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1946 DIGILAW 55 (CAL)

Jivandas Khimji v. Dindoyal Shah

1946-02-28

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JUDGMENT Gentle, J. - On the 31st of August, 1927, the Respondents (mortgagors) mortgaged their property to the Appellant (mortgagee). On the 16th of January, 1937, the Appellant instituted a suit on the, mortgage and on the 6th of April, 1938, a preliminary decree was passed under Or. 34, r. 4 in terms of Form No. 5, Appendix D of the Code of Civil Procedure. On the 23rd of April, 1940, the Registrar reported that a sum of Rs. 15,093-3-2 was due and payable to the Appellant. Nothing further was done for five years until the 18th of May, 1945, when the Appellant made an application to execute the preliminary mortgage decree by attachment and sale of the mortgaged property. It is conceded that at the date of this application the time had expired for the Appellant to apply for a final mortgage decree. Mr. Justice Clough dismissed the application and the mortgagee has preferred this appeal against his dismissal. The sole question for decision is whether a mortgagee decree-holder can execute a preliminary mortgage decree by attachment and sale of the mortgaged property. The preliminary decree is in the usual form and it directs, inter alia, that: (1) the usual accounts be taken by the Registrar to ascertain the amount which would be due under the decree six mouths from the date upon which his report would be submitted to a Judge for counter-signature, including ascertainment of costs; (2) the Respondents to pay into Court to the credit of the suit, within six months of the date of the counter-signature, such sum as might be found due including the taxed costs; (3) in default of payment as said of the amount due, the Appellant to be at liberty to apply to the Court for a final decree that (a) the property be sold, (b) the money realised by such sale be paid into Court and applied in payment of the amount due to the Appellant, and (c) if the money realised by sale should not be sufficient for payment in full the Appellant should be at liberty to apply decree for the amount of the balance. 2. The Respondents made no payment into Court and, as previously mentioned the Appellant no steps to enforce the preliminary decree he did not apply for a final decree; such application is now barred by Article 181 of the Limitation Act. 3. 2. The Respondents made no payment into Court and, as previously mentioned the Appellant no steps to enforce the preliminary decree he did not apply for a final decree; such application is now barred by Article 181 of the Limitation Act. 3. It was contended on behalf of the Appellant that a preliminary mortgage decree is decree for payment of money since it require mortgagor to pay the amount due into Court and, after non-compliance and failure, the mortgagee decree-holder is entitled to execute preliminary mortgage decree by attachment sale of the mortgaged property; it was argued that there is no need to obtain a final mortgage decree for sale of the property. 4. The argument on behalf of the Appellant is put thus: By sec. 2, sub-sec. (2) of the Code, a decree includes a preliminary decree; sec. 61 provides that the Court may order execution of a decree by, inter alia attachment and sale property; by Or. 21, r. 30, every decree for the payment of money may be executed by attachment and sale of the judgment-debtor's property by sec. 60, mortgaged property is not excluded from liability to attachment and sale in execution. Consequently the Appellant is entitled to execute the preliminary mortgage decree by the method sought in the application before Mr. Justice Clough. 5. In a mortgage suit when there is a final decree for payment of any balance remaining due after the proceeds of sale of the mortgaged property have been applied towards the discharge of the mortgage debts and costs, unquestionably that is a decree against the judgment-debtor for the payment of money which can be executed in the same manner as any other money decree. If the argument for the Appellant is correct and a preliminary mortgage decree is executable. It will follow that after obtaining such a decree it is unnecessary to take any further step in the mortgage suit in order to bring the mortgaged property to sale, but this can be accomplished by execution of the preliminary decree. Further, if a preliminary decree is executable as a money decree an application can he made pursuant to sec. 5 and Or. 21, r. 30 of the Code for detention of the mortgagor in the civil prison. 6. The case for the Appellant was placed solely on his alleged right under Or. Further, if a preliminary decree is executable as a money decree an application can he made pursuant to sec. 5 and Or. 21, r. 30 of the Code for detention of the mortgagor in the civil prison. 6. The case for the Appellant was placed solely on his alleged right under Or. 21, r. 30 of the Code to execute the preliminary mortgage decree as a money decree. 