Radha Kishan (Decree-Holder) v. Umrai Singh (Judgment-Debtor).

Iqbal Ahmad, C.J:— This is an execution second appeal by a decree-holder against an appellate decree of the District Judge of Shahjahanpur which affirmed the decision of the execution court of first instance dismissing an application for execution as time-barred.

The facts giving rise to the appeal are not in dispute and are as follows: On the 16th of August, 1919, two persons named Ram Singh and Sheoraj Singh, hereinafter referred to as mortgagors, executed a simple mortgage in favour of Radha Kishan decree-holder appellant. After the execution of the mortgage, the mortgagors sold either the whole or a part of the mortgaged property to Umrai Singh judgment-debtor respondent. The sale in favour of Umrai Singh was subject to the mortgage of 1919. Thereafter Radha Kishan appellant brought a suit for sale on the mortgage in the year 1931 and he impleaded the mortgagors and Umrai Singh as defendants to that suit. A preliminary decree for sale was passed in favour of Radha Kishan against all the defendants in November 1931, and a final decree for sale was passed in his favour on the 1st of December, 1934. Within three years of the date of the final decree, viz., on the 29th of November, 1937, Radha Kishan put the decree in execution, but the execution was struck off on the 4th of December, 1937.

Within a few weeks of the last mentioned date, viz., on the 1st of January, 1938, the Temporary Postponement of Execution of Decrees Act X of 1937 came into force and remained in force till the 31st of December, 1940, and, admittedly, during this period no application for execution of the decree was filed by Radha Kishan.

The application for execution that has culminated in the present appeal was filed by Radha Kishan on the 2nd of April, 1941, and the prayer contained in the application for sale of the property transferred to Umrai Singh. The mortgagors were apparently not impleaded as parties to this application for execution which was directed only against Umrai Singh. Even though this application was filed more than three years after the date on which the previous application for execution was struck off, Radha Kishan maintained that the application was within time. He contended that in the computation of the period of limitation, he was, in view of the provisions of section 5 of Act X of 1937, entitled to the exclusion of the period during which that Act remained in force. The relevant portion of section 5 is as follows: “In computing the period of limitation prescribed by the Indian Limitation Act, 1908, or any other law for the time being in force, for …. (b) the execution of such decree as is referred to in section 3, and not covered by section 6, the period during which this Act shall remain in force, shall be excluded.”

Sub-section (1) of section 3 enacts that:

“All proceedings in execution of any decree for money or for foreclosure or sale in enforcement of a mortgage passed by a civil court on the basis of a liability incurred before the passing of this Act, in which the judgment-debtor or any one of the judgment-debtors is, at the date of the passing of this Act, an agriculturist shall be stayed during the period this Act shall remain in force, if such judgment-debtor does not pay more than Rs. 250 as land revenue or rent, or more than Rs. 30 as local rate for revenue-free land or if the total of the revenue, rent and ten times the local rate payable by him or any two of them does not exceed Rs. 250.”

It was common ground that all the three judgment-debtors, viz., the mortgagors and Umrai Singh, were agriculturists of the description referred to in sub-section (1) of section 3, and, as such, the decree under execution was “such decree as is referred to in section 3” within the meaning of that phrase as used in section 5 of the Act. Umrai Singh, the judgment-debtor, however, contended that the decree under execution was “covered by section 6” and accordingly section 5 of the Act had no application to the case.

Section 6 runs as follows:

“Nothing herein contained shall (a) preclude any decree-holder from accepting payment under, or any adjustment of, his decree voluntarily made by the judgment-debtor, or (b) apply to decrees for money arising out of claims relating to trusts or for maintenance or for profits in favour of a co-tenant or co-owner, or for mesne profits, or for damages for tort, or for contribution between co-tenants of agricultural land, or (c) apply to a mortgage decree sought to be executed by sale of the mortgaged property in the hands of a subsequent transferee who has taken the transfer subject to the mortgage on the basis of which such decree has been obtained.”

