Sadhuprasad Bidyadhar Mahapatra and Another vs Harikrishna Panda and Others

Kulwant Sahay, J.—The facts relating to the suit, which has given rise to the present appeal by the plaintiffs, are shortly as follows: Defendant No. 2, Sridhar Upadhya and his father, Dharadhar Upadhya who were members of a joint Mitakshara family, owned eight annas makadami interest in Mouza Mulsingh bearing Touzi No. 921 of the Balasore Collectorate. On 18th March, 1899, Dharadhar and his son, defendant No. 2 executed a mortgage in respect of this eight annas makadami interest in favour of Udhab Chandra Pothal for Rs. 1,000 the due date of payment being one year from the date of the execution of the mortgage. On 30th May 1910, the defendant No. 2 executed another mortgage in favour of Kalicharan Panda, who was originally defendant No. 1 in the present suit and on whose death during the pendency of the suit his heirs, defendants Nos.1 to 1 cha, were substituted, in respect of a four annas share in the makadami interest for Rs. 700. On 24th October, 1924, defendant No. 2 sold four annas of his makadami interest to the plaintiffs for a sum of Rs. 4,000 with an assurance that this share was free from encumbrance. Prankrishna Pothal, the nephew and heir of Udhab Chandra Pothal, the mortgagee under the mortgage of 1899, instituted a suit on the foot of his mortgage and obtained a decree on 24th June, 1912. In this suit Kalicharan Panda, the mortgagee under the second mortgage of 1910, was not impleaded as a party. The decree obtained by Prankrishna Pothal was on a compromise for Re. 1,700 which was to be paid within one year. The payment, however, was not made and on 10th February 1914, a final decree for sale was made in favour of Prankrishna Pothal. Execution was taken out of this decree but nothing was realized. On 23rd February, 1925, Ganga Narayan Pothal and others, the sons of Prankrishna, who had died in the meantime, assigned the decree to Probodh Chandra Rai, defendant No. 3, and defendant No. 3 as assignee of the decree, took out execution and advertised the eight annas makadami interest, which was the property mortgaged in the bond of 1899 for sale and 15th July, 1925, was fixed for the sale. The plaintiffs who were the purchasers under the deed of 24th October, 1924, paid off the entire decretal amount and thus saved the mortgaged property from sale. In the meantime Kalicharan Panda had obtained a mortgage decree for sale of the four annas share which had been mortgaged to him on 30th May, 1910, and in execution of that decree the four annas share was sold and purchased by Kalicharan Panda on 15th January, 1924, and possession was delivered to him on 21st May 1925. The plaintiffs instituted the present suit on 25th November, 1925 claiming contribution in respect of the amount paid by them to save the eight annas makadami interest from sale in execution of the mortgage decree on the foot of the first mortgage of 1899. They claimed one half of the amount paid by them with interest thereon from Kalicharan Panda, defendant No. 1 and the other half from his vendor, defendant No. 2.

The defence of defendant No. 1 was that as he had not been made a party to the suit on the first mortgage he was not bound by the decree and that the claim to enforce the first mortgage in so far as he was concerned was barred by limitation and, therefore, there was no liability upon him to pay the money due on the first mortgage on the date the plaintiffs made the payment and, therefore, he was not liable to contribute towards such payment. Defendant No. 2 raised a defence to the effect that the plaintiffs purchased with the knowledge and subject to the prior encumbrances, and therefore, defendant No. 2 was not liable to contribute.

The learned Subordinate Judge decreed the suit as against defendant No. 2 but dismissed it as against defendant No. 1. The plaintiffs have, therefore, come up to this Court in appeal as against the decree of the learned Subordinate Judge dismissing their claim against defendant No. 1.

It has been contended on behalf of the plaintiffs-appellants that Kalicharan Panda was liable to contribute inasmuch as a decree had been obtained on the foot of the prior mortgage and although he was not made a party to the suit on the prior mortgage, still there was liability upon him as a subsequent mortgagee to satisfy the decree. It is next contended that if the liability under the mortgage could not be enforced, still the plaintiffs were entitled to claim reimbursement as against defendant No. 1 inasmuch as they had made payment of a debt which defendant No. 1 was liable to pay. In my opinion neither of these contentions is sound. A subsequent mortgagee is not bound by a decree obtained on the foot of a prior mortgage if he is not made a party thereto and the decree cannot be enforced to his prejudice when it was obtained in his absence. If the prior mortgagee intends to enforce his prior mortgage as against a subsequent mortgagee, it is incumbent upon him to make him a party to the suit. If a person interested in the mortgaged property pays off the decree on the prior mortgage in order to save this property from sale, he can make the subsequent mortgage liable to contribute only if there was a subsisting liability as against the subsequent mortgagee on the date of such payment. If on this date the claim upon the prior mortgage is barred by the Statute of Limitation, it is clear that the subsequent mortgagee cannot be proceeded against and the property mortgaged to him cannot be sold in execution of the decree on the prior mortgage.

