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Factual and Procedural Background

This revision arises from a dispute over possession of portions of the estate of Bibi Fasihan, a Muhammadan woman who died on 2 July 1909 leaving two sons (Muhammad Umar and Kalimuzaffar) and four daughters (Habiba, Fatima, Saira and Salima). Before her death various deeds of gift were executed in favour of Habiba and the two sons. In March 1912 Fatima and Saira instituted a suit (later numbered Suit No. 6 of 1913 in the District Court of Patna) to set aside those transfers and for administration of the estate. Salima instituted separate but similar suits (Suits Nos. 9, 10, 11 and 12 of 1913).

The District Judge held all deeds of gift except the deed of 7 May 1909 (in favour of Kalimuzaffar) invalid and directed partition except for lands covered by that deed. On appeal (disposed 18 July 1917 — Fazlur Rahman v. Muhammad Umar), this Court set aside all deeds of gift including the 7 May 1909 hiba, declared the heirs' shares under Muhammadan law and directed general administration of the property under court orders. Pursuant to that decree the District Judge on 22 September 1917 made a preliminary decree for administration and on 25 January 1918 appointed a Receiver after notice to mortgagees and creditors.

Subsequent facts relevant to these revision applications: Muhammad Umar, about a year after Fatima and Saira's suit was instituted, mortgaged certain proprietary interests to Dulhin Sona Kuer (contemplated consideration originally Rs. 85,000 but effectively Rs. 60,000 paid to Umar's creditors). Sona Kuer obtained a decree and, after auction-purchase, retained possession of mortgaged properties. When the Receiver was appointed, Sona Kuer refused to deliver possession and the District Judge ordered delivery to the Receiver on 22 March 1918. The present application for revision (No. 75 of 1918) challenged that order. A second similar revision (No. 138 of 1918) by other transferees (Ram Prasad Singh and others) raised analogous issues concerning possession and lis pendens.

Legal Issues Presented

  1. Whether transfers (mortgages and subsequent sales) executed by a co-heir pendente lite are affected by the doctrine of lis pendens (Section 52, Transfer of Property Act) so as to permit the court in administration proceedings to regard such transfers as nullities and order delivery of possession to a Receiver.
  2. Whether under Order 40, Rule 1, Sub-rule 2, Civil Procedure Code, the Court (through a Receiver appointed under a preliminary decree for administration) may remove persons in possession (including transferees who acquired possession after institution of the administration suit).
  3. Whether the appellate decree of 18 July 1917, directing general administration, was intended to preserve the possession of transferees to the extent of their transferor's shares (i.e., whether transferees should remain in possession until it is ascertained they hold more than the transferor's share).
  4. Whether payment by a subsequent transferee to a prior mortgagee can lead to subrogation to the prior mortgagee's rights where the payment does not satisfy the prior mortgagee's entire decree.
  5. Whether the remedy of the aggrieved transferee in the circumstances is by revision or by appeal, and whether a misdescribed application for revision can be treated as a memorandum of appeal under the Court's inherent powers (Section 151 CPC).

Arguments of the Parties

Appellant (Dulhin Sona Kuer and other transferees) — principal contentions

  • The transfer/mortgage by Muhammad Umar (a co-heir) did not ipso facto become void and, as a co-owner, Umar had power to mortgage to the extent of his share; therefore transferees in possession should not be dispossessed except upon proof that more than the transferor's share was held.
  • The appellate judgment of 18 July 1917 (directing general administration) was, it is argued, intended to preserve the possession of transferees so far as possible to the extent of the transferor's share; thus possession should remain with transferees until accounts show excess possession.
  • Sona Kuer offered to deposit a year's rent in Court as security against risk (e.g., sale for arrears of Government revenue) and argued equitable subrogation in respect of payment made to Kesho Das (a prior mortgagee), asserting she should be subrogated to Kesho Das's rights.
  • Procedurally, the applicant filed for revision relying on prior decisions of this Court on competence to appeal; she contended the remedy pursued was proper.

