Judgement Appeal (No. 67 of 1947) from a judgment and decree of the High Court (June 15 and August 28, 1945) which affirmed, subject to two modifications, a judgment and decree of the Subordinate Judge, Rangpur (July 21, 1943). The following facts and statutory provisions are taken from the judgment of the Judicial Committee. This appeal raised certain questions as to the true construction of the Bengal Money Lenders Act, 1940 (Bengal Act X. of 1940) (hereinafter referred to as the " Act "). It was necessary to state the history of the case in some detail, in order to show how those questions arose, and it would be convenient to refer to respondents Nos. 1 to 7 and their predecessors in interest as " the mortgagors " and to respondent No. 8 as " the bank." On February 10, 1927, the mortgagors borrowed Rs. 1,20,000 from the bank and executed a mortgage of the Tushbandar Estate to secure that sum, with compound interest thereon at the rate of eight and a quarter per cent, per annum, with half-yearly rests. The loan was repayable on December 31, 1927, but was never in fact repaid. On September 15, 1930, the bank borrowed Rs. 50,000 from Rai Bahadur Tarit Bhusan Roy (hereafter called " Roy "). Roy was the predecessor in title of the present appellants. On the same day, in order to secure repayment of the said sum with compound interest at the rate of eight per cent, per annum (with yearly rests), the bank executed a document which, in their Lordships1 view, might be accurately described as a sub-mortgage, though counsel for the appellants took exception to that description. That document contained an assignment in the following terms, the bank being referred to as the company" and Roy as the financier” — " This Indenture Further Witnesseth that in further pursuance of the said Agreement and for the consideration aforesaid the company doth hereby assign unto the Financier. That document contained an assignment in the following terms, the bank being referred to as the company" and Roy as the financier” — " This Indenture Further Witnesseth that in further pursuance of the said Agreement and for the consideration aforesaid the company doth hereby assign unto the Financier. All That the said sum of Rupees One lac and twenty thousand owing to the Company upon the security of the said herein before in part recited Indenture of Mortgage and all interest now due and henceforth to become due thereon and the benefit of all securities for the same and all powers rights or remedies thereby expressly or impliedly conferred on the Company to hold the same unto the Financier absolutely subject to the proviso for redemption hereinafter contained. And This Indenture Further Witnesseth that in further pursuance of the said Agreement and for the consideration aforesaid the Company doth hereby grant transfer convey and assign unto the Financier all that the right title and interest and claim and demand of the company as the mortgagee under the said Indenture of mortgage of and in the Zemindaries Talooks Mausas Jotes messuages lands hereditaments and premises particularly described in the schedule hereunder written together with all bankar, falkar, mines, Law Rep. 76 Ind. App. 76 Ind. App. 74 ( 1948- 1949) Promode Kumar Roy V. Nikhil Bhusan Mukhopadhya 29 quarries, markets, bazars, fairs, hats, ghats and all other the rights profits liberties easements appendages and appurtenances " thereto belonging or appurtenant or reputed to belong or be appurtenant thereto and also all those the rights powers and remedies available to the Company under and by virtue of the said Indenture of Mortgage against the Mortgagors in the said Indenture of Mortgage named and their and each of their respective heirs executors administrators representatives and assigns to hold the same unto the Financier subject to such right or equity of redemption as is now subsisting therein by virtue of the said Indenture of Mortgage and subject also to the proviso for redemption hereinafter contained Provided Always and it is hereby declared that if the said sum of Rupees Fifty thousand with interest and compound interest computed at the rate and in the manner and 44 all other the moneys hereby secured shall be paid on the 31st day of March one thousand nine hundred and thirty-one in pursuance of the covenants in that behalf hereinbefore contained the Financier will at the request and cost of the Company reassign and retransfer unto the company or as it shall direct the security hereby created.” On December 8, 1931, Roy brought a suit (mortgage suit No. 310 of 1931) in the Court of the Subordinate Judge, Rang- pur, to which the bank and the mortgagors were made defendants. Certain decrees were made in that suit. Unfortunately, neither the plaint nor the decrees had been included in the