Mt. Rukhmabai v. Krishnarao Shankarrao Chitnavis

ORDER OF REFERENCE

1. This is an appeal by the mortgagor's daughter. This suit was instituted to enforce two mortgages, dated the 22nd September 1925 for Rs. 15,600/- and dated the 15th June 1928 for Rs. 6,000/-, executed in favour of the late Sir Shankarrao Chitnavis and his then minor son, the respondent No. 1. The lower Court decreed the claim allowing interest equal to the unpaid principal as on the date of the suit and allowed further interest from that date till the date fixed for payment.

2. Respondent No. 2, claimed to be the adopted son of the mortgagor but his claim has been finally negatived in First Appeal No. 57 of 1942, decided on the 14th April 1944, after the decree under appeal was passed. The lower Court had directed that his liability under the second mortgage would be reduced to the amount found to have been borrowed for legal necessity and interest thereon provided he was successful in the said First Appeal. On account of the adverse decision it is clear that respondent No. 2 had no right of redemption and he is not a necessary party to the mortgage suit. He is discharged from the suit. He remained ex parte in this Court. There will be no order for costs here or in the Court below. In this appeal as lodged various points were raised. But at the hearing all except two one regarding the validity of the registration of the mortgage dated the 22nd September 1925 and the other about interest subsequent to the date of suit, have been abandoned.

3. The first contention of the appellant is that the presentation of the mortgage deed dated the 22nd September 1925 (Exhibit P-12) to the City Sub-Registrar, Nagpur, is not proper because the house in Circle No. 6/8 at Nagpur (Item No. 1 of Exhibit P-12), which purports to give jurisdiction to the Sub-Registrar to register the document, was not owned by the mortgagor. The registration being therefore invalid, it is urged that the mortgage is unenforceable. This plea was raised by an amendment of the written statement and is to be found in paragraph 12 in these words:

“On enquiry this defendant has learnt that the mortgagor Shankar Antoba Kalar did not own or possess the alleged house or any other house in the said Circle 8/6 at all………….. The inclusion in the mortgage deed of a house in Circle 8/6 of Nagpur, which the mortgagor never owned at all, is a fraud on registration.”

4. No reason has been alleged why the house to which the mortgagor had no title was included in the mortgage. Nor has it been alleged that it was deliberately included by both the mortgagor and the mortgagee. In his rejoinder the plaintiff has asserted that the house belonged to the mortgagor, that during his minority his elder brother Maroti was looking after and managing his affairs, and consequently it must have stood in the name of the brother in the municipal ‘jamabandi.’ The mortgagees asserted that they had taken the mortgage ‘bona fide’ believing that the mortgagor had good title which he intended to transfer to the mortgagee. They denied fraud on the law of registration.

5. Section 28 of the Registration Act on which the plea is based runs thus:

“Save as in this Part otherwise provided, every document mentioned in Section 17, Sub-section (1) Clauses (a), (b), (c), (d) and (e), Section 17, Sub-section (2), in so far as such document affects immovable property, and Section 18, Clauses (a), (b), (c) and (cc), shall be presented for registration in the office of a Sub-Registrar within whose sub-district the whole or some portion of the property to which such document relates is situate.”

6. It is not disputed that the house in question is situated in the sub-district of the City Sub-Registrar, Nagpur. It is contended that on account of the want of title of the mortgagor it is an Inclusion of fictitious property. Reliance is placed on the following four decisions of the Privy Council in which the registration was held to be invalid.

7. In ‘Harendra Lal v. Haridasi Debt’, 41 Cal 972 (PC), the item which purported to give jurisdiction was found to be non-existent. The defendants gave evidence to this effect but the plaintiff did not adduce any evidence. It was found that the property of the description had always belonged to parties wholly unconnected with the parties in suit and was continuously registered in their names in the record-of-rights.

