RAJA JANAKI NATH ROY Vs. AKSHOY CHBOSE

JUDGEMENT

(1.) The only question raised on this application is whether an auction-purchaser should or should not pay interest on the purchase money from the date of sale until actual payment. The property concerned, 70 Diamond Harbour Road, was mortgaged by Akhoy Chandra Bose. The mortgagee sued on his security and obtained a preliminary and then a final decree and the property was sold on 12 February 1936, and bought by the applicant Radha Nath Boy. The property was alleged to be free from encumbrances but, on the date of sale, notice of a charge in his favour was sent out by the attorneys for Inder Chand Kezriwal who contended that he was a prior mortgagee. The purchaser then applied for an enquiry into title and the matter was referred to the Registrar for enquiry and report. The order of reference provided that the time for the purchaser to complete the purchase be extended by one month from the date of the completion of the enquiry and the questions of costs and interest were reserved. In the course of the reference Inder Chand Kezriwal was found to be a puisne mortgagee and stated that he claimed no interest in the property except the right of marshalling the sale proceeds and he undertook to get back the title deeds of the premises and to make them over to the auction-purchaser. On the faith of such disclaimer and undertaking the parties agreed that a good title had been made out. The report has been confirmed by effluxion of time and the question of costs has been decided by this Court and cannot now be re-opened. The only question outstanding is whether the auction-purchaser has to pay interest, and from what date, and if so, whether he is entitled to rents and profits.

(2.) The purchaser has expressed his willingness to pay the purchase money forthwith, but he points out that he is only to pay on getting a perfect title and that under the terms of the report the title was acceptable only on receipt of the title deeds and the title deeds have not yet been handed over to him. The application is opposed on the ground that under the conditions of sale the purchase money is payable within 40 days from the day of sale and that the purchaser is liable for interest from the end of 40 days from the day of the sale-or such further time as may be allowed by a Judge-to the day on which the same is actually paid. The mortgagor contends that this condition is peremptory and that interest is payable from the end of 40 days from the day of sale. This argument fails to take into consideration the words "or such further time as may be allowed by a Judge" and the order of 24 March 1936 extended the time to complete the purchase by one month from the date of the completion of the enquiry. Reference is also made to Ch. 27 of the Rules and Orders. Rule 35 provides for an enquiry where the title is in dispute. Rule 36 provides that where the title is found to be good on grounds not appearing on the abstract the purchaser unless otherwise ordered shall be entitled to the costs of the enquiry. This rule deals only with such costs and cannot, in my view, by implication, as is suggested, deprive the purchaser of any rights that he may have aliunde. Rule 38 provides: After a sale has been made the purchaser may, where prepared to accept the title, apply for leave to pay the balance of the purchase money into Court to the credit of the suit, or he may, where not prepared to accept the title, apply for leave to pay such balance into Court without prejudice to any question as to the title to the property....

(3.) It is contended that the purchaser is bound if he questions the title to pay the purchase money into Court and that only thus can he avoid payment of the interest. But the latter part of the rule seems to me to leave the Judge an ample discretion as to the terms which may be imposed on the purchaser as to the payment of interest or waiving his right to the rent up to the time when the question of title is determined. The order of 24 March extended the time for completion of the purchase and left over for further consideration the question of interest. The result of the enquiry shows that the purchaser was justified in objecting to the title. He waives his right to the rents and it would obviously be inequitable that he should be called upon to pay interest. He has expressed his willingness to pay the purchase money by the 20th instant although the puisne mortgagee has not yet honoured the undertaking on which the acceptance of the title depended. I hold that no interest is payable provided that the purchase money is paid by the 20 instant. There will be no order as to costs of this application.