DEVICHAND GANESH Vs. CHINTAMAN YELLAPPA

JUDGEMENT

(1.) This is an appeal by the decree-holder in certain darkhast proceedings in which he sought to execute a decree obtained by him in Suit No. 161 of 1926 by attachment of the moveables of the respondent-judgment-debtors. The decree provided that the defendants were to pay Rs. 500 with interest at six per cent, by monthly instalments of Rs. 75, and that in case of two defaults the plaintiff would be entitled to recover the whole, amount due. No instalments having been paid, the decree-holder filed Darkhast p. 1641 of 1926 in September, 1926, to recover the amount of the decree by arrest of the judgment-debtors. On April 1, 1927, the decree-holder and the judgment-debtors arrived at a compromise in the following terms : The defendants do pay (the plaintiff) within one month from today the (whole) amount as per execution application together with interest on the principal sum of six hundred and seventy-five rupees at twelve per cent, from April 1, 1927. II" the defendants do not pay, a charge for the said amount is created on the three houses mentioned below of the defendants in the Shanivar Peth (and) the plaintiff to recover (the said sum) by the sale of the said property. The charged property had already been mortgaged by the judgment-debtors to one Mr. Shah, a pleader, in 1925, and the said Mr. Shah obtained a decree on his mortgage and brought the mortgaged property to sale in darkhast No. 1462 of 1928 ; and it was purchased by the son of the present decree-holder on March 21, 1929. It has been held in these proceedings by both the Courts below that that purchase, though in the name of the son, was really by the decree-holder himself. It appears that after this there were several darkhasts and in one of them there was a further compromise under which a sum of Rs. 351 was paid to the decree- holder and he relinquished the charge on one of the properties. Then the present darkhast No. 1875 of 1935 was brought to recover the balance due by attaching moveables belonging to the judgment-debtors. The judgment-debtors raised various pleas but they abandoned them except one, viz. that the judgment-debtors were not personally liable and hence the darkhast was not tenable.

(2.) The learned Subordinate Judge held that the decree-holder must proceed against the charged property; alone and that he was not entitled to proceed against the defendants personally ; and he accordingly dismissed the darkhast with costs. The decree-holder appealed to the District Court, and the learned Assistant Judge who heard the appeal held that the judgment-creditor was entitled to proceed personally against the judgment-debtors in case the property charged was found insufficient to satisfy the decretal debt. He, accordingly, remanded the case for disposal of the darkhast after dealing with certain issues which he raised, one of which was : " Is the decree-holder not estopped from proceeding against the judgment-debtors " There was an appeal to the High Court, and Broomfield J. dismissed the appeal-, holding that the compromise was not intended to take away or did take away the personal remedy which had been given to the judgment creditor by the decree. After the remand, the trial Judge held that the decree-holder would be entitled to proceed personally against the judgment-debtors on the ground that the charged property Was not available or had been found insufficient to pay his debt. But he held that the decree-holder was stopped from proceeding against the judgment-debtors, and, therefore, dismissed the darkhast. The reason for holding that the decree-holder was so estopped appears to be that the decree- holder had deprived himself of the remedy of proceeding against the charged property by his own act, i.e. by his having purchased the property at the Court sale. He also thought that the auction purchase of the charged property had effected a merger and extinguished the debt, following Bai Reva V/s. Valimahomed and Krishnachandra Bhoumick V/s. Pabna Model Company, Ltd. (1931) I.L.R. 59 Cal. 76 The decree-holder appealed to the District Court again, and the learned Assistant Judge who heard the appeal held that there was no merger of the charge under Section 101 of the Transfer of Property Act, that the Court sale was not subject to the charge created in the decree-holder's favour and that the appellant was not entitled to proceed against the moveables of the respondents (though a finding in the affirmative has been recorded against this issue in the earlier part of the judgment.) He took the view that the decree-holder still had the right to sue for sale on his mortgage (i.e. charge) subject to the first mortgage, and that he also had the right to redeem the first mortgage and to have the property sold to satisfy his own claim. He observed : " It will be no answer to say that the property has been purchased by himself or that it has been subsequently sold away by him to a third party. If he cannot effectively pursue the mortgaged property, that is no fault of the judgment-debtor and the appellant has to thank himself for that result. The judgment-debtor is entitled to insist that the decree-holder should proceed against the charged property first, and as that remedy is open to the decree-holder, he cannot execute the decree against the judgment-debtors moveables (see Raychand Jivaji V/s. Basappa Virappa )." The appeal was, accordingly, dismissed with costs.

(3.) Mr. Patwardhan on behalf of the appellant has contended that even if by the purchase of the property by the decree-holder the charge may have become unenforceable, the decree- holder cannot be deprived of his personal remedy which was originally granted to him under the decree which was held by this Court in Second Appeal No. 460 of 1938 to have been preserved to him, under the compromise. He has, therefore, contended that the reasoning of the learned Assistant Judge that the judgment-debtor is entitled to insist that the decree- holder should first proceed against the -charged property is untenable as now it is impossible for the decree-holder to recover his debt by enforcing the charge which would have to be enforced against himself.