8. In ‘Biswanath Prasad v. Chandra Narayan’, 48 Cal 509 (PC), the item which gave jurisdiction did exist but the mortgagor had no title to it and it was found that both the mortgagor and mortgagee never intended that it should form part of the security. The title of the mortgagor was alleged to be based on an unregistered deed of sale for a consideration of Rs. 50/-. That deed was not produced and no secondary evidence was given. There was no evidence that possession was given under the sale. Their Lordships affirmed the decision of the High Court that:

“The circumstances of the case leave no doubt that the parties never intended that the share of Kolhua should really be sold to the mortgagor or mortgaged by him to the mortgagee. The so-called sale was a mere device to evade the Registration Act.”

9. It was held in view of these facts that the decision fell within the rule in ‘Harendra Lal v. Hari Dasi Debt, 41 Cal 972 (PC) ‘supra’ and that the two cases stand on the same basis for the purposes of the Registration Act. Their Lordships however took care to point out that:

“this case differs ‘toto caelo’ from the case suggested in argument of a mere failure to make a good title to the property dealt with by the instrument, and which both parties had intended should form part of the security.”

10. In the third case, ‘Collector of Gorakhpur v. Ram Sundar Mal’, 56 All 468, the item which gave jurisdiction was an insignificant item of no value and completely inaccessible. It was a one-third share in a sitting room in a garden, incapable of use and enjoyment by the purchaser. Although the property and title to it did exist their Lordships held that it was never intended by either party that the item should, for any purpose other than that of registration, be subject of sale at all. The so-called sale was regarded as a mere device to evade the Registration Act.

11. In the last case, ‘Venkatarama Rao v. Sobhanadri Appa Rao’, 59 Mad 539 (PC) the item which purported to give jurisdiction to the Sub-Registrar to register the document was a strip of land of one yard in Vundoor, even the identity of which was doubtful. The purchaser never lived nor did he own any property at that place; and what possible use he could have had for a single yard of land was unexplained. Their Lordships observed that the criterion by which the question of validity of the registration must be decided was whether the one yard of land was intended to pass under the sale deed. “The motive may be immaterial,” said Sir George Lowndes, “but of this the intention is critical. They are satisfied that in the present case no such intention existed.” Accordingly the registration was held invalid.

12. The learned Counsel further relied on ‘Ramnandan Prasad v. Chandradip Narain’, 19 Pat 578 in which it was held that

“there is no effective registration under Section 28 of the Registration Act, 1908, unless the deed of mortgage or sale relates to land situate in the sub-district in which the deed is registered. It is not sufficient that the land mentioned in the sale or the mortgage deed exists. The document cannot be said to relate to land in a registration district unless it was the intention of the parties that such land, even if it exists, should in a sale deed, be transferred or, in a mortgage deed, form part of the security.”

13. We have therefore to see whether the intention of the parties in this case was not to make the house a part of the security under the mortgage deed but to insert it in the deed solely for the purpose of securing registration at Nagpur. If this is established, obviously the document cannot be said to relate to the house within the meaning of Section 28 of the Registration Act.

14. As held in ‘Venkata Sastrulu v. Veerabhadrulu’, AIR 1935 Mad 26.

“As in the case of every other kind of fraud, the party who sets up a defence under Section 28 of the Registration Act is bound to make it out by clear and cogent evidence.”

15. As pointed out in ‘Ramanathan Chetty v. Delhi Padaha Tevar’, AIR 1931 Mad 335.

“There should be the strongest possible evidence of the fact that there was collusion between the mortgagor and the mortgagee before the mortgagee can be deprived of the mortgage amount owing under the mortgage by reason of its registration being invalid because of the inclusion of a small item of property not belonging to the mortgagor.”

16. It is not enough to hold that the mortgagee or transferee has failed to prove the title of the mortgagor or transferor if the property actually existed, as in this case within the jurisdiction of the registering officer and the parties intended to transfer it. See ‘Irshad Ali v. Nadari Begam’, ILR (1941) All 320 and ‘Muhammad Kazim Hussain v. Nadri Begam’, AIR 1941 Oudh 348. The question for determination therefore in this case is whether the mortgagee was aware of the defect in the mortgagor's title and consented to the inclusion of property in the deed merely for the purpose of complying with the registration law. (Vide ‘Pahladi Lal v. Mt. Laraiti’, 41 All 22). In ‘Jageshwar Prasad v. Mulchand’, ILR (1939) Nag 64 at p. 72 the learned Judges observed:

“It would suffice if the mortgagee while fully intending that this item should be included and relying on the mortgagor's representation included an item which in point of fact did not belong to the mortgagor. In other words the mortgagee's or the transferee's intention is the vital intention and there is no intention to defraud the registration law but on the contrary an intention to take a transfer of the item if in point of fact, the mortgage did intend that the item should form part of the security.”

