The judgment established the principle of equitable assignment and clarified the rights of mortgagees in claiming debts from a firm's assets under the Indian Partnership Act, 1932.

George Abraham Vadakkel, J.

1. The material facts are: Kunjaram, widow of Ouseph, hypothecating the share Ouseph had in the firm, St.. Joseph's Tile Works, borrowed Rs. 1,750 from her husband's brother's four sons and executed Ext. 46 hypothecation deed dated 8th December 1951. This was when she was in pressing need for money to avert court sale of that share in execution of the decree in O.S. 60 of 1113 on the file of the Trichur District Court a decree charged on that share. At that time, this suit for dissolution of the firm, from proceedings where in this appeal arises was pending. It was provided therein, (Ext. 46), as follows:

x x x

A rough translation would be:-

"However, since for dissolution of the above said tile works, a suit is pending, for safeguarding your rights under this hypothecation deed, you have right to get yourself impleaded in that suit, and to recover all amounts and costs realized in that suit".

Two of the hypothecatees got themselves impleaded in this suit as defendant numbers 55 and 56. These entitled to the hypothecated share Ouseph's heirs were represented in this suit by the 53rd defendant. (He was the 1st respondent In this appeal; he died and his legal representatives are additional respondents 25 to 28.) A preliminary decree was passed in this case on 14th July 1958. Ouseph's heirs were declared as entitled to 1/2 /18 share in the assets of the firm. It was provided therein 'that the 1/2 share belonging to the heirs of Ouseph, son of Akkara Ouseph, Ouseph will be subject to the mortgage, Ext. 46 in favour of defendants 55 and 56. The tile works were sold in final decree proceedings and the proceeds are in deposit in the South Indian Bank Limited. Final decree has not yet been passed. By LA. 252 of 1972 defendants 55 and 56 claimed the amount mentioned therein from out of the deposit, which, according to them, is due to them under Ext. 46 hypothecation deed. The 53rd defendant contended that Ext. 46 mortgage is unsupported by consideration, that on the said mortgage the hypothecatees filed two suits, they were dismissed and therefore, the claim is barred by those decisions, that the claim is also barred by limitations and that the debt, if recoverable, is liable to be discharged under the provisions of Kerala Agriculturists Debt Relief Act, 1970. The Trial Court overruled these contentions holding that Ext. 46 deed enables defendants 55 and 56 to realise the debt from funds realised in this suit, and the preliminary decree provides for the same. The Trial Court noticed that the 53rd defendant in his written statement admitted the liability and recognised their right to recover the debt from funds realised in this suit. However, the contention based on the decisions in two suits brought on the mortgage was not adverted to by that court, though the 53rd defendant had produced the copies of the plaint and judgment in one of them, O.S. No. 22 of 1965 on the file of the Munsiff's Court, Trichur. The court also did not consider the 53rd defendant's claim for benefits under the Agriculturists' Debt Relief Act, 1970. On appeal by the 53rd defendant the lower appellate court held that the claim in I. A. 252 of 1972 is barred by reason of the decision in O.S. 22 of 1965. Hence this appeal.

2. It is contended that the order on I. A. 252 of 1972 is not an appealable order and therefore, the lower appellate court had no jurisdiction to deal with that order. This appears to be so. I am not satisfied that this order is an order under S.47 C.P.C. The preliminary decree is not executable and no execution was levied. Final decree has not been passed yet. The lower appellate court was not therefore competent to sit in appeal over that order, and consent would not cure that defect, I therefore set aside the lower appellate court's judgment in A. S. No. 246 of 1973 which is under appeal in this case before as mistakenly renumbered as C.S.A. 12 of 1975. I direct the office to restore the number originally assigne