Record now before the Board, but they were summarized in the following passage from the judgment of Mitter J. in the High Court, the mortgagors being referred to as " the " Mukherjees " — On December 8, 1931, Roy filed a suit to " recover his dues. The bank was made defendant No. 1 and the Mukherjees defendants Nos. 2 to 6. He prayed for a decree according to Form No. II, Appendix D. of the Code of "Civil Procedure. A preliminary decree in that form was passed on April 29, 1932. A sum of Rs. 1,43,211-14-6 was " found due from the Mukherjees to the bank on the original " mortgage and a sum of Rs. 2 to 6. He prayed for a decree according to Form No. II, Appendix D. of the Code of "Civil Procedure. A preliminary decree in that form was passed on April 29, 1932. A sum of Rs. 1,43,211-14-6 was " found due from the Mukherjees to the bank on the original " mortgage and a sum of Rs. 54,586-5-3 was found due from the " bank to Roy on the latters derivative mortgage, calculated " up to August 29, 1932 (the date of grace). The decree, inter alia, directed that in default of payment by defendants " 2 to 6 and defendant No. 1 within the period of grace, the plaintiff may apply to the court for a final decree for sale and on such application the mortgaged property or a sufficient portion thereof shall be directed to be sold. If the " defendant No. 1 pays into court the amount due to the plaintiff, but the defendants Nos. 2 to 6 make default in payment of the amount due to defendant No. 1. defendant No. 1 shall be at liberty to apply for a final decree for sale. "No payment having been made in terms of the preliminary decree either by defendants 2 to 6 or by defendant No. 1, a final decree for sale of the mortgaged properties was passed " on June 23, 1933, on the application of Roy. They were “sold in execution of the said final decree and were purchased 11 by Roy, on August 12, 1935, for the sum of Rs. 48,400. The “sale was confirmed on August 6, 1936, and possession was “delivered to him on August 19, 1936, Thereafter, on “March 18, 1939, Roy obtained a personal decree jointly " against the bank and the Mukherjees for the sum of " Rs. 28,503-13-0." tx7200 On September 1, 1940, the Act came into force. Section 36 of the Act gave the court wide powers to reopen mortgage transactions and to give certain forms of relief to borrowers. Sub-section 5, however, provided— " (5) Nothing in this section shall affect the rights of any " assignee or holder for value if the court is satisfied that the assignment to him was bona fide, and that he had not " received the notice referred to in cl. Sub-section 5, however, provided— " (5) Nothing in this section shall affect the rights of any " assignee or holder for value if the court is satisfied that the assignment to him was bona fide, and that he had not " received the notice referred to in cl. (a) of sub-s. (i) of " s. 28." Section 28, sub-s. 1, provided— “28.—(1) Where any debt in respect of— Law Rep. 76 Ind. App. 74 ( 1948- 1949) Promode Kumar Roy V. Nikhil Bhusan Mukhopadhya 30 " (i.) a loan advanced by a lender, whether before or " after the commencement of this Act, or " (ii.) interest on any such debt, or " (iii.) the benefit of any agreement made, or security " taken, in respect of any such debt or interest, " is assigned to any person, the assignor (whether he is the " lender by whom the loan was advanced or any person to " whom the debt has been previously assigned) shall, before u the assignment is made— " (a) give to the assignee notice in writing that the debt, " interest thereon, agreement or security is affected by the M operation of this Act, and " (b) where the debt is in respect of a loan advanced by " a money-lender, supply to the assignee in such form as " may be prescribed all information as to the state of the " loan together with copies of documents relating thereto." On December 9, 1940, the present proceedings were instituted in the Court of the Subordinate Judge, District Rungpur, by the mortgagors against the bank and Roy, claiming relief under the Act. In their application they alleged (inter alia) that, inasmuch as the rates of interest payable by them as well as by the bank were in excess of those permitted by the Act, the transactions ought to be reopened. In their application they alleged (inter alia) that, inasmuch as the rates of interest payable by them as well as by the bank were in excess of those permitted by the Act, the transactions ought to be reopened. They therefore prayed —(a) that the transactions concerning the mortgage bonds and the decrees in the mortgage suit should be reopened ; (b) that accounts be taken between them and the opposite parties ; (c) that they might be exonerated from payment of interest in excess of that permitted by s. 30 of the Act ; (d) that