Judgment :- 1. Defendants 1, 2, 4, 7,8 and 9 are the appellants. The suit is for damages. The plaintiff is the karnavan of one of the thavazhies of the Koratty Swaroopam. The Swaroopam was partitioned under an award decree in C.S. No. 172 of 1101 on the file of the Anjikaimal District Court. Plaintiff's thavazhi is A4 thavazhi in that partition. Defendants 1 to 9 belong to B2 thavazhi. In the partition, a property known as 'Pulani Krishi' belonging to the Swaroopam was set apart to the share of B2 thavazhi with liability to discharge certain debts charged on it. One of the debts was due to Elayathampuran Kovilakom. That debt was not discharged by B2 thavazhi and the Kovilakom sued the Swaroopom in O.S. No. 34 of 1106 of the Anjikaimal District Court. Properties belonging to the other thavazhies of the Swaroopom including A4 thavazhi were also attached by the Kovilakom. The decree that was obtained in the case was assigned to Dr. Girijavallabha Menon and in execution of the decree he attached some more properties belonging to the Swaroopom. Since B2 thavazhi was unable to discharge its liabilities the thavazhi appointed the 19th defendant in the case, Paliath Kochunni Achen, as its trustee for administering its properties and discharging the liabilities. For paying off the decree debt in O.S. No. 34 of 1106 and discharging other liabilities of B2 thavazhi the 19th defendant assigned plaint items 1 to 18 in favour of the plaintiff's thavazhi under Ext. XVII dated 15.4.1112. The consideration for the assignment deed was Rs. 4,105-13-4. Out of this Rs. 3,409-8-7 was reserved with the plaintiff's thavazhi for payment towards the decree debt in O.S. No.34 of 1106. Another sum of Rs. 210-7-5 was reserved for discharging another debt of B2 thavazhi. The plaintiff's thavazhi paid the sum of Rs. 210-7-5 in Dhanu 1112 and the other sum of Rs. 3,409-8-7 on 11.12.1115. The reason for the delay in making the payment of Rs. 3,409-8-7 was that there were two undisclosed encumbrances on some of the properties included in the assignment deed, Ext. XVII. The 10th defendant had obtained a decree against B2 thavazhi in O.S. No. 308 of 1111 of the Irinjalakuda Munsiff's Court and, in execution of that decree, had attached plaint items 1 to 3.
3,409-8-7 was that there were two undisclosed encumbrances on some of the properties included in the assignment deed, Ext. XVII. The 10th defendant had obtained a decree against B2 thavazhi in O.S. No. 308 of 1111 of the Irinjalakuda Munsiff's Court and, in execution of that decree, had attached plaint items 1 to 3. Plaintiff's attempt to avert the sale of those items did not succeed and the Original Suit instituted by him for setting aside the sale did not also meet with success. The 10th defendant obtained delivery of possession of the properties on 27.8.1113. The 11th defendant had sued B2 thavazhi in O.S. No. 1011 of 1111 of the hinjalakuda Munsiff's Court and obtained a decree charged on items 4,11 and 12. In execution of that decree items Nos. 4,11 and 12 were purchased by him and he obtained delivery of possession of those items in Kanni 1116. It was alleged in the plaint that the plaintiff's thavazhi sustained a loss of Rs. 2,105-13-4, Rs. 1,655-5-4 on account of the sale of items 1 to 3 and Rs. 450-8-0 on account of the sale of items 4,11 and 12. Interest was claimed on these amounts at 6 per cent per annum from the dates on which the properties were lost to the thavazhi. In the award partition decree there is an indemnity clause to the effect that if, on account of the default of any thavazhi to discharge the debts allotted to its share, any other thavazhi is put to any loss the thavazhi that sustains loss will be entitled to recoup the same from the properties allotted to the share of the defaulting thavazhi. Accordingly, the amount of damages was claimed as a charge on the plaint schedule properties which were set apart to the share of B2 thavazhi under the award partition. 2. Defendants 4, 7, 8, 9, 10, 11, 12, 14 to 18, 20, 21, 30 to 38 and 40 contested the suit. Defendants 4, 7, 8 and 9, who are members of B2 thavazhi, contended that the plaintiff's thavazhi was not entitled to claim any damages against B2 thavazhi, that their remedy, if any, was against the 19th defendant, the executant of Ext. XVII that they were not entitled to claim any charge on the properties belonging to B2 thavazhi, that the plaintiff's thavazhi did not pay in time the sum of Rs.
