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Marina Ammayi v. Mirza Bakhar Beg Saheb And Others
Factual and Procedural Background
This revision petition arises out of an application under Section 19 of Madras Act IV of 1938 to scale down a preliminary decree for redemption passed by the Subordinate Judge of Rajahmundry. Plaintiffs 2, 3, 4 and 6 (respondents here) had executed a mortgage in 1914; in a suit to redeem the mortgage the Court passed a preliminary decree declaring the amount due to the mortgagee calculated up to 30th March, 1937 to be Rs. 16,245-6-3. On the respondents' application to scale down the decree the Court below found they were agriculturists and that the amount already paid to the decree-holder was more than twice the principal sum payable by the respondents; it therefore ordered under Section 19 read with Section 8 that full satisfaction of the decree as a whole be entered. The Civil Revision Petition was dismissed with costs.
A second revision petition (C.R.P. No. 1331 of 1939) arose from an application by the first plaintiff (mortgagor) to scale down the same decree as it related to a mortgage under Ex. III dated 23rd November, 1927. The Court below found the mortgagor to be an agriculturist and scaled down the amount declared to be due under the decree for redemption to Rs. 18,000. This Civil Revision Petition also failed; the court made no order as to costs.
Legal Issues Presented
- Whether a preliminary decree for redemption may be scaled down under Section 19 (read with Section 8) of Madras Act IV of 1938 in favour of agriculturist judgment-debtors.
- Whether entry of full satisfaction of a decree as a whole is appropriate where some judgment-debtors or purchasers of portions of the hypotheca are non-agriculturists.
- How the principle in Ramier v. Srinivasiah (and related authority) applies where agriculturist mortgagors have brought a redemption suit impleading purchasers of portions of the mortgaged property.
Arguments of the Parties
Decree-holder's Arguments
- Some other judgment-debtors who are purchasers of portions of the hypotheca are non-agriculturists and thus not entitled to benefits under the Act.
- Reliance on the case reported in Ramier v. Srinivasiah (1940) 2 M.L.J. 872 to support the contention that a decree could be scaled down in favour of an agriculturist but left intact as against a non-agriculturist judgment-debtor.
Respondents' Position (as found by the Court below)
- The respondents are agriculturists entitled to the relief under the Act; the amount already paid to the decree-holder exceeds twice the principal payable.
- The purchasers of portions of the hypotheca hold the moneys reserved with them as "mere custodians" for the mortgagors and may be liable to return any portion of purchase money that, after scaling down, need not be paid to the mortgagee.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Ramier v. Srinivasiah (1940) 2 M.L.J. 872 | Recognised that a decree could be scaled down in favour of an agriculturist and left intact as against a non-agriculturist judgment-debtor; procedure allowing a puisne mortgagee who is an agriculturist to redeem on payment of the scaled amount, failing which the decree-holder could bring the whole mortgaged property (including the puisne mortgagee's interest) to sale. | The court noted the principle but held that the decision was not applicable to the facts of the present case; nonetheless, the court observed that the learned Judge's view that there could be no partial amendment was erroneous in view of this decision. |
| Ragunatha v. Sadagopa (1911) 21 M.L.J. 983 : I.L.R 36 Mad 348 | Illustrates that purchasers holding reserved moneys may be treated as custodians and that mortgagors may recover portions of purchase money not required to be paid to the mortgagee after scaling down. | The court cited this authority to support the view that purchasers might be obliged to account to the agriculturist mortgagors for sums which, following scaling down, are not payable to the mortgagee, thus justifying entry of full satisfaction in favour of the agriculturist mortgagors. |
| Rainier v. Srinivasiah (1940) 2 M.L.J. 872 | Same decision textually cited in the opinion (alternate spelling of Ramier v. Srinivasiah) concerning the possibility of partial scaling down in favour of agriculturists while preserving rights against non-agriculturists. | The court referred to this decision to hold that the view expressed below — that there could not be any partial amendment of a decree under the Act — was erroneous. |
Court's Reasoning and Analysis
The court examined the facts found by the Court below: the respondents were agriculturists; the amount already paid to the decree-holder exceeded twice the principal sum payable under the mortgage; redemption had been decreed on payment of a specified sum which must now be deemed to have been paid. Applying Section 19 read with Section 8 of Madras Act IV of 1938, the Court below entered full satisfaction of the decree as a whole.
Addressing the decree-holder's contention that purchasers who are non-agriculturists should not benefit, the court analysed the precedent in Ramier/Rainier v. Srinivasiah and explained that while that decision allows scaling down in favour of agriculturists and leaving the decree intact as against non-agriculturists in some circumstances, it was not applicable to the present facts where agriculturist mortgagors had brought the redemption suit and purchasers were found to be mere custodians of reserved moneys. The court held that entry of satisfaction of the decree as a whole would effectuate the relief the Act intended for agriculturist mortgagors and would not necessarily confer the Act's benefit on non-agriculturist purchasers.
