MUTHAYA SHETTI Vs. KANTHAPPA SHETTI

JUDGEMENT

(1.) The predecessors in title of the plaintiff executed Exhibit A to one Shankaranaranappayya in 1872. Shankaranaranappayya sold the property comprised thereunder to Venkappayya under Exhibit 1 in 1879. Venkappayya s widow sold it in 1897 to Puttappayya and Puttappayya s sons sold the same in 1912 to the defendant The present suit is brought by the plaintiff to redeem the mortgage of 1872. The answer of the defendant is that the suit is barred by Article 134 of the Limitation Act as more than twelve years have elapsed since the date of the transfer by the original mortgagee. Both the Courts have come to the conclusion that the suit is barred by limitation. The judgment of the District Judge is so meagre that we were obliged to hear this case as a first appeal. Mr. Sitarama Row contended before us that under Article 134 the burden of proving that the transferee from the mortgagee had acquired an absolute right in the property lay on the defendant.

(2.) Before considering this question, I shall dispose of a preliminary point suggested by Mr. Ananthakrishna Aiyar for the respondent, namely, that Exhibit A is an absolute conveyance with an option to repurchase, and that consequently his client is the absolute owner of the property. In answer to this suggestion, the learned vakil for the appellant pointed out that the construction of Exhibit A is res judicata by virtue of a decision of the District Court of South Kanara in the year 1886. That decision was given under the following circumstances. A member of the plaintiff s family sued his brothers for partition, and claimed a share in the property in dispute alleging that the alienation of it was not for necessary purposes. The District Munsif held that the plaintiff was entitled to recover a third share of the property on paying a third of the mortgage amount. There was an appeal by the alleged mortgagee, the 9th defendant in that case. His contention was that the transaction was not a mortgage but an absolute sale with an option to repurchase, Mr. Best, the District Judge, held that it was a mortgage and not a sale. He further held that it was not open to the plaintiff to sue for the redemption of a portion of the property by offering to pay only a portion of the mortgage debt, and that moreover as the suit was not one for redemption, it should be dismissed qua this property.

(3.) The question is whether this conclusion of the then District Judge of South Kanara is res judicata. Mr. Ananthakrishna Aiyar strenuously argued that as the suit was dismissed and as the mortgagee could not have appealed against the decision of the District Judge although the finding on the construction of Exhibit A was against him, the matter is not res judicata. Upon the question whether a bare finding upon an issue when the final conclusion is in favour of the party against whom the decision on the issue is given, gives a right of appeal to the party, there have been differences of opinion. In Yusuf Sahib v. Durgi it was apparently held that an appeal lies under the circumstances. In Ranganatham Chetty v. Lakshmiammal the same view was taken. Both these cases follow Krishna Chandra Goldar v. Mohesh Chandra Saha (1905) 9 C.W.N. 584. In Venkata Suryanarayana v. Sivasankaranarayana (1914) 17 M.L.T. 85 the question was left open. There is a decision of Ayling and Spencer, JJ. in Secretary of State v. Saminatha Kownden (1911) I.L.R. 37 Mad. 25 which is inconsistent with Yusuf Sahib v. Durgi (1907) I.L.R. 30 Mad. 447 and Ranganatham Chetty v. Lakshmiammal . See also Brij Behari Lal v. Shivanath Prasad (1916) 20 C.W.N. 1354. Having regard to the language of Sections 96 and 100 of the Code of Civil Procedure which gives a right of appeal only against decrees, it seems doubtful whether the two earlier Madras decisions are correct. If the decision in this case depended solely upon that question, I would have felt bound to refer the matter to a Full Bench; but I think that this case can be disposed of upon other grounds. I agree with Mr. Sitarama Row that the fact that a party against whom an issue is decided has no right of appeal does not affect the rule of res judicata. There is nothing in the language of Section 11 to suggest such a test. The language of explanation 2 to that section implies that the competence of a Court for purpose of res judicata is not affected by the fact that its decision is not appealable. It is true that this explanation was introduced to put an end to a controversy which existed as to whether when a decree is not appealable to the same tribunal the Court which decided the earlier claim can be held to have been competent to adjudicate upon the subsequent claim litigated in a superior Court. None-the-less, the wide language of the explanation shows that the legislature did not intend that the test of res judicata should depend on the right of appeal. I therefore overrule the first contention, Mr. Ananatha Krishna Aiyar then argued that the decision on Exhibit A was not necessary for the conclusion which was come to in the suit, and that consequently the matter is not res judicata. The cases on this point may be grouped under four heads : the first class of cases relates to the decision on issues which are altogether unnecessary for the disposal of the case. For instance, decisions on the character of the defendant s holding where the suit is dismissed on the ground that there has been no notice to quit or that there had been no exchange of pattas and Muchilikas : D. Narasamma v. D Kannaya (1881) I.L.R. 4 Mad. 134 and Muthukumarappa v. Arumuga (1888) I.L.R. 7 Mad. 145 represent this class of cases. In these cases as the pronouncement upon the tenure of the defendant was not necessary for the disposal of the case, the decision upon that issue was held not to be res judicata. It is to this class of cases the observation of Sir E. Collier in Rajah Run Bahadur Singh v. Mussumut Lachoo Koer (1884) L.R. 12 I.A. 23 : I.L.R. 11 C. 301 that "as the decree was not based upon it, but in spite of it" there can be no res judicata, applies. See also Nundo Lall Bhuttacharjee v. Bidhoo Mookhy Debee (1836) I.L.R. 13 Cal. 17 Thakur Magundeo v. Thakur Mahadeo Singh (1891) I.L.R. 18 Cal. 647 and Shib Charan Lal v. Raghu Nath (1895) I.L. 17 All 174. The second class deals with cases where although the decision of an issue is unnecessary for the disposal of the case, still for some reason the Court embodies that decision in the decree itself. Then the matter becomes res judicata not on the ground that there has been a decision on the issue, but because there is a decree of the Court which is binding upon the parties : Kaveri Ammal v. Sastri Ramier (1905) I.L.R. 26 Mad. 104 and. Mota Holiappa v. Vithal Gopal (1916) I.L.R. 40 Bom. 662. The third class relates to judgments which decide more than one issue; but it is doubtful from those judgments on which of these issues the final conclusion was based. In such a case the decision on both the issues will be res judicata. See Peary Mohan Mukerjee v. Ambica Churn Bandopadhya (1897) I.L.R. 24 Cal. 900 and the recent decision of the learned Chief Justice and Justice Phillips in Appeal No. 62 of 19 13 Secretary of State for India v. Maharaja of Vencatagiri 31 M.L.J. 97. Now I come to the fourth class. In the fourth class, the decision upon the issue is necessary, but unfortunately, the party against whom that decision is given could not appeal against it as the final decree is in his favour. In such a case it seems to me that the decision on the issue would be res judicata. The proper procedure where the defendant is affected by a decision on an issue which he has not the opportunity of contesting in appeal may be as suggested by Petheram C.J., in Jamaitunnissa v. Latifunissa (1885) I.L.R. 7 All. 606. that is to say, he can ask the court which has given an adverse decision on a material issue to embody it in the decree so that he may have a right of appeal against such a decision. But if he neglects the opportunity and the decision itself is necessary for the disposal of the case, there seems to be no escape from the bar of res judicata. On the whole I have come to the conclusion that the decision of Mr. Best in 1886 which was absolutely necessary for the decision of the case and which has stood unchallenged for thirty years is binding on the parties, and that Exhibit A should be construed as a mortgage by conditional sale and not as a sale with an option to repurchase.