Ghanshyam Das and Others vs Ragho Singh and Another

Rowland, J.—This appeal by defendant first party arises out of a suit to declare title and recover possession over 2 bighas 4 cottahs and odd in village Taufir Barahia known as Chhabisia Tauzi No. 1309 in Government Khas Mahal. The suit was dismissed by the Munsif but has been declared by the lower appellate Court.

It will be convenient to set forth the title alleged by the defendants and then the title alleged by the plaintiffs. The starting point is that it is common ground that on 4th March 1893 the land was put to auction on a certificate under the Public Demands Recovery Act and was sold in the name of Girdhari, The defendants'' case is that this Girdhari was merely a farzidar for Nandlal and Ram Phal who were the real purchasers. Two title suits bearing Nos. 475 and 476 of 1899 were brought by Nandlal to declare title to the property and to get partition as against Ramphal and Girdhari. Nandlal got a decree on 24th June 1901, and final decree in the partition suit was passed on 18th June 1906 by which the disputed land fell exclusively to Nandlal. He on 8th May 1907 mortgaged it to the defendants first party who brought mortgage suit No. 169 of 1919 for sale of the property. The suit was decreed on 28th October 1922. After various other proceedings the defendants first party got delivery of possession on 31st July 1926.

On the other hand the plaintiffs derived their title from Girdhari. Since the auction sale of 1893, the holding stood in the name of Girdhari in the Khas Mahal Office, and it was sold in execution of a certificate under the Public Demands Recovery Act, for its own arrears of rent in certificate case No. 442 of 1905-1906 on 11th September 1906 and was bought by Munshi Ganesh Prasad. The sale was confirmed on 12th October 1906 and the purchaser''s name was entered in the Khas Mahal Office registers. On 9th May 1907 Ganesh Prasad executed a sale deed Ex. 6 in the name of Sibdutt Ram. This Sibdutt was merely a farzidar for Babu Bengali Singh. In 1909 there was a proceeding u/s 145, Criminal P.C., to which Nandlal, Ramphal, Sibdutt and Bengali were parties. Possession was declared to be with Nandlal. On 6th April 1909, Sibdutt brought title suit No. 2 of 1910 against Nandlal and obtained an ex-parte decree on 5th May 1910, and took out delivery of possession on 14th July 1910. Thereafter he transferred the holding to his own sister''s son, whereupon Bengali in 1911 brought a suit against Sibdutt and Sibdutt''s nephew to declare that he was the real purchaser and Sibdutt was only his benamidar. The suit was decreed and Bengali took delivery of possession on 11th July 1913. Bengali according to the plaintiffs was joint with his uncle Babu Chotu Singh, and after the death of Bengali, Chotu, on 26th August'' 1923, executed a sale-deed conveying the property to the plaintiffs.

In their plaint the plaintiffs set up the above title and alleged that the mortgage suit of 1919 brought by defendants first party was collusive and fraudulent. The defence raised the contentions that Girdhari had no title; that Ganesh acquired nothing by his purchase of 1906; that the auction sale was not binding on the real owner; that the title suits of 1910 and of 1911 are of no effect against these defendants who were not parties to them; that there could further be no question, of adverse possession as against these defendants who were simple mortgagees and that by virtue of the principles of lis pendens and res judicata the title of the plaintiffs vendor Chotu as well as of the plaintiffs'' was concluded by the decision of the mortgage suit of these defendants.

