Lien of vendor over the property exists.

One Chidambaram Pillai was the owner of the properties which are sought to be redeemed in the suit out of which the above Letters Patent Appeal has arisen. On 6th February, 1917, under Exhibit P-1 he usufructuarily mortgaged these properties to the defendant respondent, the mortgage money secured being a sum of Rs.2,850. The stipulation in the deed was that the mortgagee was to remain in possession, enjoy the usufruct until the 15th May, 1923, when the mortgage amount would be paid and redemption would take place. The document in question evidences an ordinary usufructuary mortgage without any complications. On 29th October, 1923, under Exhibit D-1 Chidambaram Pillai sold the equity of redemption in these properties to one A.N.R.M. Ramanathan Chettiar and the consideration recited in the sale deed was a sum of Rs.8,500 of which Rs.2,850 was reserved for payment to the mortgagee under Exhibit P-1, Rs.150 for discharging a promissory note debt due by the vendor to the same usufructuary mortgagee, and a sum of Rs.5,500 for discharging a promissory note debt due by the vendor to one M.L.M. Ramanathan Chettiar of Devakottai in respect of which debt C.S.No.980 of 1922 had been filed in the High Court. No sum was paid in cash. It is common ground that Ramanathan Chettiar has not paid off the decree amount in C.S.No.980 of 1922 or the promissory note debt due to the defendant. Obviously the mortgage has not been redeemed at all.

On 12th September, 1930, Chidambaram Pillai filed I.P.No.28 of 1930 in the Sub-Court of Ramnad for getting himself adjudged an insolvent and he was accordingly adjudicated on 26th June, 1931, vide Exhibit D-4, with the result that his properties had become vested in the Official Receiver of Ramnad under section 28(2) of the Provincial Insolvency Act. Pending his adjudication on 13th October, 1930, Chidambaram Pillai borrowed a sum of Rs.500 from the plaintiff by executing a promissory note, a copy of which is filed as Exhibit D-14. It was renewed on 7th October, 1933, by a promissory note, a copy of which is filed as Exhibit D-15. On 28th April, 1934, under Exhibit D-8 Chidambaram Pillai obtained an order of discharge on condition that he would pay Rs.15 per month till the proved creditors are paid at the rate of twelve annas in the rupee. In October 1935 Chidambaram Pillai died and after his death the plaintiff who had obtained the promissory note,the originals of Exhibits D-14 and D-15, filed S.C.S.No.287 of 1936 in the Sub-Court of Tuticorin against the widow of Chidambaram Pillai for recovery of the amounts due under the promissory notes and the suit was decreed in favour of the plaintiff on 3rd November, 1936. In execution of that decree by E.P.No.567 of 1939, dated 18th November, 1940, the decree-holder plaintiff attached the equity of redemption in the mortgaged properties under Exhibit P-1 and purchased them himself. By E.A.No.72 of 1941 the plaintiff obtained symbolical delivery on 8th February, 1941, of the rights purchased by him and the present suit is as the owner of the equity of redemption by the plaintiff to redeem the mortgage Exhibit P-1.

The usufructuary mortgagee under Exhibit P-1 was the only defendant and Ramanathan Chettiar in whose favour the equity of redemption had been sold for a consideration of Rs.8,500 under Exhibit D-1 has not been impleaded as a party. Both the lower Courts dismissed the suit for the following reasons:firstly they held that Exhibit D-1 was not a void, sham or colourable transaction and therefore there was nothing to vest in the Official Receiver as the insolvent had parted with these properties before he filed the application to adjudge him as an insolvent Secondly they also held that there was no vendor’s lien subsisting in favour of Chidambaram Pillai with regard to any portion of the unpaid purchase money; and lastly that the decree in S.C.S.No.287 of 1936 without obtaining the leave of the Insolvency Court and without making the Official Rec