham and others hereinafter called the Barhams can be set off against a decree in favour of the latter against Kedar Nath, Musammat Teji Bibi and Nopechand Marwari, three out of sixteen appellants and which decree is now held by Hazari Earn Marwari and others, respondents 1st party, as transferees from the Barhams. The learned Subordinate Judge has answered this in the negative and hence the appeal.

2. The facts are rather complicated and long; and relate to a protracted and complicated litigation extending over a period of about thirty years. I shall however confine myself to only those of them which are relevant to the determination of the present appeal.

3. One Thakur Barham now represented by the Barhams was the owner of a fairly big estate called Patsanda in the district of Santhal Parganas. He seems to have borrowed, money rather recklessly and by the year 1902 became hopelessly involved in debt By that time 10 annas out of 16 annas of the estate had already become mortgaged and besides this there were several simple money decrees against him. Two of these decrees-one for Rs. 21,702 and another for Rs. 4,522 were in favour of one Gobardhan Das a member of the family of Kedar Nath, one of the appellants. The decree-holder proceeded to execute them. Thakur Barham succeeded in obtaining a stay order from the Calcutta High Court pending the hearing of his appeals against the decrees on giving security for carrying out the decrees of the High Court by hypothecating three annas out of the unencumbered six annas share of the estate. He gave two annas in security, against the first decree and one anna as against the second decree. This wag on 10th November, 1902. In the meantime several other persons holding money decrees against Thakur Barham proceeded almost simultaneously to execute them against the six annas which was free from mortgage, except that 3 annas of it which was subject to the two security bonds and it was sold in execution of one of these decrees which was in favour of one Jiban Ram. Unfortunately by some mistake the writ of attachment, issued in execution of this decree, instead of describing the six annas as unencumbered actually described it as encumbered. The Subordinate Judge, however, proceeded to sell and did sell the unencumbered six annas subject however to the two charges under two security bonds already referred, to. He seems to have held that the word “encumbered” was a clerical mistake for “unencumbered”. The sale took place on 27th July, 1904, and the property was purchased for Rs. 1,12,000 by three sets of persons (hereinafter called auction-purchasers) in the following shares:

Sri Mohan, father
of Kedar Nath. 2 annas
Gulab Ram, husband of
Teji Bibi. 3 annas
Chaturi Ram and Nopechand. 1 anna
___________
Total 6 abbas

3. The sale proceeds Were rateably distributed among the various decree-holders. The auction-purchasers obtained delivery of possession on 25th December, 1901. By that time the security bonds subject to which the property was sold had become payable as Thakur Barham’s appeal was dismissed by the Calcutta High Court; the auction-purchasers paid Rs. 34,000 to Gobardhan Das on the 21st of May, 1905, in discharge of the two security bonds. Objections had, however, been raised by Thakur Barham at the time of the issue of sale certificate in favour of the auction-purchasers to the effect that the. share sold was not the unencumbered six annas, but the six annas out of ten annas which was encumbered. The objection was overruled by the Subordinate Judge and the Calcutta High Court, but on appeal to the Privy Council their Lordships, on 25th November, 1913, set aside the entire sale, vide Raja Thakur Barmha v. Jiban Ram Marwari 21 Ind. Cas. 936 : 41 c. 590 : 18 C.W.N. 313 : 15 M.L.T. 137 : 12 A.L.J. 156 : 26 M.L.J. 89 : 16 Bom. L.R. 156 : (1914) M.W.N. 118 : 41 I.A. 38 (P.C.). Thakur Barham had died in 1906 and was succeeded by the Berhams and in the meantime Qamaruddin and others (hereinafter called the Mandals had obtained from them 3¼ annas out of six annas of the estate which was the subject-matter of the litigation. When the Privy Council set aside the sale, proceedings for restitution with mesne profits were started on behalf of the Barhams and the Mandals. It is unnecessary to describe in detail the course of triangular fight which lasted for more than ten years. Not only was there litigation between Barhams and the auction-purchasers but also between Barhams and Mandals. The Mandals wanted restitution of 3 1/2 annas out of six annas of the estate to them on the basis of their being; transferees of that share from the Mandals, This was disputed by the latter. The auction-purchasers objected to the restitution. They wanted refund of the purchase-money and of the Rs. 34,000 which they had paid to Gobardhan in satisfaction of the charge subject to which the property was sold and contended that as Chaturi, one of the auction-purchasers, had died before the order of the Privy Council, restitution to the extent of his share (6 pies) could not be granted. Without giving the detail of the course of this litigation it is-sufficient to state that it ended in the following manner. It was held:

(1) That the decree-holders among whom the purchase-money had been rateably distributed were not liable to refund it.

(2) That the auction purchasers should bring a separate suit for the realization of Rs. 34,000 which they had paid towards, the discharge of the two security bonds in favour of Gobardhan Das.

(3) That 6 pies share of the auction-purchaser Chaturi Ram was not affected by the order of the Privy Council and the restitution could not be granted in respect of it.