Court/Respondent positions and factual points relied on by the District Judge and Receiver

  • The transfer executed pendente lite is affected by Section 52 of the Transfer of Property Act (doctrine of lis pendens); once a Receiver was appointed under the administration order, the Court was entitled to consider the transfer a nullity for purposes of administration and to direct the Receiver to take possession.
  • Order 40 (regulating receivers) empowers the Receiver and, subject to Order 40, Rule 1, Sub-rule 2, the only ground to resist the Receiver's possession was that the person in custody could not be removed by a party to the suit — a contention rejected where possession resulted from transfers after institution of the administration suit.
  • There was an absence of evidence to establish a splitting of Kesho Das's mortgage or that Sona Kuer had satisfied the whole prior mortgage; therefore subrogation was not available.
  • Procedurally, the proper remedy for a person in the appellant's position is by appeal (Order 43), but the Court may, in special circumstances and under its inherent powers, treat a misdescribed revision as a memorandum of appeal if limitation and court-fees are in order.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Fazlur Rahman v. Muhammad Umar (appeal disposed 18 July 1917) Set aside the deeds of gift (including hiba of 7 May 1909), declared heirs' shares under Muhammadan law and directed a general administration of the property under court orders. Used as the appellate background directing general administration; the Court examined the judgment and rejected the appellant's contention that that judgment intended to preserve transferees' possession—finding no support in the appellate passages for that interpretation.
Price v. Price Recognition of an equitable principle of subrogation (where a transferee pays off a prior encumbrance for the purpose of protecting the concerned property, equitable subrogation may operate). The Court observed that the appellant might have invoked this equitable principle if the mortgage had been taken for the purpose of paying deceased's debts, but found that on the facts before it no part of the consideration was actually the consideration for Sona Kuer's mortgage and the alleged payment was not effective to support a subrogation claim.
Gurdeo Singh v. Chandrika Singh Establishes that subrogation requires satisfaction of the whole mortgage (a person claiming subrogation must show that the prior mortgage was fully discharged). The Court applied this principle to reject the appellant's subrogation claim because, on the appellant's own case, Kesho Das's full decree was not satisfied and only a portion relevant to specific properties was paid.

Court's Reasoning and Analysis

The Court's analysis proceeded by applying statutory and procedural principles to the facts as established in the record.

  1. Lis pendens and Section 52, Transfer of Property Act: The Court accepted that transfers made pendente lite are affected by Section 52. While such transfers do not become ipso facto void, once a Receiver was appointed under the administration decree the Court could treat transfers made after institution of the suit as nullities for the purposes of administering the estate and could direct the Receiver to take possession.
  2. Order 40 CPC and Receiver's authority: The Court examined Order 40, Rule 1, Sub-rule 2 (the rule cited by the appellant as limiting removal of persons from custody/possession). The Court concluded that the only legitimate ground to resist the Receiver's possession was under that sub-rule, but on the facts (transfers subsequent to institution of the suit) the sub-rule did not operate in favour of the appellant; consequently the Receiver's taking of possession was authorized.
  3. Interpretation of the appellate decree: The appellant argued the appellate order directing general administration intended to preserve transferees' possession to the extent of their transferor's shares. The Court examined the appellate judgment (Fazlur Rahman v. Muhammad Umar) and found no language supporting such an interpretation; therefore it rejected the contention that transferees should remain in possession until accounts showed excess holding.
  4. Equitable subrogation: The Court considered the appellant's claim of subrogation based on alleged payments to Kesho Das. Applying the principle (and the cited precedent Gurdeo Singh v. Chandrika Singh), the Court held that subrogation requires satisfaction of the entire prior mortgage/decree; here only part of Kesho Das's decree (insofar as it affected particular mouzas) was said to have been paid, and there was no clear evidence that Kesho Das consented to a splitting of his mortgage. The Court therefore held subrogation did not assist the appellant.
  5. Procedural remedy — appeal versus revision: The Court held that an appeal lies under Order 43 against the District Judge's order made in the administration proceedings. The applicant had filed an application for revision because of a prior decision of the Court; however, the present Court concluded that, in the special circumstances (no defect as to court-fees and limitation, and the applicant's mistake arising from a prior judgment), it had power under Section 151 to treat the misdescribed revision as a memorandum of appeal and to accept it on the condition that the appellant be confined to the grounds taken in her original application. The Court noted it would not permit the appellant to raise fresh grounds not previously taken.
  6. Relief ordered: After applying the legal principles to the facts, the Court dismissed the application for revision No. 75 of 1918 (treated as an appeal) and likewise dismissed Revision No. 138 of 1918 (treated as an appeal) for substantially similar reasons (lis pendens and transferee's lack of a right to resist Receiver's possession).

