Thiruvendipuram Chengalamma Garu and Others vs Vemasani Veeraraghava Naidu and Another

Kumaraswami Sastri, J.—These appeals arise out of two suits filed on two mortgages executed by defendants 1 to 3, appellants, in favour

of the plaintiff-respondent in each of the suits. The deeds were mortgage deeds without possession and they contain a personal covenant to pay the

amount due on the mortgage. In each of the suits the plaintiff, after setting out the mortgage and the consideration, prayed for a decree for the

amounts due. The plaintiff in Appeal No. 100 prayed for the usual mortgage decree for Rs. 38,975-8-9 with costs and further interest and the

plaintiff in Appeal No. 101 for Rs. 39,515-15-8 with costs and further interest. Execution of the mortgage document was admitted by the

defendants, but the defences raised were that the documents were not properly attested as required by law in that the attesting witnesses were not

present when the executants executed the documents and that there was failure of consideration as regards a portion of the sums claimed, that the

endorsements of payment by defendants 2 and 3 would not bind the 1st defendant so as to attract the provisions of the sections of the Limitation

Act regarding acknowledgments of payment and that the personal remedy is barred as over 3 years have elapsed from the date of the mortgage

documents. The Subordinate Judge overruled these objections and passed the usual mortgage decree in each of the suits and hence these appeals.

As regards the objection as to the mortgages being invalid as not Having been properly attested, the Subordinate Judge declined to accept the

evidence of P.Ws. 8 and 9, the attestors of the document, who state that they were not present when the deeds were executed. He accepted the

evidence on the plaintiffs'' side that they were present at the execution. As regards P.Ws. 8 and 9, it is clear from their evidence that they are not

worthy of any credit when they say that they were not present when the documents were executed. As pointed out by the Subordinate Judge, both

these witnesses were, very reluctant witnesses for the plaintiffs. They had to be brought to Court under arrest. P.W. 9 is the karnam of the village

which belongs to the 1st defendant. He is practically her servant. He says he is the karnam of Chittedu which belongs to the defendants. He says

the writer of the document is his brother. When asked to say why he attested the documents not executed in his presence, he began by saying that

he attested because he knew the signatures of the defendants and he says that the signatures in Exhibits A and D are those of defendants 1 to 3.

He says his house is quite near the house of the defendants, being only a hundred yards off. Then he turns round and says he cannot say the

signatures in Ex. D-1 are those of defendants 2 and 3, because he cannot identify the signatures. The Subordinate Judge rightly discredited the

evidence of this witness. The other witness P.W. 10 who attested both the deeds is the Village Munsif of a village which belongs to the defendants.

He also says that the documents were not signed in his presence. He began by saying that he can identify the signatures of defendants 2 and 3 but

then he says he cannot say whether the signatures in Exs. H-1 and D-1 were theirs or not and that he cannot say they are not theirs. The

defendants have not ventured to go into the witness-box to deny the statements of the plaintiff and his witnesses that the documents were executed

by them in the presence of attesting witnesses, nor do they deny that they received full consideration. Having regard to these circumstances I see

no reason to differ from the Subordinate Judge when he holds that the documents were properly attested.

The next question is whether there was any failure of consideration. Here again the Subordinate Judge points out that there was nothing in the

evidence to show that there was any failure of consideration and Mr. Lakshmanna for the defendants states that he would not press this objection.

The important question which Mr. Lakshmanna argued in this case is whether in cases of registered mortgage bonds, the period of limitation for

the personal covenant is 3 or 6 years. His contention is that even though the mortgage document was registered, the case falls under Article 66 and

not under Article 116. The contention for the respondent is that in the case of registered documents Article 116 in terms applies and that the suit is

in time. I may state that as regards this question there are a series of cases in all the High Courts holding that a suit on a personal covenant in a

registered mortgage document is governed by Article 116 and that the 6 years'' rule applies to such cases. I may refer to Miller v. Runga Nath

Moulick ILR (1885) C. 389 which has been approved of by the Privy Council in AIR 1926 56 (Privy Council) , Rahmat Karim v. Abdul Karim

ILR (1907) C. 672, Raja Ram Narain Singh v. Odindra Nath Mukerjee 17 C.W.N 369, Rathnastvami v. Subramania ILR (1887) M. 56,

Unichaman v. Ahmed Kutti Kayi ILR (1897) M. 242 : 1897 8 M.L.J. 81, Naubat Singh v. Indar Singh ILR (1890) A. 200, Jangi Singh v.

Chandar Mol ILR (1908) A. 388 Lachmi Narain v. Turab-uw-nissa ILR (1911) B. 177 and Dinkar Hari v. Chhagan Lal Narsidas ILR (1913) B.

