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IN THE HIGH COURT OF MADRAS FULL BENCH
Ramesam, J.
M. Paramasivan Pillai
Versus
A.V.R.M.S.P.S. Ramasami Chettiar
Decided On : 20.01.1933
LETTERS PATENT APPEAL - [KEYWORD] - [SUBJECT] - [ACT SECTION LIST] - [SUMMARY]
Fact of the Case:
The 1st defendant executed a deed of mortgage in favour of one Krishna Pillai on 30th May, 1924, for Rs. 20,000. The present 1st plaintiff is his brother, the 2nd and 3rd plaintiffs and the 7th defendant are his nephews and the 4th plaintiff is his grand-nephew. Krishna Pillai died and in the family arrangement entered into after his death the mortgage document fell to the share of the plaintiffs and the 7th defendant. The 2nd defendant is the undivided brother of the 1st defendant. The property that was originally mortgaged was the othi right in the suit properties created in favour of the 1st defendant by one Dathaprakasam Pillai but after the suit mortgage, i.e., on 28th November, 1928, defendants 1 and 2 purchased the whole proprietary right in the properties. The 3rd defendant is the son of the purchaser of the properties from defendants 1 and 2 under a sale deed dated 23rd February, 1929. Under the sale deed he was directed to pay Rs. 24,500 towards the suit debt. He offered to pay the said amount in complete discharge of the mortgage but the plaintiffs refused to accept it on the ground that more was due to them with the result that the amount remained unpaid. On the 29th September, 1930, a preliminary decree was passed in favour of the plaintiffs for Rs. 20,000 with interest at the rate of 131/2 per cent, per annum from the date of the plaint which amounted to nearly Rs. 37,000. In August, 1931, the plaintiffs applied for the appointment of a Receiver of the suit properties on the ground that the properties were scarcely enough for discharging the decree and that there was no other means of realising the decree amount. The Subordinate Judge passed an order holding that this was a fit case for the appointment of a Receiver and directed the Receiver to take possession of the properties from 1st November, 1931, There was an appeal to the High Court by the 3rd defendant and it was followed by an application for the stay of the order of the Subordinate Judge. The order was stayed on the appellant giving security. The matter came on before our brother Pandalai, J., who reversed the order of the Subordinate Judge on 21st September, 1932. This Letters Patent Appeal comes on before us in due course.
Finding of the Court:
The Court found that the 3rd defendant did not pay anything to the plaintiffs after the purchase. The Court disbelieved the 3rd defendants story that the plaintiffs refused to receive the amount on account of dissensions among themselves. The Court observed that there was a prior application for the appointment of a Receiver during the pendency of the suit and that it was dismissed but thought that this circumstance did not matter as at the time of the present application a much larger amount was due to the plaintiffs than at the time of the earlier application. It also appeared that the value of the hypotheca was going down day by day. The 3rd defendant also relied on the fact that the plaintiffs gave up their right to get a personal decree against the mortgagors but the Court thought that that circumstance did not matter.
Issues: Whether the Court has jurisdiction, in a suit where personal relief against the mortgagor and his other properties has been given up by the mortgagee, to order the appointment of a Receiver in the suit of a simple mortgagee.
Ratio Decidendi: The Court held that the circumstance that a simple mortgagee in India under the provisions of the Transfer of Property Act is not entitled to possession of the mortgage property even on default of payment of the mortgage money, does not necessitate the conclusion that the Court has no jurisdiction to appoint a Receiver over the mortgage properties in a suit brought to enforce the simple mortgage, should it consider just and convenient to do so. The Court further held that the circumstance that the right of the mortgagee to have personal relief against the mortgagor and his other properties has been given up, or has become barred by limitation or does not exist in particular cases, is no ground by itself to hold that the Court has no jurisdiction to appoint a Receiver in such cases.
Final Decision: The Court allowed the appeal and restored the decision of the Subordinate Judge with all costs in the High Court.
Ramesam, J.
1. This is a Letters Patent Appeal against the order of our brother Pandalai, J., in C.M.A. No. 375 of 1931. When the appeal came on for admission before our brothers Reilly and Venkatasubba Rao, JJ., while admitting it they directed it to be posted before a Bench of three Judges on the ground that the appeal raised a very important question on which conflicting views were expressed.
2. The facts of the case are as follows. The 1st defendant executed a deed of mortgage in favour of one Krishna Pillai on 30th May, 1924, for Rs. 20,000. The present 1st plaintiff is his brother, the 2nd and 3rd plaintiffs and the 7th defendant are his nephews and the 4th plaintiff is his grand-nephew. Krishna Pillai died and in the family arrangement entered into after his death the mortgage document fell to the share of the plaintiffs and the 7th defendant. The 2nd defendant is the undivided brother of the 1st defendant. The property that was originally mortgaged was the othi right in the suit properties created in favour of the 1st defendant by one Dathaprakasam Pillai but after the suit mortgage, i.e., on 28th November, 1928, defendants 1 and 2 purchased the whole proprietary right in the properties. The 3rd defendant is the son of the purchaser of the properties from defendants 1 and 2 under a sale deed dated 23rd February, 1929. Under the sale deed he was directed to pay Rs. 24,500 towards the suit debt. He offered to pay the said amount in complete discharge of the mortgage but the plaintiffs refused to accept it on the ground that more was due to them with the result that the amount remained unpaid. On the 29th September, 1930, a preliminary decree was passed in favour of the plaintiffs for Rs. 20,000 with interest at the rate of 131/2 per cent, per annum from the date of the plaint which amounted to nearly Rs. 37,000. In August, 1931, the plaintiffs applied for the appointment of a Receiver of the suit properties on the ground that the properties were scarcely enough for discharging the decree and that there was no other means of realising the decree amount. The Subordinate Judge passed an order holding that this was a fit case for the appointment of a Receiver and directed the Receiver to take possession of the properties from 1st November, 1931, There was an appeal to the High Court by the 3rd defendant and it was followed by an application for the stay of the order of the Subordinate Judge. The order was stayed on the appellant giving security. The matter came on before our brother Pandalai, J., who reversed the order of the Subordinate Judge on 21st September, 1932. This Letters Patent Appeal comes on before us in due course.
3. The Subordinate Judge found that after the purchase by the 3rd defendant nothing was paid to the plaintiffs. He disbelieved the 3rd defendants story that the plaintiffs refused to receive the amount on account of dissensions among themselves. He observed that there was a prior application for the appointment of a Receiver during the pendency of the suit and that it was dismissed but he thought that this circumstance did not matter as at the time of the present application a much larger amount was due to the plaintiffs than at the time of the earlier application. It also appeared that the value of the hypotheca was going down day by day. The 3rd defendant also relied on the fact that the plaintiffs gave up their right to get a personal decree against the mortgagors but the Subordinate Judge thought that that circumstance did not matter. On appeal our brother Pandalai, J., observed:
If this appeal depended on the above or similar considerations which affect Receiver applications in ordinary simple mortgage suits, I should have no hesitation in confirming the order of the learned Judge.
4. He referred to Khubsurat Koer v. Saroda Charan Guha (1911) 14 C.L.J. 526 and Rameshwar Singh v. Chuni Lal Shaha I.L.R.(1919) 47 Cal. 418 referred to with approval in Maharajah of Pittapuram v. Gokuldoss Goverdhan
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