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Tarak Nath Adhikari And Others Judgment-Debtors v. Bhubaneshwar Mitra Decree-Holder Opposite Party.
Factual and Procedural Background
This is a Rule calling on the opposite party to show cause why an order passed by the learned Judge in appeal should not be set aside. The petitioner is the judgment-debtor who complained that some of his properties were sold contrary to O. 34, R. 14 of the CPC and that the sale was made without the permission of the Court that had appointed a Receiver. The opposite party had obtained a money-decree against the petitioner and, in execution of that decree, sold and purchased certain properties which were mortgaged to him by the petitioner under a mortgage-deed. The opposite party had also instituted a mortgage suit under the mortgage-deed; while that mortgage suit was pending, he executed his money-decree and purchased some of the mortgaged properties himself. The petitioner asserted that Section 99 of the Transfer of Property Act should govern despite the provisions of O. 34, R. 14.
Legal Issues Presented
- Whether the sale of the mortgaged properties was contrary to Order 34, Rule 14 of the Code of Civil Procedure.
- Whether the sale was invalid for having been made without the permission of the Court which had appointed a Receiver.
Arguments of the Parties
Petitioner's Arguments
- The petitioner argued that notwithstanding the change introduced by O. 34, R. 14 of the CPC, Section 99 of the Transfer of Property Act should be given effect, which, the petitioner contended, restricts a mortgagee from selling mortgaged property except by instituting a suit under Section 67 of that Act.
It was noted that the second point in the Rule (sale without permission of the Receiver's Court) was not argued by Dr. Ghose for the petitioner.
Table of Precedents Cited
No precedents were cited in the provided opinion.
Court's Reasoning and Analysis
The court compared Section 99 of the Transfer of Property Act with Order 34, Rule 14 of the CPC. It observed that Section 99, prior to change, prohibited a mortgagee from bringing mortgaged property to sale in satisfaction of any claim (whether arising under the mortgage or not) except by instituting a suit under Section 67. Order 34, Rule 14 modified that position by limiting the restriction on the mortgagee's right to sell mortgaged properties to claims arising under the mortgage. The court concluded that the Code (by O. 34, R. 14) has effectively repealed Section 99 of the Transfer of Property Act and enacted in its place the present rule. Because the restriction preventing a mortgagee from selling mortgaged property under a judgment unconnected with the mortgage-debt had been removed as inexpedient, a mortgagee is competent to have mortgaged property sold in satisfaction of any claim he may have against the mortgagor, even if unconnected with the mortgage.
Holding and Implications
DISPOSED OF — Rule discharged.
Direct effect: The Rule is discharged with costs; the court held that under Order 34, Rule 14 a mortgagee may have mortgaged property sold in satisfaction of any claim against the mortgagor, including claims unconnected with the mortgage. The opinion does not purport to establish any further precedent beyond this conclusion as articulated in the decision.
1. This is a Rule on the opposite party to show cause why the order passed by the learned Judge in appeal should not be set aside on the ground that the sale was contrary to the provisions of O. 34, R. 14, and also on the ground that the sale was made without taking the permission of the Court which appointed a Receiver. The second point (in the Rule) has not been argued by Dr. Ghose who appeared on behalf of the petitioner. The petitioner is the judgment-debtor. Some of his properties have been sold and he complains against the sale. It appears that the opposite party had obtained a money-decree against the judgment-debtor and in execution of that money-decree, he sold and purchased certain properties which were mortgaged to him by the petitioner judgment-debtor under a certain mortgage-dead. The opposite party had also instituted a mortgage suit for the recovery of his mortgage-money under his mortgage-deed and while this mortgage suit was pending, he executed his money-decree and in execution of the decree purchased some of the mortgaged properties himself. The case for the petitioner is that notwithstanding the fact that an alteration in the law has been made by the provisions of O. 34, R. 14 of the present CPC, Section 99 of the Transfer of Property Act, should be given effect to. We find, however, that under the provisions of Section 99 of the Transfer of Property Act, a mortgagee could not bring the mortgaged property to sale in satisfaction of any claim whether arising under the mortgage or not, except by institution of a suit under S. 67 of that Act. O. 34, R. 14, has introduced a change, limiting the restriction on the mortgagee's right to sell the mortgaged properties to claims arising under the mortgage. It is clear, therefore, that the Coda has repealed Section 99 of the Transfer of Property Act, and in its place this present rule has been enacted. The first part of the section provided that a mortgagee should not bring the mortgaged property to sale otherwise than by instituting a suit under Section 67 of the Transfer of Property Act.
2. In so far as it precluded the mortgagee from selling the mortgaged property under a judgment unconnected with the mortgage-debt, the restriction has been considered inexpedient and has been removed. It follows, therefore, that a mortgagee is competent to have his mortgaged property sold in satisfaction of any claim which he may have against the mortgagor unconnected with the mortgage. For the above reasons, we discharge this rule with costs.
V.B/R.K
3. Rule discharged.
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