The main contention of Mr. Lakshmanna is that the decision of their Lordships of the Privy Council in Ram Din v. Kalka Prasad (1884) L.R.

12 IA. 502 and in AIR 1926 56 (Privy Council) compel us to hold, notwithstanding the current of authority in the various High Courts, that the 3

years'' rule applies, and it is necessary to see whether there is anything in these decisions which overrules the authorities above referred to and

decides that the 3 years'' rule applies in cases of registered mortgage documents. If there is, we are bound to follow the decisions whatever may be

the views held by this and the other High Courts. I may point out that so far as the claim for personal remedy on a mortgage document is

concerned, it is a claim which arises under the document which is registered. Mr. Laksh-manna''s argument was that although the document might

be registered as a mortgage, the registry only affects the Immovable property and the obligation to discharge the debt out of that property, and that

so far as the personal covenant is concerned, it is not a claim on the registered document and he supports his argument by referring to the sections

of the Registration Act which refer to the place of registration, namely the place where the property or some portion of it is situate, and contrasts

this with the other provisions of the Act as regards registration of documents which do not affect Immovable property in which case the place of

registration is where the parties desire it to be registered. I may point out that a mortgage document is registered under the provisions of the

Transfer of Property Act. Section 59 of the Transfer of Property Act requires a mortgage document to be registered. Mortgages are denned in

Section 58 and certainly mortgages as defined include the covenant to pay the money secured on the property where such covenant exists. Where

a document is required u/s 59 to be registered, I find it difficult to see how any portion of the document can be said not to be registered for any

purpose. What the law says is that a mortgage document as a whole has to be registered and not portions of it, and when a mortgage document is

registered, it is difficult to say that the portion which contains the covenant to pay is not registered under the Act. The fact that the legislature has

thought fit to define where documents are to be registered does not affect the question as to the registration of the document as a whole. It cannot

be suggested that in all mortgage documents or documents containing several covenants, you have to register each portion of the document or each

covenant separately in order to secure the benefit of the limitation as regards contracts. I do not see anything in the Registration Act which affects

this question. After the decision of the Privy Council in Tri-comdas Cooverji v. Gopinath Jiu Thakur ILR (1916) C. 759 : 44 I.A. 65 : 1916 32

M.L.J. 357 it is difficult to hold that the non-payment of a sum which a person agrees to pay is not a breach of contract in writing. So far as rents

are concerned, their Lordships of the Privy Council in that case have expressly decided after a review of the scheme of the Law of Limitation that a

claim for rent which is due under a registered rental agreement is governed by Article 116. I find it difficult to draw any distinction between a claim

for rent under a registered lease-deed and a claim for payment of interest under a registered mortgage deed. As regards mortgages, in addition to

the cases I have already referred to of the various High Courts, the decision in Kamcswar Pershad v. Rajkumari Ruttan Koer (1892) L.R. 19

IndAp 234 : ILR 20 C. 79 considers the question of limitation in such cases. Their Lordships negative the contention that the remedy on a personal

covenant is governed by Article 132 and that the 12 years'' period of limitation can be availed of and state that the period of limitation would be 6

years. This is what their Lordships say:

The first objection taken to the suit was that it was barred by the law of limitation. Prima facie, this would be obvious, for the bond was by its

terms made payable in the month of September 1875, whereas the right to sue the defendant for a personal debt would be limited to six years, and

the present suit was not commenced until the month of January 1887, an interval of over 11 years. The appellant, however, alleges that he comes

within the limitation applicable to a charge on Immovable property, which would be 12 years; if he is right in that contention, the suit, being

instituted 11 years and some months afterwards, is not barred. But it is necessary for the appellant to satisfy this Board that the charge upon the

estate was one which was binding upon it, and, bearing in mind the facts of the earlier suit, and what was said by the Board in that case, their

Lordships are not satisfied that it was so binding in fact. In this view, the period of six years, and not the period of 12 years, applies in this case,

and the suit is consequently barred.

Then they deal with the other point as to whether the suit was barred by res judicata. It seems to me that on the facts of this case and having

regard to these observations their Lordships of the Privy Council were of opinion that 6 years'' rule was to be applied. As regards Ramdin v.

Kalka Pershad . I do not see anything in that case which supports the view that the Privy Council have decided that 3 years is the period of

limitation.

