Corporation Of Calcutta v. Kumar Arun Chandra Singh

Lort-Williams, J.:— In this suit, the Corporation of Calcutta claimed Rupees 134-4-9 on account of consolidated rates payable in respect of premises No. 2 Payari Das Lane, Calcutta, which are part of a debutter property of which defendant 1 is the Shebait, defendant 2 a lessee, and defendant 3 a mortgagee of defendants. The defence of defendant 1, who alone contested the suit, was that the Corporation's claim arose by reason of a statutory charge created under the provisions of Section 205 of the Calcutta Municipal Act, that it had similar charges over other properties belonging to the same defendant, for the enforcement of which it had brought five other suits, four of I which had been decreed by consent, and that by reason of the provisions of Section 67-A of the Transfer of Property Act, the Corporation must: enforce all such charges in one suit. Section 205 of the Calcutta Municipal Act, provides:

“The consolidated rates due from any person (in respect of any land or building shall, subject to the prior payment of the land revenue (if any) due to the Government thereupon, be a first charge upon the said land or building and upon the moveable property (if any) found within or, upon such land or building and belonging to the said person.”

2. Section 67-A of the Transfer of Property Act, provides:

“A mortgagee who holds two or more mortgages executed by the same mortgagor in respect, of which he has the right to obtain the same kind of decree under S. 67 and who sues to obtain such decree on any one of the mortgages, shall, in the absence of a contract to the contrary, be bound to sue on all mortgages in respect of which the mortgage money has become due.”

3. Section 100 of the Transfer of Property Act, provides:

“Where immovable property of one person is by act of parties or operation of law made security for the payment of money to another, and the transaction does not amount to a mortgage, the latter person is said to have a charge on the property; and all the provisions hereinbefore I contained which apply to a simple mortgage shall, so far as may be, apply to such charge.”

4. The learned Judge (McNair, J.) decided in favour of the defendants, except; with regard to that part of the claim which referred to rates which became due prior April 1930 when S. 67-A came into force. As regards the rest of the claim he held that the suit was in competent and dismissed it. The Corporation has appealed against this decision. In the first place, the Corporation draws attention to the serious inconvenience which would or might arise if the decision were correct.

5. The Corporation, before making any claim for rates, could have to make sure in every case whether the defendant or defendants had any the properties within the municipal ??? which were subject to similar charges, and if they had, would have to ascertain further whether they were within the same jurisdiction, because the municipal area lies within the jurisdiction of more than one Court. The statutory charge applies to both move ables and immovables, and to both owners of moveables and immovables and occupiers and subtenants and purchasers (Sections 199, 200, 205 of the Calcutta Municipal Act). The inclusion of such various and over-lapping rights and obligations in one suit would or might lead both to confusion and hardship. Nevertheless, these considerations would have little weight, if the words of the statute and the intention of the legislature were clear and unambiguous. The Court would be obliged to give effect to them inspite of the consequences. Section 67-A of the Transfer of Property Act, is one which restricts the rights of mortgagees and therefore must be construed strictly. (Maxwell's Interpretation of Statutes Edn. 7, p. 245). The section seems to have been thrust into the Act without due consideration of its effect upon other sections, for example S. 100. Presumably it was intended as a benefit to mortgagors. This may be so, when there is more then one mortgage on the same property and they are liable to foreclosure. But the section has been drawn wide enough to include mortgages on different properties which are liable only to sale, and it is difficult to appreciate how it can benefit a mortgagee to have to meet demands in respect of all such obligations at one and the same time.

6. Section 100 of the Transfer of Property Act, purports to deal primarily with the incidence of the security, and not with the method of enforcing it, and declares that the provisions there in before contained which apply to pimple mortgages, shall apply to charge only “so far as may be.” That all the provisions there in before contained do not apply to charges and that S. 100 was not intended to apply to some statutory charges was decided in 15 Cal. 4921. It is not easy to understand why charges created by operation of law have been included within the provisions of S. 100. But for the fact that there are some other sections in the Act which refer to such charges, one would have thought that they had been included by inadvertence because the Transfer of Property Act 1882 is “an act to amend the law relating to the transfer of property by act of parties.” This is expressly stated also in the preamble, and where the enacting part of a statute is ambiguous, the preamble can be referred to, to explain and elucidate it: 1928 Lah 352, 7 B. &. C. 8433, 4 R.B 3134 and 11 Cl. & Fan. 855. In 1899 A.C 1436 Lord Halsbury said:

“Two propositions are quite clear: one, that a preamble may afford useful light as, to what a statute intends to reach, and another that, if an enactment is itself clear and unambiguous, no preamble can qualify or out down the enactment.”

7. Careful examination of the terms of S. 67-A makes clear, in my opinion; that it was not intended to apply to securities created by operation of law, such as statutory charges, but only to consensual securities which are created but of parties. Thus it applies to “mergages executed by the same mortgagor,” and provides that certain obligations shall arise “in the absence of a contract to the contrary.” Both terms and inappropriate to a statutory charge Ane even if it were arguabele that the first refers only to mortgages, and may be ignored because S. 100 applies be the other provisions of the Act to charges only “so far as may be” yet the power, of contracting out is clearly an essential part of the section, and could not be given effect to, in a statutory charge, unless the particular statute so provided which is not so in the present case. Moreover, the language of the section is inappropriate in other respects to a statutory charge such as that created by Section 205 of the Calcutta Municipal Act. This comes into being for the first time when the rates become due, whereas S. 67-A. clearly contemplates a security which is Already in existence at the time when the “mortgage money has ??? due.” It is true that the logical result of this construction of S. 67-A is that S. 67 also, which contains the same words “in the absence of a contract to, ??? contrary,” does not apply to securiti created by operation of law, and ??? the owners of such cannot ??? themselves of the benefit of the ??? therein contained. But the A was not intended to be exhausts and does not profess to be a ??? Code, 34 Cal. 2237, and does not with the transfer of movables, or charges upon movables, such as are refers to in Section 205 of the Calcutta Municipal A. In any case not covered by the Act, Court is entitled to apply rules of English Law which are not inconsiste with the Act, 1925 Bom 318, a the holder of a statutory charge is titled to a decree for sale. For all the reasons, I entertain no doubt that ??? 67-A does not apply to status charges created under the provisions Section 205 of the Calcutta Municipal Act.

8. The result is that the decree must modified. There will be a decree inst for Rs. 134-4-9 against all the deffdants with costs, a declaration that: corporation has a first charge on premises No. 2 Peyari Das Lane, ???, for this sum with interest a percent and a decree under O. 34 of the CPC, in Form No. S. A in ??? D to Sch. 1 thereto, as amended Act 21 of 1929, and this appeal is lowed, with costs.

Costello, J.:— I agree.

Lort-Willianss, J.:— Appeal from ginal decree No. 103 of 1933. For reasons given in Appeal No. 102/33, decree in this suit also must bemodii there will be a decree instead for pees 355-5-9 against all the defends with costs, a declaration that the poration has a first charge on the ??? No. 92 Upper Chitpore Road, ??? for this sum with interest percent, and a decree undergo 34, Code of Civil Procedure, in Form No. 5A in ??? D to Sch. 1 thereto, as amended. Act 21 of 1929, and this appeal is lowed with costs.

Costello, J.:— I agree.

G.A

9. Order accordingly.