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Madras High Court
Subbaraya Rowthu Minda Nainar And … vs Kuppusamy Aiyangar And Ors. on 12 February, 1909
Equivalent citations: 1 Ind Cas 535
Author: A White
Bench: A White, A Rahim


Arnold White, C.J.

1. I agree with the conclusion at which my learned brother has arrived in his judgment, which I have had the advantage of reading.

2. It seems to me, however, that the order of the Subordinate Judge may be supported on this short ground. The Nadars mortgaged to the respondents their mortgage interest under the decree which they (the Nadars) had obtained against the appellants. For the purpose of realizing their security the respondents brought a suit on the mortgage to them of the Nadars’ mortgage interest in the mortgaged property. This mortgage interest under the decree obtained by the Nadars includes the right to sell the property in default of payment. It seems to me no order for the sale of the decree obtained by the Nadars against the appellants was necessary in order to enable the respondents to execute the decree which they had obtained and I do not think that either Section 273 of the Code of Civil Procedure or Section 184 of the Civil Rules of Practice applies.

3. I would dismiss the appeals with costs.

Abdur Rahim, J.

4. This appeal raises the question of the correctness of the order of the Subordinate Judge of Kumbakonam, dated the 20th April 1906, allowing on the application of Kuppusami Aiyangar, Chidambara Chettiar and Vairavan Chettiar, whom for brevity’s sake I shall call the Chetties, execution of three mortgage decrees made in Original Suits Nos. 33 of 1893, 43 of 1893 and 35 of 1895 against one Subbaraya Rowthu Minda Nainar and his son, the appellants before us. These decrees were obtained by certain persons, who may be shortly described as the Nadars, and were purchased by the Chetties, who now seek to execute them at a Court auction sale held on the 24th April 1904. The sale was held in pursuance of a decree made on the 30th July 1902 in Suit No. 62 of 1901 instituted by the Chetties against the Nadars to enforce a hypothecation bond by which the latter had pledged as security the mortgage decrees, which they held against the appellants. The Nadars, it ought to be mentioned, had contested that action on the ground, amongst others, that mortgage of a mortgage decree was invalid and could not be enforced. But the defence did not prevail and the Nadars preferred an appeal to this Court (Appeal No. 190 of 1902) against the judgment of the Lower Court Pending the appeal, however, the decree of the first Court was executed and the hypothecated mortgage decrees were sold at the instance of the Chetties and bought by them with the leave of the Court. The Nadars objected to the sale under Section 311, Civil Procedure Code, but the objection was disallowed by an order dated the 21st October 1904 and they preferred an appeal to this Court against that order (Civil Miscellaneous Appeal No. 37 of 1905). When these two appeals of the Nadars (Appeal No. 190 of 1902 and Civil Miscellaneous Appeal No. 37 of 1905) came on for hearing before us they arrived at an amicable settlement with the Chetties and a compromise decree was passed with sanction obtained from the Court as some of the parties were minors. By this decree the sale to the Chetties, who abandoned their claim under the unsatisfied portion of their mortgage decree, was confirmed. The judgment-debtors of the Nadars, who are the appellants in the present appeal, were not parties to those appeals nor to the suit and the proceedings which gave rise to them. Now that the Chetties on the strength of their purchase at the Court sale seek to execute against the appellants the mortgage decrees, which the Nadars had originally obtained against them, the judgment-debtors try to resist execution on the ground-the only ground pressed upon us-that the sale did not pass any title to the Chatties. Their argument shortly stated is: a mortgage decree is a money decree; a money decree held by a judgment-debtor can be made available for the satisfaction of his debts only in the mode prescribed by Section 273, Civil Procedure Code; such a decree cannot be sold in execution as laid down by Rule 184 of the Civil Rules of Practice, 1902 and that the sale in question was sale of a money decree in execution of a money decree and must, therefore, be treated as a nullity and of no effect in law. In estimating the force of this argument it has to be borne in mind that the Nadars, whose decrees against the appellants, the Chetties, have bought, do not now question the validity of the sale.