(4) That the auction-purchasers were entitled to get a set-off of their purchase money against the mesne profits of the period of their possession: see Kedar Nath Marwari v. Jai Berhma 37 Ind. Cas. 863 : (1917) Pat. 153 : 5 P.L.W. 238 for the judgment of the High Court and Jai Berhma v. Kedar Nath Marwari 69 Ind. Cas. 278 : 4 P.L.T. 61 : A.I.R. 1922 P.C. 269 : 32 M.L.T. 10 : 37 C.L.J. 351 : 27 C.W.N. 582 : 41 M.L.J. 735 : 21 A.L.J. 490 : 25 Bom. L.R. 643 : (1922) M.W.N. 368 : 2 Pat. 10 : 18 L.W. 802 : 49 I.A. 351 (P.C.)for that of the Privy Council in appeal from this court.

4. After some further litigation with the consent of the parties, decree for mesne profits was passed in M.A. Nos. 154 and 159 for Rs. 81,393 without interest against the auction-purchasers in favour of the Barhams on 15th January, 1924, after adjustment of the purchase money of Rs. 1,12,000 and the auction-purchasers were directed to give up possession at once. I shall call this decree the mesne profit decree and it is one of the two decrees with which we are concerned in this appeal.

5. By a similar compromise between the Barhams and the Mandals in this Court the latter agreed to take 1 anna 7½ pies instead of 3 annas 3 pies and gave up their claim to the mesne profits for the period up to the date of the compromise, namely, 28th February, 1923.

6. It is necessary to state a few more facts about the mesne profit decree. It has been transferred to Hazari Ram and others, the principal respondents before us, on 12th November, 1925, for a consideration of Rs. 56,398 out of which Rs. 43,398 was set off towards the previous dues of Hazari Ram from the Barhams. Prior to its transfer the decree was attached by Lakhi Prasad Dhandhania and Sheodutt who held decrees against the Barhams, and these two persons as attaching creditors sought to execute the mesne profits decree. This was objected to by amongst others, Hazari Ram and others, the present respondents, as transferees of the decree and ultimately it was decided by this Court that as the transfer to Hazari Ram was subject to the attachment by Lakhi Prasad and Sheodut, Hazari Ram must pay up these two decree-holders before he could get a complete litle in the mesne profit decree. Accordingly Hazari Ram paid up the two decree-holders Sheodut and Lakhi Prasad a total sum of about Rs. 12,000.

7. I have said that under the orders of this High Court in Kedar Nath Marwari v. Jai Berhma 37 Ind. Cas. 863 : (1917) Pat. 153 : 5 P.L.W. 238 which was affirmed by the Privy Council in Jai Berhma v. Kedar Nath Marwari 69 Ind. Cas. 278 : 4 P.L.T. 61 : A.I.R. 1922 P.C. 269 : 32 M.L.T. 10 : 37 C.L.J. 351 : 27 C.W.N. 582 : 41 M.L.J. 735 : 21 A.L.J. 490 : 25 Bom. L.R. 643 : (1923)M.W.N. 368 : 2 Pat. 10 : 18 l.w. 802 49 I.A. 351 (P.C.) it was held that though the auction-purchasers were entitled to setoff their purchase money towards the mesne profits for which they were liable, they were not entitled to set off Rs. 34,000 which they had paid to discharge the two security bonds given by Thakur Barham to Gobardhan Das and for this they were referred to a separate suit. Consequently all the members for the auction-purchasers family brought on the 6th February, 1917, a suit for this amount against the Barhams. The Mandals being interested in the property which was charged with this money, were also impleaded as defendants. The suit was decreed on the 28th February, 1925, and a final decree for abut Rs. 87,000 with future interest was passed on 18th December, 1932, This decree which I shall call the mortgage decree, is the decree which is sought by the appellants to be set off against the mesne profit decree. All the facts which I have stated are admitted and all are based upon court records.

8. It will be useful at this stage to state the case o the appellants about the position of the auction-purchasers who are judgment-debtors in the mesne profit decree. It will be recalled that at the sale of 6 annas of the estate on 27th July, 1904, which was set aside by the Privy Council on 25th November, 1913, the auction-purchasers were Sri Mohan, father of the appellant, Kedar Nath (2 annas), Gulab Ram, husband of appellant Teji Bibi (3 annas) and Chaturi Ram and appellant Nopechand (1 anna), Chaturi Ram as already stated having died-before the Privy Council order is not in this, controversy, the appellants case has been that these purchasers purchased the property not individually but, as representing their respective families except of course Gulab Ram who was by himself and is now represented by his widow, Teji Bibi, appellant No. 12. It has been claimed that Sri Mohan represented the joint Mitakshara family of appellants Nos. 1 to 11 and Nopechand Marwari represented the family of appellants Nos. 13 to 16. It Was for this reason that when the auction-purchasers instituted the suit for recovery of the money which during the period of their possession of 6 annas of the estate they had paid to discharge the two security bonds in favour of Gobardhan Das subject to which the property was sold, they did not bring the suit on behalf of three nominal auction-purchasers only, but all the members of the two families along with Teji Bibi were plaintiffs; and it is for this reason that while in the mesne profit decree only three nominal auction-purchasers are the judgment debtors, in the mortgage decree which was for the money spent: by the auction-purchasers as such, all the members of the auction-purchasers family are the decree-holders.. That the purchase was on behalf of all the members of the three families was clearly mentioned in the plaint of the mortgage suit: vide para, 11, Ex. 2. In fact it is maintained on behalf of the appellants that though the mesne profit decree is nominally against three judgment-debtors only, all the appellants are judgment-debtors of that decree.