17. The appellant never alleged that the house at Nagpur was included in the mortgage deed without any intention on the part of both the parties to make it a security for the mortgage debt. Dr. Kathalay appearing for her placed reliance on the following circumstances to render the registration invalid.

18. The mortgagor had four other houses at Nagpur and if he intended that a house in Nagpur should be a security, he would have mortgaged all four or any one of them. The mortgage deed (Ex. P-2) contains a false recital that the mortgaged property including the house had fallen to the share of the mortgagor in a family partition between him and his brothers. The house belonged to the mortgagor's brother Maroti and stood in his name in the municipal ‘jamabandi’ (Ex. 3-D-5) and was in his possession through his tenants. This house was sold by Maroti's son Balaji on the 1st September 1933 (Ex. P-16) and the purchaser sold it away on the 1st November 1933 (Ex. P-17). No objection was raised either by the mortgagor or the mortgagee to this sale. The dimensions of the house in the mortgage deed differ from the actual dimensions as found in Ex. P-16. The value of the house was Rs. 56-4-0 only at the date of the mortgage. The person in possession of the house had not been made a defendant though annual lessees of agricultural land have been made parties and the house is not being claimed as part of the security in the suit. According to Dr. Kathalay the inference therefore is that inclusion of the house was intended to secure registration at Nagpur which was more convenient to the mortgagor than Bhandara in which district the rest of the mortgaged property was situate.

19. We find from the record that the name of ??? is recorded in the municipal ‘jamabandi’ for 1924–1925 and 1925–1926 (Ex. 3-D-5). That document shows the value of the house Rs. 56-4-0 and the annual rental Rs. 2-13-0. Under the bylaws of the Municipal Committee, Nagpur, the valuation of the house for the purpose of taxes is 20 times the annual rent when the house is actually let out. Exhibit 3-D-5 shows two numbers of this house which means that it was in occupation of two persons. The value given in this document is therefore not the market value of the property. We find from the mortgage deed that the dimensions of the actual structure are given therein while Ex. P-16 gives the measurements of the entire area. There is thus really no discrepancy, Maroti died on the 25th July 1920. Maroti's son Baiaji sold this house and the purchaser sold it away immediately thereafter. Exhibit P-17 contains warranties against any alienations made by relatives, paternal uncles, and other kinsmen, which are rather unusual and indicate that a somewhat disputed title was being conveyed.

20. It was explained on behalf of the mortgagor that persons in possession are obviously claiming a paramount title, and their inclusion in the mortgage suit was considered to be outside its scope or at any rate improper. Although there are decisions that in suitable cases question of paramount title can be gone into in a mortgage suit, it is not obligatory on the mortgagee to implead such persons merely because they are in possession of the mortgage property. It may not be necessary, particularly in a suit for sale, for the mortgagee to complicate the litigation if the other items are considered sufficient to satisfy the mortgage debt or if he does not want to purchase the disputed item in execution of his decree.

21. (12, 13 and 14) (Their Lordships after considering the documentary and oral evidence continued:) This evidence coupled with the recitals in Ex. P-12 establishes that the mortgagor claimed and represented to the mortgagee that he was the owner of the house, that he had really offered it as security and that the mortgagee ‘bona fide’ believed him to be the owner of the house and accepted it as security.

22. Dr. Kathalay for the appellant drew our attention to the observations in ‘Jageshwarprasad v. Mulchand’, ILR (1939) Nag 64 at p. 73 and urged an incredible motive for including this property. He said that the mortgagor was not willing to go to Bhandara to admit execution of the mortgage because he was not getting cash consideration for it. Therefore the mortgagee got this house included just to secure registration of the deed at Nagpur, knowing that the house did not belong to the mortgagor. Thus the appellant's contention is that her father was obliging the mortgagee by executing this deed in his favour. Such an argument should not have been advanced in face of the overwhelming circumstances against such a possibility.

