Kali Das Saha Choudhry v. Prosunno Kumar Das, Calcutta High Court, Judgment, Law, casemine.com

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Case Number

Appeal from Original Decree No. 93 of 1917

Judges

Mookerjee
Panton, JJ.

Acts

Order XXI, Rule 62,
Order XXI, Rule 66.

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Smart Summary

Factual and Procedural Background

This appeal arises from a suit by plaintiffs to enforce a mortgage executed by the mortgagor on 9 September 1902 to secure Rs. 1,900 (interest at 33% per annum; repayable 14 January 1903). The mortgagor paid Rs. 500 on account of interest on 4 March 1904 and then made no further payments. On 6 January 1915 the plaintiffs instituted the present suit for recovery. The mortgagor did not appear; four other persons were joined as puisne encumbrancers who had taken a mortgage on 12 February 1904. The Subordinate Judge overruled the defendants' contentions and decreed the suit; the present appeal is by the mortgagee defendants.

The mortgagee defendants contested the plaintiffs' suit on two principal grounds: (1) that the plaintiffs' mortgage was fictitious, and (2) that the defendants were entitled to priority in respect of a portion of the money secured by their (later) mortgage, by reason of subrogation because some of their money had been applied to satisfy an earlier decree-holder.

Background facts relevant to the second ground: On 10 June 1894 the mortgagor had executed a prior mortgage for Rs. 7,500 (12% interest) repayable 16 August 1895; the prior mortgagees obtained a decree on 16 September 1901 and pursued execution. During the execution proceedings (and before the sale fixed in February 1904), on 12 February 1904 the present defendants advanced Rs. 16,000 (9% interest) and took a mortgage reciting the pending execution and stating the money was borrowed to satisfy the dues of the prior encumbrancer. Execution records show Rs. 13,548-2 was paid to the decree-holders in satisfaction of their decree.

The defendants later (17 January 1910) sued to enforce their 12 February 1904 mortgage and obtained a decree (30 January 1911); execution and sale followed, a sale was reversed (30 March 1914), and further execution proceedings culminated in a sale proclamation. During those execution proceedings the decree-holders (two of them through their pleader) petitioned that a particular lot be sold upon declaration that it was subject to the plaintiffs' mortgage dated 9 September 1902. The execution Court directed sale subject to that mortgage and the decree-holders purchased the property at that sale.

Legal Issues Presented

Whether the plaintiffs' mortgage dated 9 September 1902 was a fictitious transaction (i.e., whether its validity could be impeached).
Whether the defendants (holders of the 12 February 1904 mortgage) were entitled to priority, in whole or in part, over the plaintiffs' earlier mortgage by reason of subrogation to the rights of prior decree-holders (given that some of their money had been applied to satisfy an earlier decree).
Whether, having agreed (or having been subject to an order) in execution proceedings that the property be sold subject to the earlier mortgage, the defendants (as decree-holder purchasers) are estopped from asserting a contrary position in this suit.

Arguments of the Parties

Defendants' Arguments

The mortgage in favour of the plaintiffs was fictitious (i.e., not a real transaction) and therefore not enforceable.
To the extent that the defendants' funds were applied to satisfy the dues of the earlier decree-holders, the defendants were entitled to subrogation to those prior rights and therefore to claim priority over the plaintiffs' mortgage.
As support for the subrogation/priority contention the defendants invoked multiple authorities (cited in the opinion) that, in their submission, allow subrogation where a subsequent lender pays off a prior encumbrancer.