There the question raised was whether Article 132 applied to the personal remedy and they held that Article 132 did not apply. Their Lordships

say that the question for their Lordships'' consideration is whether the lesser period of limitation 3, or 0 years as the case may be, has barred the

personal remedy against the mortgagee, even though the mortgage remains in full force as against the mortgage property. The words, 3 or 6 years

as the case may be, obviously refer to unregistered and registered mortgages. Later on their Lordships refer to the 6 years'' rule as regards

registered bonds. The head-note does not seem to be correct. They were dealing with the Act of 1871 in that case. In the case in AIR 1926 56

(Privy Council) . there are no doubt observations which suggest that their Lordships were of opinion that the 3 years'' rule is applicable. I may

point out that it is not clear from the facts of that case whether the mortgage document was properly registered and whether the claim was on a

duly registered document. It is pointed out by their Lordships that the suit was filed 10 years after the debt became payable. Their Lordships of the

Privy Council refer to and approve of Miller v. Runga Naih Moulick ILR (1885) C. 389, where the six years'' rule was referred to. In the case in

Ganesh Lal Pandit v. Khetra Mohan Mahapatra ILR (1926) C. 759 : 44 I.A. 65 : 32 M.L.J. 357 it was not necessary for their Lordships of the

Privy Council to decide whether the 3 years'' or the 6 years'' rule applied, as the suit would be barred even if the 6 years'' rule was applicable and

the contention was that 12 years'' rule applied. There was no question in the case as to whether the 3 years'' or the 6 years'' rule applied. We also

find that the respondents were not represented. I do not think that until there is a clear pronouncement by their Lordships overruling the series of

cases which I have referred to, their Lordships can, by reason of the observation in AIR 1926 56 (Privy Council) be said to have altered the

current of authority and to have determined that in suits on registered mortgages, 3 years'' rule is the one applicable, especially as we cannot on any

principle distinguish the decision in Tricomdas Cooverji v. Gopinath Jiu Thakur ILR (1916) C. 759 : 44 I.A. 65 : 32 M.L.J. 357 dealing with

claims on registered rent deeds from those on registered mortgages and as we find the decision in Kameswar Pershad v. Rajkumari Ruttan Koer

(1892) L.R. 19 IndAp 234 : ILR 20 C. 79 expressly states that 6 years'' rule is applicable I think that Article 116 applies to mortgages and to

personal remedies under mortgages which are registered and that the present claim is not barred by limitation.

The appeals fail and are dismissed with costs.

Reilly, J.

I agree that in this case we should not be justified in differing from the finding of the learned Subordinate Judge that the mortgages were validly

executed and attested. Mr. Lakshmanna himself does not press the contention that there was any failure of consideration.

The important and interesting point in these appeals is the question of limitation raised by Mr. Lakshmanna. He contends that the period of

limitation to, be applied to the personal covenants in connection with these mortgages on the part of defendants 2 and 3 is only 3 years under

Article 66 of the Limitation Act, not 6 years under Article 116, although those personal covenants are contained in the registered mortgage deeds.

One way in which Mr. Lakshmanna has tried to support his contention is by representing that these personal covenants, although. they are included

in registered mortgage deeds, have not themselves been registered. He asks us to accept the theory that these documents were registered because

they were mortgages: incidentally it happened that personal covenants were set out in them; but there was no necessity to register the personal

covenants, and therefore we must confine the effect of the registration to the mortgages embodied in the documents and say that the personal

covenants were not in effect registered at all. I do not think that we can deal with registered documents in that way. The reason why these

documents were registered was no doubt that they were mortgage documents: but, once they were registered, each was registered as a whole, and

every covenant contained in them was also registered. I do not see how we can get away from that fact or invent a theory that there may be a kind

of registration which is no registration. Now, if these personal covenants are registered covenants, then according to a long series of oases quoted

by my learned brother, of this Court, the Calcutta High Court, the Allahabad High Court and the Bombay High Court, the period of limitation

applicable is 6 years under Article 116, not 3 years under Article 66, and we find that there is the authority of their Lordships of the Privy Council

in Kamesww Pershad v. Rajkumari Ruttan Koer (1892) L.R. 19 IndAp 234 : ILR 20 C. 79 supporting that view of the matter. The same

principle, though not applied exactly to the same matter, is to be found in another decision of their Lordships, Tricomdas Cooverji v. Gopinath Jiu

Thakur ILR (1916) C. 759 : 44 I.A. 65 : 1916 32 M.L.J. 357 . Mr. Lakshmanna has quoted an earlier decision of their Lordships, Ramdin v.

