MATHAI Vs. MATHAI KUNJU NINA

JUDGEMENT

(1.) The suit property is a part, 40 cents in extent, of a larger property, 1 acre 6 cents in extent, which belonged to one Narayana Pillai. He mortgaged 15 cents of the larger property on the 9th Medom, 1100, to one Padmanabha Pillai by Ext. III. He also mortgaged the suit property on the 7th Karkadakom, 1100, to Padmanabha Pillai by Ext. II. The rights under Exts. II and III were hypothecated by Padmanabha Pillai to the Kerala Bank Ltd., on the 15th Vrischigom, 1101. On the 6th Mithunam, 1102, Narayana Pillai hypothecated the suit property and others to the plaintiff and his father for a chitty debt. On the 15th Makarom, 1103, Padmanabha Pillai, the mortgagee, released his rights under Exts. II and III to Narayana Pillai, the mortgagor, by Ext. IX with a direction to the latter to discharge the debt due to the Bank. On the hypothecation of 1101, the Bank instituted O. S. 412 of 1106 against Padmanabha Pillai as the first defendant, and Narayana Pillai as the additional second defendant. The suit was decreed in terms of the plaint, by Ext. A judgment and Ext. IV decree. In execution, the suit property and the 15 cents mortgaged under Ext. III, were purchased by the assignee decree holder on the 16th Vrischigom, 1109, under Ext. V sale certificate, and were delivered to him under Ext. VI dated the 16th Chingom, 1110. He then made a gift of his rights in respect of the suit property to the defendant - appellant on the 4th Thulam, 1110. On the hypothecation of 1102, the plaintiff and his father instituted O. S. 982 of 1103 and obtained a decree, Ext. B, purchased the suit property and others on the 23rd Thulam, 1122, in execution, subject to a mortgage right of Rs. 200/-, and took delivery of possession of the equity of redemption on the 19th Thulam, 1124, under Ext. D. Basing on this, the plaintiff instituted the present suit for redemption of Ext. II. The defendant contended, that by the purchase under Ext. V, she has become the owner of the suit property and that the plaintiff is not entitled to redeem. This contention prevailed with the Munsiff who dismissed the suit, but it was repelled by the Subordinate Judge in appeal.

(2.) The question for consideration in second appeal is whether the plaintiff is entitled to redeem the defendant. If the defendant is to be considered as standing in the shoes of the auction purchaser in execution of the decree on the prior mortgage, notwithstanding the fact that the plaintiff and his father, who were the puisne mortgagees, were not parties to the decree, the title of the defendant has to prevail But it was contended for the plaintiff, that the defendants predecessor in interest, the Kerala Bank Ltd., was only in the position of a submortgagee, that its security is only the mortgage right under Exts. II and III, that what was sold in execution of the decree was such mortgage right, and that the defendant cannot be considered to be in the position of a prior mortgagee auction purchaser. At the time O. S. 412 of 1106 was instituted, Exts. II and III had been released by Ext. IX to Narayana Pillai, who had notice of the submortgage to the Bank and was even charged with paying it off. As noted, he was a party to Ext. IV decree. The summary of the plaint as set out in Ext. IV discloses, that the decree prayed for was against the properties and not against the right under Exts. II and III. Ext. V also is clear that the properties as such, not the mortgage right in them, were purchased in execution. It was argued, that sale in pursuance of the submortgage cannot affect the equity of redemption of the original mortgagor, and can pass only the mortgage right. This is not always the case. The submortgagee may realise the amount due to him in one of two ways; he may enforce his security by bringing to sale the mortgage right which was submortgaged to him, or he may, in his capacity as the assignee of the mortgagee, sue for the sale of the property itself and incidentally realise his dues. This has been recognised in a very early case, Kanhal Lal v. Mahadeo Prasad 18 Indian Cases 389, where the law was stated to be, that the submortgagee by virtue of the assignment is not only entitled to the usual remedies against his own mortgagor. But he is also entitled to a remedy against the original mortgagor. The position of the original mortgagee after a submortgage becomes as it were that of a surety, the submortgagee becoming the creditor while the original mortgagor continues to remain the debtor ... the operation of the submortgage was to transfer to the submortgagee all the rights and remedies which Jot Singh (mortgagee) had against his mortgagor (Debi Singh). This has been followed in later cases in the Madras High Court, such as, Muthu Vijia Raghunatha Ramachandra Vacha Mahali Thurai v. Venkatachallam Chetti, ILR 20 Madras 35, K. Vengannan Chettiar and Sons v. N. Ramaswami Pillai, AIR 1943 Mad. 498 A.L.A. R.R.M. V. Vellayan Chettiar v. Mahalinga Pathan, AIR 1958 Mad. 30 . These were accepted as laying down good law, by a full bench of the same court in Chinnah Goundan v. Subramania Chettiar AIR 1959 Mad. 246 . In view of these pronouncements, it may be held that the submortgagee can, in a properly framed suit, enforce his security against the property itself which was the subject of the mortgage. Form 11, Appendix D of the Civil Procedure Code, also relates to the decree for sale to be passed in such a case.

(3.) It was however urged by learned counsel for the plaintiff, that O. S. 412 of 1106 can be considered to be only a suit upon the submortgage to enforce the mortgage security, and not a suit on the mortgage itself for the sale of the mortgaged property. In terms, the plaint as summarised in Ext. IV did not pray for the enforcement of Exts. II and III as distinguished from the submortgage. It cannot be overlooked, that the mortgagor too was made a party to the suit which was quite unnecessary, had it been a suit simply to realise the security of the submortgage and that the prayer in the plaint was expressly and clearly for the sale of the property itself, without any qualification or reservation. It has also to be borne in mind, that at the time the suit was instituted, the mortgages Exts. II and III had themselves been released under Ext. IX, and there was not much point for the Kerala Bank Ltd., to insist, that they still remained intact. There is, however the fact, that the Bank sought to realise only the amount due to it and not the amount of the mortgages and paid court fee accordingly, but this has to be viewed in the light of the fact just stated, that the mortgages had been released, and that a decree was prayed for, though not personally against the mortgagor, against his interests in the mortgaged property. The amount of court fee paid is not material, what are determinative being, the prayer for the sale of the property and the impleadment of the mortgagor. I am satisfied that Ext. IV was a decree not only against the mortgage security, which by that time had become merged in the larger interests of the mortgagor, but also against the equity of redemption. It was this equity of redemption which was sold under Ext. V. It must follow from the above, that the defendants predecessor in interest was the prior purchaser of the equity of redemption in a mortgage suit and so his title thereto has to prevail over the title of the plaintiff by virtue of his later purchase.