Holding and Implications

Holding: Both the applications for revision (No. 75 of 1918 and No. 138 of 1918) are dismissed (treated as appeals and dismissed with costs).

Immediate consequences and practical implications (as stated in the opinion):

  • The Receiver appointed pursuant to the administration decree is entitled to take and retain possession of the mortgaged properties which were transferred after institution of the administration suit; transferees who obtained possession pendente lite cannot resist delivery to the Receiver on the facts of these cases.
  • The transfers made after institution of the suit are affected by Section 52 (lis pendens) and, for purposes of court-ordered administration, may be regarded as nullities.
  • The appellant's equitable subrogation claim fails because there was no satisfaction of the whole prior mortgage/decree and no evidence of a permissible splitting of the prior mortgage in the record below.
  • The Court exercised its inherent jurisdiction under Section 151 CPC to convert a misdescribed revision into a memorandum of appeal in the interests of justice (where court-fees and limitation were in order), but confined the appellant to the grounds raised in the original application.
  • The costs of both appeals were assessed on the basis that the value of each appeal exceeded Rs. 5,000.

The opinion does not assert the creation of any new binding precedent beyond its application of established principles (lis pendens, receivership under Order 40, subrogation requirements) to the facts before the Court.

    Mt. Dulhin Sona Kuer And Others v. Jamil Ahmad .

    Mullick, J.:— This application for revision rrises out of a dispute as to the possession of a portion of the property of Mt. Fasihan, a Muhammadan lady, who died on 2nd July, 1909, leaving her surviving two sons Muhammad Umar and Kalimuzaffar and four daughters named Habiba, Fatima Saira and Salima. Shortly before her death the lady had execnted various deeds of gift in respect of certain properties in favour of Habiba and her two sons and on 26th March, 1912 Fatima and Saira brought a suit in the Court of the Subordinate Judge of Patna seeking to set aside these transactions and praying for the administration of the estate of the deceased. Four separate and somewhat similar suits were lodged by Salima but with these we are not concerned. The suit lodged by Fatima and Saira was transferred to the Court of the District Judge of Patna and numbered 6 of 1913. Salima's suits were numbered 9, 10, 11 and 12 of 1913. In Suit No. 6 of 1913, the District Judge held that all the deeds, of gift, except that in favour of Kalimuzaffar dated 7th May, 1909, were invalid and he directed a partition of all the lands of the estate with the exception of those covered by the said deed of gift. There was then an appeal to this Court which was disposed of on 18th July, 1917 See Fazlur Rahman v. Muhammad Umar(1) by Chamier, C.J, and Jwala Prasad, J. The learned Judges held that: the deed of gift in favour of Kalimuzaffar was also invalid having been made without the consent of other heirs and contrary to the intention of the donor. The following passages from the judgment of Jwala Prasad, J. shew the reliefs which were granted to the plaintiffs:

    “All the deeds of gift including the Hiba of 7th May must be set aside and declared invalid and inoperative. The deeds of gift the re-fore do not stand in the way of the heire of Bibi Fasihan taking their shares under the Mahomedan law, Her husband Sobhan inherited one fourth share of the lady's properties: her two sons Muhammad Umar and Kalimuzaffar each took 6132 and each of her four daughters, Habiba Fatima Saira and Salima took 313-2 of the properties left by her. The heirs of such of the aforesaid persons as have died since the death of the lady have succeeded to the shares inherited by their predecessors. The properties left by Mt. Tasihan are therefore liable to be distributed among her heirs and heirs of her heirs, unaffected by dealings or transfers of interests in cscess of their legal shares. As the donees and the hairs have been dealing with the properties since 1903 and the matter is complicated by the claims of creditors and others and thus the appeal gives each of the theirs a decree for his or her share in the ordinary, way. The result of passing such a decree would be endless litigation. The proper course appears to be to direct a general administration of the property of Mt. Fasihan under the orders of the Court.”

