Megh Raj Vaish v. Abdullah Khan

1. This suit arose under the following circumstances: On 20th June 1901, the present plaintiffs sold certain property to Kalli Mal for a sum of Rs. 800. Of this amount Rs. 150 were left to pay Megh Raj and Karia Mal on account of a decree which they had obtained against the vendors. A sum of Rs. 300 was also left with the vendees to pay the said persons on account of a mortgage under which those persons were in possession of the property sold. Kalli Mal did not pay this amount and Karia Mal and Megh Raj took out execution of their decree. The plaintiffs-vendors, on 25th July 1904 paid up those amounts by executing a mortgage of some other property in favour of Karia Mal and Megh Raj, part of the consideration of which was the amount which Kalli Mal was required to pay under the terms of the sale to those persons. Later on, on 14th May 1909, Karia Mal and Megh Raj purchased from Kalli Mal the property which has been purchased by him on 20th June 1901. The plaintiff now brings a suit to recover unpaid purchase money which the vendee was bound to pay to Karia Mal and Megh Raj in accordance with the understanding arrived at the time of the sale. The plaintiffs claim to recover their money under a charge against the property in the hands of Karia Mal and Megh Raj who are assignees of the property from Kalli Mai. The defence to the suit is that the claim is time barred, that there was no vendor's lien in favour of the plaintiffs who in the sale deed expressly stated that the purchase money had been paid up and that they had no claim therefor. It was further pleaded that the claim against Karia Mal and Megh Raj was time barred because the vendors had allowed the claim against the person of Kalli Mal to become time barred and it was finally contended that the charge created by S. 55(4)(b) was a charge enforceable only against the buyer and not against the buyer's transferees.

2. It was said that Megh Raj and Karia Mal had purchased the property without notice of the charge claimed by the plaintiffs and in any case the charge is not enforceable against them. Before dealing with the other points arising in the case I may at once dispose of the last point. It has been found by both the Courts below that the defendants-appellants had full notice of the charge that at the time of the sale the original sale deed of 20th June 1901 was handed over to them and that they were in a position to know exactly whether or not the charge existed. The last contention therefore fails on this finding.

3. I now take up the other contentions urged on behalf of the appellants by Dr. Sen. It is true that the claim against the person of the original vendee has become time barred under Article 111, Sch. 1, Lim. Act. So far as this Court is concerned the point has been settled by a decision of the Full Bench of this Court in the case of Munirunnissa v. Akbar Khan (1). The question still remains whether by reason of the claim against the original vendees personally being time barred, the claim for enforcement of the charge should therefore fail. This point, in my opinion, is equally governed by the ruling of the Full Bench. The plaintiffs were entitled to recover the amount due to them on account of unpaid purchase money as a debt due from the vendee. They had two remedies given to them by law. One of these was to enforce payment of the said sum against such persons personally, and the other by enforcement of the charge. This happens constantly in mortgage cases. The personal remedy is barred by lapse of time, but the debt is thereby not extinguished. It is still a subsisting debt. Though the creditor has lost one of the remedies for recovering it, the other remedy is still available to him.

4. In the case of Ram Din v. Kalka Prasad (2) their Lordships of the Privy Council had to consider a similar point. At p. 505 they observe as follows: There are two remedies distinctly sought in the plaintiff's petition, the one against the mortgaged property, the other against the person and against the other property of the defendant. As to the mortgaged property there is now no question. Their Lordships are of opinion that the law of limitation, which says a bond for money must be enforced within a certain date, applies to the specific demand here for a personal remedy against the defendant. The plaintiff can have no personal remedy; his remedy against the person of the mortgagor is barred, but his right remains to enforce his demand against the mortgaged property. In view of the decision of the Privy Council and of the Full Bench of this Court, I think the contention of the learned vakil for the appellants is untenable.

