NARAYAN BUDHAJI MOKAL Vs. POSHA JAMA THAKUR

JUDGEMENT

(1.) The plaintiff tiled this 3uit to recover the sum of Rs. 357-8-0 from the defendants or in the alternative to recover the sum by sale of the mortgaged property, or to recover the possession of the property by foreclosure. It appears that this property was mortgaged by the then owners, who are now represented by the defendants, to one Ramchandra Raghunath on the 1st of February 1880 for a sum of Rs. 250 with possession. The mortgagee sold his right to one Tatya Keshav on the 6fch of March 1880. It was provided that the mortgage debt was not to carry interest, and the mortgagee was to enjoy the property mortgaged in lieu of interest. The defendants then passed a document in favour of the present plaintiff s father on the 15th March 1893. That document on the face of it appeared to be a sale-deed transferring the property to the plaintiffs father in consideration of Rs. 600, In 1898 the plaintiff s father paid off the 1st mortgagee, Tatya Keshav and obtained possession from him of the suit property, together with the tiMe deeds under the original mortgage of the 1st of February 1880. The property continued in the possession of the original mortgagor s family as tenants rent-notes being passed to the plaintiffs, the last of which was dated May 1906, Exhibit 13 in the case. In 1915 the plaintiff filed a suit against the defendants for ejectment on the basis that his father was the owner of the property and the defendants were his tenants. The defendants pleaded that the document of 1893, although ostersibly a sale-deed, was in reality a mortgage. This point was conceded by the plaintiff with the result that a redemption decree was passed. The plaintiff s then contended that the defendants could not be allowed to redeem without paying off not only what should be held to be due under the document of 1893, but, also what was due under the mortgage of the 1st of February 1880. The learned Judge came to the conclusion that the defendants should be allowed to treat the plaintiffs as second mortgagees only and that they were not bound to redeem both mortgagees, relying upon Order XXXIV, Rull 1, by the explanation to which the prior mortgagee need not be joined in a suit to redeem a subsequent mortgage. I should say it would be very doubtful whether that applies to a case where the prior mortgagee is the same person as the subsequent incumbrancer. However that may be, the result of that suit was that accounts were taken of the 2nd mortgage under the Dekkhan Agriculturists Relief Act and possession was given to the defendants, they being allowed to pay off the mortgage amount by instalments. It cannot be said that anything was decided in that suit with regard to the 1st mortgage except this that the defendants were allowed to redeem the 2nd mortgage without also at the same time paying off the 1st mortgage, and under the provisions of the Dekkhan Agriculturists Relief Act they were allowed to go into possession The plaintiffs unfortunately did not appeal against that decree.

(2.) They have now filed this suit on the mortgage of the 1st of February 1880. The trial Court passed a decree in their favour for the amount claimed, viz., Rs. 357-8-0. But it is conceded that the plaintiffs could not recover in any event more than Rs. 250, the original mortgage amount, as it wan expressly provided that the mortgage debt was not to carry interest, the mortgagee being in possession and enjoying the profits.

(3.) In appeal the lower appellate Judge decided all the points in the case in favour of the plaintiff s except one, with the result that the suit was dismissed with costs. The learned Judge thought that as the plaintiff s could not produce a receipt of the amount they had paid to the 1st mortgagee, they had not the required authority to proceed against the heirs of the original mortgagor for repayment of the amount which had been paid in discharge of the 1st mortgage. The learned Judge relied upon Section 74 of the Transfer of Property Act. That suction deals with the rights of a subsequent mortgagee to pay off prior mortgagees. It provides that " any second or other subsequent mortgagee may, at any time after the amount due on the next prior mortgage has become payable, tender such amount to the next prior mortgagee, and such mortgagee is bound to accept such tender, and to give a receipt for such amount; and (subject to the provisions of the law for the time being in force regulating the registration of documents) the subsequent mortgagee shall, on obtaining such receipt, acquire, in respect of the property, all the rights and powers of the mortgagee as such, to whom he has made such tender." Under Section 17(2)(11) of the Indian Registration Act, a receipt for payment of money due under- a mortgage when the receipt does not purport to extinguish the mortgage, does not require registration. The argument is that the subsequent mortgagee having paid off the prior mortgagee without obtaining a receipt did not acquire any right to stand in the shoes of the 1st mortgagee for the purpose of recovering the mortgage money from the mortgagor.