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Judgment
Venkatasubba Rao, J.—The plaintiff has filed this suit to enforce a mortgage, refusing to recognise the discharge given to the mortgagors by
his paternal uncle, the 5th defendant. The question to be decided is very simple. If the plaintiff and the 5th defendant were members of a joint
undivided Hindu family, the act of the 5th defendant, who was the senior male member, would be binding on the plaintiff as the Judge has found
that in waiving a portion of the amount due and giving a discharge, the 5th defendant acted prudently and for the benefit of the family and this
finding has not been attacked before us. If, however, on the date the 5th defendant entered into the transaction, he and the plaintiff were divided,
the act of the 5th defendant would still be binding on the plaintiff as it was subsequently ratified by the plaintiff''s next friend in the agreement of
compromise which was ultimately made a decree of the Court in Suit No. 9 of 1909 and in this connection I must observe that it was conceded
before us that the ratification by the plaintiff''s next friend would stand upon the same footing as if it were a ratification made by the plaintiff himself
on his attaining majority.
On either hypothesis therefore the appeal must fail. A point, however, was taken for the first time before us by the learned vakil for the appellant
that the discharge of the mortgage cannot be proved as the writing evidencing the discharge has not been registered. This argument is untenable.
Ex. X is an endorsement on the deed of mortgage itself which is to the effect that the sum of Rs. 6,480 was received in full satisfaction of the
amount due under the mortgage. Ex. XVI is an independent receipt granted to the mortgagor. It recites also the acknowledgment of the sum
mentioned above and there are the following words: ""You shall take this as the receipt for the discharge of the hypothecation deed."" Sub-clause (ii)
of Clause 2 of Section 17 of the Registration Act runs thus:
Nothing in Clauses (b) and (c) of sub-section applies to any endorsement on a mortgage deed acknowledging the payment of the whole or in part
of the mortgage money and any other receipt for payment of money due under a mortgage when the receipt does not purport to extinguish the
mortgage.
This clause contemplates (1) an endorsement on a mortgage deed, and (2) any other independent receipt for payment of money. In the case of
an independent receipt. it is necessary that it must not purport to extinguish the mortgage. But so far as an endorsement on the mortgage deed is
concerned, no such limitation is placed.
In the present case I do not think Ex. XVI, the receipt mentioned above, contains any words purporting to extinguish the mortgage and it is not
sufficient that the effect of the words is to produce that result. But even granting that there are such words in the receipt, the defendant can fall back
on the endorsement and prove by it that the mortgage debt has been discharged. It is however noticeable that in the endorsement there are not
even words purporting to extinguish the mortgage. The appellant''s contention therefore is utterly un-founded and must be overruled. Lakshmana
Chetty v. Chenchuramayya (1917) 34 MLJ 79 referred to by the appellant''s learned vakil has no bearing on the question to be decided and it is
unnecessary to consider it. The appeal therefore fails and is dismissed with the costs of respondents 1 and 2.
Srinivasa Aiyangar, J.
The only question argued in this appeal, indeed the only point on which we required to be satisfied in the first instance, was whether the learned
Subordinate Judge was wrong in holding that the plaintiff, the appellant before us, is precluded from questioning the discharge of the suit mortgage
granted by the original 5th defendant in the suit. The learned vakil who appeared for the appellant has entirely failed to satisfy us that the decision
on that matter of the learned Subordinate Judge was wrong. The original mortgagee was one Sundarappa Aiyar, father of the plaintiff, who died
leaving the plaintiff, his son, and Venkatrama Aiyar, his step-brother, as the surviving members of the joint family. Both these were minors at his
death. Pursuant to an agreement made by the mother of the 5th defendant purporting to act for the family, the 5th defendant, after he came of age,
agreed to receive a sum of Rs. 6,480 in full satisfaction and discharge of the amount due from the mortgagors. This would seem to have been done
by him bona fide in the interests of the family. In evidence of this discharge he passed to the mortgagors Ex. XVI. When both the plaintiff and the
5th defendant were still minors, there was a partition sought to be brought about between them by their respective mothers and this arrangement of
partition was embodied in Ex. A. Subsequent to Ex. XVI, that is to say, subsequent to the discharge granted by the 5th defendant, O.S. No. 9 of
1909 on the. file of the Subordinate Judge''s Court at Mayavaram was instituted in the name of the plaintiff by his maternal uncle as his next friend.
