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Smart Summary

Summary of Opinion by Sir John Edge (Privy Council)

Factual and Procedural Background

These are two consolidated appeals by the plaintiffs (appellants) from two decrees of the High Court at Patna dated 30 July 1917 which reversed a decree of the District Judge of Dharbhanga dated 21 May 1914 and dismissed the plaintiffs' suit. The plaintiffs originally sued on 10 January 1912 (the opinion also later, inconsistently, refers to a date of 10 January 1922) for declarations of title to, and for possession of, a particular immoveable property and for mesne profits. The property in dispute was originally the property of Sadik Ali Khan. The plaintiffs claim title through Lalji Lal; the defendants claim title through Kamal Narain Choudhri.

Relevant prior events as narrated in the opinion:

  • 10 January 1882 — Sadik Ali Khan mortgaged the property (and other properties) to Lalji Lal for Rs. 40,000 (first mortgage).
  • 27 September 1883 — Kamal Narain Choudhri sued Sadik Ali Khan; proceedings eventually before the District Judge of Dharbhanga; an order for attachment before judgment was made on 24 November 1883 and an attachment issued.
  • 2 April 1884 — Kamal Narain obtained a decree against Sadik Ali Khan.
  • 21 March 1885 — Sadik Ali Khan executed a further mortgage to Lalji Lal for Rs. 90,000 (which expressly included and preserved the security under the 10 January 1882 mortgage).
  • 11 December 1885 — Lalji Lal sued under Section 88 of the Transfer of Property Act, 1882, to recover sums due under the mortgages.
  • 12 February 1886 — Lalji Lal obtained a decree under Section 88 for sale of mortgaged properties if decretal money not paid within four months.
  • 20 February 1886 — Lalji Lal applied for execution of his decree in the District Judge's court and sought attachment and sale.
  • 20 May 1886 — an attachment under Lalji Lal's decree was made and the property in dispute was attached.
  • 16 August 1886 — in execution of Kamal Narain's earlier decree, the property was sold at public auction and Kamal Narain purchased the right and interest of Sadik Ali Khan in the property.
  • 8 September 1886 — Kamal Narain presented a petition of objection to the attachment that Lalji Lal had obtained; Lalji Lal and Sadik Ali Khan were made parties to that objection proceeding.
  • 14 September 1886 — the Subordinate Judge of Tirhoot made an order allowing Kamal Narain's objection so far as to exempt from sale the specific item in Lalji Lal's inventory (mauza Bhandarson asli bearing No. 22), which their Lordships construe as an order that the property should not be sold under Lalji Lal's decree. Lalji Lal did not appeal from that order and it became final.
  • 19 November 1886 — Kamal Narain obtained a sale-certificate for the August 1886 purchase and obtained possession as purchaser.
  • 21 February 1895 — the plaintiffs (appellants) obtained a money decree against Lalji Lal (in proceedings to which the defendants here were not parties); in execution they purchased Lalji Lal's mortgage decree.
  • 16 February 1907 — in execution of that mortgage decree the property in dispute was sold and the plaintiffs purchased it; certificate of sale issued 29 May 1908.
  • 10 January 1912 (and alternatively 10 January 1922 as later stated in the opinion) — the plaintiffs brought the present suit for declarations of title, possession and mesne profits against the defendants, who claim under Kamal Narain.

Legal Issues Presented

  1. What is the legal effect of the Subordinate Judge's order of 14 September 1886 exempting the property from sale in the execution proceedings to which Lalji Lal was a party?
  2. Whether Lalji Lal had obtained an order absolute for sale under Section 89 of the Transfer of Property Act, 1882 (and relatedly whether any deficiency in following that procedure affected his rights)?
  3. Whether Lalji Lal, by his subsequent conduct, had elected to surrender his earlier mortgage rights (the mortgage of 10 January 1882) and thus lost priority over Kamal Narain's claim.
  4. Whether the District Judge's view that the 14 September 1886 order was made without jurisdiction was correct, and if not, what the consequence is for title and possession as between the parties and their successors.