    “I would dismiss with costs Appeals Nos. 73 and 219 arising out of Suit No. 6, Appeal No. 42 arising out of Suit No. 9 and Appeal No. 339 arising out of Suit No. 11. I would allow with costs Appeal No. 112 arising out of Suit No. 6 and Appeal No. 581 arising out of Suit No. 6 and set aside the deed of 7th May, 1909. I would declare that the heirs of the deceased are entitled to the shares specified above in the properties of Mt. Fasikan. I would remand Saits Nos. 6 and 9 of 1913 to the Court below in order that in the presence of parties a preliminary decree may be passed with reference to O. 20, R. 13 ordering such accounts and inquiries to be taken and made and giving such directions as may appear to be necessary. It would probably be necessary to appoint a Receiver or Commissioner to carry out the administration. Arrangements must be made to pay off the debts of the deceased as soon as possible. Those heirs or representatives of heirs who have been in possession of parts of the property should be debited with what they or their heirs claiming under them have received.”

    2. In consequence of the above decree the District Judge on 22nd September, 1917 made a preliminary decree for administration and on 25th January, 1918 after notice upon the various mortgages and creditors appointed a Receiver to carry out the same. It appears that on 4th February, 1913, that is about a year after Saira and Fatima's suit was instituted Muhammad Umar mortgaged the proprietary interest in certain mauzas to Mt. Dulhin Sona Kuer. The consideration at first was fixed at Rs. 85,000 were out of which Rs. 60,000 to be paid by Mt. Sona Kuer to the creditors of Muhammad Umar and Rs. 25,000 to one Kesho Das, who held a mortgage from Mt. Fasihan of certain properties which included the properties covered by Muhammad Umar's mortgage. Kesho Das refused to take the amount tendered to him, and therefore for all intents and purposes the consideration of Umar's mortgage must be regarded to have, been the sum of Rs. 60,000 which was due to be paid and was paid by Dulhin Sona Kuer to his creditors. Sona Kuer sued upon her mortgage and on 25th February, 1915 obtained a decree for Rs. 72,958.

    3. On 20th June, 1916 she brought the mortgaged properties to sale and purchased them herself. It is alleged that a sum of Rs. 37,000 is still due to her under her decree. In September 1916 she gob possession of all the mortgaged properties except three which had subsequently to her mortgage been sold for arrears of Government revenue and had passed out of the possession of the mortgagor. It is not disputed that her possession in consequence of her auction-purchase still continues.

    4. When the Receiver was appointed Sona Kuer refused to deliver up possession to him and upon the matter being referred to the District Judge he on 22nd March, 1918 decided in favour of the Receiver. It is against that order that Mt. Sona Kuer prefers the present application for revision, namely, No. 75 of 1918. Revision No. 138 of 1918 has been preferred by another set of transferees, namely Ram Prasad Singh and others and against whom a similar order has been made directing delivery of possession to the Receiver. I will deal first of all with Case No. 75 of 1918 which relates to Sona Kuer's properties. It is unnecessary to consider what would have been the position if the transfer by Muhammad Umar had been made before the institution of the administration suit. Clearly the transfer is affected by the provisions of Section 52 of the Transfer of Property Act regarding is pendens. I agree with the appellant that the transfer does not become ipso facto void but, if the provisions of S. 52 have any meaning at all then as soon as the Receiver was appointed to carry out the administration the Court was entitled if it so those to consider the transfer a nullity and to regard the property as still in the hands of Muhammad Umar and I do not think there can be any doubt that the Court had full authority to direct the Receiver to take possession. It is contended that under O. 40, R. 1, Sub-Cl. 2, the Court is not authorized to remove from the possession or custody of property any person whom any party to the suit has not a right so to remove; that Muhammad Umar as one of the heirs of Mt. Fasihan was a co-owner who had full power to give a mortgage to the extent of his share in the estate and that the other co-owners could only eject him if it was shown that he had taken possession of more than his proportionate share. That is an argument which might have had some force if the transfer had been one before the suit, but it being pendente lite I do not think there can be any doubt that the plaintiffs in the administration suit were competent to ask the Court to take possession of all the properties in the custody not only of the co-owners but also of transferees who had obtained possession by transfers subsequent to the institution of the suit. Muhammad Umar has died since the suit was instituted and it is urged that in the absence of a specific order in the preliminary decree of 22nd September, 1917 directing his co-owners to deliver up the properties in their possession, the present order of the Court is ultra vires. I am unable to appreciate this argument. The preliminary decree read with the appellate decree of 18th July, 1917 gives power to administer the property generally and to appoint a receiver. The receiver's powers are regulated by O. 40 of the CPC, and I am of opinion, the only ground upon which his possession can be resisted is sub-Cl. 2, which has already been considered and held to operate in favour of the receiver and not the appellant.