Now as to the first point the Munsif held that Girdhari was benamidar of Nandlal and Ramphal who were in possession of the disputed land and Girdhari was not the real owner. This finding was accepted by the Subordinate Judge. The Munsif held on the next point that the sale on the certificate against Girdhari had no effect against the real owners. On this point the Subordinate Judge hold otherwise relying on cases where decrees for or against a benamidar have been held to be effective for or against the beneficial owner. Those decisions are of no avail and do not support the conclusion based on them for the simple ground that a certificate is not a decree. It has not the force of a rent decree and what passes in a certificate sale is the interest of the judgment-debtor only as, held in Mt. Raja Kuer v. Ganga Singh [1909] 1 I. C, 197, following Rupram Namasundra v. Iswar Namasundra [1902] 6 C.W.N. 302, and other cases, and again affirmed in Nand Kumar Dey v. Ajodhya Sahu [1912] 11 I.C. 465 where it is clearly stated that the Public Demands Recovery Act does not contemplate the real realization of a security the steps taken being analogous to those provided for the enforcement of a money claim. This is the great difference between a sale under the Public Demands Recovery Act, and a sale in execution of a rent decree. From this it is clear that no title passed to Ganesh against Nandlal by this sale. The Section 145 proceedings and the admission of Ganesh in his evidence show that he did not get possession. It follows that the mortgage executed on 8th May 1907 by Nandlal was a valid mortgage of property to which he was entitled and of which he was in possession and this mortgage moreover is antecedent in time to the sale deed of 9th May 1907 by which Ganesh purported to sell the same property to Sibdutt.

The next point is as to the effect of the title suit of 1910. The Munsif pointed out that the defendants first party were not parties to this suit and apparently meant to infer that its result was not binding on them. The Subordinate Judge held that the

plaintiff was entitled to recover possession of the holding from defendant first-party as Nandlal was defeated in his rights by Bengali in title Suit No. 2 of 1910.

The Subordinate Judge has proceeded on the assumption that Nandlal in that suit represented the entire interest of himself and his mortgagees in the holding; but this view is clearly contrary to law as laid down in Dooma Sahu v. Joonarain Lall [1869] 12 W.R. 362, a leading case which has been repeatedly followed, e.g., in Bonamali Nag v. Koylash Chunder Dey [1879] 4 Cal. 692, in Suraja Prasad Thakur v. Rajmohan Topedar [1909] 4 I.C. 92, in Soshi Bhushan Guha v. Gogan Chandra Shaha [1894] 22 Cal. 364 and Shib Chandra Roy v. Harindra Lal Roy [1918] 47 I.C. 315 and the principle of which is approved in Sita Ram v. Amir Begum [1886] 8 All. 324. The decision in Balmakund Ruyia v. Moti Lal Burman [1916] 32 I.C. 195 and Natho Singh and Others Vs. Lachu Singh and Others, are of no avail to the plaintiffs because in those cases all that was laid down was that a mortgagor in possession had power to deal with the property to the extent of granting leases etc., in the ordinary course of prudent management so long as he did not impair his mortgagees'' security. It is manifest therefore that the present defendants first party are not bound by the result of the suits brought by Sibdutt against Nandlal, and by Bengali against Sibdutt. Nandlal as mortgagor could not represent the estate of his mortgagees. Still less could Sibdutt, after succeeding against Nandlal represent the estate of the mortgagees in the litigation brought against him by Bengali.

