KRISHNAN NAIR Vs. MADHAVAN

JUDGEMENT

(1.) In a chitty of which the first defendant was the foreman, the first plaintiff was the subscriber. He prized his ticket but was paid only a part of the prize amount and for the balance was satisfied with taking a promissory note from the first defendant. The latter having failed to make payment, the first plaintiff and his assignee the second plaintiff, have sued the first defendant for the amount due after setting off the subscriptions payable to him for the last two instalments. They prayed for a decree charging the properties secured by the first defendant for the conduct of the chitty and in respect of which, the second defendant was impleaded as a subsequent encumbrancer. The two Courts have concurred in giving the plaintiffs a personal decree against the 1st defendant and in declining to give a charge on the properties. The only question which arises in this Second Appeal is, whether the plaintiffs are entitled to a charge. The two Courts have held that by the acceptance of the promissory note the first plaintiff has lost his rights to enforce the security.

(2.) It may at once be stated, that the suit as framed, is not solely upon the promissory note. It may well be construed to be a suit for the realisation of the amount of the prize itself. The security was offered by the first defendant in pursuance of S.17(1) of the Travancore Chitties Act, 1120, which reads as follows:

(3.) Accordingly, this Second Appeal is allowed by declaring a charge on the properties in the schedule, for the amount decreed. The first plaintiff is allowed his costs in this Court and in the lower appellate Court to be realised from the contesting respondent in each court.