GANESH PRASAD Vs. RAM SHANKAR LAL; BALDEO DAS

JUDGEMENT

(1.) The question before us was referred to a Full Bench on the ground of its importance, and is whether a sub-mortgagee of mortgagee rights is entitled to a decree for sale of those rights. I understand this to be whether, when a mortgagee has sub-mortgaged his interest in the property mortgaged to him to a sub- mortgagee, the sub-mortgagee is entitled to sell the interest in the property of his sub-mortgagor without impleading the mortgagor and foreclosing his equity of redemption; whether in fact the interest in the property mortgaged which has passed to the sub-mortgagee can be sold, leaving the equity of redemption outstanding in the mortgager.

(2.) Before I deal with this question it may be well to ascertain what is the nature of a mortgage and sub-mortgage as usually met with in these Provinces. "We rarely come across a mortgage in the English form, namely, a mortgage by way of conveyance of his land by the mortgagor to the mortgagee with a proviso that on repayment of the sum advanced by the mortgagee on a certain day, the mortgagee shall re-convey the estate. In a sub-mortgage of such a mortgage according to the English form, the security comprises the personal covenant of the sub-mortgagor to pay the sum advanced to him by his sub-mortgagee and also a transfer of the original mortgage debt and mortgaged property with the benefit of all powers and remedies contained in the original mortgage, to secure repayment of the mortgage debt. According to the practice in these Provinces a mortgagor does not in terms convey to the mortgagee the mortgaged property, but merely hypothecates the property as security for the money advanced to him. The transaction takes the form of an hypothecation or pledge merely of the property. So in the case of a sub-mortgage, the sub-mortgagor merely hypothecates his interest in the property mortgaged to him as security for the repayment of an advance made to him by the sub-mortgagee.

(3.) If the rule laid down by the majority of the Full Bench of this Court in the case of Mata Din Kasodhan V/s. Kazim Husain (1891) I.L.R., 18 All., 482 is accepted, it appears to me that the question before us must be answered in the negative, for it seems to follow as a logical consequence of that decision that the rights of a sub- mortgagee cannot be sold by the Court separately and apart from the interest in the land of the original mortgagor. Under ordinary circumstances, and notwithstanding the fact that this decision has not been accepted by the other High Courts, I should be disposed, on the well recognized and convenient rule stare decisis, to accept and follow it. But we are confronted by an earlier Full Bench decision which is wholly inconsistent with it: that is the case of Raghunath Prasad V/s. Jurawan Rai (1886) I.L.R., 8 All., 105. In view of this conflict of authority it becomes our duty to consider and determine which of these two authorities commends itself to us as correct.