But it is argued for the plaintiffs that Sibdutt and after him Bengali had adverse possession as against both Nandlal and the mortgagees and this adverse possession had matured into complete title. This contention cannot be accepted. The only authority cited before us in favour of the proposition that adverse possession against a mortgagor is adverse possession against the simple mortgagee was Ramaswami Chetti v. Ponna, Padayachi [1911] 36 Mad. 97, where it was held that adverse possession by a stranger for more than 12 years of a property which is subject to a hypothecation not only extinguishes the rights of the mortgagor, but bars also those of the mortgagee even where he was not entitled to possession under the mortgage. This decision which was the judgment of two Judges was overruled by a Full Bench in Viyapuri v. Sonama Boi Ammani [1915] 39 Mad. 811 which restored the principle that the possession of a trespasser who has dispossessed a mortgagor the mortgage being simple is not adverse to the simple mortgaged. In Allahabad the same view was taken: see Nandan Singh v. Juman [1912] 34 All. 640, as well as in Calcutta. It is true that in Nand Kumar De v. Ajodhya Sahu [1912] 11 I.C. 465 the question was left open; but the principle is definitely stated in agreement with the views of the Madras and Allahabad High Courts in Priyasaki Debi v. Bireshwar Samanta [1916] 44 Cal. 425. The respondent cannot therefore set up the acquisition of title by adverse possession against the defendants first party. Finally I have to consider the argument of the appellants that the title of the plaintiffs is barred by the principles of lis pendens and res judicata. I will state first the facts regarding the suit of defendants first party. The judgment of the suit which has been exhibited shows that it was founded on a registered mortgage bond dated 8th May 1907 executed by Nand Lal, father of the first defendants, and that the defendants second and third parties were impleaded as persons having subsequently acquired an interest in the mortgaged properties and as subsequent purchasers of the mortgaged properties. Among these defendants Chotu and Bengali were included. As I have said above it was the plaintiff''s case in the present suit that the proceedings were fraudulent and collusive that Bengali and Chotu had no knowledge of the suit and that the decree was illegal, void and inoperative on account of this fraud and collusion. This case failed; it was found by Courts that Bengali and Chotu actually appeared and filed petitions, Exs. A series and Exs. B series for time for filing the written statement; but eventually they filed no written statement. After the decree an appeal was filed by Bengali''s widow which was dismissed on 3rd April 1925 and after the sale of 10th August 1925, a petition under Order 21, Rule 90 for setting aside the sale was presented by the widow of Bengali, but was rejected on 17th March 1926. The purchase by the plaintiffs was on 26th August 1923 and was therefore made during the pendency of the proceedings in the mortgage suit litigation. It appears therefore to fall within the terms of Section 52, T.P. Act. The explanation which has been added by the amendment of 1929 does not, I, think alter the law but merely emphasizes that the correct view of it is that taken by the Calcutta High Court in such decisions as Surjaram Marwari v. Brahmdeo Prosad [1905] 2 C.L.J. 288 in which it was held that in the, case of a mortgage suit the lis continues after the decree nisi and the doctrine of lis pendens is applicable to proceedings to realize the mortgage after the decree for sale. It was observed: "the plaintiffs are accordingly quite as much bound by the sale (mortgage execution sale) as their vendors."

This is one of a long series of decisions of which I need not cite others. The position is this that if Chotu, the plaintiffs'' vendor was bound by the, proceedings the plaintiffs are also bound.

It still remains to face the question whether the proceedings in the mortgage suit were binding on Chotu. At first sight the answer may seem obvious that Chotu was a party to the mortgage suit; he was impleaded as a person intended to be bound by the decree as having acquired an interest subsequent to the mortgage. Decree was passed against him and he was one of the judgment-debtors in the suit. Is not that enough? But it is argued for the respondents that the title of Bengali and Chotu was a paramount title; they claimed not under Nandlal, the mortgagor of the plaintiffs of that suit, but adversely to him and they rely on the rule that ordinarily a paramount title cannot be drawn into controversy in a mortgage action.

That is no doubt the general rule, Radha Kunwar v. Reoti Singh AIR 1916 P.C. 18, where their Lordships of the Privy Council observed that the joinder of such parties was irregular and could only tend to confusion. So it was held in Monmohini Ghose v. Parvati Nath Ghose [1905] 32 Cal. 746 that persons claiming a paramount title and not interested in the equity of redemption are not necessary parties. In Nilkanta Banarji v. Suresh Chandra Mullick [1885] 12 Cal 414 a defendant claiming adverse title was dismissed from the action and given his costs. The same was done in Jaggeswar Dutt v. Bhuban Mohan Mitra [1906] 33 Cal. 425 , which was followed in Loknath Singh and Others Vs. Santokhi Missir and Others, ; the defendants who had set up that they were not necessary parties should be dismissed from the action. The suit in such a case would be considered as bad for misjoinder of parties and causes of action. The decision in Jogeshwar Dutt v. Bhuban Mohan Mitter [1906] 33 Cal. 425 following Sarala Sundari v. Sarada Prasad [1904] 12 C.L.J. 602 and Sections 44 and 45, Civil P.C., 1882, proceeded on the ground that there could not be a joinder of causes of action of this description, and in Sarala Sundari v. Sarada Prasad [1904] 12 C.L.J. 602 the ground of decision was that such multifarious-ness was fatal to the suit.