9. I have stated that the only issue in this case is whether the two decrees can be set off against one another. The learned Subordinate Judge has refused to do so, and the only ground of his refusal mentioned in his judgment is that according to him the two decrees are not cross-decrees on account of the parties being different. The same view has been pressed before us by Mr. ManoharLal, who appeared on behalf of the respondents. He has further pressed several other grounds against the application of the rules of set off which I shall take up later.

10. In my opinion the view taken by the learned Subordinate Judge as to the parties being different cannot be accepted. In deciding whether the two decrees are cross-decrees we must look to the substance, and not to the form. In this case there is no difficulty in deciding that the judgment-debtors of the one are in subs Lance exactly the decree-holders of the other and vice versa. The two decrees relate to the same transaction, and rights and liabilities of the parties arise out of the same set of facts, namely, the possession of auction-purchasers under a sale which was subsequently set aside. The mesne profit decree in favour of the Barhams against the auction-purchasers is for the latter’s wrongful possession under a sale which was set aside by the Privy Council. – The mortgage decree is For the money which these very auction-purchasers hid spent in discharging the liability on that property of which they were in wrongful possession and for which they were specifically referred to a separate suit under the orders of this Court and the Privy Council. It is obvious that the plaintiff who brought the mortgage suit were those very persons who had paid the amount as auction purchasers and as I have said were clearly mentioned in the plaint of the mortgage suit. The fact that in the mesne profit decree only three persons were “made judgment-debtors as the sale was in their names only will not, in my opinion, affect the case. The difference in name is only in form and not in substance. It must therefore be held that all the appellants are judgment-debtors in the mesne profit decree. It has, however, been contended that the position becomes different on account of the fact that in the mortgage decree not only the Barhams but the Mandal’s as well are parties. That in my opinion should not affect the position. The Mandals were impleaded in the mortgage, suit not because they were liable for the money but because they acquired interest in the equity of redemption after the creation of the charge and it was necessary that the order for sale should be passed in their presence in order to give them an opportunity to redeem. Under Order XXI, Rule 20 the principle of set off is applicable to mortgage-decrees, and in a mortgage-decree generally persons other than the mortgagors are judgment-debtors They are, however, not judgment-debtors in the sense in which the mortgagors are judgment-debtors. The question to be considered will be who are liable to pay the money for which the decree for sale has been passed and in my opinion nobody else than the mortgagors, the Barhams, are so liable. Therefore the mesne profit decree is payable to the Barhams by the auction-purchasers in which term I will include all the appellants for the grounds stated above and the mortgage decree is payable by the Barhams to the auction-purchasers. I shall deal later with the question of the personal liability of the Baihams. The fact that the Mandals are also mentioned as judgment-debtors does not, as I have said, change the position and I, therefore, hold that these two decrees are cross-decrees. Apart from this the question that all the appellants were the auction-purchasers is concluded by res judicata between them and the Barhams whose representative the respondents Hazari Ram and others are, The two security bonds were discharged by the auction-purchasers. All the appellants claiming to be auction-purchasers instituted the mortgage suit for that money against the Barhams and got a decree. The Barhams are bound by that decree and are precluded from challenging the fact that all the appellants were auction-purchases. The respondents hare taken a transfer of the mesne profit decree after the passing of the mortgage decree, They have taken the transfer subject to all the equities which the appellants had against the Barhams (Section 49 of the Civil Procedure Code) and they cannot dispute the position taken up by the appellants.

11. I now take up the points raised by Mr. Manohar Lal against the application of the principle of set off in this case which were perhaps urged before the learned Subordinate Judge but do not seem to have been noticed by him in his judgment. It may be due to the fact that while the arguments were concluded on 14th September, 1929, on account of multifarious work which he has to do in the non-regulation district of Santhal Parganas he could not deliver his judgment till 11th April, 1921. The points are these:

(1) That Order XXI, Rule 20 applies only when both the cross-decrees are mortgage decrees. It does not apply when one is a mortgage decree and the other is a simple money decree or at any rate it applies only when the mortgage decree for sale contains a personal order for payment of money.

(2) That the appellants are precluded from maintaining that they were all the auction-purchasers and are judgment-debtors in the mesne-profit decree. Such a contention is barred by res judicata, or at any rate, by estoppel.

(3) That set off should in this case be refused on equitable grounds, because the property which is the subject of the charge of the appellants decree for sale has been purchased subject to the charge by the appellants themselves in execution of simple money decrees, or at any rate they brought about the sale of the mortgaged properties subject to their charge.

(4) That the personal remedy of the appellants against the Barhams is barred and therefore set off cannot be allowed as the mesne profit decree was the personal property of the Brahams and cannot be utilized for the satisfaction of the mortgage decree unless personal remedy is open to the appellants. 1 shall take up these points in the order in which they have been stated.