Arguments of the Parties

Objector / Defendants (Kamal Narain Choudhri) — content of the petition of objection (as presented in the opinion)

  • The objector stated that he had filed an earlier Title Suit (No. 18 of 1883) and that the relevant properties of the judgment-debtor had been attached and a decree obtained in his favour (referring to the decree of 2 April 1884) and that he had purchased the property at sale on 16 August 1886.
  • He alleged that the mortgage dated 21 March 1885 (to Lalji Lal) was null and void under the provisions of Section 276 of the Civil Procedure Code because it was made after attachment.
  • He pointed out that Lalji Lal had subsequently sought to attach the property and fix a date for sale under his own decree (the decree obtained on confession) and that a sale date had been fixed (allegedly 15 September 1886).
  • He submitted that once the property had been sold to him, it could not be sold again under the provisions of Section 285 (and that the property was fit to be exempted under Section 278).
  • He therefore prayed that the objected property (mauza Bhandarson asli and associated items) be exempted from sale in Lalji Lal's execution proceedings.

Lalji Lal (decree-holder seeking execution)

  • In his petition for execution (20 February 1886) Lalji Lal informed the court that although four months' postponement had been granted to the judgment-debtor to pay the decretal amount, there was little chance of payment and that the judgment-debtor's properties had been advertised for sale in satisfaction of several decrees; he therefore requested attachment and sale proceedings so that the decretal money might be realized.
  • He obtained an order of attachment on 20 May 1886 under his decree of 12 February 1886.

Plaintiffs / Appellants (holders of Lalji Lal's decree by subsequent purchase in execution)

  • The plaintiffs acquired Lalji Lal's mortgage decree in execution of a money decree they obtained against Lalji Lal (21 February 1895), and in execution of that decree purchased the property in dispute (sale on 16 February 1907; certificate 29 May 1908). They then brought this suit seeking declarations of title, possession and mesne profits against the defendants who claim under Kamal Narain.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The opinion recounts the differing conclusions of the lower courts and then gives the Privy Council's analysis:

  1. District Judge's position: The District Judge held that the Subordinate Judge's order of 14 September 1886 was made without jurisdiction because Lalji Lal's decree was a decree for sale under the Transfer of Property Act, and therefore Lalji Lal's decree of 12 February 1886 was binding on the property in dispute. On that basis the District Judge gave plaintiffs a decree for possession (subject to the defendants' right to redeem) and for mesne profits.
  2. High Court's position: The High Court disagreed with the District Judge. The High Court found (a) that Lalji Lal had not obtained an order absolute for sale under Section 89 of the Transfer of Property Act, 1882, (b) that Lalji Lal had in ignorance of his rights elected to surrender his earlier mortgage rights (the 10 January 1882 mortgage), (c) that Lalji Lal had proceeded to execute his decree as if it were a money decree (including attachment under Section 274 of the Code of Civil Procedure), (d) that Lalji Lal had gone to trial on the objection under Section 278, and (e) that Lalji Lal had acquiesced for some twenty years in the decision of 14 September 1886 adverse to him. The High Court therefore allowed the defendants' appeal and dismissed the plaintiffs' appeal.
  3. Privy Council's analysis and conclusion:
    • The Privy Council noted that at the hearing counsel could not show that any order absolute for sale under Section 89 had been made, but observed that historically such orders were sometimes omitted and sales proceeded under ordinary execution orders — an historical practice which the Privy Council acknowledged but did not treat as determinative here.
    • The Privy Council expressly disagreed with the High Court's conclusion that Lalji Lal had elected to surrender his rights under the earlier mortgage. Instead, they regarded Lalji Lal as having sought attachment to bring the property to sale under his decree.
    • Crucially, the Privy Council read the Subordinate Judge's order of 14 September 1886 as an order that the property in dispute should not be sold in Lalji Lal's suit. Whether that order was legally correct or not was deemed unnecessary to decide: the petition of objection was a proceeding which the Subordinate Judge had to consider, and any party dissatisfied with the Subordinate Judge's order could have appealed.
    • Lalji Lal was a party to the objection proceeding and did not appeal from the Subordinate Judge's order of 14 September 1886. Because Lalji Lal did not appeal, that order became final and binding upon him and upon persons claiming title under him.
    • On the basis that the 14 September 1886 order was final and binding, and that Kamal Narain (and those who represent him) had lawfully been in possession from 1886 under the sale-certificate dated 19 November 1886, the Privy Council concluded that the High Court's dismissal of the plaintiffs' suit was correct.

Holding and Implications

Holding:

The consolidated appeals are dismissed.