But even under the old Code it was recognized that this general rule was subject to exceptions, and in the Code of 1908 the rule as expressed in Order 2, Rule 4, is much less rigid. Causes of action may be joined with the leave of the Court and under Order 2, Rule 7, all objections on the ground of misjoinder of causes of action are to be taken at the earliest possible opportunity and in all cases where issues are settled at or before such settlement unless the ground of objection has subsequently arisen and any such objection not so taken shall be deemed to have been waived. Section 99 further enacts that no decree shall be reversed or substantially varied nor shall any case be remanded in appeal on account of any misjoinder of parties or causes of action or any error, defect or irregularity in any proceedings in the suit not affecting the merits of the case or the jurisdiction of the Court.

The principle of the exceptions admitted before 1908 was that where a party had without objection gone to trial on issues on the merits, he was not allowed to plead after failing on the merits that his paramount title should not have been adjudicated on; Hare Krishna v. Robert Watson [1904] 8 C.W.N. 365: see also Bhaja Chaudhary v. Chuni Lal Marwari [1906] 5 C.L.J. 95. In Syed Fakir Raza v. Madhusudan Das [1918] 45 I.C. 691 , Sir Jwala Prasad expressed the view that issues of paramount title can in certain cases be properly tried in a mortgage suit. These three cases were relied on in Khub Lal Upadhya Vs. Jhapsi Kundu and Others, , the parties having gone to trial on an issue of title on the merits; defendants, were not allowed to succeed in appeal on the contention that there was multifariousness. It is settled law that where paramount title has been adjudicated on, in a mortgage or redemption suit the defeated party will not be allowed to raise the contention that the Court was wrong to decide the question, either in appeal or in a subsequent litigation.

In the present case the principle relied on by the defendants first party is that of constructive res judicata under Expln. 4, Section 11, Civil P.C., by which

any matter which might and ought to have been made ground of defence or attack in such former suit shall be deemed to have been a matter directly and substantially in issue in such suit,

and so the question is whether a person, claiming paramount title or a prior lien is bound to set it up in a mortgage suit, in which he has been impleaded as a person having an interest bound by the mortgage. The moat recent decision, which is relied on by the respondents, is Brijmohan Singh Vs. Dukhan Singh, , decided on 10th March 1930, where the following propositions are laid down:

That when a party, who is a prior mortgagee and nothing more is impleaded; and nothing is alleged in derogation of his priority, he will be taken to have been impleaded under Order 34, Rule 12, and his priority is not affected.

Where the party impleaded is a prior mortgagee and nothing more, but an allegation is made in the plaint derogating from his priority his priority is barred.

When the party impleaded is a puisne mortgagee and therefore a necessary party, but claims priority, he must assert and prove his priority, otherwise he is barred,

The particular case was held to be governed by the third of these principles, and if the rule laid down is the correct rule of law, it applies to the facts of the present appeal. But in Sadhu Behera Vs. Dibakar Tarai and Others, , Das, J., has said:

There is no rule of law that a defendant being a subsequent incumbrancer or the purchaser of the equity of redemption is bound to set up as a defence that he has also a paramount title. If in such a suit he does not invite the Court to decide the question of his priority he will not be precluded from raising the question of his priority in a suit of his own.