23. The mortgage was taken by the late Sir Shankarrao Chitnavis for himself and his then minor son, the present plaintiff. He was a retired Commissioner of this Province. He was carrying on money-lending business on an extensive scale with head office at Nagpur and branches at several places including the one at Bhandara, which is only 40 miles away, connected by railway and a first class motorable road. It is always possible for any person at Nagpur who has Court work at Bhandara to leave Nagpur after breakfast and return in the afternoon or in the evening. The mortgage in suit was an item of money-lending business of the Bhandara shop and various repayments were made at that place. The mortgagor was in need of paying off the decree dated the 28th January 1922 under an earlier mortgage. He had also to pay off another money decree whose instalments he was unable to pay and the whole decree had become executable. The mortgagor was in need of respite and easy instalments. By Ex. P-12 he got easy instalments spread over 11 years. It was thus the mortgagor who was anxious to get a respite for 11 years. He had to obtain sanction for the transfer of ‘sir’ land and to get that sanction recorded on the deed. This was done either by him personally or by an agent under a power of attorney, such an agent could have admitted execution of the deed. It was not at all difficult for him to execute, if necessary, a special power of attorney to admit execution of the document. It is difficult to understand why the mortgagee would take an invalid mortgage and lose the security which he already had under the earlier mortgage decree.

24. The appellant does not allege that it was brought to the notice of Sir Shankarrao that the mortgagor had no title to the house and that he agreed to the inclusion of this property in the mortgage only with a view to ‘securing’ registration at Nagpur. There seems to be no motive for Sir Shankarrao to get an invalid mortgage. The document was presented for registration by the mortgagor himself. The mortgagee would have insisted on his going to Bhandara and get the document registered there if the house in question did not belong to the mortgagor and was not intended to be a security.

25. Even if it can be said that the mortgagor's title to the house is not proved, that is not enough to render the mortgage invalid. As both the parities intended that the house should form part of the mortgage security, the registration was not fraudulent and the mortgage deed cannot be held invalid. We affirm the finding of the learned trial Judge on the first point.

26. The other point raised by the learned Counsel for the appellant is that interest should not have been allowed from the date of the suit to the date fixed by the preliminary decree for payment inasmuch as the arrears of interest exceeded the principal on the date of the suit. He relies on Section 9 of the Central Provinces and Berar Money-lenders Act and ‘Bapurao v. Anant Kashinath’, ILR 1946 Nag 407; ‘Sardarmal v. Gendlal’, 1946 Nag LJ 384 and ‘Amarsingh v. Tulsiram’, ILR (1948) Nag 853.

27. The decision in ‘Bapurao v. Anant Kashinath’, is not one under the Central Provinces and Berar Moneylenders Act. It deals with the interpretation of the rule of ‘damdupat’. In ‘Sardarmal v. Gendlal’, it has been stated that

“though Section 9 of the Moneylenders Act may have been intended to reproduce what the legislature thought was the rule of ‘dam dupat’, the section must, be construed as it stands.”

28. The learned Judge construed S. 9 to mean that “a decree on account of arrears of interest cannot include interest for any period after the decree but will include interest for any period up to the date of the decree”;

29. And he also observed

“that it is not clear whether the term ‘arrears of interest’ in S. 9 means arrears at the date of the decree or at the institution of the suit.”

30. The learned Judge negatived the claim for interest from the date of the preliminary decree and allowed interest from the date for payment fixed by the appellate decree till realization. In ‘Sardar Amarsingh v. Seth Tulsiram’, the arrears of interest exceeded the principal on the date of the suit. In passing a decree for twice the unpaid principal the learned Judges observed:

“We do not see any reason to grant interest either ‘pendente lite’ or till realisation. The plaintiff in the suit has earned interest at a very high rate during all these years and there is no justification for awarding future interest or interest ‘pendente lite’.”

