Sumitra Devi v. Sri Nandan Prasad Singh Chaudhary — 1981 DIGILAW 86 (PAT)

Judgment S.ALI AHMAD, J. 1. This second appeal by the defendants arises out of a suit filed by the plaintiff-respondents seeking preliminary decree for foreclosure and for declaration that the appellants were debarred from all rights to redeem the property in suit, which was the subject matter of the deed of mortgage by conditional sale. The trial court decreed the suit ex parte by its judgement dated 23rd Sept., 1966, giving three months time to the appellants to deposit the entire decretal dues. It was also stated therein that in case the amount as indicated above was not paid within three months, then the plaintiff-respondents shall be at liberty to get the defendants foreclosed and debarred from all rights to redeem the Baiulwafa deed and obtain final decree therefor. A preliminary decree in terms of the judgement was drawn which was sealed and signed on 6th Oct., 1966. Since the defendant-appellants did not deposit the decretal amount within three months, a petition for preparation of final decree was filed on 28-4-1967. Thereafter, the appellants on 9-8-1967 filed an application, inter alia, stating for fixing instalments to enable them to pay the decreal amount. Curiously no order was passed on this application which remained pending until 25th Sept., 1972, when the appellants deposited the entire decretal amount in court. The respondents objected to this deposit and contended that since thedeposit was made beyond the period of three months as directed by the judgement and decree dated 23-9-1966, the same could not be said to be valid. They accordingly prayed that a final decree for foreclosure should be passed. The appellants, on the other hand, contended that the period of three months as given by the decree dated 23-9-1966 could be extended under O.34, R.3 of the Code of Civil Procedure at any time before the final decree was drawn. They, therefore, prayed that a decree asking the plaintiff-respondents to hand over the Baiulwafa deed and possession of the property in question to them be passed, the trial court, after hearing the parties, held that the court could extend the period of three months under O.34, R.3 of the Civil P.C. It accordingly passed a final decree directing the respondents to deliver the mortgage deed and other documents relating to the suit property, if any, to the appellants. It also directed the respondents to put the appellants in possession of the mortgaged property within one month, from the date of the order, failing which possession should be delivered to the appellants at the cost of the respondents through the process of court. Aggrieved by the decree passed in favour of the appellants, the respondents carried the matter in appeal to the District Judge, Patna. The appeal came up for hearing before the Additional Subordinate Judge, 3rd Court, Patna, in whose opinion, the trial court erred both in law and on fact in extending the period under O.34, R.3 of the Civil P.C. for deposit of the decretal amount. The learned Subordinate, Judge was also of the view that the deposits made were only those indicated in the judgement and decree dated 6-10-1966 and did not include subsequent costs, charges, expenses and interest. He accordingly held that the appellants have no right to redeem the mortgaged property. The appeal was, therefore, allowed and a direction for preparation of final decree for foreclosure was made. The defendants have now come to this Court in second appeal. 2. Mr. Rama Kant Verma, learned counsel for the appellants in support of the appeal urged that the view taken by the, court of appeal below was erroneous. He contended that under the preliminary decree the appellants were given three months time to pay the decretal amount. According to him, this did not mean that time to deposit the decretal amount could not be extended under R.3 (of) O.34 of the Civil P.C. in case final decree for foreclosure was not passed. According to learned counsel, the mention of three months in the decree only meant that before the expiry of this period, the plaintiffs were not entitled to make an application for preparation of final decree but that did not mean that deposit under R.3 of O.34 of the Civil P.C. could not be accepted. Mr. Guneshwar Prasad, learned counsel for the plaintiff-respondents, on, the other hand, contended that after the expiry of the time mentioned in the preliminary decree, courts have no jurisdiction to extend the time under R.3 of O.34 of the Civil P.C. According to him, extension of time, if at all, could be given under O.34, sub-rule (2) of R.2 of the Civil P.C., which in this case, was not done. He, therefore, urged that the court of appeal below was right in refusing a decree for redemption in favour of the appellants. The only course available to the court below, according to learned counsel for the respondents, was to direct preparation of final decree for foreclosure. 