Immediate consequences and practical effects as stated in the opinion:

  • The High Court's decrees dismissing the plaintiffs' suit are affirmed by their Lordships.
  • The defendants (representatives of Kamal Narain Choudhri) are confirmed as having been lawfully in possession of the property in dispute since 1886 under the sale-certificate of 19 November 1886.
  • The appellants (plaintiffs) must pay the costs of these consolidated appeals.

The opinion does not state that any new legal principle or precedent was established; the decision rests on application of the facts to established procedures (in particular the finality of the Subordinate Judge's order when not appealed from).

    Sarju Prasad Missir And Others v. Maksudan Ghoudhuri And Others

    Sir John Edge :-

    These are two consolidated appeals by the plaintiffs from two decrees, dated the 30th July, 1917 of the High Court at Patna, which reversed a decree, dated the 21st May 1914, of the District Judge of Dharbhanga and dismissed the suit of the plaintiffs.

    The suit was brought by the plaintiffs, the appellants here, on the 10th January, 1912, in the Court of the Subordinate Judge of Dharbhanga for certain declarations as to title and for a decree for possession of certain immoveable property and for mesne profits. That immoveable property will in this judgment for the sake of brevity be referred to as the property in dispute. The property in dispute was originally the property of one Sadik Ali Khan : the plaintiffs claim title through one Lalji Lal; the defendants claim title through one Kamal Narain Choudhri. The facts will later be briefly stated, but their Lordships may here say that in their opinion the fate of these consolidated appeals depends upon the effect of an order of the 14th September, 1886, of the Subordinate Judge of Tirhoot, which was made in certain execution proceedings to which Kamal Narain Choudhri, as an objector to an application for the attachment of the property in dispute, and Lalji Lal, as the applicant for the attachment, were, with Sadik Ali Khan, parties.

    Sadik Ali Khan, on the 10th January, 1882, by deed mortgaged the property, in dispute, and much other immoveable property with which this suit is not concerned, to Lalji Lal for Rs. 40,000, and interest which might become due thereon. On the 27th September, 1883, Kamal Narain Choudhri brought in the Court of the Subordinate Judge of Muzaffarpur a suit for money due to him against Sadik Ali Khan. On the same day that suit was transferred to the Court of the District Judge of Dharbhanga. On the 24th November, 1883, Kamal Narain Choudhri obtained from the District Judge an order for the attachment before judgment of the property in dispute and that property was attached. On the 2nd April, 1884, Kamal Narain Choudhri obtained from the District Judge a decree against Sadik Ali Khan for the money owing to him. On the 27th June, 1884, Kamal Narain Choudhri obtained from the District Judge attachment of the property in dispute. On the 21st March, 1885, Sadik Ali Khan by deed further mortgaged to Lalji Lal for Rs. 90,000 the property in dispute, and much other property, with which this suit is not concerned.

    The Rs. 90,000 included the debt due under the mortgage of the 10th January, 1882, and it was expressly agreed by the mortgage of the 21st March, 1885, that Lalji Lal's security under the mortgage of the 10th January, 1882, should continue. On the 11th December, 1885, Lalji Lal brought under Section 88 of the Transfer of Property Act, 1882, against Sadik Ali Khan a suit in the Court of the Subordinate Judge of Muzaffarpur to recover the money due to him under the mortgages of the 10th January, 1882, and the 21st March, 1885, amounting together to Rs. 98,519-13-6, and further interest. On the 12th February, 1886, Lalji Lal obtained in that suit a decree under Section 88 of the Transfer of Property Act, 1882, for sale of the properties mortgaged if the decretal money should not be paid to him by Sadik Ali Khan within four months from the date of the decree.

    The property in dispute being under attachment in execution of Kamal Narain Choudhri's decree of the 2nd April, 1884, Lalji Lal, on the 20th Feb ruary, 1886, presented to the Court of the District Judge of Dharbhanga a petition for the execution of his decree of the 12th February, 1886, in which he stated the nature of the assistance from the Court for which he asked thus :-

    "That in the above-mentioned case, though postponement for four months has been granted to the judgment-debtor to pay the entire decretal amount, but there is very little chance of the judgment-debtor paying the entire decretal money within the time allowed. The judgment-debtor owes a considerable amount, and besides this his properties "have been advertised for sale in satisfaction of several decrees. If proceeding for execution of this decree would be taken by your petitioner after expiry of the four months' time allowed by the Court, then the decretal money due to him cannot be realised in any way ; for this reason it is very necessary to take out the execution proceedings. Therefore it is prayed that the case may be registered, that proceedings for attachment of the properties of the judgment-debtor may be taken, that sale proclamation may be issued and date for sale of the properties may be fixed by the Court after the time allowed and that the decretal money due to your petitioner may be realised. Inventory of the properties is given below."