12. As to the contention about the applicability of Order XXI, Rule 20, there is nothing to indicate that the operation of the rule is confined only to cases where both the decrees are for enforcement of mortgage or charge; -I am unable to read in Rule 20 the qualifications which have been contended for by the respondents. In Nagar Mal v. Ram Chand 8 Ind. Cas. 835 : 33 A. 210 : 7 A.L.J. 1179 a decree for sale was allowed to be set off against a simple money decree. Mr. Manohar Lai has, however, relied upon three cases in support of his contention, and I propose to examine each of them in detail.

13. The first is the case of Sheo Shankar v. Chunni Lal 36 Ind. Cas. 948 : 38 A 669 : 14 A.L.J. 7 : 6. In this case the mortgagee decree-holders wanted to set off their decrees for sale against simple money decrees held against them not by the mortgagor but by subsequent transferees of the mortgaged property. This, if I may say so, was rightly refused. This case is rather an authority against the respondents and supports the view which I have taken in the earlier part of this judgment that in applying the principle of set off to a mortgage decree it will be necessary to examine whether a person, who is mentioned as a judgment-debtor, in that decree is really so in the sense that he is liable for payment of the decree. I have held that the Mandals being parties as judgment-debtors to the mortgage-decree before us does not affect the position, inasmuch as they are judgment-debtors but are not personally liable for payment of the decree. They were impleaded as subsequent purchasers of the mortgaged properties.

14. The next case is Ram Chander Upadhya v. Mahabir Singh 39 Ind. Cas. 560 : 15 A.L.J. 327. In this case set off between two mortgage decrees was refused. This does not support the contention that Rule 20 applies when both the cross-decrees are mortgage decrees. The position of the parties in that case is not very clear from the. judgment, but it appears that they were not identical. Mr. Manohar Lal has, however, relied upon the observation of their Lordships about the difficulties in administering r. 20 of Order XXL The observations are these:

This (Rule 20) is a new rule which has been added to the present Code. It seems to us somewhat difficult to understand how the provisions of Order XXI, Rules 18 and 19, will be administered as applying to mortgage decrees particularly in cases like the present when there is no personal liability. A mortgage-decree merely directs the sale of mortgaged property in the event of the mortgage money not being deposited. We may point out that in many cases the value of a mortgage-decree depends not on its face value, that is the amount found due, but on the value of the property directed to be sold. It might so happen that a decree declaring that a lakh of rupees was due might be of less actual value than a decree declaring Rs. 5,000 due on other property; all depends on the value of the property ordered to be said”…. “We, however, have not to consider the case of setting off of two mortgage-decrees between the same parties. It is quite clear that there cannot be a set off in the present case unless the decree can be said to be a decree “jointly” and “severally” against Ram Chander, his son and the other defendants. It seems to us that a mortgage decree can never be said to be a ‘joint’ and ‘several’ decree within the meaning of that expression in Order XXI, Rule 18.

15. No doubt a mortgage-decree so far as it orders the sale of a certain property is not joint and several, but so far as the liability of payment of money is concerned it may be a joint and several decree against the mortgagors inter se. However, the remarks of their Lordships as to the difficulties in the administration of Rule 20 of Order XXI are obiter dicta and were not necessary for the decision of the case. In fact, the ratio decidendi of that case was that the parties were not identical. While one decree was in favour of Ram Chander alone, the other was against Ram Chander, his son and six other persons, and it is clear from the judgment what was the character of persons other than Ram Chander in the decree passed against them.