5. Now whether a mortgage decree which directs the defendant to pay a certain sum of money as well as directs the sale of the mortgaged property, as is the character of the decrees bought by the Chetties, is to be regarded as a money decree depends on the connection in which the question arises. So far as it gives the first relief there can be no doubt that it is a money decree pure and simple and so far as the other relief is concerned it is directed against certain specific property. But the right to the last relief as well is given as a mere means of realising the money to which the plaintiff is found to be entitled. Whenever, therefore, we find that the Legislature, in speaking of money decrees in a particular context, has in contemplation the ultimate end, which it is intended to reach by such decrees, it would be right to hold that the description applies to ordinary mortgage decrees. See Vaidhinadasamy Ayyar v. Somasundram Pillai 28 M. 473. The Courts in considering the meaning of the word money decree,’ as used in different contexts or even in the same context, have held different views and it is not necessary for the decision of the present case to discuss all these rulings. See the decisions with reference to Section 4, Succession Certificate Act, reported in Nanchand v. Yenawa 28 B. 630, Mahomed Yusuf v. Abdur Rahim Bepari 26 C. 839 and Fatehchand v. Muhammad Bakhsh 16 A. 259. For the purpose, however, of Section 273, on which the learned pleader for the appellant mainly relies in support of his contention, supposing that it applies to the facts of this case, a decree for money, which is sought to be attached in execution, has been held in a number of cases to include a decree upon a mortgage, and the Courts have further ruled that the effect of Section 273 is to prohibit the sale of a decree for money which has been attached in execution. See Sultan Kuar v. Gulzari Lal 2 A. 290, Tiruvangada v. Vythilinga 6 M. 418; Jotindro Nath Chowdhry v. Dwarka Nath Dey 20 C. 111: Gopal Nanashet v. Joharimal; Dada, Balshet v. Joharimal 16 B. 522. Taking the law on this point to ho thus settled, I. have next to consider what is the scope of the prohibition, does it make the sale held in spite of it a nullity so that it confers on the purchaser no title which he can enforce against the judgment-debtor? That would be the result if the prohibition can be said to be based on grounds of public policy or as striking at the jurisdiction of the executing Court. But it would be otherwise if the provision of Section 273 as suggested by Mr. P.R. Sundara Aiyar, who appeared for the Chetties, is intended only for the protection of the holder of the decree sought to he sold or of the person seeking execution against it. It is easy to conceive that it might be in the interest of either of them to insist that the decree should be executed and the money realised in execution he utilised in discharging the debt due to the latter. On the other hand, the judgment-debtor under the decree, which is proceeded against, has in any event to satisfy the judgment outstanding against him and it can make no difference to him who puts it in force so long as he has not to pay twice over and whatever equities he has against his judgment-creditor are safe-guarded.