they be restored to possession of the lands purchased in the execution sale by Roy; (e) that if, on the taking of accounts, any amount were found due from them to the opposite parties, such amount to be made payable by instalments extending over fifty years ; (f) that if, on the taking of accounts, any sum were found to have been taken in excess by either of the opposite parties, the same, should be refunded. On January 24, 1941, Roy filed a petition of objection to the application, and on March 12, 1941, the bank filed its objections to the application. On June 20, 1941, the Subordinate Judge gave judgment allowing the application, with costs. He appointed a Commissioner to take accounts and ascertain the amounts due from the applicants to the opposite parties respectively, allowing a reduced rate of interest in accordance with s. 30 of the Act and giving credit for payments made. He adjourned consideration of the relief’s to be granted until after the taking of accounts. The Commissioner duly made his report, and on July 10, 1943, the matter came on for final hearing before the Subordinate Judge. On July 21, 1943, he delivered judgment, arriving at the conclusion that the net amount due to Roy, for which a new decree was to be passed, was the sum of Rs. 71,624-14-3. Similarly, he found that the net amount due to the bank was the sum of Rs. 1,72,994-1-6. Accordingly, he made an order declaring those amounts due under the reopened decree, and directing that those amounts be paid by the mortgagors in sixteen equal yearly instalments, such instalments being payable in the first instance to Roy. 71,624-14-3. Similarly, he found that the net amount due to the bank was the sum of Rs. 1,72,994-1-6. Accordingly, he made an order declaring those amounts due under the reopened decree, and directing that those amounts be paid by the mortgagors in sixteen equal yearly instalments, such instalments being payable in the first instance to Roy. He further directed that Roy was to deliver to the mortgagors possession of the mortgaged properties, but that, in default of payment of any instalment, Roy was to be put back into possession of the property. He gave certain consequential directions and granted various ancillary relief’s which were not material to be stated, and directed that all the parties should bear their own costs incurred since the earlier judgment. In compliance with that judgment, possession of the mortgaged property was given to the mortgagors. On September 13, 1943, Roy appealed to the High Court against both the judgments and orders above mentioned. He died intestate on March 16, 1944, and the present appellants were substituted in his place as his personal representatives under an order of the High Court dated April 20, 1944. The mortgagors and the bank filed cross-objections. The appeal was heard by a Divisional Bench (Mitter and Waight JJ.) and the order of the Subordinate Judge was affirmed, with certain variations which need not be stated. From that decision the appellants appealed to their Lordships Board. 1948. Oct. 18, 19, 20. Sir Herbert Cunliffe K.C. and Gavin Simonds for the appellants. The power Law Rep. 76 Ind. App. 74 ( 1948- 1949) Promode Kumar Roy V. Nikhil Bhusan Mukhopadhya 31 given to the courts by the Bengal Money Lenders Act to reopen orders or decrees in certain cases does not apply where the reopening would affect the rights of the appellants as bona fide assignees for value before the Act, or where the property, as in this case, has been sold by order of the court, the sale confirmed by the court, and possession of the mortgaged property delivered to the purchaser. There is no question here but that the assignment was bona fide ; and the reference in sub-s. 5 of s. 36 to the notice required by cl. (a) of sub-s. 1 of s. 28 is obviously to a post-Act and not to a pre-Act assignment, so the appellants could not in this case have received the notice. There is no question here but that the assignment was bona fide ; and the reference in sub-s. 5 of s. 36 to the notice required by cl. (a) of sub-s. 1 of s. 28 is obviously to a post-Act and not to a pre-Act assignment, so the appellants could not in this case have received the notice. It is submitted that the view of the High Court that " a sub-mortgagee cannot " be regarded as an assignee within the meaning of sub-s. 5 " of s. 36 of the Act " is wrong. Srimati Renula Bose v. Rat Manmatha Nath Bose (( 1945) L R. 72 I.A. 156.) was practically the same as the present case. The appellants predecessor could not be deprived of his rights as a bona fide assignee. Sections 28 and 29 clearly refer to post-Act assignments of loans, but assuming that that is wrong, it does not get rid of the protection given to the appellants by sub-s. 5 of s. 36, which only protects