Plaintiffs' Arguments

The plaintiffs relied upon authorities (specifically cited in the opinion) to resist the defendants' subrogation claim — prominently the decision in Het Ram v. Shadi Ram — contending that the defendants were not entitled to the priority they sought.
Implicit in the plaintiffs' position (and reflected in the execution proceedings) was the point that the property was properly sold subject to the plaintiffs' earlier mortgage and that the defendants (or decree-holders) could not now claim to take the property free of that encumbrance.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Gokaldas v. Puranmal	Authorities invoked in support of subrogation where money is applied to satisfy prior encumbrancer's dues.	Cited by the defendants to support their claim to be subrogated to the prior encumbrancer's rights; the Court noted these authorities but concluded estoppel prevented the defendants' priority claim in the present case.
Dinobandhu Shaw Chowdhary v. Jogrnaya Daii	Authority supporting subrogation/priority when subsequent lender pays prior encumbrancer.	Invoked by defendants; Court observed the citation but relied on estoppel arising from execution proceedings to reject priority.
Mahomed Ibrahim Hossein Khan v. Ambika Pershad Singh	Authority on subrogation/priority principles (cited with multiple reports).	Cited by defendants for subrogation; Court recorded the invocation but treated estoppel as decisive.
Surjiram Marwari v. Barhamdeo Persad	Authority cited in support of subrogation claims.	Invoked by defendants; Court did not allow subrogation to prevail because of estoppel from execution proceedings.
Dhakeswar Prosad Singh v. Harihar Prosad Narain Singh	Authority on priority/subrogation principles.	Cited by defendants; Court relied on estoppel and execution record to deny defendants' priority claim.
Bhawani Kumar v. Mathura Prasad Singh	Authority invoked for subrogation/priority rules.	Referred to by defendants; Court held estoppel barred the asserted priority despite these authorities.
Het Ram v. Shadi Ram	Authority relied upon by plaintiffs; its effect on settled law was noted in the opinion.	Plaintiffs relied upon it; Court observed that its effect might unsettle prior understanding but held that the question need not be considered given the execution events and other conclusions in the case.
Chhaggan Lal v. Muhammad Mussain Khan	Full Bench consideration of Het Ram; cited in relation to the jurisprudential impact of Het Ram.	Mentioned by the Court as having considered Het Ram; Court declined to enter upon the larger issue because of the specific events of the case.
Bibijan Bibi v. Sachi Bewah	Earlier decision potentially affected by Het Ram (mentioned in discussion).	Referred to as an example of earlier authorities that might be affected by Het Ram; not further acted upon in this decision.
Shyam Lal v. Bashiruddin	Earlier relevant authority potentially affected by Het Ram.	Mentioned in the textual survey; no separate application in the Court's ruling beyond noting the corpus of authorities.
Yellapaddi Mahalakshammal v. Sriman Madhva Siddhantha Oonahini Nidhi, Ltd.	Earlier authority mentioned in the discussion of the doctrine's development.	Catalogued among earlier cases; Court did not base its primary ruling on it.
Chinnu Pillai v. Venkatasamy Ohettiar	Earlier authority cited in the survey of related decisions.	Listed among cases; no distinct role in the Court's operative reasoning other than contextual reference.
Rahimunnissa Bibi v. Badri Das	Earlier authority in the same general area of law.	Mentioned in the survey; not separately applied to determine the appeal.
Bam Kirpal v. Rup Kuar	Principle: a decision in execution proceedings on a question properly arising is final and binding between the parties.	Applied by the Court to hold that the execution Court's direction that the property be sold subject to the earlier mortgage was binding on the decree-holders and purchasers, and therefore operated as an estoppel against the defendants' later claim of priority.
Beni Ram v. Nanhu Mal	Same principle as Bam Kirpal regarding finality/binding effect of execution proceedings.	Relied upon to reinforce the binding character of the execution Court's decision and the resultant estoppel.
