Subramania Aiyar vs Narayanaswami Vandayar alias Narayanaswami Tevar

Seshagiri Aiyar, J.

This suit is for redemption. Although the question of the priority of the two mortgages in dispute is not easy to determine, I shall proceed on the

same assumption on which the courts below have acted throughout The defendant obtained a mortgage of the A schedule properties in 1902. On a

portion of these properties which are included in the B schedule there was a mortgage to one Bava Rowther. This Rowther brought a suit on his

mortgage. The properties were put up to sale and the present plaintiff purchased the B schedule properties alone in 1908, subject to the

defendant''s mortgage. After he became the purchaser, the plaintiff presented an application u/s 8 of the Transfer of Property Act, in January 1912

calling upon the defendant to receive the amount due and to deliver up the title-deeds. This application is Ex. Q. In it petitioner states that he has

paid into court the whole of the money due on the mortgage of the A. schedule properties, and asks the defendant to accept the amount and to

give him possession of all the properties. Then he makes an alternative request to the effect that if the defendant is willing to receive the principal

amount due in respect of the B. schedule properties alone, he may draw out that sum from court and give possession of the B. schedule properties.

The reply of the defendant is Ex. R. I will use his own language in referring to it. In paragraph 2 he says, ""As there is only an offer to pay only the

proportionate amount, I am unwilling to accept the same. The petition does not state how much is the proportionate amount, and I am not willing to

accept it."" In paragraph 5 he says that he is willing to hand over the B schedule lands alone on receiving the whole of the amount of the mortgage

due upon the A schedule properties. As the parties were not able to come to terms, the Subordinate Judge passed this order upon the plaintiff''s

petition : ""Counter petitioner refuses to receive the money. Petitioner is referred to a regular suit. This petition is dismissed."" Thereupon the present

suit was brought. It is admitted that ever since the 9th January 1912 when the money was deposited by the plaintiff, it has remained in court and

has not been drawn out by him. In the present suit the plaintiff asked that he should be allowed to redeem the B schedule properties on payment of

Rs. 1800 and odd out of the sum of Rs. 3,650 deposited by him. The defendant raised various objections. He stated the same grounds which he

put forward in the counter-petition. He also raised the plea that the plaintiff was only a benamidar and as such was not entitled to redeem the

property. The Subordinate Judge found all the issues against the defendant and gave a decree to the plaintiff as prayed for. He found that the sum

of Es. 1,852-3-10 mentioned in the plaint was the correct amount payable in respect of the B schedule properties. In appeal the District Judge

confirmed the findings of the Subordinate Judge upon all the points except upon the question of interest and mesne profits. He held that the plaintiff

was the real owner, and that the defendant is only entitled to the proportionate amount due upon the B schedule properties. But, he was of opinion

that the tender was not a valid one and that consequently interest did not cease to run from the date of its deposit in court. That is the main point to

be decided by us.

I am unable to agree with the District Judge on the question of the validity of the tender. Section 83 of the Transfer of Property Act says : ""...

The mortgagor or any other person entitled to institute such suit may deposit....to the account of the mortgagee the amount remaining due on the

mortgagee."" The second paragraph says : The court shall call upon the mortgage by notice to state the amount then due on the mortgage and his

willingness to accept the money in full discharge of such amount. The section does not say that nothing more than the amount actually due should

be paid. Of course if the money deposited is less than the amount payable to the mortgagee, the section will not be satisfied; but where more than

the amount due is paid, I fail to see anything in the section to compel me to hold that the amount remaining due has not been paid. The English

authorities to which I shall presently refer support the view I have taken. In the earliest case on the subject, Wadde''s case (1601) 5 Coke Rep.

114 the resolution as it is called, is thus stated : Resolution 3 : ""A tender of more than is due is good."" This decision was followed in Douglas v.

Patrick (1790) 3 Term Rep. 683 by a Bench of four Judges including Chief Justice Kenyon. Ashurst, J., said: ""There is no doubt that a tender of

the greater includes the smaller sum"". Buller and Grose, JJ., use almost the same language. These two cases and others were considered in Dean v.

James (1883) 4 B.& Ad. 547. Pour Judges, of the King''s Bench headed by Denman, C.J., accepted the correctness of the earlier decision.

Littledale, J., said, ""This case falls within the third resolution in Wade''s case (1601) 5 Coke Rep. 114 that if a man tenders more than he ought to

pay, it is good, for Omne majus continet in se minue and the other ought to accept so much of it as is due to him."" In Bevans v. Rees (1839) 5 M.

& W. 306 the Chief Baron and three other Barons affirmed the proposition laid down in the earlier case. The Chief Baron said : ""I am prepared to

say that if the creditor knows the amount due to him and is offered a larger sum and without any objection on the ground of want of change makes

a collateral objection, that would be a good tender."" I may mention in this connection that there are some curious decisions in the English Courts to

the effect that where a debtor on paying a larger sum asks the creditor to take what is due to him and return the balance with a change, that will not

be good tender. I have not examined this matter very carefully to see on what principle this exception as regards a claim for change is based.

