K. Muthuramakrishna Chettiar (alias) K.M.R. Krishna Chettiar vs K.V. Narayanan Kutty and Others

P. Venugopal, J.—The defendant is the appellant before this Court. On 5th July, 1962, the defendant executed a mortgage in favour of K.

N. Vasudevan, for Rs. 17,000/-agieeingto repay with interest at 9% per annum and in default to pay interest on the defaulted interest at 9 per cent

per annum On 19th October, 1963, the original mortgagee Vasudevan died, leaving a will under which he bequeathed 1/3rd right in the suit

mortgage in favour of his wife. The plaintiffs are the sons of the deceased mortgagee Vasudevan. They have filed the present suit for recovery of

the amount due under the mortgage alleging that 1/3rd right in the suit mortgage bequeathed by their deceased father in favour of his wife, have

been assigned to them and the remaining 2/3rd rights in the suit mortgage have devolved on them by succession after the death of their father and

hence, they are entitled to recover the entire sum due under the suit mortgage. The plaintiffs have also further alleged in the plaint that excepting the

payments on four occasions to the extent of Rs. 3,627/50, no amount has been paid by the defendant. The defendant filed a written statement

alleging that over and above the payments admitted in the plaint, he has paid a further sum of Rs. 3,000 and the principal amount of Rs. 17,000

claimed in the plaint is not correct and the rate of interest claimed and calculated is excessive, penal and usurious. On these pleadings, as many as 8

issues were framed. However the suit proceeded for trial only on one issue viz., ""whether the claim for interest is excessive in view of the

provisions of the Usurious Loans Act of 1918 as amended by the Usurious Loans (Madras Amendment) Act, 1936."" The other issues were given

up by the defendant by making an endorsement to that effect in the plaint. The trial Court held that the claim for interest is not excessive under the

provisions of the Usurious Loans Act of 1918 as amended in 1937. The trial Court granted a preliminary decree for Rs. 41,311-80 against the

defendant for sale of the mortgaged properties with costs. Aggrieved against the decree and judgment of the trial Court, the defendant has filed the

present appeal before this Court.

The learned Counsel for the defendant/ appellant contended that the mortgagee Vasudevan had bequeathed 1/3rd rights in the suit mortgage in

favour of his wife and the remaining 2/3rd rights in the suit mortgage will devolve u/s 8 of the Hindu Succession Act on his two sons, the plaintiffs

herein and the wife and daughter of the deceased mortgagee, and since they have not been impleaded, the suit is bad for non-joinder of parties. It

is further contended by the learned Counsel for the appellant that the mortgage, by its nature being one and indivisible, both in regard to amount as

well as security, and the interest of the mortgagee having devolved on all his heirs jointly, the plaintiffs without impleading their mother and sister

cannot file the suit to enforce the mortgage, and the suit as framed is not maintainable. The learned Counsel for the appellant further contended that

in view of Order 34, Rule 1, CPC all the persons having interest in the mortgage shall be joined as parties in the suit, and the present suit without

impleading the mother and sister of the plaintiffs is defective In support of his contentions the learned Counsel relied on the following four decisions,

viz., Adiveppa Channappa Kittur v. Rachappa Balappa Hosmane AIR 1948 Bom. 211, Rameshwar Bux Singh and Others Vs. Ganga Bux Singh

and Others, , Mohammed Ismail Maracair and Others Vs. Doraisami Mudaliar and Others, , and P. Govinda Reddy and Others Vs. Golla

Obulamma, . The present contention was not raised in the written statement and even in the grounds of appeal filed before this Court. However, as

the objection raised by the learned Counsel for the appellant goes to the root of the matter, and affects the maintainability of the suit, the plea was

permitted to be raised, by this Court especially when the question as to whether the plaintiffs who have filed the suit can give an effective discharge

to the defendant on payment of mortgage money has to be considered by the Court, whether such an objection is raised by the plaintiffs or not.

Aidiveppa Channappa Kittur v. Rachappa Ballappa Hosmane AIR 1948 Bom. 211 is a case where a mortgage was executed in favour of on

S"" as karta of a joint Hindu family, and subsequent to the death of ""S"" the family became divided into three branches each of which had its karta.

