1. This is a decree-holder's appeal and the question involved is a Question of limitation and one of first impression.
2. In a suit for foreclosure of a mortgage, a preliminary decree was passed on 16-2-1935. Certain other minor events took place, which it is not necessary to follow. On 15th February, 1938 an application for the preparation of the final decree was made. It was followed by an application for amendment of the decree and, on April 2,1938 the decree was amended. It provided for the payment of the amount in three half, yearly instalments falling due in July, 1938 and January and July, 1939. It was also provided that, in the event of default of three instalments the mortgagee would be entitled to apply for preparation of the final decree for foreclosure. There was a default. Before, however, an application for the final decree could be made, the U.P. Debt Redemption Act (Act XIII of 1940) came into force. This Act only allowed a self-liquidating mortgage within the meaning of Section 17. Such an application was made by the decree-holder on 20th July 1943.
3. The defence, in the main, was that the application was barred by limitation. This plea, in defence, was accepted by the trial Court and also by the lower appellate Court, though on different grounds.
4. The learned Counsel for the appellant conttends that, although the default in the payment of the decretal amount was complete by 13th July 1939, nevertheless, with the intervention of the U.P. Debt Redemption Act, he lost his right of foreclosure and, instead, acquired the right of self-liquidating mortgage. The application of 20th July for the enforcement of such a right was, therefore, within limitation. The learned Counsel for the respondents, however argues that time began to run from 13th July 1939 and nothing which happened subsequently, I could arrest the limitation.
5. The point is, as we have already indicated, not covered by authority, but after giving our best consideration to it, we have come to the conclusion that the appeal must succeed.
6. The learned Counsel for the respondents I has relied on Abdul Karim v. Manji Hansraj ('75-77) 1 Bom. 295 and Chinnasawmi Iyengar v. Gopalchary ('71-74) 7 Mad. H.C.R. 392. 1 Those cases are authority for the proposition that if limitation has once run Out, no subsequent legislation can have the effect of reviving the right already lost under the previous Act. This is, no doubt, so and this is the view also of this. Court as expressed in Tej Bahadur v. Radha Kishan Gopi Kishan 23 A.I.R. 1936 Al. 858. The point before us is, however, of an entirely different character.
7. The learned Counsel for the appellant has on the other hand, relied on Narsingrao Kohher v. Bandu Krishna 5 A.I.R. 1918 Bom. 217. The facts of that case are slightly involved. But stripped of unnecessary details, they are these : On 17th November 1897 a decree on an award was passed. This decree was kept alive by means of various applications till the last application for execution was made on 2nd December 1909. It was contended by the judgment-debtor that twelve years had, on 17th November 1909, run out and the present application was, therefore, barred by limitation. The reply of the decree-holder was that, before the passing of the Act of 1908, the application was an application for execution, but, after that Act, it became an application in the suit itself. That was a fresh right recognised by the Act of 1908 and limitation from that date had not run out. The High Court accepted the decree-holder's contention. It may be noticed that the learned Judges made it clear that the Act of 1908 had the effect of keeping alive the application only because, on the date that it was passed, limitation had not run out.
8. We confess we feel it difficult to go the whole length with the learned Judges. The line between an application for execution and one in the suit itself is very thin. The position in this case is different. There is a marked difference between an application for foreclosure and one for a self-liquidating mortgage. Indeed, there is nothing in common between them.
9. The default was complete on 13th July 1939. The right of foreclosure was a subsisting right on 1st January 1941, the date on which the debt redemption act came into force. That right was taken away and, instead, another right - the right to apply for a self-liquidating mortgage-came into being on that day. It was a case of substituted remedy. That remedy must be available to the appellant for three years from 1st January 1941. The application presented on 20th July 1943, was, therefore, within limitation.
10. We allow the appeal, set aside the orders of the Court below and send the case back to the Court of the first instance with the direction to re-admit it to its original number and proceed with it according to law. We think it is a fit case in which the parties should bear their own costs.
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