Back
HIGH COURT OF CALCUTTA
G. K. MITTER, J.
Jnan Chand Chugh
Versus
Jugal Kishore Agarwal
Suit No.659 of 1959
Decided On : 21-09-1959
SUIT FOR DECLARATION - MORTGAGE DECREES - INVALIDITY - JURISDICTION - IMMOVABLE PROPERTY - TRANSFER OF PROPERTY ACT - GENERAL CLAUSES ACT - LETTERS PATENT - RES JUDICATA - CONSENT DECREE - JURISDICTIONAL ERROR - WAIVER - ESTOPPEL BY RECORD.
Fact of the Case:
Plaintiff filed a suit for a declaration that the decrees passed by the Court in 1958 in a suit filed by the defendants against the plaintiff's father were invalid and illegal and not binding on the plaintiff. The plaintiff's father had entered into an agreement with the defendants to lend money from time to time as and when required for the purpose of the borrower's business. The agreement provided that the borrower would execute a formal legal charge over his entire machinery and fixtures as specified in the schedule to the document. In pursuance of the agreement, the plaintiff's father executed a mortgage in favor of the defendants of properties set out in the schedule to the deed of mortgage. The mortgage was registered in the office of the Registrar of Assurances, Calcutta. The properties charged included machinery, hinges, pull drawers, door bolts, and belt lacing and machinery. The plaintiff contended that the machinery was immovable property and that the Court had no jurisdiction to try the suit filed by the defendants in 1957. The defendants denied that the machinery was immovable property and contended that the machinery was trade fixtures installed in the factories by the plaintiff's father for the purpose of their business and not for any beneficial enjoyment of the land on which they stood.
Finding of the Court:
The Court held that the machinery in question was not immovable property within the meaning of the Transfer of Property Act and the General Clauses Act. The Court further held that the suit filed by the defendants in 1957 was not a suit for land and that the Court had jurisdiction to try the said suit. The Court also held that the present suit was barred by the principles of res judicata.
Issues: 1. Are the mortgaged properties immovable properties as alleged in paragraph 1 of the plaint? 2. (a) Was suit No. 1182 of 1957 - a suit for land? 2. (b) Did this Court have jurisdiction to try the said suit? 3. Is this suit barred by res judicata or principles analogous thereto? 4. To what relief, if any, is the plaintiff entitled?
Ratio Decidendi: The Court held that the machinery in question was not immovable property within the meaning of the Transfer of Property Act and the General Clauses Act. The Court further held that the suit filed by the defendants in 1957 was not a suit for land and that the Court had jurisdiction to try the said suit. The Court also held that the present suit was barred by the principles of res judicata.
Final Decision: The Court dismissed the suit with costs.
2. The facts of the case lie in a very short compass. The plaintiffs father Ratan Chand Chugh deceased entered into an agreement on 9-6-1953 with the defendants herein whereby the latter agreed to lend to the borrower from time to time as and when required a total sum of Rs. 1,00,000/- for the purpose of the borrowers business. There is a recital in this document that in order to secure the proposed loan the borrower had agreed to execute, whenever called upon, a formal legal charge over his entire machinery and fixtures as specified in the schedule to the document. In pursuance of the above agreement and in consideration of a sum of Rs. 1,00,000/- the plaintiffs father Ratan Chand Chugh executed a mortgage in favour of the defendants herein of properties set out in the schedule to the deed of 4-8-1953. The mortgage was registered in Book No. 1 of the Registrar of Assurances, Calcutta. Ratan Chand Chugh was the sole proprietor of the Arim Tin and Steel Works at 258/4, Upper Circular Road, Calcutta, which is beyond the local limits of the original jurisdiction of this Court. The deed was in the form of an English mortgage to secure a sum of Rs. 1,00,000. Ratan Chand was only a monthly tenant of the land on which the factories stood. The properties charged include hinges, pull drawers, door bolts and belt lacing and machinery, described more fully in the schedule to the deed. As a matter of fact there are two factories one at the premises already mentioned and the other at 246, Maniktola Main Road, Calcutta, also situate outside the original jurisdiction of this Court. Below the list of machinery given in the schedule there is an endorsement reading "machinery, fixtures at premises No. 246, Maniktola Main Road and 258/4, Upper Circular Road, Calcutta". The only other thing of any significance mentioned in the deed is a statement that
"if the properties hereby granted or any portion thereof be at any time acquired by the State of West Bengal or any public or corporate body or legal authority for any public purpose then the amount of compensation money awarded in respect of such acquisition shall be applied towards the payment of costs and then towards the interest and the balance, if any, towards the payment of the principal money for the time being due under these presents without further consent of the mortgagor and the mortgagee shall be entitled to receive the said compensation money and appropriate the same".
3. On 5-7-1957 the mortgagee filed a suit on the mortgage with leave under Cl. 12 of the Letters Patent on the ground that the money was advanced in Calcutta and the mortgage executed within the jurisdiction of this Court. The prayer in the plaint was that a mortgage decree should be passed in Form No. 5 or 5A of Appendix D to the first schedule of the Code of Civil Procedure. Immediately thereafter the mortgagee applied to this Court for the appointment of a Receiver. The mortgagor filed an affidavit-in-opposition thereto contending, inter alia, that this Court had no jurisdiction to try the said suit inasmuch as the properties mortgaged were heavy machinery imbedded and permanently attached to and fixed in the earth and were immoveable property. Bose J. who heard the application, appointed the Official Receiver a Receiver over the mortgaged properties. The plaintiff preferred an appeal therefrom taking the same point as to jurisdiction. Thereafter there was a compromise between the parties whereby a preliminary mortgage decree was made on consent on 20-1-1958, the plaintiff undertaking to withdraw the said appeal. A final decree was passed on the basis of the said preliminary decree on 18-8-19
AI
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
