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1950 Supreme(All) 335

IN THE HIGH COURT OF ALLAHABAD
Wali Ullah, Kidwai and Chandiramani, JJ.
RAM KISHORE TANDON - Appellant
Versus
SHAYAUR SUNDAR LAL - Respondents
Exn. Decree Appeal 84 Of 1944
Decided On : 10/27/1950

Advocates Appeared:
H.D.Srivastava, K.N.Tandon

Headnote:

The preliminary decree cannot be amended under Section 8, Debt Redemption Act after the passing of the final decree. The final decree also cannot be amended under Section 8, Debt Redemption Act, as it was passed after the Debt Redemption Act came into force. The transactions evidenced by the earlier mortgages can be reopened for the purpose of determining the amount due at the date of the mortgage in suit, namely, 30-3-1927. The accumulated interest which has been converted into principal at any statement or settlement of account or by any contract in the course of the transaction made before 1-1-1917, shall be treated as principal.

Fact of the Case:

The mortgage was executed by Shyam Sunder Lal in favour of the appellant Ram Kishore Tandon in respect of an advance of Rs. 1428 at six per cent. interest compoundable half yearly. The hypothecated property consisted of two houses in the city of Gonda and five tenancy groves in an agricultural village called Gird Gonda. Out of the mortgage money only a sum of Rs. 339 was paid in cash at the time of the execution of the mortgage the balance of the consideration was set off against sums due under six earlier mortgage deeds in respect of the case property executed by the same mortgagor in the name of Sarju Prasad, grand-father of Ram Kishore Tandon, the mortgagee in the deed of 30-3-1927. It is not disputed that the interest of the mortgagee under the earlier deeds was vested in Ram Kishore Tandon at the date of the mortgage dated 30-3-1927. The first of these six deeds was executed on 26-4-1915 and the last one on 23-10-1916. In these deeds the rate of interest was 12 per cent. compoundable half yearly.

Finding of the Court:

The preliminary decree cannot be amended under Section 8, Debt Redemption Act after the passing of the final decree. The final decree also cannot be amended under Section 8, Debt Redemption Act, as it was passed after the Debt Redemption Act came into force. The transactions evidenced by the earlier mortgages can be reopened for the purpose of determining the amount due at the date of the mortgage in suit, namely, 30-3-1927. The accumulated interest which has been converted into principal at any statement or settlement of account or by any contract in the course of the transaction made before 1-1-1917, shall be treated as principal.

Issues: 1. Does Section 8, Debt Redemption Act, contemplate amendment of a preliminary decree when that decree has already matured into a decree absolute passed after 1-1-1940,? (sic) and 2.Could the transactions evidenced by the earlier mortgages Exs. 11 to 16 be reopened for the purpose of determining the amount due at the date of the mortgage in suit, namely, 30-3-1927?

Ratio Decidendi: The plain language of the section makes it clear that at the date of the application the applicant must be liable to pay the amount due under the decree which he seeks to amend. Where the decree sought to be amended does not place on the applicant a liability to pay or has ceased to subsist by the date of the application, there can be no amendment under the section.

Final Decision: Appeal allowed.

WALI ULLAH, J.

( 1 ) THIS appeal arises out of an application made by the judgment-debtor under Sections 8 and 9, u. P. Debt Redemption Act, (XIII [13] of 1940) for amendment of a preliminary decree for sale passed in a mortgage suit. The mortgage was executed by Shyam Sunder Lal in favour of the appellant Ram Kishore Tandon in respect of an advance of Rs. 1428 at six per cent. interest compoundable half yearly. The hypothecated property consisted of two houses in the city of gonda and five tenancy groves in an agricultural village called Gird Gonda. Out of the mortgage money only a sum of Rs. 339 was paid in cash at the time of the execution of the mortgage the balance of the consideration was set off against sums due under six earlier mortgage deeds in respect of the case property executed by the same mortgagor in the name of one Sarju Prasad, grand-father of Ram Kishore Tandon, the mortgagee in the deed of 30-3-1927. It is not disputed that the interest of the mortgagee under the earlier deeds was vested in Ram Kishore Tandon at the date of the mortgage dated 30-3-1927. The first of these six deeds was executed on 26-4-1915 and the last one on 23-10-1916. In these deeds the rate of interest was 12 per cent. compoundable half yearly.

( 2 ) ON 26-8-1939, Ram Kishore Tandon, the mortgagee, obtained a preliminary decree for sale on foot of the mortgage dated 30-3-1927 (Ex. 1 ). It was for a sum of Es. 1428 with future interest at six per cent. payable in eight annual instalments. On failure of payment of any one instalment, the decree-holder was given a right to apply for preparation of a final decree. On default of payment of the instalments, the decree-holder applied for making the preliminary decree absolute, or final. Eventually on 12-12-1942, the Court passed the final decree. I may observe here that before the final decree was passed, the mortgagor--the judgment-debtor--respondent--does not appear to have put forward any claim--as he might well have done under Section 9, Debt Redemption Act--for a fresh determination of the amount due under the decree in accordance with the provisions of the Debt Redemption Act nor does he appear to have filed any appeal against the preliminary decree.

( 3 ) WHILE proceedings for execution of the final decree were pending, on 2-2-1944, the judgment-debtor put in his application for amendment under Sections 8 and 9, Debt Redemption act, praying for amendment of the preliminary decree. This application was contested by the decree-holder on various grounds. Amongst-other grounds, it was urged that no amendment of the preliminary decree was possible inasmuch as it had been superseded by the final decree passed in December 1942. The decree-holder also made a declaration purporting to be under section 4 (3) of the Act to the effect that he would not execute the decree against the land, agricultural produce or person of the judgment-debtor.

( 4 ) THE learned Munsif held that the declaration made by the decree-holder under Section 4 (3), debt Redemption Act, was ineffective. In view of the second proviso to that sub-section the application should have been made before the final decree was passed inasmuch as the suit was pending when the Debt. Redemption Act came into force on 1-1-1941. He did not consider the question whether the preliminary decree could be amended under Section 8, Debt Redemption act after the passing of the final decree. He, however, expressed the opinion that the principal amount of the debt having been determined in the suit itself it could not be redetermined at the stage of execution proceedings. He, however, amended the decree to this extent that he reduced interest from six per cent to four and a half per cent simple on the principal amount of Rs. 1428 from the date of the loan.

( 5 ) AGAINST the decision of the learned Munsif the judgment-debtor went up in appeal and prayed for the re-opening of the earlier transactions and re-determination of the principal amount due un











































































































































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