T V DURAISWAMI PILLAI Vs. PVENKATA REDDY

JUDGEMENT

(1.) In order to appreciate the questions which arise in this appeal it is necessary to set out the course of events preceding the suit. The appellant is a mittadar in the North Arcot District. On 27 February 1875 his predecessor-in-title mortgaged a village in the mitta to the respondent's predecessor-in-title to secure a loan of Rs. 9000. The mortgage was a usufructuary mortgage and the deed provided that the mortgagee should pay annually to Government Rs. 170-13-2, the amount of the peshkush. In the year 1914 the appellant filed a suit in the Court of the Subordinate Judge of Vellore for the redemption of the mortgage, and obtained a preliminary decree. The respondent was dissatisfied with the terms of the decree and appealed to this Court which modified it in certain respects which do not call for mention. It is sufficient to say that the preliminary decree was allowed to stand with further directions with regard to the taking of the account. 1 July 1924 was the date fixed for redemption. The appellant did not pay the amount due under the mortgage and on 1 July 1924 the respondent obtained a final decree for the sale of the property. The respondent and his predecessors-in-title have not fulfilled their obligation to pay the peshkush due to Government. Throughout, the appellant or his predecessors-in-title have been compelled to pay the peshkush in order to prevent the Government from selling the property.

(2.) On 16 January 1933 the suit out of which this appeal arises was filed by the appellant to recover the amounts which he had been compelled to pay to Government as peshkush during the six years immediately preceding the suit. After the suit had been instituted the appellant paid the amount due to the respondent under the mortgage. The payment was effected by the adjustment of certain accounts in which the parties were interested. On 7 March 1933 satisfaction of the mortgage decree was entered and the appellant was given possession of the property. The adjustment between the parties which led to the discharge of the mortgage debt did not however take into account the amount due by the respondent to the appellant in respect of the peshkush which the appellant had been compelled to pay in order to safeguard the property, and in these circumstances the suit proceeded. The respondent denied all liability and various issues were framed, but the case really only involved the consideration of two questions. The first question was whether the appellant was entitled to rely on the mortgage deed and claim damages oh the basis of a breach of a contract in writing registered in which case he was entitled to recover the total amount paid by him as peshkush for the six years preceding the suit. The second question was whether the position was governed by Section 69, Contract Act, in which case, the appellant could only recover the amounts paid for three years. The District Munsif held that the appellant was only entitled to rely on Section 69, Contract Act, and granted him a decree in respect of the amount paid by him in respect of the three years immediately before suit. On appeal, the Subordinate Judge of Vellore concurred in the decision of the District Munsif. The appellant contends that he is entitled to recover the full amount, of his claim as damages for breach of a registered contract and has relied on the decision of the Privy Council in Manohar Das Mohanta V/s. Hazarimull . For the respondent three contentions have been raised. In the first place it is said that Manohar Das Mohanta v. Hazarimull is not an authority for the proposition that the appellant could file a separate suit for damages for breach of the respondent's covenant in the mortgage deed after the final decree had been passed in the redemption suit. In the second place it is said that even if that decision does apply the mortgage deed cannot be relied on in this case as the mortgage was redeemed on 7 March 1933 and in consequence the relationship of the mortgagor and the mortgagee ceased. The third contention is that a suit is not maintainable by reason of the provisions of Order 34, Rule 10, Civil P.C. It may here be mention, ed that the second and the third contentions were not advanced in the Courts below.

(3.) An examination of the judgment in Manohar Das Mohanta V/s. Hazarimull makes it manifest that the appellant is entitled to rely on the mortgage deed notwithstanding the passing of the final decree. In that case the plaintiff sued to enforce a mortgage. Defendant 7 was impleaded because he was entitled to a usufructuary mortgage of an earlier date and to certain simple mortgages which had been created after the plaintiff's mortgage. A final decree for sale was obtained by the plaintiff, but before the sale took place he brought a second suit to recover the amount of the revenue which he had been called upon to pay in respect of the mortgaged property. The mortgagor had by the mortgage deed covenanted to pay this revenue. The question was whether the mortgagee was entitled to bring the second suit. It was argued that inasmuch as there had been a final decree the mortgage deed could not be looked at. The decree had, it was said, taken the place of the deed. In this connexion reliance was placed on the decisions in Sunder Koer V/s. sham Krishan (1907) 34 Cal. 150 and Jagannath Prosad V/s. surajmal Jala . The Board did not accept the argument and held that the appellant was entitled to institute the second suit and to have the amounts which he had paid in respect of the Government revenue made a first charge on the sale proceeds.