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1906 DIGILAW 87 (ALL)

Baldeo Prasad v. Sheo Dial

1906-04-27

AIKMAN, KNOX

body1906
JUDGMENT : AIKMAN, J. We held over our judgment in this case until the decision of S.A. No. 265 of 1904, as the same question arose in both appeals. That second appeal has now been decided, Supra p. 439 and we proceed to dispose of this appeal. 2. The following are the facts of the case:— On 6th June, 1894, and 28th March, 1896, one Baldeo Parshad who is now deceased, and is in this suit represented by his sons, respondents (4) and (5), executed mortgages over his property in favour of Puran La;, father of the plaintiff-appellant, whose name is also Baldeo Parshad. 3. On the 25th June, 1896, the mortgagor, Baldeo Parshad, and his brother, Sheo Dayal, executed a joint mortgage in favour of one Manu Lal, hypothecating their respective properties as security for money borrowed from Manu Lal. The property mortgaged by Baldeo Parshad in this mortgage was the same property which he had previously mortgaged to plaintiff's father. On the 11th February, 1899, Sheo Dayal mortgaged to the plaintiff the property which he had previously mortgaged to Manu Lal. On 8th December, 1900, the plaintiff got a decree on the mortgages executed in his favour by Baldeo Parshad in 1894 and 1896. Manu Lal was made a party to that suit, he being by his mortgage of 25th June, 1896, mortgagee of Baldeo's equity of redemption. Manu Lal did not avail himself of his right to redeem. The property was sold under the decree and pur chased by the plaintiff on the 20th May, 1902. 4. Then, on the 25th June, 1902, the plaintiff paid to Manu Lal the amount due under the mortgage of 25th June, 1896. The suit out of which this appeal arises has been brought by the plaintiff against Sheo Dayal and his brother, as well as against the sons of Baldeo Parshad, mortgagor, to recover not only the amount due to plaintiff under the mortgage in his favour, of 11th February, 1899, but also the amount due under the mortgage of 25th June, 1896, which plaintiff redeemed. The amount of the latter mortgage plaintiff seeks to recover from Sheo Dayal's share alone, exempting the share of Sheo Dayal's co-mortgagor, Baldeo Parshad, which, as stated above, the plaintiff had acquired by purchase at a sale in execution of a decree obtained on the two prior mortgages. 5. The amount of the latter mortgage plaintiff seeks to recover from Sheo Dayal's share alone, exempting the share of Sheo Dayal's co-mortgagor, Baldeo Parshad, which, as stated above, the plaintiff had acquired by purchase at a sale in execution of a decree obtained on the two prior mortgages. 5. For the defence it was pleaded that the plaintiff, having himself purchased half of the property hypothecated in the mortgage of 25th June, 1896, was not entitled to throw the whole burden of the mortgage on the remaining half, but was only entitled to a half or proportionate amount of the money due under that mortgage. 6. The learned Subordinate Judge sustained this plea, and gave plaintiff a decree for only half of the amount paid to redeem the mortgage of 25th June, 1896, holding that that was all to which having regard to the provisions of section 82 of the Transfer of Property Act he was entitled. 7. Against this decree the plaintiff appeals. It is contended on behalf of the appellant that the property purchased by the plaintiff having been bought by him in execution of a decree obtained on prior mortgages, was not liable for any part of the money due under the puisne mortgage, and that if liable at all, it was not liable for as much as one-half, having regard to the incumbrances that existed on the property bought by the plaintiff at the time when the mortgage of 25th June, 1896, was executed. We were at first disposed to hold that the view taken by the court below was right and bad delivered a judgment dismissing the appeal. But before that judgment was signed we saw cause to doubt the correctness of the view we were inclined to take. We accordingly had the case reargued. The result of the further argument and of the further consideration we have given to the question is that we find ourselves unable to sustain the decree of the court below. 8. The second of the two contentions set out above is undoubtedly valid. Even if section 82 applies, the court below has overlooked the concluding words of the first paragraph of that section in as much as it has not deducted the value of the incumbrances to which the property purchased by plaintiff was subject when it was mortgaged to Manu Lal. 9. Even if section 82 applies, the court below has overlooked the concluding words of the first paragraph of that section in as much as it has not deducted the value of the incumbrances to which the property purchased by plaintiff was subject when it was mortgaged to Manu Lal. 9. But, as held by us in the second appeal referred to at the beginning of the judgment, we are of opinion that the provisions of section 82 of the Transfer of Property Act are inapplicable to a case like the present. We hold that when property subject to a second mortgage is sold in execution of a decree obtained on a first mortgage in a suit to which the second mortgagee was a party, the purchaser whether he be the decree-holder himself or an outsider, takes the property free of all claims under the second mortgage. 10. In this case the plaintiff has by redemption acquired the rights of Manu Lal in the mortgage of 25th June, 1896. Manu Lal would have been entitled to enforce his mortgage against the property of either of his mortgagors and the plaintiff who stands in Manu Lal's shoes has the same right. One of the properties mortgaged to Manu Lal has been entirely swallowed up by the prior incumbrances. Consequently no right of contribution in respect of the second mortgage can be enforced against that property, and the whole burden of the second mortgage must fall on the other property, namely, that mortgaged by Sheo Dayal of course, if Sheo Dayal or the sale of his property satisfies the joint mortgage-debt incurred by him and his brother, Baldeo Parshad, he may have a right of contribution against Baldeo Parshad's sons. But for the reasons set forth above he has no right of contribution against the property mortgaged by Baldeo Parshad. In support of this view we would also refer to the reasons given and authorities cited in our judgment in S.A. 265 of 1904, decided by us on the 10th instant. This disposes of the first three grounds in the memorandum of appeal. 11. The last ground relates to interest. The court below has allowed interest at 6 per cent, from the date of institution of suit until date of payment. This disposes of the first three grounds in the memorandum of appeal. 11. The last ground relates to interest. The court below has allowed interest at 6 per cent, from the date of institution of suit until date of payment. Having regard to the heavy rate of interest decreed to the appellant up to the date of the suit we are not disposed to interfere with the order of the court below as to interest. The result is that we vary the decree of the court below by allowing to the plaintiff the full amount, namely, Its. 3,100 paid by him to Manu Lal in redemption of the bond of 25th June, 1896, instead of the half of that amount, i.e., Rs. 1,550, allowed by the Court below, together with interest on the said sum, Rs. 3,100, at the rate of 24 per cent, per annum from the date of payment to Manu Lal, i.e., 25th June, 1902, to the date of suit, i.e., 8th August, 1902. To this extent we allow the appeal: quoad ultra, it is dismissed. The parties will pay and receive costs here and in the Court below in proportion to their failure and success, and the costs of this court will include fees on the higher scale. We fix the 27th. October, 1906, as the date by which payment must be made by defendants. The office will prepare a fresh decree in accordance with this judgment which will be signed after being shown to the Counsel of the parties, and after any objections by them have been disposed of. 12 Appeal decreed in part.