XVII that they were not entitled to claim any charge on the properties belonging to B2 thavazhi, that the plaintiff's thavazhi did not pay in time the sum of Rs. 3,409-8-7 reserved in the sale deed (Ext. XVII) for payment towards the decree debt in O.S. No. 34 of 1106, that on account of this delay B2 thavazhi sustained losses, that in any case B2 thavazhi was entitled to have the amount claimed in the plaint as damage set off against damages due to them on account of the failure of the plaintiff's thavazhi to pay in time the said sum of Rs. 3,409-8-7, that the amount claimed as damages in the plaint was excessive, and that in any event B2 thavazhi was entitled to a prior charge in respect of survey Nos. 1469 and 1470/1 in plaint items 30 and 31. The 10th defendant contended that the plaintiff was not entitled to claim any charge in respect of the properties purchased by him in court auction. The 11th defendant also contended that the properties purchased by him were in no way liable for the plaint claim. The contentions of the other defendants are not relevant for the purpose of this appeal. 3. Other thavazhies of the Swaroopam also instituted suits against B2 thavazhi for damages on the basis of the indemnity clause in the award partition. They were O.S. Nos. 154,155 and 157 of 1119. This suit, which was numbered as O.S. No. 143 of 1118, was tried along with those suits. All these suits were subsequently transferred to the Trichur District Court and this suit was re-numbered as OS. No. 3 of 1122 of that court. That court dismissed the suit on the ground that the remedy of the plaintiff, if any, was against the 19th defendant and B2 thavazhi under the sale deed, Ext. XVII, and not under the award partition decree, Ext. VII, and that the suit instituted on the basis of the indemnity clause in Ext. VII was not maintainable. It was also observed in the judgment that the plaintiff had agreed with the 19th defendant to discharge the debt due to the 10th defendant and that the plaintiff could at best claim only damage for the loss of items 4,11 and 12 purchased by the 11th defendant. But, since the suit was not based on Ext.
It was also observed in the judgment that the plaintiff had agreed with the 19th defendant to discharge the debt due to the 10th defendant and that the plaintiff could at best claim only damage for the loss of items 4,11 and 12 purchased by the 11th defendant. But, since the suit was not based on Ext. XVII, the plaintiff was not given any relief and the suit was dismissed with costs. 4. The plaintiff appealed from this decision before the Cochin High Court. That Court set aside the decree of the District Court and remanded the case to the Anjikaimal District Court for fresh disposal after allowing the plaintiff to amend the plaint. After remand, the suit was re-numbered in its original number viz. O.S. No. 143 of 1118. The plaint was amended and relief was claimed on the basis of the sale deed, Ext. XVII. The amount was claimed from defendants 1 to 9 and their thavazhi properties. Defendants 4 and 7 to 9 filed additional written statement in which it was contended that the plaintiff's thavazhi was aware of the decrees in favour of defendants 10 and 11 at the time of the sale deed, Ext. XVII, that the plaintiff had agreed to pay off those decree debts, and that, therefore, the plaintiff was not entitled to claim any damages from B2 thavazhi. They also claimed from the plaintiff's thavazhi Rs. 2,700 as damages and paid court fee for that amount. 5. The two main questions that had to be decided in the case were: (1) Whether the plaintiff's thavazhi was entitled to claim any damage from B2 thavazhi on account of the loss of plaint items 1 to 4 and 11 and 12; and (2) Whether B2 thavazhi was entitled to get from the plaintiff's thavazhi the amount claimed as damages in the counter claim on account of the default of the plaintiff's thavazhi to pay in time the amount reserved in the sale deed, Ext. XVII, for payment towards the decree debt in O.S. No. 34 of 1106. On the first question the court below found that the plaintiff's thavazhi was entitled to get from B2 thavazhi the amount claimed in the plaint as damages. On the second question also the finding of the lower court was in favour of the plaintiff.