3. Before I proceed to examine the respective contentions advanced on behalf of the parties it will be useful to refer in brief to the changes and amendments made from time to time with respect to suits for foreclosure. Originally such suits were controlled by S.86 of the Transfer of Property Act, 1882. According to that section, the court in case of plaintiffs success had to pass a decree directing that an account be taken of what shall be due to the plaintiff for principal and interest on the mortgage and for his cost of the suit, if any awarded to him on the day fixed by it or declaring the amount so due at the date of the decree. It also provided that the court had to give an opportunity to the defendant to pay the amount so found due on a day within six months fixed by it. In case the amount so fixed was paid then, according to the decree, the plaintiff had to deliver to the defendant all documents in his possession and transfer the property to the defendant free from all encumbrances created by the plaintiff or any person under him and had also to put the defendant in possession of the property if necessary but according to the aforesaid section the decree had to provide that in case payment was not made on or before the day which was fixed by the court then the defendant was to be absolutely debarred of all rights to redeem the property. It is significant to note that under S.86 of the T.P. Act, there was no discretion in the court to allow the defendant more than six months time to pay to the plaintiff the amount found due. The defendant also could not move the court for extending the period to make payment once fixed by the court Ss.85 to 90 of the T.P. Act relating to suits for foreclosure, sale or redemption were, however, repealed (by the Code of Civil Procedure, 1908 (Act 5 of 1908), S.156 and Sch. The defendant also could not move the court for extending the period to make payment once fixed by the court Ss.85 to 90 of the T.P. Act relating to suits for foreclosure, sale or redemption were, however, repealed (by the Code of Civil Procedure, 1908 (Act 5 of 1908), S.156 and Sch. V) and the law relating to suits for foreclosure was mentioned in O.34, Rr.2 and 3 of the Civil P.C. Rule 2 of O.34 of the Civil P.C. provided that in case the plaintiff succeeded then the court had to pass a preliminary decree ordering an account to be taken of what would be due to the plaintiff for principal and interest on the mortgage and for his cost and directing the defendant to pay into court the amount so due on a day within six months from the date of declaring in court the amount so due. In case such payment was made then the plaintiff according to the decree that had to be passed under the rule, had to deliver to the defendant all documents in his possession or power relating to the mortgaged property and also if so required had to retransfer the property to the defendant free from the mortgage and from all encumbrances created by him or any person claiming under him. But in case payment as stated earlier was not made on or before the date so fixed by the court then the defendant was debarred from all rights to redeem the property. Then R.3 of O.34 of the Civil P.C. provided that in case the defendant made deposit as directed in the preliminary decree then the court will pass a final decree for redemption directing the plaintiff to hand over all documents relating to the mortgaged property to the defendant and also retransfer the mortgaged property to the defendant at his own costs free from all encumbrances created by him. According to sub-rule (2) of Rule 3, however, in case payment as directed by the preliminary decree was not made within the time allowed then a final decree debarring the defendant from all rights to redeem the mortgaged property had to be passed. But according to the proviso to this sub-rule, the court was given a discretion to postpone the date fixed for such payment from time to time upon good cause being shown. But according to the proviso to this sub-rule, the court was given a discretion to postpone the date fixed for such payment from time to time upon good cause being shown. That means a provision was introduced in the year 1908 empowering the court to extend the time to make deposit beyond six months on sufficient cause being shown. Rules 2 and 3 of Order 34 of the Civil P.C. were again amended in the year 1929. The appeal has to be decided according to the rules that exist after this amendment. It is, therefore, necessary to keep in mind the provision of Order 34, Rules 2 and 3 of the Civil P.C. as they exist today. Sub-rule (1) of Rule 2 provides for passing of a preliminary decree in a suit for foreclosure. It, inter alia, says that after determining the amount payable under the mortgage, the court should fix a period not exceeding six months within which time the defendant should make payment of the amount together with sub- sequent interest. It further provides that in case such payment is made then the plaintiff should deliver all documents in his possession relating to the mortgaged property