16. The last case is The Burma Oil Company Limited v. Ma Tin 120 Ind. Cas. 669 ; 5 R. 505 : Ind. Rul. (1930)Rang. 59 : A.I.R. 1930 Rang 68. This case has been relied upon by Mr. Manohar Lal as an authority for the proposition that Order XXI, Rule 20 has no application unless there is a personal liability under the mortgage decree. The, judgment of their Lordships no doubt supports this contention. In that case there was a money decree in favour of Ma Tin and Po Gon against the Burma Oil Company while the other decree a mortgage one was in favour of the latter but was not only against Ma Tin and Po Gon but also against. Po San, brother of the husband of Ma Tin who was not only a co-mortgagor with his deceased brother but had an interest in the mortgaged properties by virtue of an award. It is obvious that set off, if I may be permitted to say so, was rightly refused, but their Lordships did not decide the case on that ground. They decided it on the ground that for the application of Order XXI, Rule 20 it was necessary that there should be a decree for payment of money. If their Lordships meant that Rule 20 applied only in cases where personal remedy is legally available and not otherwise, I respectfully agree; but if they meant that Rule 20 only applies when the decree actually is for payment of money personally by the judgment-debtor, then with due deference I beg to differ, as this view is against the plain meaning of Rule 20. Every preliminary decree for sale directs that a certain sum of money shall be paid by the judgment-debtors to the decree-holder within the time fixed by the court (Form No. 5-A in Appendix D of the Civil Procedure Code) and a final decree makes the conditional order for sale absolute. Such decrees are decrees for payment of money in the sense that money is payable under them and default results in the sale of the mortgaged property. They are, however, not decrees for payment of money in the sense that there is no personal obligation to pay any money at that stage. That stage comes later. The decree making the mortgagor personally liable for payment of the money can only be passed after the mortgaged properties had been sold up and the sale proceeds are found to be insufficient for satisfaction of the decree. Order XXXIV, Rule 6 provides that where the net proceeds of any sale held under the last preceding rule (Rule 5) are found, to be insufficient to pay the amount due to the plaintiff, the court on application, by him may, if balance is legally recoverable from, the defendant otherwise than out of the; property sold, pass a decree for such balance. It cannot be said that the decree referred to in Rule 20 is the one contemplated in Rule 6 of Order XXXIV or, in other words, that Rule 20 applies only to personal decree for the balance left after sale of the mortgaged property. This view will defeat the very object which the Legislature had in mind when they deliberately introduced Rule 20 in Order XXI. Decrees passed under Order XXXIV, Rule 6 are not decrees for enforcement of mortgage or sale, but Rule 20 specifically mentions a decree for enforcement of a mortgage and a charge. When a personal decree is passed under Order XXXIV, Rule 6, there is no decree for enforcement of mortgage or charge. It appears from the judgment of Heald, J, that in his Lordship’s viewer. 20 applies when the preliminary decree for sale provides that in case the sale-proceeds of the mortgaged property are insufficient to satisfy the decree, the decree-holder will be at liberty to apply for a personal decree, Form No. 4 in, Appendix D of the Civil Procedure Code is referred to (perhaps Forms Nos. 5 and 5-A are meant). Now this provision need not he mentioned in a preliminary decree. This is a right given to the decree-holder by law under Order XXXIV, Rule 6. In my opinion it makes no difference whether such a provision is or is not made in the decree. If made it is nothing more than Rule quotation from Order XXXIV, Rule 6. There are, however, passages in the judgment to show that in that case personal remedy was not available and his Lordship meant that in such a case Rule 20 is not applicable. If so, as I have said, I respectfully agree with him. For instance, at pages 508 and 509 of the report his Lordship says:

Nevertheless I find it difficult to hold that a mortgage decree for the sale of the mortgaged property, while there is no remedy except against the property and where there is no obligation on the part of the mortgagors personally to pay any sum of money, is a decree for the payment of a sum of money.

17. Again at page 512 the following significant passage occurs:

If the balance is not so recoverable, the decree is not an ordinary decree for sale in enforcement of a mortgage, end since in my opinion it cannot be regarded as a decree for the payment of a, sum of money. 1 would hold that Rule 18 cannot be applied to it.

18. It may, however, be argued that the view which I have taken may lead to anomalous results. For instance, it may be said that while in a decree for enforcement of a mortgage or charge the decree-holder, even if his personal remedy against the mortgagor is not barred by limitation, cannot proceed against him personally unless he exhausts his remedy against the mortgaged property. In other words, he is entitled to proceed against the mortgagor personally only for the balance of the money which remains unsatisfied and that also ordinarily after he obtains a decree under Order XXXIV, Rule 6; but if we allow a decree-holder to set off his mortgage decree against a money decree which the mortgagor has against him, we practically allow the mortgagee decree-holder a personal remedy against the mortgagor before his remedy against the mortgaged properties is exhausted. Allowing a set off is practically allowing the decree-holder of the mortgage decree to realize his decree from one particular kind of personal property of the mortgagor-judgment-debtor, e.g., the mortgagor’s money decree against the mortgagee. This may be so. But the Legislature has deliberately allowed this by introducing Rule 20 in Order XXI and, in my opinion, its effect is that if the mortgagor has a decree against the mortgagee, such a decree can be set off against the mortgage decree even before the mortgaged property is exhausted and a personal decree under Order XXXIV, Rule 6 is passed. It would have been rather unjust to a mortgagee who holds a decree against the mortgagor for the enforcement of the mortgage, to force him in some cases to wait for the expiry of the period of grace and then to proceed against the mortgaged properties which may hardly be sufficient for satisfaction of the decree, and then to apply under Order XXXIV, Rule 6 for a personal decree, and in the meantime to allow the mortgagor in execution of his own decree against the mortgagee to put him into prison by enforcing his money decree against him. It was to avoid this contingency that the Legislature, in my opinion, has deliberately allowed the mortgage decree to be enforced against a particular kind of property of the mortgagor judgment-debtor, namely, against the decree of 1 he mortgagor against the mortgagee. Then it is not universally true that a mortgage decree cannot be executed against the mortgagor unless the mortgaged property is exhausted See Hart v. Tara Prasanna Mukherji 11 C 718. It is however, not necessary to discuss the matter further. Rule 20 is clear and unambiguous and I would overrule the contention of the respondents.