XVII, for payment towards the decree debt in O.S. No. 34 of 1106. On the first question the court below found that the plaintiff's thavazhi was entitled to get from B2 thavazhi the amount claimed in the plaint as damages. On the second question also the finding of the lower court was in favour of the plaintiff. It was held that since there were undisclosed encumbrances on some of the properties included in the sale deed the plaintiff's thavazhi was not bound to pay the reserved amount and that, therefore, B2 thavazhi was not entitled to claim any damages on account of the failure of the plaintiff's thavazhi to pay the reserved amount in time. The counter claim was, therefore, disallowed and the suit was decreed with costs as prayed for in the amended plaint against defendants 1 to 5 personally and the assets of B2 thavazhi. 6. In this appeal, learned counsel for the appellants, urged before us the following points: (1) The plaintiff was aware of the attachment of plaint items 1 to 3 by the 10th defendant for the decree debt in O.S. No. 308 of 1111 at the time of the execution of the sale deed (Ext. XVII) and the plaintiff had undertaken to discharge that debt. The plaintiff is, therefore, not entitled to claim any damages on account of the sale of items 1 to 3 for that decree debt; (2) The suit is barred by limitation as regards the claim for damages in respect of items 1 to 3, having been brought more than six years after the date of the sale deed (Ext. XVII) and more than three years after delivery of those items; (3) The court below ought to have allowed the counter claim of B2 thavazhi for damages on account of failure of the plaintiff's thavazhi to pay in time the amount reserved in the sale deed for payment towards the decree-debt in O.S. No. 34 of 1106 and ought to have set off such damages against the plaint claim; (4) The court below went wrong in giving a personal decree against defendants 1 to 5. 7. So far as the first ground is concerned, it was agreed that the evidence of the 19th defendant, Paliath Kochunni Achan, who was examined as Dw.
7. So far as the first ground is concerned, it was agreed that the evidence of the 19th defendant, Paliath Kochunni Achan, who was examined as Dw. 3 in the case, goes to show that the plaintiff was aware of the decree in O.S. No. 308 of 1111 at the time of the execution of the sale deed, Ext. XVII, and that the plaintiff had undertaken to pay off that debt; and it was contended that there is no reason why that witness should not be believed. This is what Dw. 3 says in chief examination: only in the additional written statement filed on 15.6.1124, after the plaint was amended, that it was contended that the plaintiff was aware of the decree and attachment in O.S. No. 308 of 1111 and that the plaintiff had undertaken to discharge the debt. It has also to be noted that other debts charged on the properties were mentioned in Ext. XVII and the vebdee was directed to discharge those debts. Further, it is admitted that the debt in favour of the 11th defendant for which he had obtained a decree was not disclosed to the plaintiff at the time of the execution of Ext. XVII. There is, therefore, every reason to believe that the debt in favour of the 10th defendant also was not disclosed to the plaintiff at that time. In the circumstances, it is difficult to act on the evidence of Dw. 3 when he says that the plaintiff was told about this debt at the time of the execution of the sale deed and that the plaintiff undertook to pay it off. If that was the case, there is no reason why it was not so stated in the sale deed. We have, therefore, no hesitation in upholding the finding of the court below that the plaintiff was not aware of the decree and attachment in O.S. No. 308 of 1111 at the time of the execution of the sale deed Ext. XVII, and that he had not undertaken to discharge that debt. 8. As for the quantum of damages, the finding of the court below was not impeached by learned counsel for the appellants. The amount of damages was arrived at on the basis of the value of plaint items 1 to 4 and 11 and 12 which were lost to the plaintiff's thavazhi. They were valued at Rs.