Laktmishanhar v. Vishnuram	Principle that a consent order is as binding on the parties as a decree after contentious trial.	Cited to support the proposition that where the sale was agreed to be subject to the earlier mortgage (consent by parties), that order was binding on them.
Bajlakshmi Dasee v. Katyayani Daisee	Authority for the binding effect of consent orders in execution-like proceedings.	Used to show that an agreement recorded in Court (consent order) is binding and contributes to estoppel.
Kasturi v. Venkatachalapathi	Authority illustrating that decree-holder purchasers are bound by estoppel in circumstances similar to the present case.	Relied upon to support the holding that mortgagee purchasers who participate in the execution proceedings are bound by the Court's order and cannot assert a position inconsistent with that order.
Jaganatha v. Gangi Reddi	Authority on binding effect of execution orders and estoppel of purchasers under execution.	Referred to as supporting precedent for estoppel of decree-holder purchasers.
Erishnan v. Chadayan Kutti Haii	Illustrative authority on the doctrine that execution purchasers are bound by estoppel.	Used to show consistency of the doctrine across decisions; supported the Court's estoppel reasoning.
Giribala Delia v. Rani Mina Kumari	Authority showing binding nature of execution orders on purchasers.	Cited to reinforce that decree-holders who purchase are bound by estoppels that would have bound their mortgagor.
Kishory Mohun Roy v. Mahomed Muzoffar Hossein	Principle that a mortgagee who purchases at sale in execution is bound by an estoppel that would have bound his mortgagor.	Applied to the case to show that the defendants' purchase did not weaken the estoppel arising from the execution Court's order; thus they could not assert priority contrary to that order.
Mahomed Mozuffer Hossein v. Kishori Mohun Roy	Same principle regarding the binding effect of estoppel on a purchaser-mortgagee at execution sale.	Reinforced the conclusion that the defendants' status as purchasers under execution did not release them from the estoppel.
Prosonna Kumar Mukherjee v. Srikant Raut	Doctrine that a decree-holder who is bound to notify encumbrances before sale cannot later set up an encumbrance in his own favour not set up in execution proceedings.	Directly applied to hold that the defendants (as decree-holders) could not now assert an encumbrance in their favour that they had not set up in the execution proceedings and had in fact agreed to sell subject to the prior mortgage.
Inayat Singh v. Izzat-un-Nissa Begam	Illustrative authority distinguishing purchase subject to a mortgage from purchase with mere notice of a mortgage.	Quoted as part of the line of authorities illustrating the legal distinction; Court used these authorities to explain when estoppel applies versus when a purchaser may still contest validity.
Rama-chandra v. Haji Kassim	Case illustrating the distinction between purchase subject to mortgage and purchase with notice.	Referred to in explaining the legal distinction; not separately dispositive of the appeal because the Court upheld mortgage reality and estoppel.
Shantappa v. Chedambaraya v. Subrao Ramchandra	Authority illustrating the same distinction between subject-to purchases and notice-only purchases.	Used as part of the illustration of principles; Court noted the distinction when discussing purchaser's ability to impeach mortgage validity.
Shib Kunwar Singh v. Sheo Prasad Singh	Illustrative case on the purchase-subject-to vs notice-only distinction.	Listed among authorities explaining when a purchaser is precluded from disputing a mortgage.
Ganesh v. Curshottam	Illustrative of the distinction between purchase subject to mortgage and mere notice.	Referred to in explanatory context; Court observed the principle but did not need to rely on it to overturn the Subordinate Judge's finding of reality of mortgage.
Jairoj Mai v. Radha Kishan	Another illustrative authority on the same distinction.	Used among the cited cases to show the well-established distinction; ultimately the execution order and estoppel made further elaboration unnecessary.