Kalka Pershad , as ''if it supported his case; if we look into that case, we find that even there their Lordships recognised that the period of

limitation for a personal covenant might in some cases be 3 years and in some cases 6 years. The obvious meaning of what they said, I take it, is

that it would be 3 years if the document were not registered and 6 years if it were registered. The trouble in the present case arises from the recent

judgment of their Lordships in AIR 1926 56 (Privy Council) . In that case there is a reference to Ramdin v. Kalka Pershad , as if it decided, as

Mr. Lakshmanna represents, that the period of limitation. was only 3 years. I must confess that I find it a little difficult to follow the reference to

Ram Din''s case11 in this recent decision. What is actually said in quoting Ram Din''s case11 is that it was held by the Privy Council that, when a

mortgagee sues"" on a personal covenant to make the mortgagor responsible for any deficiency in the realisation of the mortgage-debt out of the

mortgage properties, the claim would be barred in 3''years. That would have been the case if the mortgage deed-had not been registered; and it

was possible at the time to which the decision in Ram Din''s case11 related that some mortgage deeds would not be registered. But further on in

this recent decision we find their Lordships of the Privy Council quoting Miller v. Runga Nath Motdick ILR (1885) C. 389 with approval. They

not only mention that case with approval, they quote a long passage from it in extenso, and that passage ends with the words:

The claim to make the: defendants personally liable has, therefore, been rightly held to be barred by limitation, the present suit having been

commenced more than six years after the accrual of the cause of action.

There it is quite clear the learned Judges of the Calcutta High Court took the view that the period of limitation was 6 years, and their Lordships

in this very case, on which Mr. Lakshmanna so much relies, appear to approve of that. They quote the statement without any dissent whatever. In

the next paragraph it is true they go on to say that in the case with which they are dealing Article 66 and a period of 3 years apply. What they say

is:

The cause of action on the personal covenant accrued to Behari Lal Pandit when Suryamani failed to pay the mortgage-debt, viz., within six

months from the date of the mortgage. And the claim had become barred under Article 66 long before the execution of the razinama and the

conveyance thereunder.

Now at first sight that looks as if their Lordships were dissenting from the long series of cases in the Indian High Courts which I have

mentioned and from their previous decisions in this matter. The question was not one of, any moment in AIR 1926 56 (Privy Council) because the

time for payment under the present covenant in that particular case occurred in 1885 and, therefore, whether the period of limitation was 3 years

or 6 years, it was all very ancient history, which could not affect the result of the case. But the statement that Article 66 applies is certainly a

puzzling one, and it would be very difficult for us to reconcile it with a long series of decisions in the Indian High Courts and with their Lordships''

own earlier pronouncements, if we were assured that the mortgage deed with which they were dealing in that particular case had been validly

registered. Unfortunately, we have not got the facts of that case before us. The judgment of their Lordships starts by saying that it is unnecessary to

set out the facts at length because they have been set out very clearly in the judgment of the High Court which was under appeal. But it does

appear from an early passage in their Lordships'' judgment that there was something wrong with the mortgage deed then in question. It had some

taint of invalidity, though what exactly is not clear. Their Lordships say:

They (that is the Judges of the High Court) have also held that the principal mortgage purporting to have been executed by Suryamani was not

executed in compliance. withs the provisions of the law so as to make it binding on Suryamani.

It would be very interesting and profitable for us to know exactly what was wrong with that mortgage; but I suspect it had something to do

with a defect in registration. If we go a little further in their Lordships'' judgment, we find that Suryamani had executed a power-of-attorney in

favour of a man called Lakhan Mahanty authorising him to execute and register this mortgage-deed and also to execute and register a sale-deed. In

the end it appears she executed the mortgage-deed herself but Lakhan Mahanty purported to execute the sale-deed on her behalf, and their

Lordships find that his execution of the sale-deed on her behalf was invalid because there was a defect in his power-of-attorney. It does not

appear to me at all improbable that the mortgage-deed was presented for registration by Lakhan Rahanty, as was intended by Suryamani, and, if

that was so and if the power-of-attorney was defective then the registration was invalid. It happened that on -that mortgage there was a suit in

1896, in which the mortgagee obtained an ex parte decree, and in execution of that decree the property was brought to sale. But that also was

ancient history into which their Lordships did not think it necessary to go for the disposal of the case before them. It will be seen that there was

something wrong"" with the mortgage-deed in question in that case, and there is at least some reason to suppose that what was wrong was that it

was invalidly registered. Now, when their Lordships have made a statement that the period of limitation for a personal covenant in a mortgage-

deed is 3 years instead of 6 years, as had been most uniformly held before, and have not discussed the matter in detail, but have merely stated it as

a fact applying to that particular case, it appears-to me to be more reasonable to suppose that they did so because the mortgage-deed then before

them was invalidly registered than that they intended to upset the law as understood in this country on a question of great importance generally,

though of no consequence in the case before them, without stating their reasons far more elaborately than has been done in that case. I think there

is good reason to suppose that AIR 1926 56 (Privy Council) is not really an authority for the proposition for which Mr. Lakshmanna wishes to use

it, namely, that the period of limitation for a personal bond embodied in a registered mortgage-deed is 3 years under Article 66 instead of, as

previously held, 6 years under Article 116.

I agree, therefore, that both these appeals must be dismissed with costs.