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1951 Supreme(SC) 62

SUPREME COURT OF INDIA
 17th October 1951
PATANJALI SASTRI, B.K. MUKHERJEA, S.R. DAS AND BOSE JJ.
Sant Lal Mahton
Versus
Kamla Prasad and others
Appeal No. 81 of 1950.
Advocates appeared
Shri B. C. De, Senior Advocate (Shri Bhabananda Mukherjee, Advocate, with him), instructed by Shri I. N. Shroff, Agent - for Appellant ; Shri S. P. (Sinha, Senior Advocate (B. K. Saran, Advocate, with him), instructed by Shri R. C. Prasad, Agent - for Respondents.

Advocates:
B.C.Dey, B.K.SARAN, BHABANANDA MUKHEJI, I.M.SHROFF, R.C.Prasad, S.P.SINHA

Headnote:written or signed acknowledgement as only proof of payment

       

Judgement Key Points

Key Points: - The bond’s attestation and whether it was properly executed determine if the suit is for enforcement of a mortgage or for personal decree (!) . - The High Court held the bond was properly attested and that a mortgage decree could be passed, but the Supreme Court ultimately found against it based on attestation and other factors, dismissing the suit (!) (!) (!) . - Section 20, Limitation Act requires a written or signed acknowledgment of payment for extending the limitation period; mere part payments without such acknowledgment do not extend time, though acknowledgment can occur after the period but must exist before suit is filed (!) (!) (!) (!) . - For extension under S. 20, the acknowledgment must be in writing and signed or in the payer’s handwriting; absence defeats extension (!) (!) . - The suit filed on 4-3-1940 was deemed time-barred if treated as a personal decree; the amended plaint attempting to rely on payments did not provide proper written acknowledgments before filing (!) (!) . - The Court considered whether a mortgage decree could be passed under O. 41, R. 33 CPC; the appellate court exercised discretion in the absence of appeal/cross-objection but ultimately the judgment was to dismiss (!) (!) . - The learned judges concluded the appeal is allowed and the judgments of both Courts below are set aside and the suit dismissed; each party bears its own costs (!) .

How to determine whether a mortgage bond was properly attested and enforceable as a mortgage bond?

What is the effect of S. 20, Limitation Act, on extending the period for personal liability when payments are made without a signed acknowledgment?

What is the court’s decision on passing a mortgage decree in the absence of an appeal or cross-objection by the plaintiffs against the trial court’s negative finding on sale?


Judgment

B. K. Mukherjea J.- This appeal, which was originally taken to the Judicial Committee, on special leave, granted by an Order-in-Council dated 2-8-1946, now stands transferred to this Court by reason of the abolition of the jurisdiction of the Privy Council. It is directed against a judgment and decree of a Division Bench of the Patna High Court dated 17-3-1944, affirming, on appeal, a decision of the Subordinate Judge of Purnea dated 27-2-1942.

2. The appellants before us are the first party defendants in a suit, commenced by the plaintiffs respondents, for enforcement of a simple mortgage bond by sale of the mortgaged property. The trial Judge, while deciding all the other issues in favour of the plaintiffs, held on the evidence on the record, that the bond sued upon was not legally attested and hence could not rank as a mortgage bond. On this finding, he refused to make a decree for sale of the mortgaged property in favour of the plaintiffs and passed a money decree, for the amount due on the bond, personally against the defendants first party. According to the Subordinate Judge, although the suit was instituted more than 6 years after the date fixed for payment in the bond, yet the claim for personal relief against the mortgagors did not become time barred by reason of the fact that there were several payments made by the defendants towards the satisfaction of the debt, which attracted the operation of S. 10, Limitation Act. Against this decision an appeal was taken by the defendants mortgagors to the High Court of Patna, but no appeal or cross objection was filed by the plaintiffs against the refusal of the trial Court to make an order for sale of the mortgaged property in their favour. The appeal was heard by a Division Bench of the Patna High Court, consisting of Fazl Ali, C. J. and Beevor, J., and the principal point canvassed on behalf of the defendants appellants was, that the trial Court was wrong in holding that the plaintiffs claim for a personal decree was not barred by time. The argument put forward, was that the suit, as one for personal relief against the debtors, was barred on the expiry of 6 years from the date for repayment mentioned in the bond and the part payments relied upon by the plaintiffs in their plaint were ineffectual for the purpose of extending the period of limitation under S. 20. Limitation Act. The High Court on hearing the appeal came to the conclusion that the bond in suit was duly attested and was effective and enforceable as a mortgage bond, and that the view taken by the trial Court on the question of attestation could not be sustained on the evidence on the record. As the bond could be treated as a mortgage bond, the suit, as one for enforcement of a mortgage, was, in the opinion of the learned Judges, quite within time, and it was not necessary in these circumstances to call in aid the provisions of S. 20, Limitation Act, for the purpose of extending the period of limitation. The learned Judges held, however, that as the plaintiffs had not preferred any appeal or cross-objection attacking that part of the judgment of the trial Judge which dismissed their claim for a sale of the mortgaged property, they were unable to pass a mortgage decree in their favour. The result was that the decree made by the trial Judge was affirmed. It is the propriety of this decision that has been challenged before us in this appeal.

3. Mr. De, who appeared in support of the appeal has contended in the first place that even if the High Court was right in holding that the bond in suit was effective as a mortgage bond and the suit could be treated as one for enforcement of a mortgage, no decree for money could be passed against the defendants personally, unless the suit was instituted within the period prescribed by Art. 116, Limitation Act. The High Court, it is said, overlooked this aspect of the case altogether and was wrong in not considering the question of limitation. It is argued by the learned













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