    On the 20th May, 1886, Lalji Lal obtained in the Court of the Subordinate Judge of Muzaffarpur an order of attachment under his decree of the 12th February, 1886, of the property in dispute, and the property in dispute was accordingly attached.

    On the 16th August, 1886, the right and interest of Sadik Ali Khan in the property in dispute wore put up for sale at public auction in execution of Kamal Narain Choudhri's money decree against him of the 2nd April, 1884, and Kamal Narain Choudhri, who had previously obtained permission to bid at the sale, purchased the right and interest of Sadik Ali Khan in the property in dispute. On the 8th September, 1886, Kamal Narain Choudhri presented to the Court of the Subordinate Judge of Tirhoot a petition of objection to the attachment of the property in dispute, which Lalji Lal had obtained. To that proceeding by petition of objection Lalji Lal and Sadik Ali Khan were made parties.

    That petition, so far it is material, was as follows :-

    "That objection on behalf of the objector in the execution case of Lalji Lal Sahu, decree-holder, against Sadik Ali Khan, judgment-debtor is as follows :

    "1. That a Title Suit No, 18 of 1883 was filed by the objector on the 9th Katik 1291, corresponding to the 25th October, 1883, in the Court of the District Judge, and the properties of Babu Sadik Ali Khan, the defendant judgment-debtor, situated in mauza Bhandarson asli with daklili, together with the tolas, pargana Loam, were attached, and on the 2nd April, 1884, a decree was passed in favour of the objector ; in the execution of decree on the 24th Asarh, 1291 F. S., corresponding to the 2nd July, 1884, the said property was attached, and on the 16th August, 1886, after having been sold by the District Judge, was purchased by the objector.

    "2 That the judgment-debtor, after the attachment mentioned above, mortgaged the said property under a bond, dated the 12th (21st) March, 1885, to Lalji Sahu. Hence the said mortgage under the provisions of Section 276 of the Civil Procedure Code is null and void.

    "3. That subsequent to attachment by this objector Babu Lalji Lal Sahu attached the said property on the 7th Jeth, 1293, alleging a lien under a decree obtained on confession of judgment, and the date for the sale of the said property is fixed for the 15th September, 1886.

    "4. That when the said property had it been sold it cannot now be sold under the provisions of Section 285.

    "5. That the said property, having been sold, is purchased by this objector, the Court has no jurisdiction to sell the property again, and the said property under Section 278 is fit to be exempted, and it is prayed that by allowing this objection mauza Bhandarson, asli, together with dakhli and the tolas in pargana Loam, be exempted from sale.

    " I, Kamal Narain Choudhri, objector, do declare that the contents of this petition of objection are true to my knowledge.

    "(Signed) kamal narain choudhri, objector. "By my own pen."

    There appears to be some confusion in paragraph 1 of the petition of objection as to facts and dates. The decree of the 2nd April, 1884, was made by the District Judge in the suit which was brought on the 27th September 1883, and the order for the issue of the writ of attachment was made on the 27th June, 1884. It is to be observed that there is nothing in that petition of objection which would suggest to the Subordinate Judge that Lalji Lal had held any mortgage of the property in dispute except the mortgage of the 21st March, 1685, or would draw the attention of the Subordinate Judge to the fact that by the mortgage of the 21st March, 1885, the security which Lalji Lal had obtained by the mortgage of the 10th January, 1882, was maintained, or to the fact that the mortgage of the 10th January, 1882, was made before Kamal Narain Choudhri had obtained his attachment of the property in dispute. Those facts do not appear to have been brought to the attention of the Subordinate Judge by or on behalf of Lalji Lal or by anyone. On the 14th September, 1886, the Subordinate Judge on that petition made the following order :

    "It is ordered that the objection of the objector be so far allowed that mauza Bhandarson asli bearing No. 22 (the property in dispute) in the inventory of the decree-holder (Lalji Lal), be exempted from the sale."
    As their Lordships construe that order, it was an order that the property claimed should not be sold under the decree which Lalji Lal had obtained on the 12th February, 1886. Lalji Lal did not appeal against that order of the 14th September, 1886, of the Subordinate Judge, and it became final. On the 19th November, 1886, Kamal Narain Choudhri obtained his sale certificate in respect of his purchase at the auction sale on the 16th August, 1886, of the right and interest of Sadik Ali Khan in the property in dispute, and obtained possession as the purchaser.