This suit was no doubt based on the footing of Ex. A being a partition binding on the parties. But the defendant--the 5th defendant in this case--
denied the validity of the partition and set up that the family was still joint. One of the items in the suit in respect of which the plaintiffs half share
was demanded was the amount of the said mortgage. But the suit was compromised and Ex. III is the razinama decree passed therein. That decree
was on the basis that there had been no valid partition between the parties, and that the action of the 5th defendant in claiming to represent the
family and granting a discharge to the mortgagors under Ex. XVI, receiving the sum of Rs. 6,480 was binding on the plaintiff, and the razinama
decree further proceeded to determine the shares of the parties on that basis. This razinama decree has not been set aside but on the other hand
been not only acquiesced in by the plaintiff after he came of age but has been made the basis of other claims made by him. In Ex. XVIthe 5th
defendant acted not only for himself but purported to act also for the plaintiff as his guardian. If the 5th defendant was the manager of the joint
family at the time of his granting the discharge and if the discharge granted by the 5th defendant was bona fide and in the interests of the family as
found by the learned Subordinate Judge, then it follows that the plaintiff could not re-open it or ask for his share of the mortgage moneys on the
footing that there had been no valid discharge. Assuming that the 5th defendant was not the manager of the joint family and had no power to grant
a discharge in that capacity, then the position is this. The 5th defendant purported to act as the guardian of the plaintiff in the transaction. The
transaction was therefore liable to be avoided by or on behalf of the minor plaintiff. But by the said razinama decree in O.S. No. 9 of 1909 the
plaintiff was decreed to be bound by the discharge granted by the 5th defendant. Even on the assumption therefore that the discharge originally
granted by the 5th defendant was voidable by or at the instance of the minor plaintiff, by reason of the said decree in O.S. No. 9 of 1909 the right
to avoid the discharge was finally put an end to. The razinama decree was passed with the sanction of the Court granted on behalf of the minor
plaintiff. We asked the learned vakil who appeared for the appellant whether he was going to argue that such a decree passed in respect of a minor
with the sanction of the Court would in law be in a different position to a decree passed in respect of an adult, and he properly intimated to us that
he did not propose to argue for any such position. We therefore fail to see how the plaintiff whose right, if any, to avoid the discharge has been
either found against or put an end to by the compromise decree, can be entitled to any relief on the footing that there has been no valid discharge
binding on him. We have therefore come to the conclusion that the learned Subordinate Judge was right in his decision on the point.
The learned vakil who appeared for the appellant however wished to argue a question of law not raised before the lower Court and not even
raised in the grounds of appeal here, on which he contended he was entitled to succeed on the question whether or not there had been a valid
discharge. As the question raised was a pure question of law and as the other side did not strenuously oppose, we allowed him to argue the point.
His contention was that Ex. XVI the receipt granted by the 5th defendant was not receivable in evidence, as it is a document required to be
compulsorily registered and was not. so registered. For this position, reliance was placed on Clause (b) in Section 17 which prescribed
compulsory registration for all non-testamentary instruments which purport or operate to limit or extinguish whether in the present or future any
right title or interest of the value of Rs. 100 or upwards to or in Immovable property. In the same section, Exception 11 to Clause (b) provides that
any endorsement on a mortgage deed acknowledging the payment of the whole or in part of the mortgage money and any other receipt for the
payment of the money due under a mortgage when the receipt does not purport to extinguish the mortgage need not be registered. The learned
vakil who appeared for the appellant argued that Ex. XVI would not fall under the 11th exception because while no doubt the mere endorsement
on a mortgage deed acknowledging the payment of the whole or any, in part, of the mortgage money need not be registered, the receipt of a part
of the amount due in full satisfaction of the whole amount due was not contemplated or covered by the exception. But Exception 11 also excepts
from the operation of Clause (b) of Section 17 '' any other receipt for the payment of the money due under a mortgage when the receipt does not
purport to extinguish the mortgage. '' There are no words in Ex. XVI which purport to extinguish the mortgage. In the body of Clause (b) all
instruments which purport or operate to limit or extinguish certain rights are included, but in the exception the words '' or operate '' are not
repeated. This is significant, and the obvious conclusion to be drawn from this deliberate difference in the wording is that receipts granted for
money may extinguish the debt and may therefore operate to extinguish the security; but if they do not purport in terms to extinguish the security
they need not be registered. The learned vakil who appeared for the appellant drew our attention to the decision of this Court in the case of
Lakshmana Chetty v. Chenchuramayya (1917) 34 MLJ 79 as an authority for the position contended for by him with regard to the admissibility of
Ex. XVI under the Registration Act. At the outset we may observe that that decision has no bearing on the present case. That was clearly a case of
a contract the performance of which was being sought to be enforced. Further it was not the case of a payment made or accepted in respect of
which either an endorsement was made or a receipt was granted and therefore obviously the terms of Exception 11 to Clause (b) of Section 17 of
the Registration, Act had no application. If the document should be merely an agreement to reduce the amount payable under the mortgage, it is
conceivable that it might fall within the terms of Clause (b) of Section 17 because it may, though not purporting to do so, operate to limit or
extinguish rights in Immovable property. All the decisions referred to by the learned Judges as authorities for the position were all cases only of
agreements which would operate to create or limit such interests in Immovable property. None of those cases were cases of receipts or discharges
for payment of the mortgage amount accepting a smaller amount in lieu of the whole. The contention therefore that Ex. XVI is not admissible in
evidence also fails.
In view of our finding that the plaintiff-appellant is precluded from questioning the discharge it has become unnecessary to consider the other
questions raised in the appeal. The appeal therefore fails and must be dismissed with the costs of 1st and 2nd respondents.