Decided on November 21,1963


Referred Judgements :-



- (1.)THIS appeal arises in execution of a mortgage decree. At execution, Rs. 11,000 odd have been deposited as the price of redemption decreed, and the property has been delivered to the plaintiff. The 12th defendant, the mortgagee on record, prayed for payment of the amount in Court less what has been claimed out of it by the other defendants. In other words, the prayer was only that the undisputed portion of the amount in Court that belonged to him might be delivered to him. The Court below dismissed that prayer, directing him to a fresh suit therefor. Hence this appeal.
(2.)THE facts show no justification for the order of the Court below. If the mortgagee, after surrender of the property to the mortgagor, claimed to be paid only such portion of the mortgage-amount that is beyond dispute by the other parties in the case, we do not see why the same was not allowed forthwith.
(3.)THE practice found in some Courts of decreeing redemption to the plaintiff-mortgagor, leaving the rival claims to the mortgage-amount of the defendants, the mortgagees and the sub-mortgagees, to be settled in a fresh suit is not warranted in law. Order 34, Rule 4 (4), C. P. C. directs that, in suits for sale where "persons deriving title from. . . mortgagees are joined as parties, the preliminary decree. . . . shall provide for the adjudication of the respective rights and liabilities of the parties to the suit in the manner and form set forth in. . . Form No. II. . . with such variations as the circumstances of the case may require. " A like provision in regard to adjudication of the rights and liabilities of sub-mortgagees occur in Order 34, rule 3 (3), C. P. C. as regards suits for foreclosure. See Form No. XI in Appendix D to the Code of Civil Procedure and Vengannan Chettiar and Sons v. Ramaswami pillai, AIR 1943 Mad 498. There is, however, no provision in Order 34 as to whom the price of redemption lodged in Court shall be given. But as "the mortgagor's right of redemption and the mortgagee's right of foreclosure or sale are coextensive" (Mulla's Transfer of Property Act, 4th Edn. P. 378), the procedure in regard to payment of the price of redemption cannot be different from those regarding the proceeds of sale of the mortgaged property; and therefore an adjudication as to the relative rights of the mortgagee and the sub-mortgagee becomes necessary in redemption suits as well. The AIR Commentaries on the code of Civil Procedure in Note No. 4 to Order 34, Rule 7 puts the position succinctly thus:
"'in a suit for redemption of a mortgage to which the sub-mortgagee also is joined as a party, the decree should direct accounts to be taken of the mortgage as well as of the sub-mortgage, and should provide that, out of the mortgage money, the sub-mortgagee should be paid the amount due to him and the balance, if any, should be paid to the mortgagee. " in Narayan Vithal Maval v. Ganoji, ILR 15 Bom 692 one of the issues framed by the trial Court was "can accounts be taken between the defendants inter se in this case?". The Subordinate Judge found the issue in the negative. On appeal, Sir charles Sargent C. J. and Candy, J. remanded the suit "for an account of the sub-mortgage to be taken", observing: "in the case of a derivative mortgage or sub-mortgage the judgment directs an account of what is due to the original mortgagee or his assignee, and then of what is due to the derivative or sub-mortgagee; and that upon payment to the latter of the sum due to him, not exceeding the sum found due to the original mortgagee, and on payment of the residue, if any, of what is due to the original mortgagee, both of them shall reconvey to the mortgagor. "
This was followed by Sir John Stanley, C. J. and Sir George Knox, J. in Gokul Das v. Debi Prasad, ILR 28 All 638 where the suit was one for redemption of a mortgage of 1860, on which there were two sub-mortgages of the years 1890 and 1895. It was held :
"the sub-mortgagees have derivative interests in the mortgage as submorgtagees and they were therefore properly impleaded in the suit. The proper course, we think, for the Court below to have adopted was to ascertain what sum is due to the sub-mortgagees or to their representatives on foot of the sub-mortgages which are dated respectively the 15th of September 1890 and the 6th of September 1895, and to direct payment of this sum out of the money lodged in court which is the full amount of principal which the plaintiffs are liable to pay. "
and remanded the suit for ascertainment of sum due on the sub-mortgagee. Again in Ehsanali v. Kikabhai, AIR 1956 Madh-B. 118, Chaturvedi, J. held:
"it is well settled that in any suit for redemption or foreclosure of the original mortgage, the accounts between the original mortgagor and the original mortgagee on the one hand, and the latter and the sub-mortgagee on the other, have to be taken and the respective claims of the three parties adjusted and settled. "
From the above, it is clear that, in a suit for redemption of a mortgage, the submortgagee's claims in the price of redemption found due to the original mortgagee have to be adjudicated. However, the decree in the present case directed :
"the mortgage amount can be withdrawn either jointly by all interested persons or on proving the rights of individual claimants in separate proceedings. " the "separate proceedings" in the context must mean proceedings in the suit itself, not a fresh suit.


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