1937 Supreme(Mad) 345
IN THE HIGH COURT OF MADRAS
R.V. Lakshmayya Naidu alias Raju Naidu
Versus
Purushothama Naidu and Ors.
Decided On : 20.10.1937
The main legal point established is the entitlement to enforce the vendors lien and the availability of statutory charge in favor of the vendor against the properties.
Headnote:
Vendors Lien - Property Sale - O.S. No. 114 of 1934, O.S. No. 93 of 1929 - I.L.R. (1926) Mad. 639, I.L.R.(1929) Luck. 552, I.L.R. (1935) Mad. 202, I.L.R. (1932) Lah. 618
Fact of the Case:
The properties were sold by the plaintiff to the defendant to pay off decree debts. The defendant failed to pay off one of the debts, leading to a series of property transfers and court auctions. The plaintiff filed a suit seeking possession of the properties, refund of purchase money, and enforcement of vendors lien.
Finding of the Court:
The court found that the plaintiff was entitled to enforce the vendors lien against the defendant, but the defendant could not enforce the same lien against the plaintiff. The court allowed interest at 6% on the unpaid purchase money.
Issues: The main issue was the enforcement of the vendors lien and the entitlement to unpaid purchase money and interest.
Ratio Decidendi: The court held that the statutory charge in favor of the vendor was available against the properties, and the plaintiff was entitled to enforce the charge against the defendant. However, the defendant could not enforce the same charge against the plaintiff.
Final Decision: Both appeals were allowed, and the decrees of the lower courts were set aside. O.S. No. 114 of 1934 was dismissed, and in O.S. No. 93 of 1929, there was a decree in favor of the plaintiff for the unpaid purchase money with interest against the defendant.
Pandrang Row, J.
1. The main facts in these connected appeals are simple and undisputed. The plaint properties in both the suits are one and the same. They were sold by one Lakshmi Ammal, the plaintiff in O.S. No. 114 of 1934, on 31st March, 1922, to one Purushotham Naidu, the first defendant in that suit. These will be referred to as the vendor and the vendee respectively. The vendor had succeeded to the properties on the death of her infant son and immediately thereafter the creditors of her husband filed several suits and obtained decrees. It was mainly to pay off these decree debts that the sale was effected for Rs. 11,000. The sale-deed clearly recites that the properties were sold for Rs. 11,000, out of which Rs. 1,041 were received in cash and the balance was left with the vendee for payment to the decree-holders. The vendee paid off the decree debts except one, namely, the debt due to the decree-holder in O.S. No. 166 of 1921. That decree-holder brought the properties to sale after the private sale in favour of the vendee and the properties were purchased in Court auction by one Ponni Naidu who subsequently transferred the same to one Gopala Naidu. They were ultimately brought to sale in execution of a decree obtained against Gopal Naidu and purchased by Lakshmiah Naidu, the plaintiff, in O.S. No. 93 of 1929. This suit was one in which there were three alternative reliefs prayed for, namely, (1) recovery of possession of the plaint properties, (2) refund of the money deposited as purchase money by the plaintiff, and (3)to enforce the vendors lien or charge in respect of the unpaid purchase money due under the sale-deed of 31st March, 1922. That suit was dismissed by the Court below mainly on the ground that there was no right of suit in a case of this kind, the learned Judge having relied upon the decision in Muthukumaraswami Pillai v. Muthuswami Thevan I.L.R. (1926) Mad. 639 and having declined to follow the Full Bench decision in Bahadur Singh v. Ramphal I.L.R.(1929) Luck. 552. Since then, however, the question has come up before a Full Bench of this High Court in Macha Koundan v. Kottora Koundan I.L.R. (1935) Mad. 202 which lays down the law more or less in the same terms as Bahadur Singh v. Ramphal I.L.R. (1929) Luck. 552 and Mehr Chand v. Milkhi Ram I.L.R. (1932) Lah. 618 another Full Bench case. Appeal No. 152 of 1932 is by the plaintiff in O.S. No. 93 of 1929. In the other suit by the vendor against the vendee to enforce the lien a decree was passed in favour of the plaintiff, the plaintiff in the other suit being also a party to that suit. The first defendant-vendee is the appellant in the other appeal. From the facts stated above, it is very clear that this is not a case in which the judgment-debtor, that is, the vendor, had no saleable interest in the property that was sold in execution of the decree in O.S. No. 166 of 1921, if it is found that there was a vendors lien or charge subsisting at the time of the Court sale. The question whether the vendor had such a charge is raised in the other appeal by the vendee. This question can be answered very shortly because a perusal of the sale-deed shows that there was no contract to the contrary negativing the charge given by the statute. The sale-deed clearly says that the sale was of land for a price, namely, Rs. 11,000. No doubt, the bulk of the price was retained with the vendee for being paid to certain creditors mentioned therein at the request of the vendor. In these circumstances it cannot be said that the statutory charge was given up. There is absolutely no substance in the contention that there was a waiver of this charge. There is nothing to show that the charge was at any time waived. The mere fact that the vendor asked the vendee sometime after the sale-deed was executed not to pay the amount due to one of the creditors does not mean that the vendor intended to give up or waive the right given by the statute in the shape of a charge on the proper