    On the 21st February, 1895, the plaintiffs in this suit, who are the appellants here, in a suit to which the respondents here, who are the representatives of Kamal Narain Choudhri, were not parties, obtained a money decree against Lalji Lal. In execution of that money decree the plaintiffs, appellants here, purchased the mortgage decree which Lalji Lal had obtained on the 12th February, 1886, and eventually, in execution of that mortgage decree of the 12th February, 1886 applied for the sale of the property in dispute, which was sold and was purchased by them on the 16th February, 1907, and a certificate of sale was granted to them on the 29th May, 1908. The defendants, respondents here, were not parties to those proceedings, This suit was brought by the plaintiffs (appellants) on the 10th January, 1912, to obtain declarations of title to and possession of the property in dispute, and mesne profits. The suit was tried by the District Judge of Dharbhanga and went on appeal of the High Court at Patna. There are concurrent findings of these Courts which determine a question which arose as to the identity of the property in dispute.

    The District Judge being of opinion that the order of the Subordinate Judge of Tirhoot of the 14th September, 1886, was made without jurisdiction, as Lalji Lal's decree was a decree for sale under the Transfer of Property Act, 1882, and that Lalji Lal's decree of the 12th February, 1886 was binding on the property in dispute, gave the plaintiffs, appellants here, a decree for possession, subject to right of the defendants, respondents here, to redeem, and decreed that plaintiffs were entitled to mesne profits. From that decree the plaintiffs and the defendants appealed to the High Court at Patna.

    The learned Judges of the High Court before whom those appeals came were of opinion that Lalji Lal had not obtained, under Section 89 of the Transfer of Property Act, 1882, an order absolute for sale, had, in ignorance of his rights, elected to surrender his rights under his mortgage of the 10th January, 1882, and had proceeded to execute his decree of the 12th February, 1886, as a money decree; had attached the property in dispute under Section 274 of the Code of Civil Procedure, 1882; had gone to trial on the objection of Kamal Narain Choudhri under section 278 of that code, and had acquiesced for twenty years in the decision of the 14th September, 1886, against him under Section 278 ; and they allowed the defendants' appeal and dismissed the plaintiff's appeal and their suit. From those decrees these consolidated appeals have been brought.

    At the hearing of these consolidated appeals counsel was unable to show that any order absolute for sale under Section 89 of the Transfer of Property Act, 1882, was made, but their Lordships are aware that even in 1886 the pecessity for an order absolute under that section was sometimes overlooked in suits for sale, and sales proceeded in suits for sale under an ordinary order for execution such as would be made for the execution of a money decree. Their Lordships do not draw the same conclusion as the High Court that Lalji Lal elected to surrender his rights under the mortgage of the 10th January, 1882. Lalji Lal had got the property in dispute attached in order to bring it to sale, and on the petition of Kamal Narain Choudbri the Subordinate Judge made his order of the 14th September, 1886, which as their Lordships construe it, was an order that the property in dispute should not be sold in the suit of Lalji Lal. It appears to their Lordships to be unnecessary to consider whether that order should or should not have been made. The petition of objection was a petition which the Subordinate Judge had to consider and dispose of and any party to that proceeding who was dissatisfied with the order which the Subordinate Judge might make could have appealed from it. Lalji Lal was a party to that proceeding and he did not appeal, and the order became final and binding upon Lalji Lal and upon those who claim title under him. From 1886 Kamal Narain Choudhri or the defendants who represent him have been lawfully in possession of the property in dispute under the certificate of sale of the 19th November, 1886, and the plaintiffs did not bring this suit disputing that title until the 10th January, 1922. Their Lordships are of opinion that the decrees of the High Court were right.

    Their Lordships will humbly advise His Majesty that these consolidated appeals should be dismissed. The appellants must pay the costs of these consolidated appeals.

    Appeals dismissed.

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    Sarju Prasad Missir And Others v. Maksudan Ghoudhuri And Others
    (Apr 27, 1922)