GOURI DUTT MAHARAJ Vs. SUKUR MOHAMMED

JUDGEMENT

(1.) This appeal is from a judgment and decree of the High Court at Port William in Bengal (Mukberjea and Pal JJ.) dated 27 - 8 - 1942 which substantially varied the judgment and decree, dated 24 - 11 - 1939, of the Court of the Subordinate Judge at Asansol in a mortgage suit brought by the present appellant as mortgagee.

(2.) The facts material to the issues now calling for determination may be stated as follows - On 15 - 11 - 1931, Sheikh Sukur Mohammad, the first named respondent (hereinafter called the mortgagor), obtained a lease of some three - fifths of an acre in the town of Asansol for 3 years at a rent of Rs. 12 per month and with a right of renewal. The mortgagor proceeded to construct a cinema on this plot and, falling short of funds, took into partnership Oscar Gerald Birt and Pramatha Nath Mukherjee (hereinafter called the new partners) who were, it appears, the predecessors - in - title of the respondents other that the mortgagor. This transaction was effected by an unregistered agreement in writing of 8 - 6 - 1932, which provided (a) for the carrying on of the cinema business in partnership by the mortgagor and the new partners, with the former having an eight annas interest and each of the new partners a four annas interest, and (b) for the sale by the mortgagor to the new partners of the mortgagor's eight annas interest, or half share, in the cinema business and its assets, which included the leasehold already mentioned, for the sum of Rs. 15,000 "free from all encumbrances". The parties to this agreement fell out and on 20 - 9 - 1932, the new partners commenced a Suit No. 229 of 1932 - against the mortgagor. In this suit the new partners pleaded the agreement of 8 - 6 - 1932, alleged that they had advanced thereunder a sum of Rs. 17,375 and claimed, inter alia, specific performance of the said agreement for sale and, alternatively, a decree for the said advance of Rs. 17,375 with a declaration that it and costs were a first charge on the premises described which included the said leasehold. On the next day, 21 - 9 - 1932, the mortgagor executed a mortgage deed of the said leasehold, with fittings and equipment, in favour of the appellant to secure an advance of Rs. 6,000 with interest. This was a simple mortgage, duly registered, and the present suit is founded upon it.

(3.) Suit No. 229 (to which the appellant was throughout a stranger) ended in a compromise between the mortgagor and the new partners which was reduced to writing and was framed on the basis that the new partners should drop out of the cinema business and relinquish their rights under the agreement of 8 June in consideration of the mortgagor paying them a sum of Rs. 18,500 in respect of moneys advanced and costs of suit. It is unncessary to explore the full detail of this document, but the following stipulations therein are material and must be set out: Clause 2. "That a final decree for the aforesaid sum of Rs. 18,500 will be passed in favour of the plaintiffs and that the defendant will make payment of the said decretal sum by monthly payment as described below." Clause 6. "That the decretal dues of the plaintiffs as stated above are a first charge on the Cinema house, lands, machineries, plants, tools, furniture, equipment, etc. mentioned in the Schedule below and shall continue a first charge till full satisfaction of this decree." Clause 12. "That the defendant assures the plaintiffs that there is no charge or mortgage on the properties mentioned in the Schedule below save and except one mortgage in favour of Gouri Dutt Maharaj of Asansol for Rs. 6,000 (six thousand) subsequent to the aforesaid agreement dated 8 - 6 - 1932." The Schedule referred to specified the leasehold in question. The compromise was accepted by the Subordinate Judge at Asansol on 17 - 11 - 1932, as appears from the final decree in Suit No. 229 which ordered that "the suit be decreed in terms of petition of compromise" and directed that the compromise be made part of the decree.