9911796707
TMI Blog1964 (11) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... and March 13, 1950, Seth Girdhari Lal, the husband of Appellant No. 1 herein, purchased the mortgagee rights of Novat Mal and Marfatia respectively. On May 1, 1950, Girdhari La] was put in possession of the mortgaged properties. On July 22, 1950, Respondents 9 to 11 purchased the equity of redemption of the mortgaged properties from Radha Kishan. Har Prasad and Pokhi Ram. On August 10, 1950, Girdhari Lal instituted Civil suit No. 739 of 1950 in the Court of the Senior Subordinate Judge, Ajmer, for enforcing the said two mortgages. In the suit he claimed ₹ 48,919-12-6 as the amount due to him under the said two mortgages. On April 25, 1953, the Senior Subordinate Judge, Ajmer, gave a preliminary decree in the suit for the recovery of a sum of ₹ 34,003-1-6 with proportionate costs and future interest; he disallowed interest from September 14, 1936, to March 13, 1950, on the mortgage of ₹ 25,000. The plaintiff-mortgagee preferred an appeal, being Civil Appeal No. 71 of 1953, to the judicial Commissioner, Ajmer, against the said decree in so far as it disallowed interest to him. The defendants preferred cross-objections in respect of that part of the decree awarding c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r adjourning the hearing - of the revision petition till after the decision of the Supreme Court in Civil Appeal No. 383 of 1956. On February 17, 1957, the decree-holder died, and his legal representatives, who are the appellants herein, were brought on record. On December 16, 1960, this Court delivered judgment in the said appeal modifying the preliminary decree made in the suit and directing the Trial Court to pass a fresh final decree. On April 5, 1961, the High Court accepted the revision petition filed by the defendants, remanded the case to the Trial Court and directed it to take an account of the receipts from the mortgaged properties and expenses properly incurred for the management etc. of the said properties as contemplated under s. 76(g) and (h) of the Transfer of Pro- perty Act and to determine what sum remained to be paid to the mortgagees taking into account the decision of this Court. Hence the present appeal. The gist of the arguments of Mr. B. D. Sharma, learned counsel for the appellants may be stated thus : (i) A preliminary decree settles the rights of parties by deciding all the controversies between them relating to a mortgage transaction and gives all nece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t debars the mortgagors from claiming that the mortgagee has to account for the profits realized by him from the mortgaged properties in his possession; if he is not so debarred, what is the period for which the mortgagee could be compelled to render accounts in respect of the said profits ? The suit was filed on August 10, 1950; the preliminary decree was made under 0. XXXIV, r. 4, of the Code of Civil Procedure on April 25, 1953. The preliminary decree does not contain any direction directing the mortgagee to account for the profits realized from the mortgaged properties in his possession. The contention briefly stated is that, as there is no direction in the preliminary decree, the mortgagee escapes his statutory liability to render accounts under S. 76 of the Transfer of Property Act. To appreciate this contention the relevant provisions of the Code of Civil Procedure and those of the Transfer of Property Act may be considered. Under 0. XXXIV, r. 4, of the Code of Civil Procedure, in a suit for sale, if the plaintiff succeeds, the Court shall pass a preliminary decree to the effect mentioned in cls. (a), (b) and (c) (i) of sub-r. (1) of r. 2; under r. 2, in a suit for foreclosu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce due to the mortgagee on the date of the preliminary decree. If the mortgagee did not raise the plea, he would be barred on the principle of res judicata from raising the same as the said matter should be deemed to have been a matter which was directly and substantially in issue in the suit up to that stage. It is settled law that though a mortgage suit would be pending till a final decree was made, the, matters decided or ought to have been decided by the preliminary decree were final. Suppose the mortgagor paid certain amounts to the mortgagee before the preliminary decree; if these were not given credit to the mortgagor and a larger amount was declared by the preliminary decree as due to the mortgagee, can the mortgagor, after preliminary decree, reopen the question ? Decidedly he cannot. This is because the preliminary decree had become final in respect of the disputes that should have been raised before the preliminary decree was made. So too, under S. 76(h) of the Transfer of Property Act, the net receipts of the mortgaged property have to be statutorily ,debited against the mortgagee in deduction of the amount due under the mortgage from time to time in the manner