6. Can it then he said that the prohibition contained in Section 273 is founded on reasons of public policy or is such as to oust the jurisdiction of the Court to sell a decree in order to discharge the debts of the decree-holder? I think it is not difficult to gather an answer to these questions from the different provisions of the Code of Civil Procedure hearing on the matter. Section 232 recognises that a money decree can be transferred by a voluntary act of assignment and that it is capable of devolving on others by the operation of law. In the case of an assignment all that the law requires is that it must be made in writing. Section 266, Civil Procedure Code, lays down generally that all saleable property of the judgment-debtor which would apparently include a decree for the payment of a sum of money is liable to attachment and sale in execution. This provision only embodies the general rule of law which entitles a creditor in order to realise his judgment-debts to have recourse to whatever property is or may be made available for the benefit of the debtor. But the Legislature, for reasons apparently of public policy, has at the same time exempted certain descriptions of property, and rights, some of which at least are transferable by a voluntary act of the owner, from compulsory sale, but a money decree is not on that list. Section 273, on the other hand, does not say, in so many words, that a decree shall not be sold, though such a prohibition is inferred from its provisions as a matter of implication. This section primarily lays down how a decree for money can be attached and Section 284 generally lays down that whatever is attached may be sold. But in a case where the decree to he proceeded against was passed by the Court which passed the decree sought to he executed, Section 273 says that the attachment shall be made by an order directing the execution of the former decree and that in other cases the attachment shall be by an order staying the execution of the decree proceeded against unless and until the holder of the decree sought to be executed applies for execution of the attached decree. No doubt this procedure does not contemplate the sale of a decree for money. And if we take it, as has been held, that it also precludes the sale of a decree, such exclusion must be considered as having the effect of an exception engrafted upon the general substantive rights of the creditor as recognised by Section 266, Civil Procedure Code. Section 273 is a mere rule of procedure and I do not think we ought to give it or Rule 184, which merely embodies the effect of that section, a scope which would interfere with the provisions of Section 266 any further than is necessarily called for by its language. I think that it would he extending the application of Section 273 beyond all reasonable limits if we were to hold that it has the effect of rendering the sale of a decree for money held in execution altogether invalid and without jurisdiction. On the other hand it seems to ho unreasonable that where no objection is raised to such a sale by the holder of the decree or his creditor, who in this case has in fact brought about the sale, it should be open to the judgment-debtor under that decree to raise any objection. This view is warranted by the principle of the decisions reported in Gulzari Lal v. Daya Ram 9 A. 46, Balkrishna v. Masuma Bibi 5 A. 142, at p. 157 (P.C.) and Naigar Timapa v. Bhaskar Parmaya 10 B. 444. No doubt in Tiruvengada v. Vythilinga 6 M. 418, the facts of which were similar to the present case, the objection to the execution which was uphold was raised by the judgment-debtor but the question whether he was competent to raise such an objection, in the absence of any objection on the part of the person whose decree was sold, was not argued before the [earned Judges, nor considered by them.

7. I have assumed so far that Section 273 applies. That section, however, seems to have no application to a case like this, where attachment of the decree was never asked for. The point for decision before the Full Bench in Mallikarjunadu Setti v. Lingamurti Pantulu 25 M. 244, which is relied on by the learned pleader for the appellants in this connection, was whether Sections 310A and 311, Civil Procedure Code, applied to sales held in execution of a mortgage decree and in coming to a conclusion on that question the majority of the learned Judges held that an order under Section 89, Transfer of Property Act, was substantially an order in execution of a decree It may also well be that many of the provisions of the Civil Procedure Code as stated in that case apply to mortgage decrees. But in order to determine whether a particular section of that Code is applicable or not in a given case, one must have regard to its language as well as to its scope. Section 273 of the Civil Procedure Code as well as Rule 184 of the Civil Rules of Practice, as I have said, deal with cases where a decree is attached in execution but such a process would be wholly unnecessary in enforcing an ordinary mortgage decree ordering sale of the property. If Section 273 applied, the result would be that if the holder of a mortgage decree-which, in this connection we shall regard as a money decree-pledges it as security for his debts authorising the creditor to obtain an order for its sale in default of payment, the Court cannot enforce such a contract, or, in other words, a mortgage decree cannot be pledged as security. We have not been referred to any authority in support of such a proposition and I am not prepared to accord to Section 273, Civil Procedure Code, which merely enacts a rule of procedure, a scope which would indirectly affect an important question relating to the right of the decree-holder to deal with his rights under the decree. OIL the other hand Section 232, Civil Procedure Code, the language of which is quite general, seems to me to recognise the validity of a pledge of a decree as security no less than the validity of its sale. And there is nothing in reason why if a decree-holder can sell his decree, he cannot make it security for his debts. It then follows that if there is nothing in the law to prevent a decree-holder from pledging his decree as a collateral security, it must be within the competence of the Court, which is asked to enforce such a contract, to order the sale of the property pledged. But it is said that the Transfer of Property Act makes no provision for such a transaction; but that statute does not purport to deal exhaustively with the law relating to different forms of securities, for instance, it does not deal with pledges of tangible movable property, Government Promissory notes, policies of insurance and the like. In oases not specifically dealt with by that Act the Court acts upon its general power of enforcing contracts.

8. I think, therefore, that the petition of the Chetties for execution of a mortgage decree obtained by the Nadars has been rightly allowed by the lower Court and would dismiss these appeals with costs.

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