HARI RAM Vs. MUNSHI SINGH

JUDGEMENT

(1.) This is a plaintiff's appeal arising out of a suit brought for the enforcement of a mortgage dated 29 November 1930 executed by Bhartu in favour of the plaintiff. Munshi Singh was impleaded in the suit as a defendant as on 20 May 1932 ho had purchased the mortgaged property in execution of a simple money decree No. 726 of 1930. The suit was resisted mainly by Munshi Singh who pleaded inter alia that the mortgaged property could not be sold without his mortgages being paid first. The trial Court decreed the suit. On appeal the learned Civil Judge modified the decree of the Court of first instance and directed that the plaintiff shall not be entitled to sell the mortgaged property in suit unless and until he pays the money due to Munshi Singh under the prior mortgages standing in favour of Munshi Singh. The plaintiff has preferred an appeal from the decree of the Court below. It is contended that the view of law taken by the Court below is erroneous and that the right to redeem enjoyed by a subsequent mortgagee is a right which can be exercised only at his option and at will. He cannot be forced to redeem against his will. It appears that there are three mortgages standing in favour of Munshi Singh. The first is a usufructuary mortgage dated 3 May 1909; the remaining two are simple mortgages dated 22 July, 1925 and 4 May 1926. Munshi Singh by virtue of his possessory mortgage has been in possession of the property ever since 1909 and since he purchased the equity of redemption in execution of a simple money decree he has become full proprietor of the property subject to certain obligations under the mortgage dated 29 November 1930 in favour of the plaintiff.

(2.) A large number of authorities have been cited by learned Counsel on behalf of the parties. Before examining the case law I proceed to consider the statutory provisions on the subject. It is not disputed that the plaintiff is a subsequent mortgagee and his mortgage is the last in point of time. It is open to a subsequent mortgagee to redeem a prior mortgagee. It is also open to him to sue for foreclosure or for sale without making the prior mortgagee a party to the suit. Nor is it necessary for a puisne mortgagee to implead a prior mortgagee in a suit to redeem a subsequent mortgagee : see Order 34, Rule 1, Explanation. In the present case however the prior mortgagee is a party and the question is whether it is permissible for the plaintiff to sell the property mortgaged to him subject to the prior incumbrances under the earlier mortgages without redeeming those mortgages. Section 101, T.P. Act, provides: Any mortgagee of or person having a charge upon, immovable property, or any transferee from such mortgagee or charge holder, may purchase or otherwise acquire the rights in the property of the mortgagor or owner, as the case may be, without thereby causing the mortgage or charge to be merged as between himself and any subsequent mortgagee of or person having a subsequent charge upon the same property and no such subsequent mortgagee or charge holder shall be entitled to foreclose or sell such property without redeeming the prior mortgage or charge, or otherwise than subject thereto.

(3.) It will be observed that under the first part of the Section the prior mortgagee namely the respondent, can set up his prior mortgages as a shield against the subsequent mortgagee and the mere fact that the equity of redemption has been purchased by the respondent will not be deemed to extinguish the mortgages in his favour. Even if some of the mortgages are barred by limitation the prior mortgagee can insist on their being paid by the subsequent mortgagee if the latter wants to dispossess him. The latter part of the Section deals with the right of the subsequent mortgagee and the Section provides that the subsequent mortgagee shall not be entitled to sell such property as is mentioned under the earlier part of the Section without re-deeming the prior mortgage or otherwise than subject thereto. It has been contended by learned Counsel for the appellant that the law provides two alternatives for his client. The one alternative is to redeem the prior mortgages and the other is to sell the property subject to those prior mortgages. It is contended that the Court below has erred in limiting the right given to the subsequent mortgagee under the Section by directing him to redeem the mortgages. Several cases have been cited by learned Counsel in support of his contention. In Chinnu Pillai V/s. Venkatasamy Chettiar (1917) 4 A.I.R. Mad. 751 it was held: Where a prior mortgagee sued for sale on his mortgage without making a puisne mortgagee a party to the suit and obtained a decree and in execution of the decree property was sold and purchased by a third person the puisne mortgagee is entitled to sue for sale on his mortgage subject to the prior mortgage after making the purchaser a party to the suit.