Both the courts below accepted the contention of Umrai Singh respondent and dismissed the application for execution as time-barred. This decision of the courts below is assailed by the present appeal.

Clauses (a) and (b) of section 6 are not relevant for our present purposes. But it would prima facie appear that clause (c) of section 6 covers the present case in as much as the decree under execution is a mortgage decree and the execution is being sought by sale of the mortgaged property in the hands of Umrai Singh, a subsequent transferee, who purchased the property subject to the mortgage which culminated in the decree under execution. The contention advanced on behalf of Radha Kishan decree-holder, however, is that clause (c) of section 6 is confined in its operation only to a mortgage decree which is “sought to be executed” and has no application when such decree is not “sought to be executed”. The contention, in other words, is that if a mortgagee decree-holder does not apply for execution of a decree by sale of the mortgaged property in the hands of a subsequent transferee, the case will not fall within the purview of clause (c) of section 6 and the decree-holder will be entitled to the benefit of the provisions of section 5 of the Act. In my judgment there is no substance in this contention.

The Act was, as disclosed by the preamble, passed with the object of “granting relief from indebtedness to agriculturists” and sub-section (1) of section 3 of the Act provided for stay of execution of decrees as against agriculturists of humble means. The Act was, however, not intended to provide relief to monied people who purchased properties subject to incumbrances with a stipulation that they will be liable to discharge those incumbrances. The reason for this is not far to seek. The implied covenant between a vendor and a vendee who purchases a property subject to mortgage is that the mortgage will be discharged by the vendee and there is nothing in the Act to absolve such a vendee from the performance of his obligation. To put the matter in another way. The consideration that a transferee stipulates to pay for a property which he purchases subject to a mortgage consists of the price that he agrees to pay for the equity of redemption as also of the amount of the mortgage debt. In such a case the transferee labours under a contractual obligation to the vendor to pay either the whole or a part of the mortgage debt, as the case may be, and the Act was not intended, nor does it profess, to relieve the transferee from such an obligation. In order to put this beyond doubt clause (c) of section 6 was enacted and its manifest object was to hold a subsequent transferee to his bargain and to ensure that he will discharge the mortgage debt according to the covenant in the deed of transfer.

Great emphasis is, however, laid by the counsel for the decree-holder appellant on the fact that the words “sought to be executed” do not find a place in clause (b) of section 6, and it is accordingly urged that those words in clause (c) must have been deliberately introduced by the legislature with the object of confining the operation of clause (c) to cases where a mortgage decree-holder actually puts the decree in execution. The argument, though plausible, is, in my judgment, without force. A mortgage decree may direct sale of not only the property in the hands of a subsequent transferee but also of that portion of the mortgaged property that may still be in the hands of the mortgagor. As I read clause (c) of section 6, it appears to me that the words “sought to be executed” were introduced in that clause with a view to make it clear that clause will be confined in its operation to that portion of the mortgage decree that directs sale of the mortgaged property in the hands of the subsequent transferee and will have no application to the property still in the hands of the mortgagor, who may be an agriculturist of the description referred to in sub-section (1) of that section 3.

Another process of reasoning also leads to the same conclusion. In computing the period of limitation prescribed by an Act, ordinarily, only such period is excluded during which a person is under a statutory or legal disability from filing a suit or making an application. The only exception to this rule is furnished by cases where an option is given to an obligee to enforce his remedy at once or to waive a default made by the obligor. Such an option may be the outcome of a contract between the parties or may be given by a statute. No such option is, however, given to a decree-holder by section 5 of Act X of 1937. Clause (c) of section 6 must be so interpreted as not to come into conflict with section 5 and this is possible only if the interpretation put on clause (c) by the courts below is accepted.

For the reasons given above I would dismiss this appeal with costs.

Dar, J.:— I agree.

Yorke, J.:— I agree.

By the Court:— The appeal is dismissed with costs.