prescrib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that it must be held that the question of statutory liability of the mortgagee to account for the receipts must be deemed to have been decided in favour of the mortgagee by the preliminary decree. It is true that the mortgagee may, if he chose, have raised this untenable contention that for some reason he was not under a statutory liability to account for receipts under s. 76 of the Transfer of Property Act; and if the Court wrongly decided in his favour, the finding might have been binding on the mortgagor in respect of the mort- gagee's liability to account for receipts even for the subsequent period subsequent to the preliminary decree was neither expressly He had conceded his general statutory liability, but, by some mistake, it was not quantified upto the date of the preliminary decree and deducted from the mortgage amount. His liability for the period subsequent to the preliminary decree was neither expressly nor impliedly negatived by the preliminary decree. In this context, the decision of the Judicial Committee in Madan Theatres, Ltd. v. Dinshaw Co. Ltd. ( (1945) L. R. 72 I. A. 277,286) may usefully be cited. There, the question arose whether after the preliminary d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndicate that such an account must necessarily be taken. Even if they did not, the right of the mortgagor to such an account is established beyond question by the provisions of S. 76, T.P. Act. Again it is beyond question that when a suit whether for sale or redemption of a mortgage is filed it is the duty of the Court to decide in that suit all the claims of the mortgagor and mortgagee under the mortgage up to the date when the final decree is given. Such claims can and indeed must be included in the mortgage suit. If they are not included the person failing to include them is barred thereafter under the provisions of 0.2, R. 2, Civil P.C. from filing a suit in respect of them. The learned Judge cited a number of decisions in support of his conclusion. These observations appear to be rather wide and comprehensive enough to take in the liability of a mortgagee to account for the net receipts from the mortgaged property even for the period before the preliminary decree. But the facts of that case show that the learned Judge was only considering the question of the mortgagee's liability for a period after the preliminary decree was made, even though the preliminary decree did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in the Court of the Subordinate Judge stating that they were prepared to deposit all the remaining amounts which would on settlement of accounts, be found duly payable to the mortgagee. They also prayed that the mortgagee be directed to produce the accounts of all the rents and profits which he had realized so that the Court, after checking the aforesaid accounts, might decide what amount was exactly due to the mortgagee. To that application the mortgagee filed a counter-affidavit, wherein 'he stated thus : That the plaintiff has no objection to give an account as to the amount of rent realised by him and the expenses incurred by him in the management and preservation of the mortgaged property but he maintains that he has a right to remain in possession of the property and enjoy its usufruct till the last penny due on the mortgage in his favour is paid up to him. The plaintiff is therefore entitled to remain in possession of the property till the amount of ₹ 14,916-11-0 on account of interest wrongly disallowed by the learned Court is also paid to him alongwith the other dues or till the said interest is finally disallowed by Honourable the Supreme Court of India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e satisfied : (1) representation by a person to another, (2) the other shall have acted upon the said representation, and (3) such action shall have been detrimental to the interests of the person to whom the representation has been made. In the instant case it may be said that the first two conditions are satisfied : the appellant represented to the respondents that he was liable to render accounts to them in regard to the net proceeds of the mortgaged properties from the date of the plaint to the date of the preliminary decree, and on the said representation the respondents agreed to the appellant drawing out from the Court about ₹ 35,515 deposited by them. But can it be said that the respondents had in any way acted to their detriment on the basis of the representation made by the appellant ? The respondents had to pay the decretal amount to the appellant if they wanted to get possession of the properties. What they paid was less than what they had to pay under the decree. By paying the said amount they did nothing more than discharging their liability under the decree. The discharge by the respondents of their legal liability under the decree cannot in any sense of the te ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