In the same case Rowland, J., thought that a party in that position ought to disclose his title, but need not prove it unless it was definitely attacked; and in Lachmi Narain Marwari v. Chowdhary Bhagat Singh, [1920] 58 I.C. 33 Coutts and Sultan Ahmad, JJ., were not prepared to go beyond the proposition that the prior mortgagee would be bound to disclose his prior mortgage in the previous suit if he is made a party; where the prior mortgagees filed a written statement asserting their priority and still the plaintiffs made no attack on it and no issue was framed regarding it, it was held that they were not barred from asserting it in a subsequent litigation. It would be consistent with the views last referred to, and in conformity with the principle of the observations cited in Mahomad Muzaffar Hossein v. Kishori Mohan Roy [1895] 22 Cal. 909 from Ramcoomar Koondoo v. McQueen [1872] 11 B.L.R. 46 to hold in the present case that the suit is barred by the principle of res judicata and that position would agree with Lal Behari Singh v. Gur Prasad Singh A I.R. 1923 Pat. 290 and Mahabir Pershad Singh v. Parbhu Singh [1909] 3 I.C. 686, the principle of res judicata being applicable where there is a definite claim of relief against the particular defendant or a definite attack on his title; and consideration of the rules in Order 2, Civil P.C., might also seam to favour this result; but I do not see how to reconcile such a conclusion with certain observation in Koi Sahu Vs. Atul Krishna Ghose and Others, .

There being this conflict of authority, it would I think be our duty to refer the point for the decision to a Full Bench if its decision was essential to the disposal of this appeal; but for the reasons given above I am of opinion that independently of the question of res judicata the plaintiffs must fail on the merits as the defendants have established a good title and the plaintiffs have not succeeded in establishing their own title. I would therefore allow the appeal and dismiss the suit with costs throughout.

Kulwant Sahay, J.

I agree. In the course of the argument on the question of res judicata reference was made to the decision of a Division Bench of this Court in Koi Sahu Vs. Atul Krishna Ghose and Others, . His Lordship the Chief Justice is reported to have observed in that case that there is a serious misprint in my judgment in Lal Bihari Singh v. Gur Prasad Singh A I.R. 1923 Pat. 290. I held in that case that where a person, who is impleaded in a suit on a mortgage on the allegation that he is a puisne mortgagee, files a written statement that he is a prior mortgagee, but does not otherwise contest the suit, and the judgment in that suit proceeds on the assumption that he is a puisne mortgagee, he is not entitled subsequently to allege in a suit on his own bond that he is a prior mortgagee. The judgment of the Privy Council in Radha Kishna v. Khurshed Hossain AIR 1920 P.C. 81 was cited as an authority against that proposition, and I observed that it was not so. I said:

That case ... is an authority in favour of the proposition that where a prior mortgagee is impleaded as a defendant in an action on a subsequent mortgage and it is sought to displace the prior title and to postpone it to the title of the plaintiffs, it is the duty of the prior mortgagee to prove his prior mortgage. In that case the prior mortgagee was joined as a defendant, but it did not appear whether any and what relief was sought against him. The plaint of the prior suit was not produced and their Lordships held that in the absence of any proofs as to the allegation upon which the prior mortgagee was made a party it must be assumed that he was made a party as a prior mortgagee and the case came within the terms of Section 96, T.P. Act.

I referred to the observations of Sir Lawrence Jenkins to the effect that to sustain the plea of res judicata it was incumbent on the Sahus to show that they sought in the former suit to displace Bakhtaur Mull''s prior title and postpone it to their own. The plaint of the prior suit was not produced and it" was not shown that the Sahus in their plaint made a distinct case in derogation of Bakhtaur Mull''s priority. Their Lordships of the Privy Council therefore assumed that he was made a party as a prior mortgagee with a view that the property ''might be sold free from his prior mortgage u/s 96, T.P. Act (now Order 34, Rule 12, Civil P. C). His Lordship the Chief Justice observes that the words "it must be assumed" underlined (italicized) in the above quotation from my judgment should read "it must not be assumed." Perhaps I was not very explicit in my language. I meant to point out that had the plaint in the previous suit been produced and it appeared from it that the Sahus sought in the former suit to displace Bakhtaur Mull''s prior title and postpone it to their own the plea of res judicata could have been sustained, but that as they did not do so their Lordships assumed that Bakhtaur Mull was impleaded as a prior mortgagee under the provisions of Section 96, T.P. Act. I maintain that there was no misprint in the report of my judgment in Lal Bihari Singh''s case A I.R. 1923 Pat. 290, the original of which I have referred to and I adhere to the view then expressed by me.