Darbari Lal vs Khetra Chandra Mitra and Others

Ross, J.—This is an appeal by the plaintiff in a suit on a mortgage executed on the 21st of May 1906, by Defendant No. 1. The suit was decreed for sale of the mortgaged property subject to the decree of Defendants Nos. 15 to 18 in Suit No. 320 of 1917 of the Court of the Second Subordinate Judge of Gaya. The appeal is directed against that part of the decree which makes the plaintiff''s mortgage subject to the aforesaid decree. The properties mortgaged to the plaintiff were 16 annas mokarrari interest in Mouza Gopalpur and 8 annas out of 16 annas interest in Mouza Bhelawar.

In order to decide the question raised in the appeal it is necessary to examine all the transactions affecting these properties. By two deeds executed on the 3rd of April 1900, and the 28th of May 1902, Defendant No. 1 mortgaged to one Puran Mal the 16 annas interest in Mouza Bhelawar. On the 27th of February 1906, Puran Mai brought a suit on his mortgage and obtained a decree in execution of which the mortgaged property was purchased by Defendant No. 6. On the 19th of December 1905, the Defendant No. 1 mortgage 8 annas interest in Mouza Gopalpur to one Rajkeshwar Narain and on the 21st of December 1905, he again mortgaged 16 annas interest in Mouza Gopalpur to Defendants Nos. 5 and 6. No suit has been brought on this latter mortgage, although it has been dealt with in the decree referred to in the present decree a matter which will be discussed later. On the 19th of April 1909, Defendants Nos. 5 and 6 and the father of Defendants Nos. 9 and 10 purchased the 8 annas interest in Mouza Gopalpur in execution of a decree obtained on the mortgage to Rajkeshwar Narain. On the 22nd of July 1910 Defendants Nos. 5 and 6 and the father of Defendants Nos. 9 and 10 mortgaged 8 annas interest in Gopalpur and 16 annas interest in Bhelawar to Upendra. Chandra Mitra, the predecessor-in-interest of Defendants Nos. 15 to 18, The deed contains the following clause:

We have kept the original certificates of sale in respect of Mouzas Bhelawar and Gopalpur and the original mortgage-bond, dated the 21st December 1905, for Rs. 2,800 in the custody of the said Babu (that is, the mortgagee) for his satisfaction (waste itiminan). When on payment of the entire amount, principal with interest and compound interest, we shall take back this bond, we shall take back the original certificates of sale and the bond.

Then follows the schedule of the mortgaged properties containing, among others 8-annas share of Gopalpur and 16 annas interest in Bhelawar. But there is no reference to the aforesaid sale certificates and the mortgage bond. The successors-in-interest of Upendra Chandra Mitra brought Suit No. 320 of 1917 in the Court of the Second Subordinate Judge of Gaya to enforce this mortgage. The present plaintiff was no party to that litigation. In that suit it was held that the deed executed in favour of Upendra Chandra Mitra not only effected a mortgage of the properties set forth in the schedule, but also effected a sub-mortgage of the property included in the bond of the 21st of December 1905, that is, of the 16 annas interest in Gopalpur; and it is this part of that decision which is in question in the present appeal.

It is clear on the facts already stated that Defendants Nos. 15 to 18 have priority over the plaintiff in respect of 8-annas share of Mouza Gopalpur by virtue of their title derived ultimately from the mortgage of the 19th of December 1905, in favour of Rajkeshwar Narain. It is also clear that they have priority with regard to Mouza Bhelawar by virtue of a title derived ultimately from the mortgages of 1900 and 1902 in favour of Puran Mal. The only question is whether they have priority as regards the remaining 8-annas interest in Mouza Gopalpur by reason of the deposit of the mortgage-bond of the 21st of December 1905, which affected the whole 16 annas interest in that village.

The learned Subordinate Judge has treated this as an equitable mortgage by deposit of title-deeds. But, as the transaction was entered into in Gaya and as an equitable mortgage by deposit of title-deeds can only be effected in the Presidency and other towns, mentioned in Section 59 of the Transfer of Property Act, it is clear that this part of the decision cannot be sustained. It is clear also that the plaintiff is not bound by the decree in Suit No. 320 of 1917 to which he was not a party.

It was contended on behalf of the respondents that it was a question of the intention of the parties in depositing the certificates of sale and the mortgage-bond of 1905. The intention is expressed in the words "waste intiminan" which apparently mean "for the sake of satisfaction" and the deposit must be taken to have been, intended as an assurance of the mortgagor''s title. The respondents claim that these documents were deposited as further security; but further security could only be created by way of transfer. It is said that a transfer was effected by sub-mortgaging the properties referred to in these documents. But the instrument itself does not effect any sub-mortgage and these documents are not included in the schedule of properties mortgaged. The mere deposit of these documents gave no right to the mortgagee to proceed against the properties to which they related.

Finally, it was contended on behalf of the respondents that they had no notice of the plaintiff''s mortgage. But this argument begs the question, because, if they are subsequent mortgagees, then they had constructive notice of the prior registered mortgage of the plaintiff.

The result, therefore, is that the respondents have priority only as regards Bhelawar and 8-annas share of Gopalpur and not as to the remaining 8-annas of Gopalpur and the decree of the Subordinate Judge must be modified accordingly. There will, therefore, be the usual mort gage-decree for sale, subject to the prior security of Defendants Nos. 15 to 18 in respect of 8 annas interest in Mouza Gopalpur and the whole interest in Mouza Bhelawar. A period of three months from the date of this decree is allowed to the defendants to redeem the plaintiff''s mortgage.

To this extent the appeal is decreed with costs which will come out of the mortgaged property. The plaintiff will be entitled to redeem the Defendants Nos. 15 to 18 on payment within three months of this date of Rs. 5,288-2-0 due upon the prior mortgage; thereafter, these defendants will be entitled to redeem the plaintiff within a further period of three months on payment of Rs. 5,288-2-0, the amount due under the decree at the date of the sale to Rajkeshwar.

Das, J.

I agree.