and should also retransfer the property to the defendant at his cost free from the mortgage. In case, however, the payment as aforesaid is not made then the plaintiff mortgagee becomes entitled to apply for a final decree debarring the defendant from all rights to redeem property. Sub-rule (2) of this rule then provides that on good cause being shown and upon terms to be fixed, the court may from time to time at any time before passing of a final decree extend the period fixed for payment of the amount under sub-rule (1). Rule 3 provides for preparation of final decree. According to sub-rule (1) of this rule, if the defendant makes payment into the court of all amount due from him under sub-rule (1) of Rule 2 before a final decree debarring the defendant from all rights to redeem the mortgaged property is passed then an obligation is cast upon the court to pass a final decree directing the plaintiff to deliver up the document referred to in the preliminary decree and, if necessary, ordering him to retransfer at the cost of the defendant the mortgaged property and also ordering him to put the defendant in possession of the property. Sub-rule (2) provides that if payment in accordance with sub-rule (1) is not made then on an application made by the plaintiff, the court shall pass a final decree debarring the defendant from all rights to redeem the mortgaged property. If necessary, the court shall also order the defendant to put the plaintiff in possession of the property. 4. I have referred to Section 86 of the T.P. Act which was repealed in the year 1908 and also to Rules 2 and 3 of Order 34 of the Civil P.C. which were amended in the year 1929 only to demonstrate that the Legislature with the changing social conditions gave more facilities to the mortgagor to redeem his mortgaged property. Prior to 1908, as I have mentioned above, the court had no jurisdiction to grant more than six months time to the defendant to pay the mortgage-debt. Then in the year 1908, Section 86 of the T.P. Act was repealed and Rules 2 and 3 of O.34 of the Civil P.C. took its place. Under Rule 2 of Order 34 of the Code, the court while passing a preliminary decree was empowered to allow time up to six months to the defendant to pay the mortgage-debt and to get a final decree for redemption. According to sub-rule (1) of Rule 3, if the amount as directed in the preliminary decree was deposited within the time specified in the preliminary decree then a final decree for redemption had to be passed but, according to sub-rule (2) of this rule, if payment was not made within the time prescribed then a final decree for foreclosure had to be passed. The proviso to this sub-rule, however, provided that on sufficient cause being shown, the court could postpone the fixed day, that means, could extend the period of date fixed for payment by the preliminary decree. This was a significant amendment to the advantage of the defendant-mortgagor. According to the existing Rule 3 of Order 34 of the Code, the position is still better. Sub-rule (1) of Rule 3 of the Code provides that at any time before the passing of the final decree for foreclosure the defendant may deposit the amount found due in court and in case such deposit is made then a final decree for redemption has to be passed. Sub-rule (1) of Rule 3 of the Code provides that at any time before the passing of the final decree for foreclosure the defendant may deposit the amount found due in court and in case such deposit is made then a final decree for redemption has to be passed. I may repeat here that according to sub-rule (1) of R.3 of Order 34 as it existed prior to the amendment of 1929, the defendant could make deposit on or before the day fixed and not after its expiry. This change in law has to be kept in mind while appreciating the argument advanced by learned counsel for the parties, which I now propose to consider. 5. Mr. Rama Kant Verma, learned counsel for the appellants, urged that irrespective of the fact that no extension of period to deposit the amount was allowed under sub-rule (2) of Rule 2 of Order 34 of the Civil P.C., the defendant-mortgagors have right to make deposit under Rule 3(1) of Order 34 of the code. He further urged that in case the amount is so deposited before a final decree is passed then the court is bound to make a final decree for redemption in their favour. Learned counsel to support his argument referred to the case of Sant Bakhsh V/s. Bhagwandin Singh (AIR 1931 Oudh 121). This case fully supports the contention of Mr. Verma and it says that where no final decree debarring the defendant from the right to redeem the mortgaged property has been passed, the defendant is entitled to make the payment and to ask for a final decree ordering the plaintiff to deliver up the documents referred to in the preliminary decree and also ordering him to retransfer at the cost of the defendant the mortgaged property as directed in the said decree and also ordering him to put the defendant in possession of the property. Mr. Guneshwar