a bona fide assignee although it says " nothing in this section," s. 36 is the only section which allows transactions to be reopened. As the final mortgage decree for sale was satisfied by the sale of the mortgage properties before January 1, 1939, that decree cannot be reopened in view of proviso (ii.) to sub-s. 1 of s. 36, which provides that " in the exercise of these " powers the court shall not do anything which affects any " decree of a court, other than a decree in a suit to which this " Act applies which was not fully satisfied by the first day of " January, 1939 . . . . "There are two decisions of the High Court in the appellants favour in regard to the reopening of a decree, where it was held that the property having been sold and possession given the final decree for sale was satisfied and could not be reopened Naresh Chandra Gupta v. Lal Mahmud Bhuiya (I. L. R. [ 1942] 2 C. 243.), which was followed in Bhabani Prosad Maitra v. Satyendra Nath Mukherji (I. L. R. [ 1943] 2 C. 4t7.). A later decision of the Full Bench, however, Mrityunjay Mitra v. Satish Chandra Banerji (I. L. R. [ 1944] 2 C. 376.), overruled those two decisions, and the High Court in the present case contended itself with saying that it was bound by the Full Bench decision. It is submitted that the arguments and reasons in the first two cited cases are better and more acceptable than those in the Full Bench case, and that the latter should be held to be wrong. Further, this was a commercial loan, and since the Act only applies to a loan which is not a commercial loan, it does not apply to this case. Lastly, the appellants are bona fide purchasers for value and are protected by s. 36, sub-s. 2 (b), of the Act. If, however, the submission on sub-s. 5 of s. 36 is right there is an end of the case. S. C. Isaacs for respondents Nos. 1 to 7. Examining the nature of the transaction between the bank and the appellants predecessor there can be no doubt that it was in the nature of a sub-mortgage or derivative mortgage, and it has been so treated by the parties at no time does the original mortgagee drop out of the picture Seton, Forms of Judgments and Orders, 7th ed., vol. 3, p. 2011, note. With regard to s. 36, sub-s. 5, there are two alternative submissions (a) that, following to a great extent the line of reasoning of Mitter J. in the High Court, a sub-mortgagee is not an assignee within the contemplation of the Act of 1940 ; and (b) if a sub-mortgagee is an assignee, then he is not an assignee of the type to which sub-s. 5 of s. 36 applies. “Assignee " as used in the Act contemplates an irrevocable transfer to the transferee of all the rights vested in the original mortgagee so as to eliminate the original mortgagee and vest all those rights irrevocably in the transferee. [Reference was made to s. 37 of the Indian Contract Act, 1872, and to s. 130 of the Transfer of Property Act, 1882.] It is only by giving that meaning to “assignee " that the relevant statutory provisions can be made to work, and it has to be assumed that it is used with the same connotation throughout. [Reference was made to s. 37 of the Indian Contract Act, 1872, and to s. 130 of the Transfer of Property Act, 1882.] It is only by giving that meaning to “assignee " that the relevant statutory provisions can be made to work, and it has to be assumed that it is used with the same connotation throughout. [Counsel indicated a number of anomalies which he submitted must result from giving to “assignee " a definition sufficiently wide to include a sub-mortgagee.] Both as a matter of definition and as a matter of interpretation of the relevant statutory povisions it is clear that “assignee " means, and was only intended to mean, the transferee irrevocably of rights vested in the original mortgagee, and was not intended to include a sub-mortgagee. Alternatively, it is submitted that sub-s. 5 of s. 36 of the Act does Law Rep. 76 Ind. App. 74 ( 1948- 1949) Promode Kumar Roy V. Nikhil Bhusan Mukhopadhya 32 not apply to a pre-Act loan; it is intended to apply to cases of assignment of post-Act loans which are dealt with by s. 29, sub-s. 1. [Reference was made to Srimati Renula Bose v. Rai Manmatha Bose (L. R. 72 I. A. 156.).] For the reasons given in the High Court judgment and also by reason of the provisions of or. 34 of the Code of Civil Procedure, the mortgage decree in question was not fully satisfied on January 1, 1939, within the meaning of proviso (ii) to sub-s. 1 of s. 36. Assuming that the appellants predecessor was an “assignee “within the meaning of sub-s. 5 of s. 36, he was, nevertheless, not entitled by reason of the other provisions of the Act, to the protection of that sub-section. Respondents Nos. 1 to 7 were entitled to relief under the Act. Khambatta K.C. and Colombos for respondent