Important points
When Section 36 A provides for a special charge, it is obvious that a charge created by a decree cannot prevail over Gahan/mortgage hypothecation-The charge created by mortgages executed on 3.10.2015, 16.11.2015 and 15.12.2015, by all means prevails over the charge created by the compromise decree of the court.

T.V. ANILKUMAR, J.

1. A claim petition filed by the Thrissur Service Co-operative Society Ltd. 1097 Thiruvambady (hereinafter called as claim petitioner) under Order XXI Rule 58 of the CPC in E.P. No.2/2016 was allowed by the Family Court, Thrissur by its order dated 21.3.2018. By the impugned order, the court upheld the charge claimed in the property by the Society and the decree holder was permitted to bring the property for sale subject only to the mortgage right held by it. The decree holder being the sole person aggrieved by the order, challenges the same in this O.P. invoking the powers of this Court under Article 227 of the Constitution of India.

2. The decree holder in O.P.862/2013 obtained a compromise decree on 15.6.2015, creating charge over 1.17 ares of land in survey No.222/5 B in Koorkanchery village, owned by third respondent under partition deed No.4533/2010 dated 1.12.2010. This property stands described as (C) schedule in the O.P. One of the terms agreed upon in the compromise decree by the parties is that, the respondents will be at liberty to encumber the property for raising funds for the purpose of satisfying the claim of the decree holder. With this object in mind, the attachment of the property effected before judgment on 7.6.2013, was lifted, subsequently on 27.7.2015. When the respondents in the O.P. failed to discharge their liability the decree holder filed E.P.No.2/2016 for realisation of an amount of Rs.13,68,360/- with interest from the judgment debtors and also applied for sale of the property based on the charged decree passed on 15.6.2015. It is in this context, the claim petitioner filed E.A. 298/2017 claiming first charge on the property and opposed the proposed sale in the execution proceedings.

3. The claim petitioner contended that the judgment debtors 2 and 3 had availed loans on various occasions mortgaging the property in its favour. There were transactions creating charge in the property even before institution of the Original Petition and also after lifting of attachment. The decree holder, who is the first respondent in the E.A.298/2017, opposed the claim petition. The judgment debtors, who are the parties to the compromise decree, did not choose to contest the claim petition for their own reasons.

4. The court below conducted an enquiry into the claim and after examining the documents on record, accepted the case of the claim petitioner that it had acquired first charge on the property. No oral evidence was adduced by any of the parties. On the side of the claim petitioner, Exts.A1 to A14 were marked. On the side of the decree holder, no evidence was tendered.

5. Contention of the decree holder that the charge created by the compromise decree on 15.6.2015 will prevail over the mortgage interest in favour of the claim petitioner, was not accepted by the lower court. By allowing the claim petition the court made it clear that, the proposed sale of the property in execution of compromise decree shall be subject only to the charge in favour of the Society.

6. Heard both sides.

7. Neither the decree holder nor the other respondents in the claim petition dispute that, even before institution of O.P.862/2013 there were various transactions of mortgage created with respect to the property in question in favour of the claim petitioner, by judgment debtors 2 and 3, in connection with availing of loans from the Society. The petition 'C' schedule property was attached before the judgment in the O.P., on 7.6.2013. The documents produced by the claim petitioner would show that the earliest mortgage created by judgment debtors 2 and 3 in respect of the property was on 3.6.2011 for a sum of Rs.3 lakhs and the said loan transaction was closed on 24.1.2012, before the institution of the O.P itself. Before closure of the above said loan, another mortgage was created a few days ago on 16.1.2012 for a sum of Rs.10 lakhs in respect of the same property. This mortgage continued to be in force on the d