Prasad, on the other hand, while contending that unless good cause was shown under sub-rule (2) of Rule 2, the Court had no jurisdiction to extend the period for payment prescribed in the decree. In support of his contention, learned counsel referred to the decision in the case of Motilal V/s. Ujiar Singh (AIR 1928 PC 137) and the case of Madhorao Paikaji V/s. Eknathrao Balappa (AIR 1948 Nag 56). In my opinion, neither of these two cases support Mr. Prasad. In support of his contention, learned counsel referred to the decision in the case of Motilal V/s. Ujiar Singh (AIR 1928 PC 137) and the case of Madhorao Paikaji V/s. Eknathrao Balappa (AIR 1948 Nag 56). In my opinion, neither of these two cases support Mr. Prasad. Their Lordships of the Privy Council were considering the scope of Order 34, R.3(2) of the Civil P.C. as it existed prior to the amendment made in the year 1929 and in that connection observed that the deposit by the defendant beyond the period fixed by the preliminary decree was bad inasmuch as no cause was shown for extension. I have mentioned earlier that prior to 1929, time to deposit could be extended only on sufficient cause being shown and sub-rule (1) of Rule 3 provided that the deposit could be made on or before the date fixed. Now as has been seen, Rule 3 has been substantially amended which provides that the defendant can make the deposit at any time before passing of the final decree debarring him from all rights to redeem the mortgage. This case, therefore, has no application. Lilkewise, the case of Madhorao Paikaji V/s. Eknathrao Balappa (AIR 1948 Nag 56) also does not help Mr. Prasad. The learned Judge only followed the decision of the Privy Council, reported in AIR 1928 PC 137 (supra). Then Mr. Prasad referred to the decision in the case of Ratnakar Gountia V/s. Chamra Satpasty (AIR 1919 Pat 497). This case also was decided at a time when O.34, Rules 2 and 3 were not amended by the Act of 1929. Their Lordships therefore, were interpreting the law as it stood then and I say with respect that they correctly observed "if the preliminary decree is not complied with the mortgagors have no absolute right to pay the redemption money and avoid foreclosure merely on the ground that a final decree has not been passed". But this interpretation was made with respect to the two rules as they existed then. The position has now changed after the 1929 amendment. This case also, therefore, does not help Mr. Prasad. 6. Mr. But this interpretation was made with respect to the two rules as they existed then. The position has now changed after the 1929 amendment. This case also, therefore, does not help Mr. Prasad. 6. Mr. Guneshwar Prasad, learned consel appearing for the respondents, contends that in case it is held that the defendants have a right to make Payment of the amount determined under sub-rule (1) of Rule 2 at any time before the passing of the final decree then that will render sub-rule (2) of Rule 2 absolutely nugatory. He, therefore, contends that a harmonious construction should be given to these two rules so that all the provisions may remain operative. There can be no dispute that as far as possible provisions of the Code should be so interpreted that no part of it becomes nugatory or inoperative. But in this case, to me it appears, in case sub-rule (2) of Rule 2 and sub-rule (1) of Rule 3, are given their full operation, they will not render each other either nugatory or inoperative. The reason is quite obvious. In the decree provided under sub-rule (1) of Rule 2 a period is prescribed enabling the defendants to make the deposit. During that period, the plaintiffs are not entitled at all to apply for preparation of final decree. Likewise, the plaintiffs are again debarred to take steps for preparation of final decree, if the period to make deposit prescribed under the decree is extended under sub-rule (2) of Rule 2 on good cause being shown. This is the effect of the extension granted under sub-rule (2) of R.2. But in case time is not extended or the time extended under sub-rule (2) of Rule 2 expires then the plaintiffs get a right to make an application for preparation of final decree debarring the defendant from redeeming the mortgaged property. This is the stage where Rule 3(1) of Order 34 of the Civil P.C. comes into play. The defendants under this rule are entitled to make deposit although steps have been taken for preparation of final decree and this right continues until a final decree is passed. I, therefore, see no reason to give a narrow construction to sub-rule (1) of Rule 3 of Order 34 of the Civil P.C. The two provisions apply to two different stages. I, therefore, see no reason to give a narrow construction to sub-rule (1) of Rule 3 of Order 34 of the Civil P.C. The two provisions apply to two different stages. The argument, therefore, that in case sub-rule (1) of R.3 is given its natural meaning then it will render sub-rule (2) of R.2 nugatory, has no substance. 