8. As for the quantum of damages, the finding of the court below was not impeached by learned counsel for the appellants. The amount of damages was arrived at on the basis of the value of plaint items 1 to 4 and 11 and 12 which were lost to the plaintiff's thavazhi. They were valued at Rs. 2,105-13-4. Interest was claimed on that amount from the dates on which the properties were taken delivery of. The total amount claimed in the plaint is Rs, 2,696-3-4. 9. The next question for consideration is whether the claim for damages as regards plaint items 1 to 3 is barred by limitation. According to learned counsel for the appellants, the Article of the Indian Limitation Act that applies to the case is either Art.116 or Art.83. Art.116 relates to suits for compensation for the breach of a contract in writing registered. The period of limitation is six years from the time "when the period of limitation would begin to run against in a suit brought on a similar contract not registered". Art.115 applies to suits for compensation for the breach of any contract express or implied not in writing registered. The period is three years from the time when the contract is broken or (where there are successive breaches) when the breach in respect of which the suit is instituted occurs or (where the breach is continuing) when it ceases. Under Art.116 read with Art.115 the period of six years should start when the contract is broken. According to learned counsel for the appellants the contract of indemnity in this case should be deemed to have been broken on the date of the sale deed itself and, therefore, the suit ought to have been filed within six years from that date. Art.83 relates to suits upon any contract of indemnity not otherwise provided for in the Limitation Act. The period under that Article is three years from the time when the plaintiff is actually damnified. If that Article applies the period will have to be calculated from the date when the properties were lost to the plaintiff's thavazhi. It was contended for the appellants that in either case the suit will be barred by limitation.
The period under that Article is three years from the time when the plaintiff is actually damnified. If that Article applies the period will have to be calculated from the date when the properties were lost to the plaintiff's thavazhi. It was contended for the appellants that in either case the suit will be barred by limitation. According to learned counsel for the respondent, in the case of registered contracts of indemnity Art.83 will have to be read with Art.116 and the period of limitation will be six years from the time when the plaintiff is actually damnified. 10. Learned counsel for the appellants relied on the decision of the Cochin High Court in Ambat Bank Limited v. Subbayyan Chettiar (10 Cochin 373) in which case Ananthakrishna Ayyar, C.J., quoted with approval the following observation in Gabriel v. Raman Menon (20 Cochin 414): "In cases of this kind the plaintiff may either bring an action before an injury is done or damage takes place, or he may bring an action to be indemnified after he is actually damnified. In the former case, the cause of action begins on the date of the contract or on the date, if any, fixed for its performance and in the latter, only when the plaintiff is damnified. Art.106 (Cochin) corresponding to Art.116 of the Indian Limitation Act applies to suits of the first class when the contract is in writing registered. Art.73 (Cochin) (Art. 83 of the Indian Act) applies to suits of the second class. For latter Article to apply the contract the indemnify may be either express or implied". The question whether in a case in which the contract is in writing registered, Art.73 of the Cochin Limitation Act (Art. 83 of the Indian Act) should be read with Art.106 of the Cochin Act (116 of the Indian Act) and whether the period of limitation is six years from the date when the plaintiff is actually damnified was not discussed in 20 Cochin 414. In the circumstances, neither that case nor 40 Cochin 373 can be regarded as an authority for the position contended for by learned counsel for the appellants. 11.
In the circumstances, neither that case nor 40 Cochin 373 can be regarded as an authority for the position contended for by learned counsel for the appellants. 11. It was also argued for the appellants that Art.116 of the Limitation Act will apply only to cases of express contract and not to cases of implied contract and that in this case there is no express contract of indemnity in the sale deed, Ext. XVII. It is true that there is no express contract of indemnity in Ext. XVII. The contract is implied by virtue of the provision in S.55(1)(g) of the Transfer of Property Act, which says that, in the absence of a contract to the contrary, the seller of immovable property is bound to discharge all encumbrances on the property existing on the date of the sale deed except where the property is sold subject to encumbrances. In this case the property was not sold subject to encumbrances and, therefore, the seller must be deemed to have made a contract of indemnity if it turns out that there were encumbrances on the property on the date of the sale deed. The question then is whether the term 'contract' used in Art.116 would include an implied contract of this nature. We are of opinion that the term would include an implied contract also. It was so held in a good number of cases. Reference may be made to Krishnan Nambiar v. Kannan (21 Madras 8), Arunachala v. Ramaswamy (1915 Madras 742), Sigamany v. Munibadra (1926 Madras 255), Chithambaram Pillai v. Sivathaswamy Thevar (15 M.L.J. 396), Hanwant Rai v. Chandi Prasad (51 All. 651), Bageswar Tewari v. Bikramjit Singh (1930 All. 785), Md. Siddiq v. Md. Nuh (1930 All. 771) and Chacko v. Sankaran (39 T.L.R. 118). In Ganappa v. Hammad (1925 Bom. 440) it was held by the Bombay High Court that the words 'express or implied' occurring in Art.115 should be read into Art.116 also. 12.