31. This refusal to grant interest can be attributed to the exercise of discretionary power which the learned Judges assumed they had under Section 34 of the CPC even in a mortgage suit. The learned Judges did not disallow interest under Section 9 of the Central Provinces and Berar Moneylenders Act.

32. The learned Counsel for the respondent relies on ‘Hiralal v. Narsilal’, 37 Bom 323 P.C which has been followed in ‘Motilal Ramlal v. Beni’, AIR 1924 Nag 348 and ‘Kisanrao v. Mangniram’, AIR 1929 Nag 355. The decision in ‘Hiralal Ichhalal v. Narsilal Chaturbhujdas’, is not an authority for the proposition that notwithstanding the rule of ‘damdupat’ a Court has power to award interest ‘pendente lite’ in excess of the amount imposed by that rule. Their Lordships refused to interfere with the order of the District Judge refusing interest ‘pendente lite’ and future interest as the maximum limit of interest was reached before the date of suit on the ground of its being a discretionary order. In ‘Motilal Ramalal v. Beni’, it was held that as soon as such limit of interest is reached under the rule of ‘damdupat’ before the date of suit, the matter of allowing interest passes with the domain of judgment as soon as the suit is instituted and the Court has power under Section 34 of the CPC, to award interest ‘pendente lite’ and future. To the same effect is the decision in ‘Kisanrao v. Mangniram’. All these cases were of mortgage suits.

33. As observed by their Lordships of the Privy Council in ‘Jagannath Prasad v. Surajmal’, 54 Cal 161 (PC), in the case of mortgages the question as to interest is to be determined under O. 34 and not under Section 34 of the CPC. Order 34 has been amended in 1929 by addition of R. 11 regarding interest in mortgage suits. It was added by the T.P (Amendment) Supplementary Act, 1929, and it came into operation on the 1st April 1930. In a suit for sale the Court, has to pass a preliminary decree under R. 4 ordering that an account be taken of what was due to the plaintiff at the date of such decree for principal and interest on the mortgage, cost of the suit and other costs, charges and interest, if any, and to declare the amount so due at that date. The Court has to fix a date for payment which is to be within six months from the date on which the Court confirms and countersigns the account so taken. Under R. 11 the Court may order payment of interest to the mortgagee as follows, namely.

“(a) interest up to the date on or before which payment of the amount found or declared due is under the preliminary decree to be made by the mortgagor or other person redeeming the mortgage—

(i) on the principal amount found or declared due on the mortgage, at the rate payable on the principal, or, where no such rate is fixed, at such rate as the Court deems reasonable.

(ii) on the amount, of the costs of the suit awarded to the mortgagee — at such rate as the Court deems reasonable from the date of the preliminary decree.

(b) subsequent interest up to the date of realization or actual payment at such rate as the Court deems reasonable

(i) on the aggregate of the principal sums specified in Cl. (a) and of the interest thereon as calculated in accordance with that clause.

34. This rule gives effect to the judicial decisions under of the Transfer of Property Act, 1882, and under O. 34 of the CPC.

35. In ‘Sunder Koer v. Rai Sham Krishen’, 34 Cal 150 P.C their Lordships observed:

“They think that the scheme and intention of the Transfer of Property Act was that a general account should be taken once for all, and an aggregate amount be stated in the decree for principal, interest and costs due on a fixed day, and that after the expiration of that day, if the property should not be redeemed, the matter should pass from the domain of contract to that of judgment, and the rights of the mortgagee should thenceforth depend, not on the contents of his bond, but on the directions in the decree.”