7. The view, I have taken, also finds support from some other provisions of Order 34 of the Civil P.C. Rule 4 of Order 34 of the Code provides that on good cause being shown at any time before a preliminary (final?) decree for sale is passed, the time fixed for payment of the amount found or declared due may be extended. Again Rule 5, which provides for final decree in a suit for sale says that if at any time before confirmation of sale, the defendant in addition to the amount mentioned in sub-rule (1) of Rule 5 deposits in court for payment to the purchaser a sum equal to five per cent of the amount of purchase money, in addition to the purchase money, then the sale shall not be confirmed and the purchaser will be entitled to withdraw the amount so deposited. The scheme of the Code, therefore, seems to protect and provide all possible facilities to the defendant to pay the mortgage amount and save his property from sale or foreclosure as the case may be. For all these reasons, I am of the view that even if time is not extended under sub-rule (2) of Rule 2 of Order 34 of the Civil P.C., the defendant has a right to deposit the amount under sub-rule (1) of Rule 3 of Order 34 of the Code at any time before passing of final decree. In this case, since the deposit admittedly was made on 25-9-1972, at a time when final decree was not passed, the trial court was absolutely right in passing a decree of redemption after accepting the amount so deposited. The lower appellate court for the reasons discussed above erred in holding that the deposit made after the expiry of three months as provided in the preliminary decree dated 23-9-1966 was invalid. I, therefore, set aside the judgement and decree passed by the lower appellate court and restore that of the trial court. The appeal is, accordingly, allowed with costs. The lower appellate court for the reasons discussed above erred in holding that the deposit made after the expiry of three months as provided in the preliminary decree dated 23-9-1966 was invalid. I, therefore, set aside the judgement and decree passed by the lower appellate court and restore that of the trial court. The appeal is, accordingly, allowed with costs. LALIT MOHAN SHARMA, J. 8 I agree that the appeal should be allowed and as directed by the trial court, a final decree should be passed. 9. From the judgement of my learned brother, it will be clear that the defendants filed an application on 9-8-1967 before the trial court which is at pages 36 and 37 of File C. It was stated that the preliminary decree was passed without any notice to them and if they had any knowledge of the decree, they would have immediately deposited the amount. The service report was challenged as erroneous and collusive. The defendants further asserted their right to deposit the decretal amount and they wanted an order allowing them to make the deposit in instalments. In paragraph 6 of the application, it was said that the defendants had no means to deposit the entire amount in one lump sum and a request for instalments made by them had been accented by the plaintiffs. Towards the end of paragraph 4 it was said that it was within the discretion of the Court to extend the time. No orders were passed on this application. However, the entire amount was deposited in 1972. During the course of the argument in this Court, the attention of the learned counsel for the respondents had been drawn to this application and he could not give any reason as to why this prayer could not have been allowed under sub-rule (2) of Order 34 Rule 2 of the Civil P.C. which is in the following terms : "2 (2). The Court may, on good cause shown and upon terms to be fixed by the Court, from time to time, at any time before a final decree is passed, extend the time fixed for the payment of the amount found or declared due under sub-rule (1) or of the amount adjudged due in respect of subsequent costs, charges, expenses and interest." 10. The final decree had not been passed till many years after filing of the application. The final decree had not been passed till many years after filing of the application. The defendants cannot be made to suffer for the default of the Court in not disposing of their application promptly. When they were able to collect the money, they deposited the entire amount before the preparation of the final decree. Even if the interpretation of the plaintiffs on Order 34 R.3 be assumed to be correct, the decision of the lower appellate court must be set aside on the ground that the defendants application dated 9-8-1967 should have been considered and order passed thereon. It is not desirable in the facts and circumstances of the case to remit the matter for this purpose. I have gone through all the relevant materials in this regard on the records of the case and I am satisfied that the defendant had shown good cause for extension of the time. The deposit made by them, therefore, must be accepted as valid. As the appeal has to be allowed on this view, I do not express any opinion on the interpretation of R.3 of O.34 of the Civil P.C.