No. 8. The bank is interested on this reopening to secure its interest in the decree given by the High Court. The preliminary, the final and the personal decrees in the mortgage suit are based on one and the same transaction and are therefore indivisible. The preliminary and final decrees had not been fully satisfied by January 1, 1939, and are not therefore attracted by sub-s. 1 (ii) of s. 36 of the Act. The preliminary, the final and the personal decrees in the mortgage suit are based on one and the same transaction and are therefore indivisible. The preliminary and final decrees had not been fully satisfied by January 1, 1939, and are not therefore attracted by sub-s. 1 (ii) of s. 36 of the Act. The appellants predecessor did not acquire the totality of the rights of the principal mortgagee (respondent No. 8) and cannot consequently be regarded as an assignee within the meaning of sub-s. 5 of s. 36. The decrees in the mortgage suit formed part of a suit to which the Act applies, and the High Court was right in holding that they could be reopened under s. 36. In the absence of any proof to that effect, the loan given by the appellants predecessor to the bank cannot be regarded as a commercial loan. 1949. Jan. 20. The judgment of their Lordships was delivered by LORD MORTON OF HENRYTON, who stated the facts set out above and continued Counsel for the appellants put in the forefront of his argument the submission that the appellants predecessor Roy was an " assignee or holder for " value " within s. 36, sub-s. 5, of the Act ; that there had never been any suggestion that the assignment to him was not bona fide ; that he had not received the notice referred to in cl. {a) of s. 28, sub-s. 1, and could not have received any such notice, since he took his assignment long before the Act came into force ; and that, consequently, the court had no power to make any order under s. 36 which would affect his rights. It was obvious that if this submission should be held to be correct, the order appealed from could not stand. Accordingly, their Lordships invited counsel for the respondents to address them on this point, before considering the other arguments put forward on behalf of the appellants. At the conclusion of the argument on this point their Lordships were satisfied that the first submission of counsel for the appellants, already stated, was correct. It was therefore unnecessary to arrive at a conclusion on the other arguments put forward on behalf of the appellants. At the conclusion of the argument on this point their Lordships were satisfied that the first submission of counsel for the appellants, already stated, was correct. It was therefore unnecessary to arrive at a conclusion on the other arguments put forward on behalf of the appellants. In answer to the first submission of counsel for the appellants it was contended for the respondents (a) That Roy, being a sub-mortgagee, was not an " assignee or holder for value " within s. 36, sub-s. 5 ; alternatively, (6) that the sub-section refers only to an assignee of a mortgage decree, and not to an assignee of the mortgage debt ; alternatively, (c) that the sub-section refers only to a case in which the loan was made after the Act came into operation. Counsel for the respondents did not contend that the assignment was not bona fide. Contention (a) found favour with the High Court, but in their Lordships view it cannot be sustained. The sub-mortgage of September 15, 1930, contained an assignment, in the clearest possible terms, of the sum of Rs. 1,20,000 and interest owing under the mortgage of February 10, 1927, and of " the benefit " of all securities for the same and of all powers rights or 11 remedies thereby expressly or impliedly conferred " on the bank. It is true that the bank had the right to redeem, but this fact does not make the assignment any the less an assignment of all the banks rights under the mortgage. Mitter J. observed that an assignee within s. 36, sub-s. 5, " would be " that transferee only who has got by the act of the transferor " all the rights of the latter/1 but, in their Lordships view, Roy exactly answers that description. The bank vested all its rights in Roy, although in a certain event, namely, redemption, these rights would be restored to the bank. Law Rep. 76 Ind. App. 74 ( 1948- 1949) Promode Kumar Roy V. Nikhil Bhusan Mukhopadhya 33 It was suggested, in the judgment of Mitter J. (with which Waight J. agreed), and in the argument for the respondents, that if a sub-mortgagee were an “assignee " within s. 36, sub-s. 5, of the Act, certain difficulties and anomalies would result. Their Lordships cannot agree with this suggestion. Their Lordships cannot agree with this suggestion. They express no view as to the position which arises if the