19. The second point raised is that of res judicita and estoppel. In order to appreciate the arguments of Mr. Manohar Lal it is necessary to state a few more facts on which his contentions are based. In the beginning of the judgment I have stated that there were a number of simple money decrees against Thakur Barham now represented by the Barhams and the decree-holders proceeded against the six annas share of Patsanda estate which was sold in execution of the decree of one of them, Jiban-ram, and this sale was set aside by the Privy Council and litigation followed. In the meantime the sale proceeds Rs. 1,12,000, had been rateably distributed among various decree-holders. When the restitution proceedings were started the decree-holders between whom the sale proceeds were rateably distributed were necessarily made parties to the proceeding and they were also parties to the two miscellaneous appeals before this court. Miscellaneous Appeal No. 154 of 1922 on behalf of the Barhams against the decree-holders and auction-purchasers and Miscellaneous Appeal No. 159 of 1922 by the three auction-purchasers against the Barhams and the decree-holders. By compromise a decree for Rs. 81,398 for mesne profits was passed against the auction-purchasers. Among the money decree-holders there were some members of one of the families of the auction-purchasers, and they were decree-holders respondents in Miscellaneous Appeal No. 154 of 1922 preferred by the Barhams. The decree of this court, by mistake of the office was so drawn tip as to read that the mesne profits were decreed not only against the auction purchasers but against the decree-holders as well. This was wrong. Two of the appellants, namely, Bansidhar and Jwala Prasad, and Dwarka Prasad, the father of another appellant Moti Lal and some other decree-holders in their capacity as decree-holders filed an application for amendment of the decree and in Miscellaneous Judicial Case No. 9 of 1925 the decree was amended on the 20th of April 1925, with an order that the mesne profits decree be confined against the three auction purchasers only. On this fact Mr. Manohar Lal contended that some of the appellants having denied the liability to the mesne profit decree by, applying for amendment of the decree cannot now come forward and say that they are the judgment-debtors in the mesne profit decree and thereby claim a set off by making the mesne profit decree and the mortgage-decree cross-decrees. I do not find any force in this contention. We sent for the record of Miscellaneous Judicial Case No. 9 of 1925 and examined, in the presence of the parties, the application for the amendment of the decree, and informed them of this. There is nothing in that application to show that Dwarka Prasad and other appellants ever denied the liability to the mesne profit decree as auction-purchasers. They only wanted that the decree, as drawn up which read as if the liability for payment of the mesne profits was not confined to the auction-purchase but to the decree-holders also, be amended. The appellants were not only some of the appellants before us but several other decree-holders as well. In my opinion they rightly got the decree amended. Apart from this, I do not understand how estoppel can in any sense be applied to this case. Long before this application which was in 1925, all the appellants had already instituted a suit in 1917 for the realization of money which they had paid to discharge the two security bonds and _ all the members of the family were plaintiffs in that suit, though the nominal, purchasers, were three persons only They had also already-obtained their decree on that basis on 28th February, 1925; several months before the order of amendment was passed by this court. There was no representation which in any way induced the Barhams to change their position. The Barhams knew full well that the case of the appellants in their mortgage suit was that all the appellants were in fact auction-purchasers and it was in that capacity that they were suing for the money. I do not find any merit in this contention.

20. The second set of facts on which the contention of res judicata and estoppel are based are these. I have already stated that two persons Lakhi Prasad and Sheo-dutt who held simple money decrees against the Barhams in Execution. Cases Nos. 13 and 17 of 1924 attached this mesne profit decree and as the attaching creditors proceeded to execute it against the three auction purchasers and attached a specific share of Kedar Nath and Nopechand in the joint family properties: (Execution Cases Nos. 40 and 42 of 1925). There was an objection on behalf of some of the appellants which was disposed of on the 17th of January, 1927 (see Ex. K). The learned Subordinate Judge directed that only the share of judgment-debtors named. in the decree be proceeded with, these two execution cases were dismissed on full satisfaction as Hazari Rain and others transferees of the mesne profit decree paid up the creditors who had attached that decree prior to its transfer to them. On this it is contended on behalf of the respondents that as some of the appellants took up the attitude in those execution cases that the mesns profit decree was against three persons only, and it was so decided, this decision operates as res judicata, or at any rate the appellants are now estopped from raising the question that the mesne profit decree is against all the appellants. I shall take up res judicata. First of all there is no decision that the appellants are not liable, for the mesne profit decree or that they are not the judgment-debtors. The only point decided was as to the extent of the share of the three judgment-debtors which was liable to attachment. Assuming that there was a decision (if it was one) between some of the appellants on the one hand and Lakhi Prasad Dhandhania arid Sijeodutt the two attaching creditors of the Barhams, on the other. The appellants are claiming a set off against the Barhams and their representatives the respondents. Neither the Barhams nor the respondents were parties to that decision, nor are they representatives of the attaching creditors. As the Barhams and the respondents are bound by that decision, the appellants are not bound by it. For operation of res judicata there must be reciprocity. If in execution of a decree at the instance of an attaching creditor it is decided that the decree is barred by limitation, this decision is not binding upon the decree-holder and if it is decided otherwise, it cannot therefore, be pleaded as res judicata by the decree-holder if the question arises directly between the decree-holder and the judgment-debtor.