Court's Reasoning and Analysis

The Court proceeded in a structured manner addressing the two principal grounds raised by the defendants.

On the first ground (that the plaintiffs' mortgage was fictitious), the Court affirmed the Subordinate Judge's finding: the evidence "proves conclusively" that the mortgage was a genuine transaction and therefore the contention that it was fictitious was unsubstantial. The Court stated that, because it upheld that finding, a further question about estoppel on that point did not require detailed elaboration.
On the second ground (defendants' claim to priority by subrogation), the Court examined the execution history and the conduct of the decree-holders in the execution proceedings. The pivotal fact was that during the execution sale the decree-holders (two through their pleader; the third not appearing) requested and accepted that the property be sold "subject to" the plaintiffs' prior mortgage; the execution Court directed sale on that basis, and the decree-holders purchased the property at the sale.
The Court applied established principles regarding the finality and binding effect of decisions or orders made in execution proceedings: a question decided in execution that properly arises is final and binding between the parties (citing Bam Kirpal v. Rup Kuar and Beni Ram v. Nanhu Mal). The Court also emphasized that a consent order is as binding as a decree after contentious trial (citing Laktmishanhar v. Vishnuram and Bajlakshmi Dasee v. Katyayani Daisee).
The Court stressed the statutory and procedural duties of execution creditors: they must specify the judgment-debtor's interest (Order XXI, Rule 13) and the sale proclamation should specify encumbrances as accurately as possible (Order XXI, Rule 66). If the decree-holders claimed priority they should have raised the issue in the execution proceedings; instead two of them expressly agreed to a sale subject to the prior mortgage, and the third acquiesced in the order. On that factual matrix the Court held that the doctrine of estoppel binds the decree-holders and prevents them from taking a position inconsistent with what they adopted in the execution Court.
The Court reinforced that a purchaser who buys subject to a mortgage or undertakes to discharge it cannot later deny the validity of that mortgage; by contrast a purchaser who merely buys with notice but not subject to the encumbrance retains the right to contest validity. The Court cited a line of authorities illustrating this distinction (e.g., Inayat Singh v. Izzat-un-Nissa Begam and others) but observed that, because it had upheld the reality of the plaintiffs' mortgage, further elaboration of that distinction was not necessary to decide the appeal.
Given the execution-order facts and the authorities applying the doctrine of estoppel to execution purchasers, the Court concluded that the defendants could not set up a question of priority as against the plaintiffs despite their argument for subrogation.

Holding and Implications

Holding: The decree of the Subordinate Judge is affirmed and the appeal is dismissed with costs.

Implications:

Direct effect: The plaintiffs' mortgage is held to be genuine and enforceable; the defendants are not entitled to assert priority over the plaintiffs' mortgage in this suit.
The defendants (as decree-holder purchasers and execution creditors) are bound by the execution Court's order that the property be sold subject to the plaintiffs' mortgage and are estopped from taking a position inconsistent with that order.
No broader change in law is declared by this opinion: the Court relied upon longstanding authorities concerning finality of execution proceedings, consent orders, estoppel of purchasers at execution sales, and the statutory obligations under Order XXI. The opinion notes the existence of authorities (e.g., Het Ram v. Shadi Ram) whose effect was described as potentially unsettling but expressly states that those larger questions did not require consideration in view of the specific events and findings in this case.

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Kali Das Saha Choudhry v. Prosunno Kumar Das

1. This is an appeal by the mortgagee defendants in a suit to enforce a mortgage security. On the 9th September 1902, the mortgagor defendant executed a mortgage in favour of the plaintiffs to secure a loan of Rs. 1,900, which was to cany interest at 33 per cent. per annum and was to be repaid on the 14th January 1903. On the 4th March 1904, a sum of Rs. 500 was paid by the mortgagor on account of interest. No further payment was made and on the 6th January 1915, the mortgagees instituted the present suit for recovery of their dues. The mortgagor was made the 1st defendant. Four other persons were also joined as defendants, on the allegation that they were puisne encumbrancers who had taken a mortgage on the 12th February 1804. The mortgagor defendant did not enter appearance. The mortgagee defendants contested the claim substantially on two grounds, namely, first, that the mortgage in favour of the plaintiffs was fictitious, and secondly, that they were entitled to priority in respect of a portion of the money secured by their mortgage. The Subordinate Judge has overruled both the contentions and decreed the suit. On the present appeal, the two grounds just mentioned have been reiterated. The first ground is, in our opinion, unsubstantial, because the evidence proves conclusively that the mortgage which is the foundation of the claim of the plaintiffs was a genuine transaction, as held by the Subordinate Judge. The second ground, however, requires careful consideration.

