1934 Supreme(Cal) 96
CALCUTTA HIGH COURT
Jagat Chandra De - Appellant
Versus
Abdul Rashid & Ors. - Respondent
Decided On : 12-07-1934
The rights of persons who have taken transfers of property subject to a mortgage cannot be bound by proceedings in a subsequent suit between the prior mortgagee and the mortgagor to which they were never made parties.
Headnote:
mortgage - property rights - Transfer of Property Act, Section 85, Order 34 Rule 5, Limitation Act - The court discussed the rights of the mortgagor and the mortgagee, the effect of lis pendens, and the bar of limitation in enforcing the mortgage lien. The court also highlighted the principle that persons who have taken transfers of property subject to a mortgage cannot be bound by proceedings in a subsequent suit between the prior mortgagee and the mortgagor to which they were never made parties.
Fact of the Case:
The plaintiff brought a suit for recovery of possession of a property purchased through a mortgage decree. The defendant, who purchased the property in execution of a prior mortgage decree, contested the plaintiff's claim.
Finding of the Court:
The court found that the plaintiff could not claim possession of the property against the defendant, as the defendant's rights were not affected by the sale held in execution of the plaintiff's mortgage decree. The plaintiff's claim for possession was dismissed.
Issues: The issues were whether the plaintiff could claim possession of the property against the defendant and whether the defendant was bound to redeem the plaintiff.
Ratio Decidendi: The court held that persons who have taken transfers of property subject to a mortgage cannot be bound by proceedings in a subsequent suit between the prior mortgagee and the mortgagor to which they were never made parties. The court also found that the plaintiff's right to enforce the mortgage lien had become barred by limitation before the institution of the suit.
Final Decision: The appeal was allowed, and the plaintiff's suit was dismissed. The parties were directed to bear their own costs throughout.
JUDGMENT
1. The facts which are relevant for the purposes of the present appeal and which are in dispute now are as follows: One Dasarath De, who is defendant 6 in the present suit, mortgaged the disputed land to the father of the plaintiff and the proforma defendants 7 and 8 and the husband of pro forma defendant 9 on 20th Sraban 1274 M.E. corresponding to 4th August 1912. The plaintiff and the pro forma defendants brought a suit on their mortgage on 9th July 1920. Usual mortgage decree for sale was passed on 8th September 1923 and the property was purchased by the plaintiff on 8th May 1924. The same mortgagor, that is defendant 6, mortgaged these very lands to one Lakshi Charan Saha on 21st Chaitra 1274 corresponding to 5th April 1913. Lakshi Charan Saha's son Prasanna Kumar Saha sued on his father's mortgage on 2nd June 1919 and obtained a decree on 11th September 1919 in execution of this mortgage decree. Defendant 2 purchased the property in execution of the mortgage decree on 2nd February 1922, and obtained possession of the lands through Court. The plaintiff after his purchase on 8th May 1924 could not get actual possession. On 13th December 1927 he raised the present suit for recovery of khas possession of the lands which he purchased on declaration of his auction-purchased right in the lands. The defence of defendant 2 was that the plaintiff was not entitled to any relief in the suit, in view of the fact that neither he nor the second mortgagee was impleaded as parties in the mortgage suit instituted by the plaintiff in the year 1920. The trial Court accepted the defence of defendant 2 and dismissed the suit. On appeal the learned Judge has reversed the decision of the trial Court and has passed the following order
The case is remanded to the Court below for enabling defendant 2-to redeem the prior mortgage of the plaintiffs father in accordance with the observations as above made. If defendant 2 exercise his right of redemption in pursuance of the Court's order, the suit will fail, but if he does not do so, the suit will succeed and the plaintiff will be given possession of the suit lands by ousting him (defendant 2) and the other defendants if in possession.
2. Hence the present appeal by defendant 2. The points for determination in this appeal therefore are (1) whether the plaintiff can claim possession of the property as against defendant 2, and (2) whether defendant 2 is bound to redeem the plaintiff in view of the events that have happened in this case. The principle is now well established that
persons who have taken transfers of property subject to a mortgage cannot be bound by proceedings in a subsequent suit between the prior mortgagee and the mortgagor to which they were never made parties: See Umesh Chandra Sircar v. Mt. Zahoor Fatima (1890) 18 Cal 164.
3. Defendant 2 is therefore not bound by the proceedings in the suit instituted by the plaintiff and his right cannot in any way be affected by the sale which was held in execution of the decree passed in that suit. Now what are the rights of defendant 2 on the basis of his purchase at the auction-sale held before the plaintiff purchased this property. It cannot be disputed now that a purchaser at a sale in execution of a mortgage decree gets the mortgagee's rights as well as the rights of the mortgagor and after the mortgagor's interest has once passed away to a purchaser, that interest cannot again be sold effectively: See Moti Lal v. Karrab-ul-din (1897) 25 Cal 179. The rights of the mortgagor vested in defendant 2 before the plaintiff's purchase and consequently he became entitled to possession before the plaintiff purchased at the auction-sale in execution of the decree obtained by him on the basis of his first mortgage. Consequently, the plaintiff cannot claim the mortgagor's right on the basis of his purchase. Again the purchase by the plaintiff cannot affect defendant 2's purchase of the mortgagor's right, that is, the equity of redemption, inasmuch as