Sreekanta Sundararamiah and Others vs Tadikamalla Venkatasubbiah and Others

Krishnan, J.—In this suit the competition is between the purchasers of the plaint property in execution of a mortgage decree obtained by the

plaintiffs and the purchasers in a rent sale in execution of a rent decree which the Zamindar had obtained against the pattadar of the lands in

question. The father of the plaintiffs had obtained on this property a mortgage in 1897 evidenced by Ex. A. In 1909 the amount due under that

mortgage came to about Rs. 508 and a new mortgage was then taken for a part of it Rs. 300 which was the principal of the old mortgage, and that

deed is Ex. B. That deed was executed, as is evidenced by its'' date, after the passing of the Estates Land Act. That deed says that it is taken for

Rs. 300 due under the previous deed, and there is a statement that Rs. 208 are still due under the old deed. The plaintiffs brought a suit on the

second of these deeds, Ex. B, and obtained a decree and brought the property to sale and purchased it themselves. But before they did that,'' the

Zamindar, as already stated, obtained a decree in the Revenue Court (the Judgment in which case is Ex. K) and had the properties brought to sale

and purchased some of the properties himself, and the other properties were purchased by the other defendants.

The question that has been argued in this case is as to whether the plaintiffs purchase prevails, or whether it is the purchase of the defendants

that prevail. u/s 5 of the Estates Land Act, the landholder gets for his rent a first charge on the holding, but this is subject to Section 125 of that

Act, which says, "" When a holding or part of a holding is sold for arrears due in respect thereof, the purchaser shall take, subject to any right or

interest which the ryot has created therein with the landholder''s permission in writing registered and subject also to any encumbrance created

before the passing of this Act. "" The contention of the respondents before me is that the encumbrance under Ex. A having been created before the

passing of the Act, although they brought the suit on Ex. B, they must be allowed to fall back upon their rights under Ex. A and use those rights as

against the defendants, whose charge should, therefore, be treated as subject to the rights of the plaintiffs. On the other hand, it is contended that

the plaintiffs having taken Ex. B in 1909, which was after the passing of the Act. any rights which they had under Ex. A, except as regards Rs. 208

still reserved under it, had become extinguished, and that, as the suit was for the enforcement of the Rs. 300 included in Ex. B, it must be held that

their sale was not for any encumbrance created before the Act, but, it was for an encumbrance created after the Act and as there was no

permission of the landholder to create such encumbrance, their (defendants'') first charge should prevail. This 1 think, overlooks the principle that a

man by taking a further security for his money that is charged upon land, does not, and cannot be taken thereby to have intended to, give up his

rights under earlier deed which he had. A case very similar to this case was considered by the Privy Council in Shankar Sarup v. Mejo Mal ILR

(1901) A 313. There there was a first mortgage in May 1883 to the plaintiffs for Rs. 15,000 and odd. Then in June 1883, there was another

mortgage in favour of the defendant. Then again in November 1883, the plaintiffs took a third deed over the same properties including a further

sum of money for a total of Rs. 20,000. The property was sold in Court auction and the question arose as between the defendant and the plaintiffs

as to who had priority for payment out of the sale proceeds : It was held by the Privy Council that, although the mortgage on which the suit was

brought was the mortgage of November 1883, that is, the third mortgage, still the plaintiffs could not be taken to have abandoned their rights under

the first mortgage and that they were entitled to use those rights as against the second mortgage and claim priority and to have their amounts paid in

the first instance. It seems to me that that case really covers this case.

Some confusion was introduced into this case by reference to rights of subrogation. 1 do not think any question of subrogation arises in this case

at all, because the second document, Ex. B, was taken by the same person who had the rights under the first document, Ex. A. Subrogation rights

can only arise when persons pay off debts charged upon the land in favour of third parties. It is difficult to understand how such a question can

arise except in a case where a person claims to stand in the shoes of the person who had the original right as against any mesne encumbrancers.

Here no such question arises, because the document Ex. B was for a sum of money which was due under Ex. A and only created a further security

of making one more person liable under it than was originally liable. No new properties have been added, or new debts created either. In these

circumstances, I think that the principle clearly applies and that the plaintiffs, who were the persons entitled to the rights under Ex. A, are entitled to

rely upon those rights as against the defendants, whose rights must, u/s 125, be treated as subject to their rights. Taking this view, I do not think it

necessary to consider the other points in the case.

I would, therefore, dismiss the second appeal with costs.