2. On the 10th June 1894, the mortgagor executed a mortgage in favour of Jaladhar Saha and Makhan Lal Saha to secure a loan of Rs. 7,500, which was to carry interest at 12 per cent. per annum and was repayable on the 16th August 1895. The mortgagees instituted a suit on the 15th August 1901 to enforce their security and obtained a decree on the 16 th September 1901. They took out execution on the 9th November 1903, and the 16th February 1904 was fixed for the sale of the mortgaged properties. During the pendency of the execution proceedings, on the 12th February 1904, the mortgagor borrowed from the present defendants a sum of Rs. 16,000 which was to carry interest at 9 per cent. per annum and was to be repaid on the 12th February 1906. This mortgage is the root of the title of the defendants. It recites the execution proceedings on the decree of the first mortgage then pending and states that the money had been borrowed to satisfy the dues of the prior encumbrancer. The records of the execution case show that a sum of Rs. 13,548-2 was paid to the decree-holders in satisfaction of their decree. The defendants contend that to the extent that their money was applied to satisfy the dues of the first encumbrancer, they are entitled to be subrogated to his rights and to claim priority over the mortgage of the plaintiffs. They have in support of their contention invoked the aid of the decisions in Gokaldas v. Puranmal 10 C. 1035 : 11 I.A. 126 : 4 Sar. P.C.J. 543; Dinobandhu Shaw Chowdhary v. Jogrnaya Daii 29 C. 154 : 29 I.A. 9 : 12 M.L.J. 73 (P.C.) : 4 Bom. L.R. 238 : 6 C.W.N. 209 : 8 Sar. P.C.J.217; Mahomed Ibrahim Hossein Khan v. Ambika Pershad Singh 14 Ind. Cas. 496 : 39 C. 527 : 39 I.A. 68 : (1912) M.W.N. 367 (P.C.) : 11 M.L.T. 265 : 9 A.L.J. 332 : 14 Bom. L.R. 280 : 16 C.W.N. 505 : 15 C.L.J 411 : 22 M.L.J. 468. Surjiram Marwari v. Barhamdeo Persad 2 C.L.J. 202 : Dhakeswar Prosad Singh v. Harihar Prosad Narain Singh 27 Ind. Cas. 780 : 21 C.L.J. 104; Bhawani Kumar v. Mathura Prasad Singh 16 Ind. Cas. 210 : 40 C. 89 : 16 C.W.N. 985 : 23 M.L.J. 311 : 12 M.L.T. 352 : (1912) M.W.N. 244 : 14 Bom. L.R. 1046 : 16 C.L.J. 606 : 39 I.A. 228 (P.C.). The plaintiffs have relied on the other hand upon the decision in Het Ram v. Shadi Ram 45 Ind. Cas. 798 : 45 I.A. 130 : 40 A. 407 : 5 P. L.W. 88 : 16 A.L.J. 607 : 35 M.L.J.I; 24 M.L.T. 92 : 28 C.L.J. 188 : (1918) M.W.N. 518 : 20 Bom. L.R. 798 : 22 C.W.N. 1033 : 9 L.W. 550 : 12 Bur. L. T.73 (P.C.) which was considered by a Full Bench of the Allahabad High Court in Chhaggan Lal v. Muhammad Mussain Khan 51 Ind. Cas. 133 : 17 A.L.J. 741 : 1 U.P.L.R. (H.C.) 1 : 41 A. 456. The decision of the Judicial Committee last mentioned may have the effect, as the appellants have contended, to unsettle what has hitherto been understood as settled law and may have affected judicial decisions which were not brought to the notice of the Judicial Committee, such as Bibijan Bibi v. Sachi Bewah 31 C. 863 : 8 C.W.N. 684, Shyam Lal v. Bashiruddin 28 A. 778 : 3 A.L.J. 630 : A.W.N. (1906) 230 Yellapaddi Mahalakshammal v. Sriman Madhva Siddhantha Oonahini Nidhi, Ltd. 11 Ind Cas. 865 : 35 M. 6 42 : 10 M.L.T. 169 21 M.L.J. 811 : (1912) M.W.N. 24; Chinnu Pillai v. Venkatasamy Ohettiar 34 Ind. Cas. 607 : 40 M. 77 : 30 M.L.J. 347 (1916) 1 M.W.N. 245 : 19 M.L.T. 217; Rahimunnissa Bibi v. Badri Das 9 Ind. Cas. 205 : 33 A. 348 : 8 A.L.J. 112. But the question of the effect of the decision in Het Ram v. Shadi Ram 45 Ind. Cas. 798 : 45 I.A. 130 : 40 A. 407 : 5 P. L.W. 88 : 16 A.L.J. 607 : 35 M.L.J.I; 24 M.L.T. 92 : 28 C.L.J. 188 : (1918) M.W.N. 518 : 20 Bom. L.R. 798 : 22 C.W.N. 1033 : 9 L.W. 550 : 12 Bur. L. T.73 (P.C.) upon the accepted view of law applicable to this class of oases, does not require consideration in view of events which we shall presently mention.