651), Bageswar Tewari v. Bikramjit Singh (1930 All. 785), Md. Siddiq v. Md. Nuh (1930 All. 771) and Chacko v. Sankaran (39 T.L.R. 118). In Ganappa v. Hammad (1925 Bom. 440) it was held by the Bombay High Court that the words 'express or implied' occurring in Art.115 should be read into Art.116 also. 12. The real question for decision in this appeal so far as the plea of limitation is concerned is whether in a case in which there is a breach of contract of indemnity, express or implied, in writing registered, Art.83 of the Limitation Act should be read with Art.116, or in other words, whether the plaintiff will have a period of six years from the date when he is actually damnified or only three years from that date. We are of opinion, that, in such a case, Art.83 should be read with Art.116 and that the period of limitation will be six years from the date when the plaintiff is damnified. It was so held in the following cases: Abdul Aziz Khan v. Muhammad Bakhsh (1921 Lah. 260), Kartar Singh v. Sant Singh (1940 Lah. 321), Mt. Lakhpat Kuer v. Durga Prasad (1929 Pat. 388), Mehdatum Nissa Begum v. Mt. Ralimatun Nissa Begum (1939 Pat. 194). Sreenivasa Raghava v. Rangaswamy (31 Mad. 452) and Valivakath Periyattal v. Govinda Menon (1935 Mad. 655). In 1921 Lah. 260, the facts of which were similar to those of the present case, Broadway, J., observed: "In our opinion a suit for compensation for the breach of a contract to indemnify falls within the purview of Art.83 of the Limitation Act and when such a contract is in writing registered Art.116 becomes applicable and by virtue of it the period is extended to six years". The question was considered by the Travancore High Court in 39 T.L.R. already referred to. Referring to an earlier decision of that Court in Subramania Ayyar v. Chidambara Ayyar (5 T.L.R. 118) the learned judges observed thus: "In stating, however, that the Article applicable was Art.68 of the Limitation Regulation (Art. 83 of the Indian Limitation Act) the learned judges seem to have forgotten that when the contract is registered the limitation would be enlarged to six years as in such a case Art.68 should be read with Art.96 (Art. 116 of the Indian Act)".
To the same effect are the decisions in Narayanan v. Ouseph (42 T.L.R. 285) and Kesavan Velayudhan v. Ramankutty (1 T.L.J.12). We, therefore, hold that the suit, which has brought within six years from the date on which plaint items 1 to 3 were lost to the plaintiff's thavazhi, is not barred by limitation. 13. The further question for decision is the one relating to the counter claim of B2 thavazhi. It is contended by them that the plaintiff paid the sum of Rs. 3,409-8-7 reserved in Ext. XVII only on 11.12.1115 and that on account of the delay in making the payment they were put to loss by way of interest on the decree amount and execution costs. A sum of Rs. 2,700 was claimed as damages on this account. It is not clear from the written statement on what basis the amount was fixed at Rs. 2,700. At the time of argument of the appeal learned counsel for the appellants limited the claim to interest on Rs. 3,409-8-7 from 15.4.1112, the date of Ext. XVII, to 11.12.1115, the date of payment of the amount, at 9 per cent per annum which is the rate of interest provided in the decree in O.S. No. 34 of 1106 and to execution costs which amounted to Rs. 1,441-9-6 on 27.1.1116 as seen from Ext. CXLVO). The plaintiff denied his liability to pay any amount as damages to B2 thavazhi. It was contended that the amount reserved in the sale deed was not paid in time on account of the fact that there were undisclosed encumbrances on the properties covered by the sale deed and that it was because he was forced to pay it for averting the court sale of some of the properties included in the sale deed which were attached for the decree-debt that he paid it on 11.12.1115. The undisclosed encumbrances amounted to only Rs. 1,660. There was, therefore, no justification on the part of the plaintiff in with-holding payment of the whole amount of Rs. 3,409-8-7.