The suit was filed by only one of those kartas without impleading the other two kartas and it was held that the mortgage being indivisible, the suit

by one karta for recovery of the mortgage debt without joining the other co-mortgagees as parties, is not maintainable in law. In the case reported

in Rameshwar Bux Singh and Others Vs. Ganga Bux Singh and Others, the suit was filed on a mortgage, by one of the mortgagees, without

impleading the other co-mortgagees and it was held that it is not possible to split up the mortgage and permit one of the mortgagees to enforce his

claim either for the whole or for a part, nor is it possible for him as one of the joint promisees to enforce the claim without impleading his co-

promisees either as plaintiffs or, in the case of their refusal, as defendants within the period of limitation. In Mohammed Ismail Maracair and Others

Vs. Doraisami Mudaliar and Others, the mortgage was executed in favour of a single individual who was a Mohamedan lady and after her death

the right devolved on several heirs under the Muhammadan Law and one of the heirs filed a suit for his share in the mortgage right. It was held that

even though the heirs were co-owners under the Muhammadan Law, some of them alone cannot represent others and the absence of the other

heirs from the array of parties in the suit would render the suit defective and the suit as laid was incompetent. In the decision reported in P.

Govinda Reddy and Others Vs. Golla Obulamma, it held was that the mortgage by its nature being one and indivisible both in regard to amount as

well as security and if the interest of the mortgage has devolved on all his heirs jointly, no suit for enforcement of the mortgage can be validly

brought without impleading all the heirs for recovery of the amount due under the mortgage. It was further pointed out that all the persons entitled

to a share in the amount due on the mortgage must joint in the action and be made parties thereto and the frame of the suit will be defective if all of

them have not been so made parties to the suit.

In the present case the deceased had bequeathed 1/3rd of his right in the suit mortgage in favour of his wife. His 1/3rd rights in the suit mortgage

had devolved by succession, on his two sons, wife and daughter, by operation of Section 8 of the Hindu Succession Act. The wife and daughter of

the mortgagee, along with the sons (plaintiffs herein) are entitled Ho a share in the amount due on the mortgagee. As the mortgage is one and

indivisible both in regard to the amount as well as security, and the interest of the mortgage having devolved not only on the plaintiffs but also on

their mother and sister, they are necessary and proper parties to the suit. The present suit by the plaintiffs without impleading them is not

maintainable.

In answer to the objection raised by the learned Counsel for the appellant at the appellate stage, the learned Counsel for the respondents filed

G.M. P. No. 11913 of 1979 to implead their mother and sister as plaintiffs 3 and 4 respectively in the suit. The learned Counsel for the appellant

contended that devolution of interest of the mortgagee on his heirs makes them tenants in common in relation to their interest in the mortgage and in

a suit to enforce the mortgage, they should all be impleaded either as plaintiffs or as defendants and if they are left out, the defect should be cured

within the period of limitation. It was further contended that the mother and sister of the plaintiff should be impleaded before the expiry of the

period of limitation and as the mortgage was executed on 5th September, 1962, the 12 years period of limitation expired on 5th September, 1974

and the present application to implead the new parties has to be rejected. In support of this contention the learned Counsel relied on the four

decisions referred supra.

The learned Counsel for the respondents relied on a decision of the Supreme Court reported in Devidas and Others Vs. Shrishailappa and

Others, and contended that if fresh parties are merely joined for the purpose of safeguarding the rights subsisting as between them and others

claiming generally the same interest, the determination of the date of the institution of the suit as regards such freshly joined parties does not

ordinarily affect the right of the original plaintiff to continue the suit and will not attract the application of the general provisions of the Limitation Act.

The decision relied on by the learned Counsel for the respondents related to a suit filed by the manager of a joint Hindu family for enforcement of a

mortgage. One of the female heirs was omitted to be impleaded in that suit. The Supreme Court held that as the suit was instituted by an adult

member in his capacity as manager, the omission to implead the female heir who is a proper but not a necessary party, does not affect the

maintainability of the suit, nor does it invite the application of Section 22 of the Limitation Act, 1908. The facts of the present case are clearly

distinguishable as the suit has not been filed by the manager of a joint Hindu family and the persons omitted to be impleaded are heirs of the

deceased mortgagee having subsisting interest in the mortgage. The objection raised by the learned Counsel for the appellant cannot be answered

by relying on the decision of the Supreme Court in Devidas and Others Vs. Shrishailappa and Others, However, the objection raised by the

learned Counsel for the appellant has to be rejected on the following two grounds:

(1) In reply to the suit notice, the defendant has sent a notice dated 8th February, 1969 wherein he has categorically admitted ""After adjusting the

payments made already by my client, as acknowledged by you, my client is prepared to pay whatever is really and legally due, under the

mortgage."" Learned Counsel for the respondents filed an application in C. M, P. No. 11938 of 1979 to receive this reply notice as an additional

evidence in the present case. As the issue of the notice is not disputed by the learned Counsel for the appellant and in the interests of justice and for

a satisfactory and effective adjudication of the disputes involved, this document was permitted to be received as additional evidence and marked as

