SHEOPATI SINGH Vs. JAGDEO SINGH

JUDGEMENT

(1.) This is a defendants appeal arising out of a suit for recovery of Rs. 12,000, the principal amount of mortgage-money, and Rs. 6,000 as damages on account of a breach of contract. It appears that on 23 September 1922, the plaintiffs Jagdeo Singh and Bishnath Singh, father and son, executed a document which represented a compound transaction of sale and mortgage for Rs. 20,050 in favour of the defendants-appellants. This deed is printed at page 35. Under it 5 annas 21/2 pies share in Mudila Khurd in all was transferred, out of which 2 annas 1 pie share was sold for Rs. 11,050 and the remaining 3 annas 11/2 pies share was mortgaged with possession for a period of twelve years in lieu of Rs. 9,000. The payment of consideration was not split up for the two transactions of sale and mortgage separately, but was stated as a consolidated sum of Rs. 20,050. Out of this amount the mortgagees had to pay Rs. 12,000 to one Ram Krishan a previous mortgagee of the property not covered by this deed, and the balance of the consideration was to be set off against another mortgage-deed as well as two promissory notes and a small amount which had been advanced as earnest money. On the same date a security bond was executed by the transferors in favour of the transferees, agreeing to indemnify the latter and pay interest at 2 per cent. in case they suffered loss on account of any portion of the property going out of their possession.

(2.) At the time when the deed's were executed a suit for the redemption of the property in the hands of Mathura Kurmi who was a prior mortgagee of the property transferred, was pending, and the present plaintiffs had already deposited the entire mortgage-money due to him under Section 83, T. P. Act. But later on 24 October 1923, Mathura Kurmi filed a written statement pleading that the transaction was not one of mortgage but of a sale out and out. This suit was decreed by the trial Court on 2 May, 1925, and Mathura's appeal was dismissed by the High Court on 21 December 1926.

(3.) It is an admitted fact that the defendants have not made the payment to Ram Krishan and they justify their nonpayment by the circumstances that the money was payable on 30 April 1923, by which date the suit in the trial Court had not been decided, and that the final adjudication was not made till December 1926. The claim was contested on various grounds, but it has been decreed by the learned Subordinate Judge. In appeal several points have been urged before us. The first is that according to a correct interpretation of the sale-deed time was not of the essence of the contract and the defendants were not bound to pay the amount to Ram Krishan so long as Mathura Kurmi's suit had not been finally disposed of, but in any event the defendants would be liable to make compensation : Section 55, Contract Act. We are unable to accept this interpretation of the deed. The condition contained in the deed relating to the first item of the said consideration on page 38 is clear and is to the effect that the mortgagees had taken upon themselves the responsibility to pay the whole amount of the mortgage-money due to Ram Krishan at the proper time, i. e., Baisakh Sudi 15th, 1380 Fasli (corresponding to 30 April 1923). There was a clear undertaking to pay this amount on the date mentioned. As Mathura Kurmi was in possession of the property belonging to the executants, it was in their interest and for their benefit that the amount should be paid to Ram Krishan promptly, so that the executants might recover possession of the property. In these circumstances it cannot be urged that time was not of the essence of the contract and that the defendants could pay it at any future time according to their wish and pleasure. Even if no time had been fixed it was the clear duty of the defendants to pay the amount within a reasonable time : Section 46, Contract Act.