36. Although Sections 86 and 88 of the Transfer of Property Act which were then in force and have since been repealed by the Code of Civil Procedure, Act V of 1908, contained no directions for interest beyond the date to be fixed by the Court, up to which the account is directed to be taken, it was held that the power to grant future interest must be considered as established since the decision in ‘Maharajah of Bharatpur v. Kanno Dei’, 23 All 181 (PC). Bn ‘Jagannath Prasad v. Surajmal’, 54 Cal 161 (PC), their Lordships again held that “till the period for redemption has expired, the matter remains in contract and the interest has to be paid at the rate and with the rests specified in the contract of mortgage”. In ‘Rajwanta Kuer v. Shiam Naraln Singh’, 36 All 220, it has been held that the account to be taken under O. 34, R. 2 & R. 4, must be up to the date fixed by the preliminary decree for payment, and that the account must be according to the contract between the parties unless the Court interferes with the contract as to the rate of interest under some provision of law. In ‘Kusum Kumari v. Deviprasad’, 15 Pat 210, their Lordships quoted with approval the aforesaid passage from ‘Rani Sunder Koer v. Rai Sham Krishna’, (‘supra’). Their Lordships were considering the effect of Cl. VI-B of Regulation of 1872 in force in Santhal Farganas on the rights of the mortgagee to interest. That clause runs:

“The total interest decreed on any loan or debt shall never exceed one-fourth of the principal sum if the period be not more than one year and shall not in any other case exceed the principal of the original debt or loan.”

37. Their Lordships held

“Up to the date fixed for redemption the matter between the parties is one of their contract, and what the Court has to consider is how much does the law allow them to recover under it. This is determined by the Regulation and is limited to twice the amount of the principal. If that limit has been reached before the institution of the suit, no further interest could be allowed between that date and the date fixed for redemption.”

38. In ‘Bapurao v. Anant Kashinath’, ILR (1946) Nag 407 the learned Judges lay down that

“the rule of ‘dam dupat’ operates so long as the relation of the creditor and debtor exists but not when the contractual relation has come to an end by reason of the decree. The contractual relation arising out of a mortgage debt comes to an end on the expiry of the date fixed for payment under the preliminary decree…………. The matter then passes from the domain of contract to the domain of judgment and the rights of the mortgagee thenceforth depend not on the contents of the bond but on the direction in the decree. The operation of the rule of ‘dam dupat’ consequently is from the date of mortgage to the date fixed for payment in the preliminary decree.”

39. In this view, there is no doubt that on a true interpretation of Section 9 of the Central Provinces and Berar Money-lenders Act the mortgagee is not entitled to any interest from the date of suit till the date fixed for payment if the arrears of interest due on the date of suit exceed the principal. The same view has been taken in ‘Vithoba v. Cyril Lobo’, F.A No. 72 of 1940 D/- 19-9-1946. The judgment of the Bench was delivered in this case by the Judge who later on delivered the judgment in ‘Amarsingh v. Tulsiram’, ILR 1948 Nag 853. In ‘Vithoba v. Cyril Lobo’, the arrears of interest exceeded the principal on the date of suit. The lower Court had granted interest from the date of suit till the date fixed for payment and the appeal related only to this interest. The learned Judges observed:

“It is a matter of common knowledge that the rule of ‘dam dupat’ under the Hindu law as such does not operate in the Central Provinces.”

40. It was further held that Section 9 of the Central Provinces Moneylenders Act was applicable and the decree was modified to the extent of reducing the additional interest awarded.

41. We are therefore of the opinion that the plaintiff is not entitled to interest from the date of the suit till the date fixed for payment as in both the mortgages the arrears of interest exceeded the principal on the date of the suit. The decree will be modified by deleting Rs. 3728-0-0 and Rs. 2,181-11-2 on account of first and second mortgages respectively from the account in the decree.

42. The learned Counsel for the appellant contends that since the amount decreed will thus be reduced it is necessary to pass a new decree and to fix a fresh date for payment. He further contends that the direction in the preliminary decree for future interest at 3-0-0 per cent, per annum from the date fixed for payment till realization will be operative not from the 24th June 1944, the date fixed by the preliminary decree, but from the date to be fixed by this Court.

43. The period fixed by the preliminary decree had expired two days before the appeal was preferred. With the appeal the appellant made an application for stay of the proceedings for the final decree on the ground that the property is sufficient not only for the amount determined as on the day fixed for payment but also for further interest at the rate of 3-0-0 per cent per annum which the lower Court has granted to the decree-holder plaintiff. In the grounds of appeal the appellant has not disputed the award of interest from the date fixed for payment by the trial Court till realization not has he asked for a date to be fixed by this Court for redemption and for award of interest at contractual rate up to that date subject to the limit imposed by Section 9 of the Central Provinces and Berar Moneylenders Act.