The court therefore concluded that the order of the Court below was correct on the facts, while noting that the learned Judge's categorical view that there could be no partial amendment under the Act was erroneous in light of the cited authority.
Holding and Implications
Holding: The Civil Revision Petition (first petition) is DISMISSED WITH COSTS. The second Civil Revision Petition (C.R.P. No. 1331 of 1939) also fails; the court made no order as to costs.
Implications: The direct effect is that the orders of the Court below scaling down the decree in favour of agriculturist mortgagors and entering full satisfaction of the decree (in the first petition) are upheld, and the second petition's reduction to Rs. 18,000 stands. The opinion does not posit broader precedent beyond applying and distinguishing the cited authorities; no broader new precedent is announced in the text of this opinion.
1. This revision petition arises out of an application under Section 19 of Madras Act IV of 1938 to scale down a preliminary decree for redemption passed by the Subordinate Judge of Rajahmundry.
2. The plaintiffs 2, 3, 4 and 6 were the petitioners in the Court below and are respondents here. They had executed a mortgage in 1914 and in a suit to redeem the mortgage the Court has passed the preliminary decree declaring that the amount due to the mortgagee calculated up to the 30th March, 1937, the date fixed for redemption, was Rs. 16,245-6-3. On the application of the respondents to scale down the decree, the Court below has found that they are agriculturists and that the amount already paid to the decree-holder (petitioner herein) was more than twice the principal sum payable by the respondents under the mortgage. The Court has therefore ordered under Section 19 read with Section 8 of the Act that full satisfaction of the decree as a whole be entered, holding that there could be no question of any partial amendment of the decree.
3. It is argued for the decree-holder that some of the other judgment-debtors who are purchasers of portions of the hypotheca are non-agriculturists and that the Court below ought not to have entered full satisfaction of the decree even as against them as they are not entitled to the benefits of the Act. The case reported in Ramier v. Srinivasiah (1940) 2 M.L.J. 872, is relied on in support of this contention. That decision no doubt recognised that a decree could be scaled down in favour of a judgment-debtor who was an agriculturist and left intact as against a non-agriculturist judgment-debtor and it was accordingly held that a puisne mortgagee who was an agriculturist and a party to the decree on a prior mortgage should be given an opportunity to redeem on payment of the decree amount as scaled down but that, on his failure to pay such amount within the time allowed, the decree-holder should be entitled to bring the whole of the mortgaged property including the puisne mortgagee's interest to sale. This procedure was indicated as appropriate in the circumstances of that case to give to the agriculturist judgment-debtor the full benefit of the relief to which the Act entitled him while safeguarding the right of the decree-holder as against the non-agriculturist mortgagor judgment-debtor. But that decision, it seems to us, is not applicable to the facts here. The respondents who are agriculturists brought the suit as mortgagors to redeem the mortgage impleading purchasers of portions of the hypotheca as co-plaintiffs and redemption has been decreed on payment of a certain sum which must now be deemed to have been paid. How then can redemption of the mortgage as a whole be denied to them? The Court below has found that the purchasers hold the moneys reserved with them for payment to the mortgagee as "mere custodians" for the mortgagors, and it may be that the respondents would be entitled to recover any portion of the purchase money which as a result of the scaling down of the decree, the purchasers will not have to pay to the mortgagee. See Ragunatha v. Sadagopa (1911) 21 M.L.J. 983 : I.L.R 36 Mad 348. In such circumstances the Court by entering satisfaction of the decree as a whole would only be allowing to the agriculturist mortgagors the fall benefits of the Act and not necessarily benefiting the non-agriculturist purchasers of portions of the hypotheca. It follows that the order of the Court below is correct though the view expressed by the learn-ed Judge that there could not be any partial amendment of a decree under the Act must be held to be erroneous in view of the decision in Rainier v. Srinivasiah (1940) 2 M.L.J. 872.
4. The Civil Revision Petition is dismissed with costs.
C.R.P. No. 1331 of 1939.
5. This revision petition arises out of an application made by; the first plaintiff (mortgagor) to scale down the same decree so far as it relates to the mortgage under Ex. Ill dated 23rd November, 1927. The Court below has found that the mortgagor, the respondent herein, is an agriculturist and scaled down the amount declared to be due under the decree for redemption to Rs. 18,000.
6. For the reasons indicated in our judgment in C. R. P. No. 1330 of 1939, this Civil Revision Petition also fails but we make no order as to costs.
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