21. I now take up the consideration of estoppel. There is nothing to show, not even an allegation that either the Barhams or the Mandals acted on any representation of any of the appellants. The respondents had already taken the transfer of the decree. Barhams knew the position of the appellants all along. So long ago as in 1917 the appellants had set up their case that all of them were auction-purchasers. It was on that basis that mortgage decree was passed in favour of all of them in 1925. The representation, if any in the objection filed against the execution taken out by the two attaching creditors of the mesne profit decree was in 1927. What binds the Barhams binds the respondents. There is no estoppel when the true state of affairs is known. The only thing which the respondents did, after the objection, was that they paid about Rs. 12,000 to satisfy the decree of the attaching creditors. There is no allegation that they did soon the strength of any representation of the appellants. They did so to complete their own title to the mesne profit decree, which was transferred to them while it was under attachment. I, therefore, hold that the claim of set off is not barred either by res judicata, or estoppel.

22. The next point urged is the equitable consideration. In order to appreciate this, it will again be necessary to state a few more facts. I have already stated that after the sale of the six annas of the estate was set aside by the Privy Council the Barhams and the Mandals were allowed restitution of 5½ annas share only. The restitution of the remaining 6 pies was refused on the ground that one of the auction purchasers Chaturi Ram, who was sharer in the sale to that extent, had died before the order of the Privy Council was passed. I have also stated that by a compromise between the Barhams and the Mandals 1 anna 7½ pies was allowed to the Mandals, thus leaving 3 annas 10½ pies only to the Barhams. It has also been stated that the several money decrees were being enforced against the Barhams and it was in execution of one of those decrees in favour of one Jiban Ram that 6 annas was sold and the sale proceeds Rs. 1,12,000 were rateably distributed among all the decree-holders. When the sale was set aside and restitution proceedings were started, the execution proceedings were also revived and the decree-holders who held money decrees proceeded against the 5½ annas which by now, as I have shown, was owned to the extent of 3 annas 10 pies by the Barhams and 1 anna 7½ pies by the Mandals. It appears from the statements made in para. 13 of the objections filed by the respondent (page 3 of the paper-book, Parts I and II) that the Barhams sold 6 pies to one Ramrekha, 1 anna 1½ pies to Surajmal Marwari and gave the remaining 2 annas 3 pies in Satotra (an usufructuary mortgage in which the principal and the interests are satisfied. within a certain fixed period of time and then the property automatically reverts to the mortgagor) to the same Surajmal Marwari. Out of the proceeds of these transactions the Barhams partly satisfied the various money decrees. These facts have not been disputed before us. Thereafter the money-decree-holders proceeded against the remaining 1 anna 7½ pies which apparently belonged to the Mandals. It is not clear from the record, but it seems that the attachment of 6 annas made in the year 1902 was taken to have been subsisting all these years, otherwise the shares which had passed to the Mandals could not have been proceeded against. Be that as it may, the fact is that the decree-holders proceeded to sell the remaining 1 anna 7½ pies and the encumbrance of the mortgage-decrees of the appellants was notified in the sale proclamation and the share was sold subject to this encumbrance in execution of the decree of one of these money decree-holders Baijnath Ram Marwari and was purchased by the aforesaid Surajmal Marwari and one Ramautar Lal Marwari for a sum of Rs. 38,100 and the sale proceeds were rateably distributed amongst all the decree-holders. The sale certificate is Ex.l (page 66 of the paper-book, Part III) and the rateable distribution list will be found at page 67 of the same paper-book. Now, prior to this execution against the 1 anna 7½ pies of the estate three out of five of these decrees mentioned at page 66 of the paper-book came to be held by some of the appellants: two of them by the family of the appellant Kedarnath and one by appellant Chaman Ram, and these three decrees were also executed, and though the sale did not take place in execution of these decrees, the decree-holders participated in the rateable distribution and they had also taken steps to have the encumbrance of the mortgage-decree notified in the sale proclamation. On these facts the respondents contend that Surajmal and Ramautar and the benamidars of the appellants and the 3 annas out of 5½ annas of the estate, on which there is a charge of the mortgage-decree of the appellants, has come in their possession and they have purchased it subject to the encumbrance of their own decree. Therefore, it will be inequitable to allow them to realise their decree by a set off.

23. The second contention is that even if the purchasers are not the benamidars of the appellants, even then as the family of the appellant Kedarnath and the appellant Chaman Ram brought the mortgaged properties to sale in execution of their own money decrees subject to the encumbrance, the appellants should not now be allowed to realize the decree by a set off, as it would amount to double payment, inasmuch as while the property was sold at lesser price on account of the encumbrance of the appellants and thus the Barhams, whose place has been taken by the respondents, were forced to part with their property, on lesser price, they are now being called upon to surrender their mesne profit decree to satisfy that encumbrance, namely the mortgage decree.

24. As to Surajmal and Ramautar being benamidars of the appellants, the respondents have not been able to substantiate this. There is absolutely no evidence on the record to show that either or them is a benamidar for anyone of the appellants. No doubt, Surajmal is a partner in one of the cloth shops of one of the families of the appellants but that does not show that he is their benamidar in the property which he has purchased. The very fact that he is a partner shows that the interests of the two are different. Rahi rekha is no doubt a relation of one of the appellants Nopechand, but that also does not show that he is his benamidar. Suggestions to this effect were made to the witnesses of the appellants but have been denied by them. 1, therefore, hold that it has not been proved that the mortgaged properties 3 annas out of 5½ annas of the estate have come into the possession of the appellant, the decree-holders of the mortgage-decree.