44. On the strength of the statements made in this application for stay, the final decree proceedings were stayed ‘ex parte’ on the 23rd August 1944. The respondent mortgagee was evidently satisfied with this order because the appellant did not dispute the award of future interest at 3/- per cent, per annum. It was really unnecessary for the appellant to apply for stay of final decree proceedings unless the object was to delay the payment of even the undisputed amount of the decree. The appellant was entitled to redeem at any time before the sale was confirmed (Order 34, Rule 5, Sub-rule (1).) The appellant has not made any repayment towards even the amount which is not in dispute in appeal. There are thus no equities in her favour and it would be highly inequitable to disallow future interest from the date fixed for payment by the trial Court till the date of payment, if any, to be fixed by this Court.

45. The learned Counsel for the appellant further contends that the appellate Court is bound to fix a fresh date for payment even when the appeal is dismissed, and that it is all the more obligatory when the redemption amount is reduced in appeal as in the instant case. He also contends that under Section 9 of the Moneylenders Act even the appellate Court is precluded from awarding interest ‘pendente lite’ till the date of its decree if arrears have reached the maximum limit at any earlier time. According to him the date of the decree in a mortgage suit is the date fixed for payment. He strongly relies on the word “appellate” in that section. He has, however, not brought to our notice any decision in support of these submissions.

46. Order 41, Rule 35 of the CPC, provides for the date and contents of an appellate decree. The relative Form is No. 9, Appendix G. It does not provide for the passing of a preliminary decree. Neither does Order 34 provide for it nor for fixing a fresh date for payment by the appellate Court. Replying on ‘Jowad Hussain v. Gendan Singh’, 6 Pat 24 (PC), it was held in “Parashram v. Umrao Prashad’, 29 Nag L.R 130, that it is necessary for the appellate Court to pass a fresh preliminary decree fixing a fresh date for payment and making a fresh calculation of the amount which will be due on that date even when the defendant's appeal from preliminary decree is dismissed. This was a case of foreclosure. The Privy Council decision does not lay down any such proposition. There it was held that the plaintiff is not bound to apply for making final the preliminary decree of the trial Court if an appeal is pending from it and in such a case limitation for making the preliminary decree final begins from the date of the appellate decree which is the effective preliminary decree in the suit. The view in ‘Parashram v. Umrao Prasad’, was dissented from in ‘Madhaorao v. Eknathrao’, ILR (1947) Nag 412, where it was held that a fresh preliminary decree fixing a fresh date for payment need not invariably be passed when an appeal is dismissed. There a final decree for foreclosure was passed during the pendency of the appeal and the mortgagor's appeal was dismissed.

47. In ‘Mohmad Hussain v. Balkrishna’, Misc. Civil Case No. 71 of 1948 D/- 22-11-1949 and in ‘Seth Maganmal v. Mohemad Yakub’, F.A No. 108 of 1940 D/- 24-8-1950, to which one of us (Deo, J.) was a party, it was held that there is no provision of law which requires the appellate Court to pass a fresh preliminary decree fixing a fresh date for payment and that the matter is entirely within the discretion of the appellate Court. In ‘Mohmad Hussain v. Balkrishna’, during the pendency of the appeal a final decree was passed and the mortgaged property was sold for an amount in excess of the amount payable under the preliminary decree. Though that amount was reduced in appeal the appellate Court did not fix a fresh date for its payment. This alleged omission was sought to be corrected under Section 152 of the CPC. In the other case the amount was reduced in appeal but the mortgagors not having made payment even of the undisputed amount for nearly 10 years after the date of the preliminary decree for sale, the Court refused to fix a fresh date.

