1932 Supreme(SC) 37
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
LORD WEIGHT, SIR LANCELOT SANDERSON, AND SIR DINSHAH MULLA.
MOHAMMAD AFZAL KHAN - Appellant
Versus
ABDUL RAHMAN (DEFENDANTS) - Respondents
On appeal from the Court of the Judicial Commissioner, North-West Frontier Province.
Decided On : July. 14. 1932.
Solicitor for appellant: R. S. Nehra.
Solicitors for respondents No.1 and 2: T. L. Wilson & Co.
A mortgage of an undivided share is subject to the right of partition, limiting enforcement to the mortgagor's allotted share. Additionally, a transfer of attached property pursuant to a court decree, even if based on a private arbitration award, is not a "private transfer" under Section 64 CPC.
Headnote:(A) Transfer of Property Act, 1882 - Section 44; Code of Civil Procedure, 1908 - Section 64 - Mortgage of undivided share in joint property - Effect of subsequent partition - A mortgagee of an undivided share takes the security subject to the right of other co-sharers to enforce a partition - Upon partition, the mortgaged properties allotted to other co-sharers are taken free from the mortgage in the absence of fraud - The mortgagee can proceed only against the properties allotted to the mortgagor in substitution of the undivided share.
(B) Code of Civil Procedure, 1908 - Section 64 - Attachment of property - Partition decree based on private arbitration award - Whether a transfer pursuant to such a decree is a "private transfer" - A transfer made pursuant to a decree of the court is a transfer under an order of the court and not a private transfer, regardless of whether the decree was made on an award in a reference to arbitration without the intervention of the court.
Facts of the case:
A co-owner of joint properties mortgaged an undivided share to a creditor. Subsequently, other properties within the same joint estate were attached in execution of a decree against the same co-owner. Later, a partition was effected via a private arbitration award, which was subsequently converted into a court decree. This partition allotted both the mortgaged properties and the attached properties to other co-sharers. The creditor challenged the partition, claiming it was collusive and that the mortgage and attachment should prevail over the partition.
Findings of Court:
The court found that the mortgage of an undivided share is inherently subject to the right of partition. Regarding the attachment, the court held that the transfer of property occurred pursuant to a court decree, which distinguishes it from a private transfer.
Issues: (1) Whether a partition by arbitration affects the rights of a mortgagee of an undivided share in joint properties; (2) Whether a transfer of attached property pursuant to a partition decree based on a private arbitration award constitutes a "private transfer" under Section 64 of the Code of Civil Procedure.
Ratio Decidendi: The court ruled that a mortgagee of an undivided share cannot enforce the charge against properties allotted to other co-sharers upon partition, as the security is subject to the right of partition. Furthermore, any transfer of property executed under a court decree is not a "private transfer" within the meaning of Section 64 of the Code of Civil Procedure, even if the decree is based on a private arbitration award, as it is enforceable through court execution proceedings.
Result: Appeal dismissed.
Legal Category Hierarchy
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property law
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mortgages
- undivided share
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partition
- arbitration awards
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mortgages
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practice and procedure
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civil procedure code
- attachment of property
- execution of decrees
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civil procedure code
Judgement
Appeal (No. 102 of 1931) from a decree of the Court of the Judicial Commissioner, North-West Frontier Province (July 1, 1930), reversing a decree of the Subordinate Judge of Peshawar (November 22, 1929).
The appellant instituted a suit for a declaration that the share of defendant No. 1 (respondent No. 3) in certain mortgaged and attached properties was liable to be attached and sold in execution of the plaintiffs decree against that defendant, that the property was lawfully mortgaged with the plaintiff, and that defendants Nos. 2 and 3 (respondents Nos. 1 and 2) had no title to more than one-third share in the property.
The facts appear from the judgment of the Judicial Committee.
The main question in the appeal was as to the effect of a partition decree made in pursuance of an award in arbitration, the reference being made without the intervention of the Court, upon a mortgage of an undivided share in part of the partitioned property and upon an attachment of other parts thereof.
The Court of the Judicial Commissioner, reversing the trial judge, dismissed the appellants suit upon grounds which appear from the judgment of the Judicial Committee.
1932. May 31; June 2. Dunne K.C. and Narasimham (with them K. Shrinivas Rao) for the appellant. The partition did not affect the appellants right to enforce the mortgage according to its terms. There is no statutory provision depriving him of that right, and no decision of the Board applicable to the facts of the case. In Byjnath Loll v. Ramoodeen Chowdry (( 1874) L. R. 11. A, 106.) the partition was made under Ben. Reg. XIX. of 1814, and was already proceeding when the mortgage was executed. In the present case the partition was four years later than the mortgage, and was made in pursuance of a private arbitration to which the appellant was not a party. The trial judge rightly held that the arbitration was collusive. Further, in the case above referred to, the suit was to enforce a mortgage against property allotted to the mortgagor upon the partition, the observation that that was the only property against which the mortgage could be enforced was obiter. Neither did the partition affect the attachment. The partition, being made in pursuance of an arbitration without the intervention of the Court, operated as a " private transfer" within the meaning of s. 64 of the Code of Civil Procedure, 1908, and was therefore void as against the appellant.
De Gruyther K.C. and Parikh for the respondents Nos. 1 and 2 (respondent No. 3 did not appear). Since the judgment of the Board in 1874, a series of decisions in India have consistently upheld the principle that a mortgage of an undivided share of joint property takes the security subject to the right to partition, and that after a partition the mortgage can be enforced only against such property as is allotted to the mortgagor. Among the latest of these decisions are Bhup Singh v. Chedda Singh (( 1920) I. L. R. 42 A. 596, 606.) and Niranjan Mukherjee v. Soudamini Dassi . (( 1926) I. L. R. 53 C. 694. F. B.) The principle applies although the partition decree is made pursuant to an award in a private arbitration Amolak Ram v. Chandan Singh (( 1902) I. L. R. 24 A. 483.) ; Muthia Raja v. Appala Raja (( 1910) I. L. R. 34 M. 175.) ; Pullamma v. Pradosham . (( 1895) I. L. R. 18 M. 316.) Sect. 44 of the Transfer of Property Act, 1882, does not affect the inherent right to partition. The evidence did not show fraud or collusion in connection with the arbitration. A partition decree, though made in pursuance of an award in a private arbitration, does not operate as a " private transfer " within the meaning of s. 64 of the Code of Civil Procedure, 1908 Qurban Ali v. Ashraf Ali (( 1882) I. L. R. 4 A. 219.) ; Narayana Ayyar v. Biyari Bivi (( 1921) I. L. R. 45 M. 103.) ; Kasi Viswanatham Chettiar v. Kamaswami Nadar (( 1918) 35 Mad. L. J. 441.) ; see also Order xxi., r. 54. Great inconvenience would be caused if an attachment held up the right