The undisclosed encumbrances amounted to only Rs. 1,660. There was, therefore, no justification on the part of the plaintiff in with-holding payment of the whole amount of Rs. 3,409-8-7. S.55, sub-s. 5(b), of the Transfer of Property Act provides that the buyer is bound to pay or tender at the time and place of completing the sale, the purchase money to the seller or such person as he directs provided that, where the property is sold free from encumbrance the buyer may retain, out of the purchase money, the amount of any encumbrances on the property existing on the date of the sale, and shall pay the amount so retained to the persons entitled thereto. The plaintiff was, therefore, entitled to retain only the amount covered by encumbrances and he was also bound to pay the same to the persons entitled to it. The plaintiff did not pay any portion of the amount reserved in the sale deed for satisfying the claims of defendants 10 and 11. His explanation for not paying the amounts covered by the encumbrances from out of the sum reserved in the sale deed is that some of the properties included in the sale deed were attached for the decree debt in O.S. No. 34 of 1106 and that it became necessary to pay the whole amount reserved in the sale deed for averting the sale of those properties. Whatever that may be, so long as the plaintiff utilised the amount reserved in the sale deed for his own benefit for the period between 15.4.1112 and 11.12.1115 it is only proper that he should be made liable to pay to B2 thavazhi interest on that amount for that period. According to the appellants they are entitled to get interest at 9 per cent per annum at which rate they had to pay interest for the decree amount in O.S. No. 34 of 1106. But, in view of the fact that the plaintiff is not wholly at fault in not making the payment in time, we think that six per cent per annum will be a reasonable rate of interest. Interest calculated at that rate will come to Rs. 750. 14. The other claim relates to execution costs. Ext. CXLV shows that the execution costs came to only Rs. 188-15-0 on 30-12-1111. Ext. CXLV(j) shows that by 27.1.1116 the execution costs swelled up to Rs. 1,441-9-6.
Interest calculated at that rate will come to Rs. 750. 14. The other claim relates to execution costs. Ext. CXLV shows that the execution costs came to only Rs. 188-15-0 on 30-12-1111. Ext. CXLV(j) shows that by 27.1.1116 the execution costs swelled up to Rs. 1,441-9-6. It will thus been seen that the costs incurred after the date of Ext. XVII came to about Rs. 1,252. It cannot be said that the plaintiff was solely responsible for the execution costs incurred after the date of Ext. XVII. The amount reserved in Ext. XVII was not sufficient to discharge the whole decree debt. Therefore, even if the palintiff paid Rs. 3,409-8-7 soon after the date of Ext. XVII the decree would not have been satisfied. In the circumstances, we think it proper to make the plaintiff liable only for one-half of the execution costs incurred after the date of Ext. XVII. That will come to Rs. 626. Thus, the total amount that can be awarded as damages to the appellants is Rs. 1,376. This amount has to be set off against the plaint claim. The balance amount due to the plaintiff will be Rs. 1,320-3-4. The plaintiff is given a decree for this amount against B2 thavazhi represented by defendants 1 to 9. Future interest on this amount at six per cent per annum is also allowed. Plaintiff is not entitled to a charge on the plaint schedule properties. 15. A personal decree was given by the court below against defendants 1 to 5. We do not think that defendants 15 can be made personally liable for the plaint claim. Plaintiff is allowed to realise the amount decreed from the properties belonging to the thavazhi of defendants 1 to 9. 16. The decree of the court below is modified to the above extent. The parties will pay and receive proportionate costs both here and in the court below. The appeal is allowed to the extent mentioned above and dismissed in other the respects.