In the present case the plaintiffs satisfied the decree on the basis of the mortgage of 1899 on 15th July, 1925. The due date fixed in the bond of 1899 was one year. The period of limitation to enforce that bond, therefore, began to run from 18th March 1900, and the claim to enforce the mortgage of 1899 became barred on the expiry of 12 years from 18th March, 1900. In July, 1924, when the payment was made by the plaintiffs there was no claim subsisting upon the mortgage of 1899. Defendant No. 1, therefore, was under no liability to pay the mortgage of 1899. The liability had been extinguished by lapse of time and the plaintiffs by making payment of the decree on the foot of the first mortgage were in no way benefiting defendant No. 1. It is thus clear that the plaintiffs cannot enforce a charge upon the four annas purchased by Kalicharan Panda in execution of a decree upon a subsequent mortgage. They cannot also claim a reimbursement as against Kslicharan Panda because there was no liability upon Kalicharan Panda to pay the decree and the payment made by the plaintiffs was not for the benefit of Kalicharan Panda or his heirs. It is thus clear that the plaintiffs have no remedy in so far as defendant No. 1 and his heirs are concerned.

A number of cases have been cited by the learned Advocate for the appellants but none of them applies to the facts of the present case. Chagandas v. Gansing 20 B. 615 was a case in which the plaintiff had made payment in order to save his share from sale within the period of limitation to enforce the mortgage, and, therefore, the owner of the other portion of the mortgaged property, who had not been made a defendant in the mortgage suit, was liable to contribute towards the payment which was made by the plaintiff.

In Jagatnarain v. Qutub Hussain 2 A. 807, it does not appear that any question of limitation was raised and the payment was presumably made within the period of limitation. In Sukhi v. Ghulam Safdar Khan 65 Ind. Cas. 151 : 43 A. 469; (1921) M.W.N. 445 : 14 L.W. 162 : 26 C.W.N. 279 : 42 M.L.J. 15 : 30 M.L.T. 175 : 24 Bom. L.R. 590 : AIR 1922 PC 11 : 48 I.A. 465 (P.C.), the suit was by a subsequent mortgagee and it was held that as she was not made a party to the suit on the basis of the prior mortgage she was entitled to redeem. It was a converse case, where the subsequent mortgagee, not made a party to the suit on a prior mortgage, sought to redeem the prior mortgage, and not a case in which a liability was sought to be enforced against the subsequent mortgagee.

In Mahomed Ibrahim Hossein Khan v. Ambika Pershad Singh 14 Ind Cas. 496 : 39 C. 527 : 39 I.A. 68 : 11 M.L.T. 265; (1912) M.W.N. 357 : 9 A.L.J. 332 : 14 Bom. L.R. 280 : 16 C.W.N. 505 : 15 C.L.J. 411 : 22 M.L.J. 468 (P. C) it was held that the right to enforce the prior zarpeshgi of 1874 was barred by Article 132, Limitation Act, and the suit which gave rise to the appeal before their Lordships of the Privy Council to enforce the rights of priority under the zarpeshgi of 1874 not having been instituted within 12 years from the date when the money under that deed became re-payable in 1887 was barred by limitation. This case supports the respondents in the present appeal. In the present case also the claim to enforce the mortgage of 1899 was barred by limitation on the date of the present suit and, therefore, it could not be enforced as against defendant No. 1.

The facts in Naurang Rai and Others Vs. Ram Sumer Rai and Another, were somewhat similar to the facts of the present case. There also the second mortgagee was not made a party to the suit on the first mortgage. The second mortgagee obtained a decree upon his mortgage without impleading the prior mortgagee. The decree of the prior mortgagee was earlier in date, but the subsequent mortgagee had the properties sold under his decree and purchased them himself and took possession. Subsequently the prior mortgagee took out execution of his decree and put the property to sale and purchased it himself. He, however, could not obtain actual possession and he brought a suit for possession against the second mortgagee offering him the option to redeem. At the date of this suit the claim of the plaintiff to enforce his first mortgage had become barred by limitation, and it was held that the plaintiff not having impleaded the defendant, his decree was not binding on the latter, and his suit must fail, as he could neither enforce his mortgage, nor could the defendant be compelled to redeem against his Will. This case applies to the facts of the present case, and it is clear that there was no liability upon defendant No. 1 or upon his heirs to satisfy the decree on the basis of the first mortgage on 15th July, 1925, and, therefore, the plaintiff, who made a payment in satisfaction of that decree on that date, is not entitled to claim contribution or enforce any charge in so far as the four annas share of defendant No. 1 is concerned. The decision of the learned Subordinate Judge is right and this appeal is dismissed with costs.

Macpherson, J.

I agree.