sub-mortgage contains only a charge on the original mortgage debt, but when it contains an assignment of that debt, and of all the rights of the mortgagee, the position appears to be free from difficulty. Relief can be given to the original mortgagor as against the original mortgagee under s. 36, but such relief must not affect the rights of the assignee by way of sub-mortgage. To take an imaginary case by way of illustration, let it be assumed that the amount due on the original mortgage, for principal and interest at the original rate, is Rs. 1,000, and the sum due on the sub-mortgage by assignment, for principal and interest at the original rate, is Rs. 500. Let it further be assumed that if relief could be given, and were given, under s. 36, as against both mortgagee and sub-mortgagee, the sums due to them respectively would be Rs. 800 and Rs. 400. By reason of sub-s. 5, the sub-mortgagees rights cannot be affected. He can therefore, as assignee of the mortgage debt, claim his full Rs. 500, as against both mortgagor and original mortgagee. But if the court gives the mortgagor relief as against the original mortgagee, the mortgagor will only be liable to pay to the original mortgagee Rs. 300, the balance of the reduced debt after paying the sub-mortgagee in full. As to contention (b), it is impossible to read sub-s. 5 of s. 36 as referring only to an assignee of a mortgage decree. The words " and that he had not received the notice referred to in " cl. (a) of sub-s. 1 of s. 28 " make it plain that an assignee of a mortgage debt is within the sub-section, since s. 28, sub-s. 1, is concerned only with assignment of debts. Contention (c) cannot succeed in view of the decision of the Board in Renula Bose, Srimati v. Rai Manmatha Nath Bose and others (( 1945) L. R. 72 I. A. 156.). If the word " assignee " in s. 36, sub-s. 5, is to be given its ordinary meaning, it must apply to the appellants predecessor Roy, in view of the clear and comprehensive assignment contained in his sub-mortgage. If the word " assignee " in s. 36, sub-s. 5, is to be given its ordinary meaning, it must apply to the appellants predecessor Roy, in view of the clear and comprehensive assignment contained in his sub-mortgage. Their Lordships see no good reason for giving any special or limited meaning to this word. This being so, Roys successors, the appellants, are protected by sub-s. 5, and the judgment appealed from cannot stand, as it gravely affects their rights, both as to possession of the mortgaged estate and as to their right to recover in full the principal and interest owing under their sub-mortgage. For these reasons, their Lordships are of opinion that the respondents 1 to 7, having regard to the provisions of s. 36, sub-s. 5, of the Bengal Money Lenders Act, 1940, were not entitled to apply for the reopening of the decrees in the mortgage suit No. 310 of 1931 as against the present appellants or their predecessors. They will humbly advise His Majesty that this appeal should be allowed and that an order should be made to the following effect— (1.) Possession of the mortgaged properties sold to Roy on August 12, 1935, to be restored to the appellants forthwith. (2.) Discharge the order and decree of the Sub- ordinate Judge of June 20, 1941, and July 21, 1943, as far as they purport to reopen the decrees in the mortgage suit No. 310 of 1931 as against the present appellants or their predecessors and to alter the amount then due to them. (3.) Order respondents 1 to 7 to repay to the appellants such sums as the appellants may have paid to them or for them under the orders of July 21, 1943 and August 28, 1945. (4.) Order respondents 1 to 7 to pay to the appellants mesne profits received by or on behalf of such respondents from the date of their taking possession of the mortgaged properties under the orders and decrees of the Subordinate Judge until re-delivery of possession of such properties pursuant to this order. (5.) The appellants are to be at liberty to apply to the Subordinate Judge under s. 144 of the Code of Civil Procedure, 1908. (5.) The appellants are to be at liberty to apply to the Subordinate Judge under s. 144 of the Code of Civil Procedure, 1908. (6.) Any sums paid by respondents 1 to 7 as annual instalments under the order of the Subordinate Judge dated July 21, 1943, or on land revenue under the order of the High Law Rep. 76 Ind. App. 74 ( 1948- 1949) Promode Kumar Roy V. Nikhil Bhusan Mukhopadhya 34 Court of June 15, 1945, may be set off pro tanto against amounts payable by the respondents to the appellants under cls. (3.) and (4.) of this order or in respect of costs. The respondents must pay the appellants costs of this appeal and respondents 1 to 7 must pay the appellants costs of the proceedings in the Court of the Subordinate Judge.