SIVASUBRAMANIA AIYAR Vs. SUBRAMANIA AIYAR

JUDGEMENT

(1.) The question referred to us must be answered in the negative. Section 55, Sub-section 4, Clause (6) of the Transfer of Property Act says that in the absence of a contract to the contrary, the vendor shall have a charge upon the property in the hands of the buyer for the amount of the purchase money or any part thereof remaining unpaid. In this case the vendor has asked the purchaser to pay the unpaid purchase money to a certain creditor of his. It is not alleged that the creditor accepted the liability of the purchaser of the property in substitution of the vendor s own liability. But the purchaser as between himself and the vendor has accepted the obligation to pay the purchase money according to the vendor s direction. It has been held by the Privy Council in Webb v. Macpherson (1908) I. L R. 81 C. 67, that the statutory charge created by Section 55 of the Transfer of Property Act is not to be negatived except where there is a contract to the contrary, either express or arising by necessary implication. They point out that this charge is different in its origin and nature from the vendor s equitable lien under the English law. They also observe that " the charge is not excluded by a mere personal contract to defer payment of a portion of the purchasemoney, or to take the purchasemoney by instalments, nor is it excluded by any contract, covenant or agreement with1 respect to the purchasemoney which is not inconsistent with the continuance of the charge". It is difficult to see how a direction to the purchaser to pay the purchase money to the vendor s creditor is inconsistent with the existence of the charge. This is the view taken by the Allahabad High Court in Har Chand v. Kishori Singh (1910) 7 I.C. 639 and in Meghraj v. Abdullah (1914) 12 A.L.J. 1031. It is argued, however, that in this Court the contrary view has prevailed in Abdula Beary v. Mammali Beary (1910) I.L.R. 88 M. 446, which has been followed in Siva Subramania Mudaliar v. Gnanasammanda Pandara Sannadhi (1911) 21 M.L.J. 869. The learned Judges who decided the former case state in their judgment that, by the terms of the contract under their consideration, the purchase money was not payable to the plaintiff and he had no right of action to recover it. That is, however, not the position involved in the present case. It has been held in Sheonandan Lal v. Zainal Abdin (1914)I.L.R. 12 C. 819, that the vendor s charge for unpaid purchase money is not a mere personal right but is capable of being transferred to a third person and in Ramakrishna Ayyar v. Subrakmania Ayyan (1905) I.L.R. 29 M. 805, it has been ruled that a suit to enforce the charge is governed by 12 years limitation. A vendor s lien or charge is not lost by the mere taking of personal security. See Karuppiah Pillai v. T.R. Hari Row (1910)21 M.L.J. 849 and Mackreth v. Symmons 2 W. & T s L.C., p. 964. There is no doubt a distinction, on principle, as well as authority, as pointed out by the Privy Council in Webb v. Macpherson (1908) I.L.R. 31 C. 57 at 73, between a conveyance or sale in consideration of a covenant to pay a sum of money in the future and a sale in consideration of money which the purchaser covenants to pay. Here the consideration for the sale is money, payable by the purchaser, only he has agreed with the vendor to pay it to a third person.

(2.) The learned Judges who decided Abdulla Beary v. Mammali Beary (1910) I.L.R. 88 M. 446, seem to hold in one part of their judgment that where the purchase money is to be paid to another, that is necessarily inconsistent with the vendor retaining the charge. There is nothing in Section 55, Sub-section 4, Clause (b) to suggest that for the charge to arise or to subsist, the purchase money must be payable to the vendor himself and not, by his direction, to a third person. If the above case holds otherwise, I am of opinion that it was wrongly decided. I may mention that the decisions in Ramakrishna Ayyar v. Subrahmania Ayyan (1905) I.L.R. 29 M. 805 and Gopala Aiyar v. Ramaswamy Sastrigal (1911) 22 M.L.J. 207, are in accordance with the view I have expressed. Seshagiri Aiyar, J.

(3.) I agree with the conclusions of the learned Judges who made the reference that the vendors lien is not lost by a direction to pay the purchase money to a third person. The charge is for the purchase money and it is immaterial that that money is not directly payable to the purchaser. As was pointed out by the learned vakil for the appellant, the statute itself by Section 55(5)(b), enables the vendor to direct it to be paid to any person he names. The obvious inference is that the purchase money does not lose its character by the direction to pay another.