Kulwant Sahay, J.:— (after stating the facts set out above, proceeded as follows): It is clear that a second mortgagee who has not been made a party to the suit of a prior mortgagee is entitled to redeem the prior mortgage and is not bound either by the decree in the suit of the prior mortgagee or by the sale held in execution thereof. It has been contended on behalf of the respondents that after the sale in execution of the decree the prior mortgagee, the mortgage was extinguished and the purchasers remained in possession not as representative of the prior mortgagee but as representatives of the mortgagor; and that, therefore, Article 148 has no application inasmuch as it provides for a suit against a mortgagee to redeem or to recover possession of the mortgaged property.
In my opinion this contention is not sound. So far as the second mortgagee is concerned, he is not bound by the decree or the sale in enforcement of the prior mortgage. His position as a second mortgagee remains unaffected by the decree and the sale. He was a necessary party in the suit brought by the prior mortgagee and a decree obtained in his absence on the basis of the prior mortgage did not affect his right to redeem the prior mortgage. The fact that the purchaser in execution of the decree of the prior mortgage has been in possession for more than 20 years does not, in my opinion, affect the right of the second mortgagee to redeem the first mortgage.
The question, however, remains as to whether Article 132 or Article 148 of the Indian Limitation Act applies to the present case. In my opinion Article 132 has no application to the present suit. In the case of Nidhi Ram Bandhopadhya mentioned above, the reasoning adopted was that the second mortgagee by his purchase at the sale in satisfaction of his mortgage debt cannot acquire any right of redemption which he had not as mortgagee. With very great respect to the learned-judges, I am unable to follow this reasoning. The right to redeem the prior mortgage was vested in the second mortgagee by virtue of his being a second mortgagee. This right was not acquired by him by his purchase at the sale in satisfaction of his mortgage debt. The learned-judges observed that “the omission of the prior mortgagee to include the second mortgagee in his suit has been held by this court not to deprive the second mortgagee of his right to redeem the prior mortgage; but it cannot be held that this interpretation of the law which is intended merely to save his right as second mortgagee gives him any additional right or extends the period during which under the law he can sue to enforce his rights. The right to redeem was held not to be lost. It was not held and in our opinion it was not intended to hold that a fresh period to enforce his right to redeem under his mortgage was given to him from the date of the purchase. We hold that Articles 134 and 148 of Schedule II of the Indian Limitation Act have no application in this case. The Article that applies is Article 132 of that Schedule under which limitation begins to run from the date when the mortgage debt Became due”. I regret I am unable to agree with this reasoning. Once it is conceded that the second mortgagee had still the right to redeem and was not affected by the sale in execution of the prior mortgage, it must necessarily follow that whatever right the second mortgagee had before the sale in execution of the decree on the prior mortgage remained intact. Under Article 148 the second mortgagee had 60 years to redeem the first mortgage and this right was consequently not affected by the sale in execution of the decree upon the prior mortgage. Article 132 provides for enforcement of payment of money charged upon immoveable property. The second mortgagee's right of redemption cannot, in my opinion, be considered to be a right to enforce payment of money charged upon immoveable property. The second mortgagee in a suit for redemption does not seek to recover the money due to him upon his second mortgage. This Article has, therefore, no application to a suit for redemption brought by the second mortgagee.
I am, therefore, unable to accept the view taken in the case of Nidhi Ram Bandhopadhya. This case was followed in two cases in the Madras High Court in Bitragunta Appayya v. Addanki Venkataramanayya and Lakshmanan Chettiar v. Sella Muthu Naicker, and the reasoning adopted in these cases, is similar to the reasoning adopted by the learned-judges in Nidhi Ram's case. The Lahore High Court has, however, differred from the view taken in Nidhi Ram's case in Basant v. Inder Singh. That Article 148 of the Schedule to the Limitation Act applies to the present case is supported by the view taken by the Allahabad High Court in Priya Lal v. Bhora Champa Ram and by the Calcutta High Court in Harprasad Lal v. Dal Mardan Singh.
I would therefore hold that the present suit was not barred by limitation and that the plaintiff was entitled to a decree for redemption.
The question remains what should be the form of the decree. The learned Munsif has ordered that the plaintiff will be entitled to redeem on payment of Rs. 50 together with interest thereon at the rate of 12 per cent, per annum from the date of sale, that is, 26th October, 1895, to the defendants nos. 1-3. This sum of Rs. 50 represents the price of the property fetched at the sale in execution of the decree upon the first mortgage. This is not a correct principle upon which redemption should be allowed. The puisne mortgagee is held to be entitled to redeem the prior mortgage on the hypothesis that so far as he is concerned the mortgage has not been extinguished and is still in existence. He must, therefore, pay to the prior mortgagee the entire amount due upon the prior mortgage on an account being taken less the sum of Rs. 50, being the purchase money at the first sale already paid to him. Upon such payment being made the plaintiff will acquire the right of the prior mortgagee, because what he redeems is not the premises but the prior encumbrance and he is entitled not to a conveyance of the premises, but to an assignment of the security.
This would necessitate a remand for the taking of the account and also directions declaring the rights of the parties to redeem each other and relating to other matters which would create complications. The parties have, however, come to terms and desire that a decree be made in the following terms: that the plaintiffs right to redeem be declared, that it be declared that she will be entitled to redeem on payment to the defendants 1-3 of a sum of Rs. 100 only within three months from this date, that on her failure to do so, the suit will stand dismissed with costs. Each party is to bear its own costs throughout in the event of payment being made by plaintiff within the three months. It is represented that the plaintiff has deposited in the trial court a sum of money in accordance with the decree of that court. If so, and if there be no other objection to her doing so, she will be entitled to take the sum back from the court.
The appeal be decreed by consent on the above terms. The decrees of the courts below will be set aside and the suit decreed as directed above.
Mullick, J.:— I agree.
Appeal decreed.