.Ex. A-13. Under Ex. A-13 the defendant appellant before the expiration of the period of 12 years prescribed for filing a suit on the mortgage has

acknowledged his subsisting liability under the suit mortgage bond and this gives a fresh period of limitation of 12 years to be computed from 8th

February, 1969. If the fresh period of limitation of 12 years is computed from 8th February, 1969, the present application, C.M.P. No. 11913 of

1979 to implead the mother and sister of the plaintiffs as plaintiffs 3 and 4 is well within time.

(2) The proviso to Section 21 of the Limitation Act, 1963 provides that where the Court is satisfied that the omission to include a new plaintiff or

defendant was due to a mistake made in good faith, it may direct that the suit as regards such plaintiff or defendant shall be deemed to have been

instituted on any earlier date.

Under Ex. A-12 the defendant has stated that there are other heirs who are entitled to claim the amount under the suit mortgage. Having stated

in Ex. A-12, the defendant has failed to raise the plea in the written statement that the suit without impleading the other heirs interested in the

mortgage is not maintainable and bad for non joinder of parties. Even in the grounds of appeal before this Court the plea has not been raised. The

learned Counsel for the appellant merely stated that this is a bona fide mistake and the plea was omitted to be raised. If the defendant-appellant''s

plea that the omission to raise the ground regarding non-maintainability of the suit is a bona fide mistake is to be accepted the same plea by the

plaintiffs that their failure to implead their mother and sister as parties in the suit is bona fide mistake has to be also accepted. After all, mistakes

bona fide or otherwise, need not be unilateral and they can be bilateral as seen from the facts and circumstances of this case. Even otherwise, on

the materials placed before us we are satisfied that the plaintiffs'' omission to plead their mother and sister as parties in the suit is a bona fide

mistake and under the proviso to Section 21(1) of the Limitation Act, the suit against them shall be deemed to have been instituted on 27th June,

1974 the date on which the plaint was filed. Thus after the impleading of the mother and sister of the original plaintiffs the suit should be taken to

have been validly filed by all persons entitled to the mortgage money.

The mortgage deed Exhibit A-1, provides 9 per cent simple interest and on default to pay interest each month at 9 per cent per annum. The

additional interest has to be paid by the defendant on the defaulted interest. The learned Counsel for the appellant contended that the levy of

additional interest of 9 per cent on the defaulted interest is excessive in view of the provisions of the Usurious Loans Act of 1918 as amended in

1937. In Gopala Menon and Another Vs. Srinivasa Varadachariar and Others, which was a case of suit on a mortgage, it was held that 15 per

cent compound interest calculated at quarterly rates was excessive and 10 per cent compound interest was allowed. In Mavis Ammal Fernando

and Anr. v. S. Subbiah Iyer (1974) 87 L.W. 298 the mortgage bond provided 12 per cent interest per annum and in case of default, it has to be

added to principal every month and then interest at 13 3/4 per cent was levied. It was held that this was not violative of the Usurious Loans Act, as

amended by Madras Act VIII of 1937. In Srinivasavardachariar and Others Vs. Gopala Menon and Others, the mortgage provided interest at 15

per cent compoundable every quarter, and this provision of interest in the mortgage bond was held to be reasonable by the Supreme Court. As

repeatedly pointed out by Courts, no hard and fast rule can be laid down either with reference to the percentage or with reference to the nature of

interest, whether simple or compound, for the purpose of coming to the conclusion whether the rate of interest charged in a particular case is

excessive or not. In the present case the mortgage bond provides interest at 9 per cent per annum on the principal amount. If there is default in

payment of interest, the mortgage bond stipulates that on the defaulted interest, 9 per cent per annum is payable. We do not see that there is any

case for this Court, exercising its powers u/s 3(1) of the Madras Usurious Loans Act (as amended by Act No. VIII of 1977) to reduce the rate of

interest from what has been provided in the mortgage bond. We hold that the interest charged and levied is neither penal nor excessive. The

preliminary degree passed by the lower Court will be in favour of the existing plaintiffs as well as the newly impleaded plaintiffs 3 and 4. To this

extent, the decree and judgment of the lower Court are modified and in all other respects it stands confirmed. Subject to the above modification,

the appeal is dismissed, in the circumstances, without costs.