25. Coming to the next question, Mr. Manohar Lai has relied upon Exs. A, K(3), C, K(4), E and K(6) showing that it was at the instance of some of the appellants as, money decree-holders that 1 anna 7½ pies, which was put up for sale, was so done after notifying the encumbrance of the mortgage-decree. He contends that the judgment-debtors, the Barhmas, fixed the upset price of 1 anna 7½ pies of the estate, which was going to be sold, at Rs. 73,000; it was at the instance of the decree-holders, who brought to the notice of the court that the property was subject to the encumbrance of Rs. 88,000, that the court fixed the value of the property at Rs. 35,000 and the property was sold at Rs. 38,100.

26. Now the question is whether by asking the court to notify their encumbrance of the decree the appellants have lost their rights of set off under Order XXI, Rule 20. As was pointed out in the case of Sheo Shanker v. Chunni Lal 36 Ind. Cas. 948 : 38 A. 669 : 14 A.L.J. 7 : 6 a case already referred to, the right of set off of decrees is aright created bylaw and must be enforced unless it is lost under the law. First of all the property was not sold in execution of the decrees of anyone of the appellants. It was Bold in execution of a decree of another man altogether, namely, Baijnath Ram Marwari. They simply executed their money, decrees to participate in the rateable distribution and participated in it. Notification of the encumbrance is compulsory under Order XXI, Rule 66, and the decree-holders were legally bound to notify. Again, the encumbrance was not on this specific 1 anna 7½ pies. It was on 3 annas out of the 5½ annas which was restored to the Barhams and the Man dais after the setting, aside of the sale by the Privy Council. I do not find anything which can be said to have taken away the right of the appellants to have the decree set off.

27. Assuming, however, that we can apply, equitable considerations in this case, there is no particular equity in favour, of the respondents. The respondents have purchased the mesne profit decree after the mortgage-decree was passed against the Barhams and they must be taken to have purchased it subject to all the equities which the appellants had against the Barhams. Those who have purchased 1 anna 7½ pies have done so for a sum of, Rs. 38,100 of which the upset price as given by the judgment-debtors themselves was Rs. 75,000. They have also the equity in their favour to this extent that the burden on the property purchased by them should not be more than the difference between the actual value of the property and the price paid by them. Assuming that the properties fetched smaller price on account of their being subject to the encumbrances, the deficit was only Rs. 36,900 or say Rs. 40,000. The set off claimed by the appellants will not entirely satisfy the mortgage-decree. It has swelled to about Rs. 1,12,000. The mesne profit decree, on the other hand, is only forRs. 81,000 and as no interest was allowed on this amount the recoverable amount has not increased. The result will be that after the satisfaction of the mortgage-decree by a set off against the mesne profit decree there will still be left about Rs. 40,000 to be realised before the mortgage decree can be satisfied and the purchasers of the property will still be liable for that amount. Therefore, taking into consideration the equities in favour of the respondents and in favour of those who are subsequent transferees of the mortgaged properties, I do not think there is any reason to give the former preference over the latter and under the circumstances I think the legal right of the appellants must prevail. One more fact has weighed with me. It was purely a legal obstacle which prevented the appellants from getting the amount paid, by them to discharge the security bonds adjusted in the mesne profits for which they were made liable and they were forced to have recourse to a separate suit. Now when the law allows them to claim a set off they should not be deprived of it.

28. The last contention raised by Mr. Manohar Lal was that the personal remedy of the appellants against the Barhams was barred. His contention amounts to this that this is a case in which after the sale of the mortgaged properties a personal decree under Order XXXIV, Rule 6 cannot be passed. It must at once be conceded that if a personal remedy against the mortgagor is barred, the decree ceases to be a decree for payment of money and Rules 18 and 19 of Order XXI, will not apply, be cause there is no possibility of there ever being a decree enforceable against the person and other property of the mortgagor. Now, in this; case, the cause of action of the appellants was not the maturity of the original security bond executed by the Barhams in favour of Gorbardhan Das. After the purchase of 6 annas of the estate in 1904 the money became payable by the auction purchasers, as they purchased it subject to the charge. Therefore, when the auction purchasers discharged those two bond they did what they were bound to do, and they had absolutely no right to see the Barhams for that money. Their right to sue accrued when this Court on 14th December, 1916 in Kedar Nath Marwari v. Jal Berhdma 37 Ind. Cas. 963 : (1917) Pat. 153 : 5 P.L.W. 238 refused to take this amount into consideration in adjusting the accounts between the Barhams and the auction-purchasers and the latter were specifically referred to a civil suit, Limitation for a suit for realization of this, money which was not based upon any registered contract, was only three years and the suit was instituted on 6th February. 1917, much before the time. I would, therefore, hold that the personal remedy of the appellants against the Barhams is not, barred.

29. The result is that I would allow this appeal with costs, set, aside the order Of the learned Subordinate Judge and direct that the mesne profit decree be setoff against the mortgage decree held by the appellants against the Barhams and that the appellants be permitted to proceed with the execution for the realization Of any amount which may be left due to them after part of their mortgage decree is sat isfied by a set off.

Courtney Terrell, C.J.

30. I agree.

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