    5. The learned vakil for the appellants next relies upon the judgment of this Court, dated 18th July, 1917, and contends that it was the intention of the learned Judges, when directing a general administration, to preserve the possession of the various transferees, as far a possible, to the extent of the shares of their transferor. It is admitted that Muhammad Umar had no right to transfor the specific properties in question, and that he had merely an inchoate right to the residue after the estate was fully administered by reason of his joint undivided share in the estate. But it is contended that the intention of this Court was that the administration should be carried on and accounts taken leaving. Sona Kuer in possession till it was ascertained that she was holding more than Muhammad Umar's share. I have in vaia examined the appellate judgment of this Court for an indication of this intention. The passages I have cited certainly do not support this interpretation and I can find no there which give us any assistance in the matter. Clearly the administering Court will be put to the gravest inconvenience if it cannot take possession of the properties in the custody of the co-owners, and it is conceivable that under certain circumstances further proceedings may be reduced to a standstill if this procedure were adopted. It may be the Court's management would be more beneficial and more efficient than that of the mortgagee or that the sale of the zerait lands might save the rest of the property. There may be many reasons to support the decision of the learned District Judge to take the property into his own custody and I do not think that the appellant has any cause for complaint, seeing that she took the mortgage with full notice after the institution of the suit and knowing that she would be bound by whatever orders the Court thought fit to pass in the suit.

    6. Mr. Kulwant Sahay on behalf of the appellant has offered to deposit a year's rent in Court as security against the risk of the property being sold for arrears of Government revenue, but I do not think that any arrangement of this kind can be accepted in view of the fact that unless all the properties are brought under the custody of the Court, the Court cannot coma to a satisfactory conclusion as to the real value of the assets. Other transferees may make the same claim and the appellant is, in my opinion, not entitled to and ought not to be allowed any special preference as against them. The appellant might perhaps resist the receiver if she could shew that she had a right to suppose that her vendor was mortgaging for the purpose of paying Mt. Fasihan's debts. She would then be competent to invoke the equitable principle which was recognized in Price v. Price(2). But in the case before us, although an attempt has been made to show that a sum of Rs. 25,000 out of the consideration money was intended to pay off Mt. Fasihan's mortgage to Kesho Das, it is quite clear that no part of this money was in fact the consideration for Sona Kuer's mortgage and that the true consideration was the sum of Rs. 60,000 only. This sum of Rs. 25,000 is said to have bean, after Kesho Das refused to accept it, deposited in the Bank of Bengal and subsequently withdrawn by the appellant herself.