7. A decree for the payment of money is a decree by which, under Or. 21, r. 1, the judgment-debtor, at his option can pay the amount decreed either to the judgment-creditor or into Court or, if there is any direction given by the Court so to do to pay in accordance with such direction. In such a decree, upon default of payment, the remedy of the decree-holder is not prescribed in the decree and he can enforce payment by the several methods set out in sec. 51. The preliminary mortgage decree first directs ascertainment of the amount due and secondly, for this to be paid into Court within a specified time; then it provides thereafter that upon the judgment-debtor's failure to pay within the prescribed time the decree-holder can apply to the Court for sale the proceeds of which are to be applied towards the discharge of the mortgage debt and costs, and if any balance then remains, the decree-holder can apply for a personal decree for that sum against the mortgagor. 8. The first question to consider is, whether a preliminary mortgage decree is a decree for the payment of money. There are several decisions to the effect that it is not a decree of that nature. In Fazil Howladar v. Krishna Bundhoo Roy I. L. R. 25 Cal. 580 (1897), it was held that a decree directing realisation of the decretal amount from the hypothecated property and if insufficient the Defendant should remain personally liable is not a decree for the payment of money. Decisions to the same effect are to be found in Kartick Nath Pandey v. Juggernath Ram Marwari I. L. R. 27 Cal. 285 (1899) and also in AIR 1939 303 (Lahore) . In Perumal Pillay v. Perumal Chetty I. L. R. 51 Mad. 701 (1928), it was held that a mortgage suit was still pending after the passing of a preliminary decree; that decision was cited with approval by Mr. 285 (1899) and also in AIR 1939 303 (Lahore) . In Perumal Pillay v. Perumal Chetty I. L. R. 51 Mad. 701 (1928), it was held that a mortgage suit was still pending after the passing of a preliminary decree; that decision was cited with approval by Mr. Justice McNair in Kameshwar Singh v. Anath Nath Basu I. L. R. [1937] 2 Cal. 207. In my opinion a mortgage decree is not a decree for money. There is no finality with respect to it and until the passing of a final decree, a mortgage suit is still a pending suit. 9. No authority was cited which supports the proposition enunciated for the Plaintiff. The nature of a preliminary decree has been considered in several decided cases. In Kanniah Naidu v. Chengama Naidu A. I. R. [1917] Mad. 844, a transferee of a preliminary mortgage decree applied for execution of the decree and also for the passing of a final decree: but in the latter respect the petition was irregular. In the judgment of the Court it was observed at page 845, that There is at present no executable decree because only a preliminary decree under Or. 34, r. 4 has been passed in the suit. and later, the application for execution, therefore, was premature; elsewhere in the judgment reference is made to the transferee praying for "unripe reliefs"; the matter was remanded back to the lower Court for the transferee to amend his petition. In Hemendra Lal Singh Deo v. Fakir Chandra Datta I. L. R. 50 Cal. 650 (1923). Mr. Justice Ghose and Mr. Justice Panton observed at page 656, if it was merely a preliminary decree in a mortgage suit, then obviously it follows that before execution could be levied, an order under Or. 31, r. 5, C. P. C., making the preliminary decree final had to be obtained. 10. In Mst. Arunbati Kumari v. Ramniranjan Marwari A. I. R. [1921] Pat. 320, Mr. Justice Das, with whom Mr. Justice Adami agreed observed at page 320: I accede to the proposition that if a decree has been passed in accordance with Or. 34, r. 4, then such a decree is incapable of execution until the final decree has been passed under the provisions of Or. 34, r. 5. 11. With respect I agree with the observations which have been quoted. 12. 34, r. 4, then such a decree is incapable of execution until the final decree has been passed under the provisions of Or. 34, r. 5. 11. With respect I agree with the observations which have been quoted. 12. In Jagannath Jugalkishore v. Chimanlal Chowdhury 48 C. W. N. 645 (1944), the nature and effect of a preliminary mortgage decree arose out of the argument addressed in that case. There Mr. Justice McNair and myself were sitting as an Appellate Bench hearing appeals from the Original Side of this Court. At page 654 I made the following observation: A preliminary mortgage decree quantifies the amount due but, whilst it directs the mortgagor to pay this sum into Court within a specified time, the mortgagee cannot obtain execution if the payment is not made. His sole remedy is to avail himself of another provision in the decree enabling him to apply to the Court for a final decree for sale. Such application is to obtain a decree which is capable of being enforced and is not an application to enforce a decree. 13. After hearing the able argument of Mr. P. B. Mukherjee, for the Appellant, I see no reason to retract from the view which I expressed in the last-mentioned case. In my opinion a preliminary mortgage decree is not a money decree; upon its passing, the mortgage suit in which it is passed remains a pending suit and execution cannot issue with respect to such a preliminary decree. 14. If the effect of this appeal is that the Appellant has no remedy available to him then there is no one to blame save himself inasmuch as for a long period of years he was content to sit still, to do nothing, and to refrain from exercising the rights and remedies which were given to him by the preliminary decree in the suit. 15. In my opinion the decision by Mr. Justice Clough was correct, and this appeal should be dismissed with costs. Certified for two Counsel. Ormond, J. I entirely agree both with the conclusion and with the reasonings expressed in the judgment that has been just delivered, and need add nothing.