3. The defendants instituted a suit on the 17th January 1910 to enforce their mortgage of the 12th February 1904. In this suit, they joined the mortgagor alone as the defendant and did not implead the plaintiffs whose mortgage, as we have seen, was dated the 9th September 1902. The suit was decreed on the 30th January 1911. Execution was taken out on the 16th March 1911. The sale was held, the properties were purchased by the decree-holders, an application was made by the judgment-debtors for cancellation of the sale, and the sale was ultimately reversed on the 30th March 1914, On the 25th May 1914 the decree holders commenced the second execution proceedings. The sale was proclaimed in due course. But on the 17th August 1914, the mortgagor judgment-debtor preferred various objections. One of these objections was that the property described as the fifth lot in the sale proclamation (which is the substantial property covered by the mortgage in suit) was under mortgage, but it had not been mentioned. On the 19th August 1914, two of the decree-holders, through their Pleader, presented a petition and prayed that the property in question might be put up to auction upon declaration that it was subject to a mortgage for Rs. 1,900 held by Prasanna Kumar Das and others (the plaintiffs in this suit). The Subordinate Judge delivered judgment on the 22nd August and directed that the property mentioned be sold on declaration that it was subject to the mortgage mentioned. These facts we have gathered from an examination of the execution records, which we have called up at the request of both the parties. The sale was held on the same day. The bid offered by the decree-holders proved to be the highest and the property was purchased by them for Rs. 3,500. In the circumstances, the question arises whether it is now open to the decree-holders auction-purchasers (the mortgagees defendants in this suit) to contend that they have taken the property free of the mortgage of the plaintiffs either entirely or partially. We are of opinion that they are bound by the doctrine of estoppel and cannot take up a position inconsistent with what they adopted in the execution Court.

5. It was decided by the Judicial Committee in Bam Kirpal v. Rup Kuar 11 I.A. 37 : 6 A. 269 (P.C.) : 4 Sar. P.C.J. 489 and Beni Ram v. Nanhu Mal 11 I.A. 181 : 7 A. 102 : 4 Sar. P.C.J. 564 that a decision, in the course of execution proceedings, of a question which properly arises for consideration is final and binding between the parties. The position is not different when the order is made by the consent of the parties, for, as was observed in Laktmishanhar v. Vishnuram 24 B. 77 : 1 Bom. L.B. 534 and Bajlakshmi Dasee v. Katyayani Daisee 12 Ind. Cas. 464 : 38 C. 639 at p. 674 the consent order is just as binding on the parties to the proceeding as a decree after a contentious trial. In the case before us, two of the decree-holders agreed that the property should be sold subject to the mortgage of the 9th September 1902; the other decree-holder did not appear. The binding character of the order is not affected by the circumstances that as to some of the parties it was based on agreement, as to the others on adjudication by the Court. Reference may be made to the decisions in Kasturi v. Venkatachalapathi 15 M. 412; Jaganatha v. Gangi Reddi 15 M. 303; Erishnan v. Chadayan Kutti Haii 17 M. 17 and Giribala Delia v. Rani Mina Kumari 5 C.W.N. 497 to show that, in circumstances such as those of the present case, the decree holders purchasers would be bound by the doctrine of estoppel. It was their duty as execution creditors to specifiy the judgment debtor's interest in the property so far as they had been able to ascertain the same (Order XXI, Rule 13). The sale proclamation was to specify, as fairly and accurately as possible, any encumbrance to which the property was liable (Order XXI, Rule 66). The judgment-debtor took exception that the prior encumbrance had not been mentioned. The Court thereupon directed that the property be sold subject to the mortgage now in suit. The decree holders, if they claimed priority, should have set forth their objection at the time. But they did not claim priority for any portion of their dues. On the other hand, two of them expressly agreed to have the sale held subject to the mortgage of the plaintiffs which was prior in point of time, while the other acquiesced in order. On no conceivable principle of justice, equity and good conscience can they be now permitted to take up a position inconsistent with what they deliberately adopted at the time. They themselves and their mortgagor were all bound by the order made by the execution Court, and the fact that they purchased the interest of the mortgagor in execution proceedings undoubtedly does not operate to weaken its binding character; for it is well settled that the mortgage who has purchased at the sale in execution of his decree on the mortgage is bound by an estoppel that would have bound his mortgagor. Kishory Mohun Roy v. Mahomed Muzoffar Hossein 18 C. 188; Mahomed Mozuffer Hossein v. Kishori Mohun Roy 22 I.A. 129 : 2 C. 909 : 5 M : L.J. 101 : 6 Sar. P.C.J. 683. In this view the mortgage defendants are not entitled to set up a question of priority as against the plaintiffs; for the circumstances disclosed attract the operation of the well-established doctrine, recognised in a long series of decisions, that the decree-holder himself who is bound to notify before the sale all encumbrances on the property about to be sold cannot subsequently set up an encumbrance in his own favour not set up in the execution proceedings Prosonna Kumar Mukherjee v. Srikant Raut 16 Ind. Cas. 365 : 40 C. 173 : 17 C.W.N. 137 : 16 C.L.J. 202.