Probably it is due to the idea that the creditor should not be put to any trouble in accepting a tender. I do not think that in this country where we

are not obsessed by technicalities of such a narrow description, we shall be justified in accepting a rule that where a person tenders a larger amount

and asks for a change, he should not have the benefit of the tender. Apart from this rule as to the claim for a change, the decisions I have referred

to, affirm the principle which has been consistently laid down since Wade''s case (1601) 5 Coke Rep. 114. All these decisions had been given

before the Transfer of Property Act was enacted. I feel no doubt that the framers of the Act had these decisions in their mind in drafting the rule as

to tender and deposit. It is to be remembered that the rule as to tender is a part of the law as to the performance of a contract. Section 38 of the

Contract Act which uses the term '' offer'' lays down three conditions. The offer must be unconditional; it must be made at a proper time and place;

and the thing offered must be produced for inspection.

So far I have been able to see there are no provisions in any English Act relating to tender. The practice is referred to in Bullen and Leake,

pages 710 and 711. There is an analogous provision in the Rules of the County Court.

Now I shall refer to a few Indian decisions which were quoted on behalf of the respondent. All that was decided in Venkatrama Aiyar Vs.

Rangasami Aiyangar and Others, was that a mortgagee should not be compelled before accepting the tender to decide a dispute which has arisen

between the parties as to the extent of the subsisting interest of the mortgagor in the equity of redemption. I do not think this decision is against the

view I have enunciated. In Lal Batcha Sahib v. Arcot Narayanaswami Mudaliar ILR (1910) M 320 Sir Arnold White, C.J., and Ayling, J. held

that an offer to pay such amount as may be due on a settlement of account if the payee would execute an indemnity bond, is not a valid tender. To

use the language of the Contract Act, in that case there was no unconditional offer. In Subbai Goundan Vs. Palani Goundan and Another, where a

tender of money which was less by nine pies was made, the learned Judges seem to have held that it was not a valid tender. If I were deciding that

case I would have applied the maxim de minimus non curat lex; however that may be, the principle that where a man tenders less than what is

actually due is not a good tender is the only proposition that must be taken to have been laid down in that case. In Ayyakutti Mankondan v.

Periasami Kavandan ILR (1915) M 579 it was held by Courts Trotter and Kumaraswami Sastri, JJ., that where a bond contains a stipulation by

way of penalty and the debtor deposits in court what he considers to be reasonable compensation for the penal claim, it is a valid tender.

The principle to be borne in mind, especially in this country, is that the parties should be given an opportunity of making a bond fide attempt at

performing the contract. If that requirement is complied with, the rights of the parties should not be defeated by technicalities. Of course, if the law

imposes conditions, we are not at liberty to disregard them on the ground that they are against justice. I am of opinion that the tender in January

1912 was valid. At any rate so far as the ceasing of interest from the date the defendant was served with the summons in the present case, is

concerned, I entertain no doubt about it. The defendant was informed by the plaintiff that the money was already in court; he was told what the

exact sum was which was due and payable to him; he was further told that he could draw that amount from court. The courts below have found

that the exact amount mentioned in the plaint was the sum which was payable to the defendant and nothing more.

Under these circumstances, the principle of Order 24, Rule 3 of the CPC applies, and the plaintiff is entitled to interest after the date of the

service of the plaint and the summons on the defendant. I would modify the decree of the lower Appellate Court by giving interest to the plaintiff

from the date of the service of the plaint and summons on the defendant. The parties are entitled to proportionate costs in this court and in the court

below.

Napier, J.

I have found some difficulty in holding that there was a deposit within the meaning of Section 83 of the Transfer of Property Act, for, in my

opinion, the petition which was filed with the deposit was not a petition contemplated by the section. The section requires that the mortgagor

should deposit to the account of the mortgagee the amount remaining due on the mortgage, and that thereupon the court should give written notice

to the mortgagee, and he, on presenting a petition stating the amount then due on the mortgage and his willingness to accept the money so

deposited, is entitled to receive the money. Now, the appellant, according to the language of his petition, sought something different. He asked the

court to pass an order "" directing the counter petitioner to hand over all the said othi lands with the produce to the petitioner on receiving the other

amount of Rs. 3,650, or directing the counter petitioner to hand over the lands (along with the produce) bought in auction on receiving the

proportionate amount, making the counter petitioner liable for the costs and granting other reliefs."" This petition is clearly not contemplated by the

Act. This court has, under its power to make rules given by Section 104 of the Act, framed rules for the Original Side which, though not applicable

to the present case, indicate the scope of the section. They require that the mortgagor should file an affidavit stating the facts of the case and in

addition to depositing the amount due on the mortgage, deposit in court a sum sufficient to provide for the costs of the mortgagee etc. They do not

contemplate the exercise by the court of any discretion in the matter of making either party liable for costs or granting any relief. I am clear,

therefore, that if the court had refused to take any action on this petition the proceeding purported to be taken u/s 83 would have been bad.

However, the court did give notice to the mortgagee and I must take it that it treated the application as being in proper form. The mortgagee did

not take objection that the mortgagor had not deposited the amount remaining due on the mortgage so as to enable him to decide whether he

would accept the money so deposited in full discharge of the amount as calculated by him. Just as it was the duty of the mortgagor to deposit the

amount remaining due, so it was the duty of the mortgagee to state the. amount then due on the mortgage. It appears to me that if he had stated the

amount as some figure under the whole othi amount and had claimed to receive that amount out of the total amount deposited, he would have been

entitled to do so. It is on this footing alone that I can find that proportionate amount on such properties was, in fact, deposited. If the petition was

to be read as requiring the court to ascertain what the proportionate amount was, I should certainly hold that there was no proper deposit; but in

the view that the petition left it to the mortgagee to take whatever sum, under the total amount, which he thought he was entitled to as

proportionate, I am not prepared to say that the deposit was not good. I agree with the order of my learned brother.