Lala Mewa Lal and Another vs Kunwar Ragho Prasad and others

Macnaghten, J. 1. This is an appeal from a decree of the High Court at Allahabad, which affirmed a decree of the Court of Small Causes there exercising the powers of a subordinate judge. 2. The suit was brought by the respondents Mewa Lal and Lachmin Narain to recover property of which they had been deprived through the intervention of a Government official who attached it and got it sold in order to satisfy a debt due to Government from somebody else. 3. The facts are undisputed. 4. On December 17, 1895, the respondents, who were mortgagees of shares in seven villages belonging to their mortgagor, one Tufail Ali Khan, obtained the usual decree for sale. April 17, 1896, was the date fixed for payment of principal, interest, and costs, which amounted in all to Rs. 19,290.9.6. The mortgagor made default. On April 23, 1896, the mortgagees applied for an order absolute. The order was drawn up on May 16 following. On March 24, 1897, an application was made for execution of the decree by sale of the mortgaged property, and on April 26, 1897, the execution case was transferred to the Collector''s Court as the property was ancestral. The decree came into the hands of the sale officer on July 8, 1897. 5. In the meantime, the wife of the mortgagor brought a suit in forma pauperis against her husband, Tufail Ali Khan, and the respondents, claiming from her husband a lakh of rupees under a contract of dower, and alleging that that sum was charged on the mortgaged property in priority to the mortgages, the subject of the decree of December 17, 1895. On May 11, 1897, the suit was decreed with costs against Tufail Ali Khan, but dismissed with costs as against his mortgagees, and it was ordered that the amount of Court fees which would have been paid by the plaintiff had she not been allowed to sue as pauper should be the first charge on the amount decreed to the plaintiff, and should also be recoverable from the defendant Tufail Ali Khan. 6. The order as regards the Court fees payable to Government was in accordance with the directions of Section 411 of the Civil Procedure ?ode, 1882, as to pauper suits. That section is in the following terms:

If the plaintiff succeed in the suit, the Court shall calculate the amount of the Court fees which would have been paid by the plaintiff if he had not been permitted to sue as a pauper; arid such amount shall be a first charge on the subject-matter of the suit, and shall also be recoverable by the Government from any party ordered by the decree to pay the same, in the same manner as costs of suit are recoverable under this Code. 7. There, was an appeal to the High Court, but it was dismissed with costs. 8. So the respondents succeeded in preserving the priority of their incumbrances and in maintaining the decree of December 17, 1895. With this success all their troubles began. The Collector on behalf of Government applied for and obtained execution of the decree of May 11, 1897, not against Tufail Ali Khan, against whom the suit was decreed, but against the mortgaged property, in regard to which the suit failed. That execution case was also sent to the Collector''s Court. It was received by the sale officer on February 18, 1898, more than six months after the receipt of the decree of December 17, 1895. However, the sale officer fixed one and the same date, July 22, 1899, for sale in both cases. And when the day of sale came he put the property up for sale under the decree of May 11, 1897, and it was sold to Rai Bahadur, the father of the appellants, for Bs.1529, an amount just sufficient to satisfy the claim of the Government. 9. The mortgagees'' decree was returned to the Civil Court with a statement that no property was left for sale in connection with that decree. In taking this course the sale officer, according to the opinion of the Collector, acted legally. Possibly, said the Collector, he might have put the property up for sale under the mortgagees'' decree, "proclaiming at the same time the debt due to Government as an incumbrance to be satisfied by the purchaser," but there was no material irregularity. In the Collector''s opinion the authorities clearly affirmed "the principle that the Government takes precedence of all other creditors, whether or not they have a lien on the property." 10. At the instance of the mortgagees the Civil Court directed that the property should be put up for sale again under the decree of December 17, 1895. Ultimately the mortgagees bought it for Bs.18,365. They obtained formal possession. But it seems that Rai Bahadur had already obtained possession under his sale certificate. Both parties then exerted themselves to collect rents. Then followed a struggle for mutation of names. The Assistant Collector dismissed an application for that purpose by the mortgagees, blaming them for trying to avoid payment of the Government dues "instead of quietly paying off" the Court fees and getting the property sold in satisfaction of their large debt. After a learned argument he held that the wording of Section 411, Civil Procedure Code, was clear that the Government dues were the first charge on the property, and that Rai Bahadur had consequently a preferential claim. Then the mortgagees appealed to the Collector. He took the same view, after argument, though he confessed that he "had not hitherto realized that the position of the Crown in such matters was so strong." Lastly, the mortgagees applied to the Commissioner on second appeal. He, too, rejected their application, in the first instance on reading the record, and then on an application for revision after hearing the parties at considerable length, who "argued as to the equity and legal rights of the case." As to the merits he pronounced no opinion. He thought it essentially a case for the Civil Court. But he added that until the question was determined by a competent Court he did "not think that any fairer decision could he come to than that at which the Collector had arrived." 11. So at last the mortgagees betook them to the Civil Court, to which they ought to have applied long before in a regular suit. The judge of first instance ordered that the respondents should be put in possession of the property, and declared that they were the absolute owners. An appeal to the High Court was dismissed with costs. But the learned judges, after argument, came to the conclusion that there was a substantial question of law involved, and gave leave to appeal to His Majesty in Council. 12. Their Lordships are at a loss to discover what question of law is involved in this case. So far as can be gathered from the judgments in the Collector''s Court, the validity of the sale to Rai Bahadur was rested on two grounds - (1.) on the terms of Section 411 of the Civil Procedure Code, and the decree of May 11, 1897, and (2.) on the prerogative of the Crown. As to the first joint, the claim put forward on behalf of the Government is absurd. The decree of May 11, 1897, did not create or purport to create any charge on the mortgaged property in favour of the Government. The Government had no right to attach the property and sell it in execution under that decree, though, of course, such interest, if any, as remained in the mortgagor from whom the Court fees were declared to be recoverable might have been reached by a proper proceeding. The order for the first sale was, therefore; without jurisdiction. The sale passed no property to the person declared purchaser. On the second point the claim advanced by the Collector on behalf of the Government is a preposterous claim. It is only when claims of the Crown and claims of "common persons" (to use an old expression) "concur" or come into competition that the Crown is preferred. The Crown has no more right than a "common person" to seize A.''s property and apply it in or towards the discharge of a debt due from B. That is not a question of Jaw. It is a matter of common justice, and, it may be added, of common honesty. 13. Their Lordships will humbly advise His Majesty that the appeal ought to be dismissed with costs.