6. We may add that if we had not affirmed the finding of the Subordinate Judge as to the reality of the mortgage which the plaintiffs seek to enforce, the question would have arisen whether the defendants were not bound by the doctrine of estoppel upon that question also. If a person purchases an estate subject to a mortgage, whether under a voluntary conveyance or under a sale in invitum, or undertakes to discharge it, he cannot be heard to deny the validity of the mortgage subject to which he made his purchase. Where, however, the purchaser merely buys an estate which is under mortgage but does not take it subject to the encumbrance or undertake to discharge it, he is not precluded from impeaching the validity of the mortgage. The distinction between the two classes of eases depends upon the question, whether the property has been sold subject to the mortgage or whether mere notice of the alleged mortgage has been given in the proclamation of sale. The former contingency is provided for by Order XXI, Rule 62, the latter is contemplated by Order XXI, Rule 66. The distinction is well-illustrated by the cases of Inayat Singh v. lzzat-un-Nissa Begam 27 A. 97; A.W.N. (1904) 174, 1 A.L.J. 435; Rama-chandra v. Haji Kassim 16 M. 207; Shantappa v. Chedambaraya v. Subrao Ramchandra 18 B. 175; Shib Kunwar Singh v. Sheo Prasad Singh 28 A. 418 : 3 A.L.J. 200 : A.W.N. (1906 ) 68; Ganesh v. Curshottam 1 Ind.Cas. 106 : 33 B. 311 : 11 Bom. L.R. 26 : 5 M.L.T. 228 and Jairoj Mai v. Radha Kishan 20 Ind. Cas. 182 : 35 A. 257 : 11 A.L.J. 357. The language used in the petition of the decree-holders and the order of the execution Court may well lend support to the contention that the decree-holders agreed to have the property sold as subject to a genuine mortgage. They do not suggest that the purchaser should buy the property, merely with notice of a mortgage claim, subject to such risks as the notice might involve, with liberty to contest the mortgage and to redeem it only if it was established to be a really subsisting mortgage. This point of view, however, does net require further elaboration, as in concurrence with the Subordinate Judge we have overruled the contention that the mortgage of the plaintiffs was ficititous.

7. The result is that the decree of the Subordinats Judge is affirmed and this appeal dismissed with costs.

Kali Das Saha Choudhry v. Prosunno Kumar Das

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Defendants' Arguments

Plaintiffs' Arguments

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Kali Das Saha Choudhry v. Prosunno Kumar Das

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