5. The second contention is that by reason of the plaintiffs having acknowledged payment of the full amount of the purchase money no amount on account of purchase money is now due, and he relies in support of his contention on certain rulings of the Madras High Court. In our Court the point was considered in the case of Har Chand v. Kishori Singh (3), and Karamat Husain, J., held that the vendor's purchase money remained still unpaid, until and so long as the money had been actually paid out, notwithstanding the recital in the sale deed, and the charge still subsisted. His Lordship relied upon a ruling of their Lordships of the Privy Council in the case of Webb v. Macpherson (4). Their Lordships at p. 72 observe as follows: “With reference to the conveyance a number of English cases were cited. No doubt English cases might be useful for the purpose of illustration, but it must be pointed out that the charge which the vendor obtains under the Transfer of Property Act is different in its origin and nature from the vendor's lien given by the Courts of equity to an unpaid vendor. That lien was a creation of the Court of equity, and could be modified to the circumstances of the case by the Court of equity. But in the present case there is a statutory charge. The law of India, speaking broadly, knows nothing of the distinction between legal and equitable property, in the sense in which that was understood when equity was administered by the Court of Chancery in England, and the Transfer of Property Act gives a statutory charge upon the estate to an unpaid vendor unless it be excluded by contract. Such a charge therefore stands in quite a different position from a vendor's lien. You have to find something, either express contract or at least something from which it is a necessary implication that such a contract exists, in order to exclude the charge given by the statute. In their Lordships' opinion there is no ground whatever for saying that charge is excluded by a mere personal contract to defer payment of a portion of the purchase money, or to take the purchase money by instalments, nor is it, in their Lordships' opinion, excluded by any contract, covenant, or agreement with respect to the purchase money which is not inconsistent with the continuance of the charge.

6. It is quite clear that the agreement by Mr. Tucker, the purchaser, to pay the balance of the purchase money (Rs. 51,210) in three annual instalments with interest was in no way inconsistent with the existence of a charge to the vendor for the amount of the instalments with interest to become due from time to time.” This contention, in my opinion, is equally untenable. Even in the Madras High Court the rulings are not consistent. The case of Abdulla Beary v. Mammali Beary (5) is not in point. That Court in that case on the interpretation of the sale deed came to the conclusion that the purchase money was not payable to the plaintiffs. They had therefore no right to recover it. They could therefore have no charge for the money to which they were not entitled. Whether that conclusion on the terms of the sale deed in that particular case was correct or not it is the basis upon which the judgment of the Madras High Court proceeds. Under the terms of the sale deed now in suit it is not possible to say that the money was not payable to the plaintiffs. It was at the plaintiffs' request left in the hands of the vendee to pay for and on behalf of the vendors, and in that sense the money was payable to the vendors, and they have a lien for the money so long as it was not paid.

7. The last contention urged is that the charge is only enforceable against the buyer and not against the buyer's transferees or legal representatives. If this contention were correct the moment the vendee died the charge could not be enforced against his hairs, although the heirs of the transferees were in possession of the property sold. In my opinion the charge was on the property in whosoever's hand it may pass. It is only a personal remedy against the vendee which is not enforceable against his transferees. Whosoever obtains the property either by inheritance or by transfer does so with the burden of the charge, and the defendants who are purchasers of the property with notice of the charge are not relieved of the necessity of paying it merely because the property had changed hands. The point has been considered by the Privy Council in the case of Webb v. Macpherson . At p. 244 of the report their Lordships thus lay down the law: “In the absence of a contract to the contrary ……… the seller is entitled, where the ownership of the property has passed to the buyer before payment of the whole of the purchase money, to a charge upon the property in the hands of the buyer for the amount of the purchase money, or any part thereof remaining unpaid and for interest on such amount or part. Mr. Lloyd's executors therefore had a statutory right to a charge upon the property in the hands of Mr. Tucker and those claiming under Mr. Tucker, unless it can be shown that there was a clear contract to the contrary between the parties.” The italics are my own. This contention therefore is untenable. I dismiss the appeal with costs including counsel's fee in this Court on the higher scale.

V.B/R.K

8. Appeal dismissed.