    7. It is next contended that on 2nd January, 1917, Mt. Sona Kuer paid a sum of Rs. 36,000 to Kesho Das to discharge the incumbrance created by Mt. Fasihan on two Mouzas. This payment is said to have come about in the following way. Kesho Das sued upon his prior mortgage from Fasihan, which covers not only the properties now in suit but other properties, and on 26th February, 1916 brought the mortgaged properties to sale. On 15th December, 1916, the Subordinate Judge set aside the sales on the ground of fraud and dismissed the execution case. Against that order there was an appeal by the auction-purchasers to the High Court, which affirmed the Subordinate Judge's order setting aside the sale upon the judgment-debtor paying to the auction-purchasers a certain sum as compensation. On 2nd January, 1917, Sona Kuer came in and paid to Kesho Das the sum of Rs. 36,000 for the purposes of freeing from his charge the properties covered by her mortgage. I fail to see how this payment can as considered sufficient to subrogate Sona Kuer to the rights of Kesao Das. It seems settled that there must be a satisfaction of the whole mortgage before a person interested can claim to be subrogated to the position of a prior mortgagee Gurdeo Singh v. Chandrika Singh(3). Here according to the appellant's own case there was no satisfaction of Kesho Das full decree but only that portion of it which fell upon the properties covered by the present proceedings. The principle of subrogation therefore does not assist the appellant in respect of the mortgage of Kesho Das. It is however said that Kesho Das agreed to a splitting up of his mortgage. Of this there is no evidence. It is said the point was taken before the learned District Judge, but the petition of the appellant before him does not disclose any such contention in clear and unequivocal terms. There was certainly no evidence tendered by the appellant on this question of fact. The truth is that a case is now being made in this Court which, even if indicated, was never developed in the Court below. The appellant is not entitled to raise a point of this kind in appeal and much less in revision. Indeed Mr. Kulwant Sahay'g argument of this part of the case convinces me that complicated questions as to the rights of transferees are certain to arise and that they can only be satisfactorily decided if the Court is in custody of the whole estate. Mr. Kburshed Husnain agrees that if it is found by the Receiver that Kesho Das has in fact split up his mortgage, the sum paid by the appellant for the two Mouzas will be refunded to her. In the view I take of the merits it becomes unnecessary to consider whether an appeal lies in this case or not. As the point however has been argued I will deal with it shortly. Sona Kuer objects to deliver possession to the receiver appointed by the Court under O. 40 of the CPC, and in my opinion an appeal lies under O. 43 against the order of the learned District Judge. The appellant, following a decision of this Court which laid down that no appeal lay if the person aggrieved was not a party to the suit, has filed an application for revision. But in a recent case we considered all the authorities and held, that the proper remedy of a person in the position of the appellant was by appeal. We have therefore no power to, interfere unless we accept the application for revision as a memorandum of appeal.

    8. Now there is ample authority for accepting an appeal which is found incompetent as an application for revision, and there is also some authority for the converse process of converting an application for revision into a memorandum of appeal. In my opinion this Court has ample jurisdiction, in exercise of its inherent powers under S. 151, to condone in special cages the misapplication of the Code of Civil Procedure, if the provisions of the law as regards limitation and court-fees are complied with. Hera the applicant's fault was that she misconceived her remedy by reason of a judgment of this Court and if she had, instead of describing her application as an application for revision, described it as a memorandum of appeal she would have been competent to invoke the assistance of the Court. It is admitted that there is no defect as regards court-fees and limitation and having regard to the special circumstances of this case, I think the interests of justice require that we should accept the application as a memorandum of appeal. The appellant however must be confined to the grounds taken in her application and she cannot ben allowed to urge any ground which she had not taken in it in support of her appeal. The result is that in the view that I take the appeal must be dismissed with coats.

    9. This judgment disposes of Revision No. 138 of 1918 also. That application must also be treated as an appeal. The facts is this case are simpler than in case No. 75. The mortgage of Muhammad Umar in this case was in favour of Ram Prasad and others. It was executed on 3rd November, 1913 for Rs. 9,000 and was followed on 21st January 1917 by a sale in favour of the mortgagees by Umar for Rs. 16,000 and the appellants, after satisfying the mortgage charge, are alleged to have paid the balance to Umar in cash. The sale deed mentions the fact that an appeal against the decision of the District Judge is pending in the High Court and it appears that in order to indemnify himself against the risk of Umar's title under the hiba being declared invalid, the mortgagees took a security bond by way of indemnity.

    10. So there can be no doubt that the principle of lis pendens is fully applicable in this case and if that is so, the transfer is invalid for the purpose of affecting the Tights of the plaintiff and the Receiver is clearly entitled to take possession. The application for revision treated as an appeal as in the last-mentioned case is dismissed with costs. The costs in both appeals will be calculated on the assumption that the value of the appeals is above Rs. 5,000 in each case.

    11. Dawson-Miller, C.J:— I agree.

    V.S/R.K

    12. Appeal dismissed.

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    Mt. Dulhin Sona Kuer And Others v. Jamil Ahmad .
    (Nov 7, 1918)