S K SUBBA AYYAR Vs. PICHUMANI AYYAR

JUDGEMENT

(1.) This appeal is against the order of the lower Appellate Court reversing the order of the Principal District Munsif of Srivaikuntam in a matter in execution, viz., the order in which certain mortgaged property shall be sold is execution of a mortgage-decree. Two items are involved ia this case. The appellant i8 the decree-holder and the respondent is the 8th defendant who is interested in Item No. 2 and wants it to be sold last. The District Munsif permitted the property to be sold in the order selected by the decree-holder, as ordered in M.P. No. 99 of 1918. The decree-holder has chosen to sell Item No. 2 first. It has been sold and the sale has been confirmed. The lower Appellate Court reversed the order, cancelled the sale, and directed that further enquiry be held and that the sale of the properties shall be in the order in which they are set out in the decree, provided that the 8 defendant has the right of marshalling.

(2.) The order of the lower Appellate Court seems to be vitiated by several faults. If the lower Court had looked into the judgment in the suit in which the decree was passed it would have found that the question of the 8 defendant's right of marshalling had already been decided. In para. 22 of that judgment the District Munsif held that the 8 defendant took his mortgage with full knowledge of the decree-holder's mortgage. The 8 defendant contends before me that this is not res judicata, (1) because he was ex parte in the suit; (2) because he could not have appealed against 4 that finding; and, (3) because such a matter, even if decided in the suit, can be reopened in the execution proceedings. None of these grounds seems to me tenable. As to the first the decision is nonetheless res judicata because the party is ex parte; as to the second, the judgment rejected the 8 defendant's prayer that the first item be sold last. Even if he could not present an appeal, he could at least have moved by way of cross- objections in the appeal preferred by the 1 defendant, or have moved the matter at the re- hearing of the suit which was remanded by the District Court. He did neither of these things. As to the third point, the ruling in Raghavachariar V/s. Duvvuru Krishna Reddi 83 Ind. Cas. 918 : 46 M.L.J. 32 : 19 L.W. 23 : (1924) M.W.N. 134 : A.I.R. 1921 Mad. 509 is quoted; a ruling which has been accepted in an unreported case Sine reported as 96 Ind. Cas. 492 : 23 L.W. 765 : 51 M.L.J. 135 : (1926) M.W.N. 566 : A.I.R. 1926 Mad. 834--[Ed.] C.M.S.A. No. 17 of 1925, Arukapalli Narasimha Rao V/s. Arumilli Subbarayudu which follows it. These rulings, however, appear to me to be no authority for the contention advanced. In these cases, the point was whether the order in which property shall be sold is a matter which can be agitated in execution, even though it had been decided in the suit and it was held that it can, presumably on the principle that such an order is primarily a matter in execution and need not have been decided in the suit. But no authority has been advanced before me which lays down that, when the right of marshalling has been decided in the judgment, it could be reopened again in execution proceedings. The judgment in a recent unreported case Since reported as 97 Ind. Cas. 586 : 24 L.W. 257--[Ed.] C.M.A. No. 6 of 1926 Kasivasi Chokkalinga v. Ramanadan to which my attention has been drawn, does not touch the point at all. Obviously the question whether a mortgage was taken with notice of a prior mortgage is one that may on occasions be an extremely important issue in the suit itself and must be decided there, and might in fact be the only important issue for decision; and I cannot accept the argument that when the judgment has decided such a matter, it can be re-opened in execution proceedings. Therefore, the 8 defendant took the mortgage with full knowledge of the prior mortgage, and under Section 81 of the Transfer of Property Act he has no statutory right of marshalling. The order of the lower Court, therefore, which directs that this point shall now be decided by the Executing Court is based on misconception of the facts and an error in law.

(3.) This is enough to dispose of the appeal as the 8 defendant has no right of marshalling. The decree-holder is unfettered as to the order in which the property has to be sold. The lower Appellate Court seems to find some sort of fraud in the decree-holder's conduct merely because his election to have Item No. 2 sold first coincides with the desire of one of the mortgagors, the 2nd defendant. I can see no basis for deducing fraud from these circumstances. The decree-holder had an order in his favour in M.P. No. 99 of 1918 which gave him power to choose the order in which the properties should be sold, and why he should be accused of fraud merely because he exercised his right of choice which that order gave him, I do not understand.