48. Relying on an earlier decision of the Board in ‘Sunder Koer v. Sham Krishan’, 34 Cal 150 (PC), their Lordships held that the date when the contract rate expires is six months from the date of the decree in appeal and not six month from the date of the decree of the original Court when the decree is not confirmed but varied in favour of the appellant mortgagee: ‘Jagannatk Prasad v. Surajmal’, 54 Cal 161 (PC). The facts of the case are not quite clear from the judgment, but it appears that the trial Court passed a decree according to the contract till the date of the suit and awarded further interest at the Court rate. The decree was modified on plaintiff's appeal and interest was awarded according to the contract till the date for payment fixed in appeal and subsequent interest at the Court rate. No question of ‘damdupat’ or Section 9 of the Moneylenders Act arose in that case. The defendant appealed to the Privy Council and contended that the decision of the trial Court was correct and that the date fixed for payment, to which the contract extends must be taken to be the date fixed by the trial Court. This contention was overruled on the ground that the defendant in whose favour an incorrect judgment was given in the trial Court cannot rely on the date fixed by it for payment, adding that the case might have been otherwise if the judgment had been affirmed.

49. This decision was relied on in ‘Nathumall v. Ramanmall’, ILR (1937) Lah 245 (PC), for fixing a fresh date for redemption. This was plaintiff's apeal against the decision of the High Court that under the terms of the mortgage the respondent, subsequent purchaser of a part of the mortgaged property, purchased it free of the mortgage and was not liable under it. Plaintiff succeeded and the respondent was held liable for the mortgage debt. It was, therefore, necessary to fix a fresh date for redemption.

50. In ‘Sateendranath v. Jateendranath’, 63 Cal 1 (PC), which was also relied on in ‘Nathumall v. Ramanlal’, ILR (1937) Lah 265 (PC), the defendant had appealed to the High Court against the direction for personal decree under Order 34, Rule 6 of the CPC. He was successful. Though he did not dispute the amount decreed, he had not made any payment. When he asked the High Court to fix a fresh date, the High Court fixed a fresh date and allowed interest at the contract rate till this date, though the decree of the trial Court had allowed only 6-0-0 per cent, per annum from the date for payment fixed by it and though the plaintiff had not appealed against it. In maintaining this decree of the High Court, their Lordships observed:

“It is beyond dispute that the stipulated rate of interest can be awarded up to the date of realisation or actual payment, and that a debtor should not be allowed to keep the money of his creditor at a low rate of interest by merely bringing an unsuccessful appeal…… Otherwise, a debtor has only to prefer an appeal in order to withhold the payment of money to his creditor for a long period without incurring liability for interest at the rate which he himself had agreed to pay and which he could not challenge on any valid ground. Such a device, if permitted, would lead to manifest injustice.”

51. The decision of this question is complicated by Section 9 of the Central Provinces and Berar Moneylenders Act which precludes an appellate Court from decreeing in respect of any loan made before this Act came into force on account of arrears of interest a sum greater than the principal of such loan.

52. In view of the divergence of opinion about the necessity to fix a fresh date for redemption when the redemption amount is reduced in appeal, we think it desirable that the controversy should be set at rest by a Full Bench. The question is of importance in the present case because if a fresh date were to be fixed the mortgagee would lose interest between the date fixed by the trial Court and the fresh date. We accordingly refer the following question for the decision of a Full Bench:

“Whether it is obligatory on a Court of appeal to fix a fresh date for payment in a mortgagor's appeal from a decree for sale when the price of redemption fixed by the trial Court is reduced in accordance with Section 9 of the Central Provinces and Berar Moneylenders Act?”

53. Let the papers be laid before the Honourable the Chief Justice for necessary orders.

OPINION OF THE FULL BENCH

Sinha, C.J:— I have had the advantage of perusing the differing opinions recorded by my learned brothers Hidayatullah and Sen, JJ. I agree with the answer proposed by my learned brother Sen, J., and also generally with the reasons for that conclusion. My learned colleagues have examined the question in great detail and have stated the relevant facts in their opinions. Hence, it is not necessary for me to state the facts leading up to the reference to the Full Bench.

54. In my opinion, it is not obligatory on a Court of appeal to fix a fresh date for payment in every case where the appellate Court varies the amount of the mortgage decree which the mortgagor is bound to pay for redemption of the property mortgaged. The reasons leading up to the variation are naturally of no significance in considering the question referred to the Full Bench. I also do not think it necessary to express any opinion whether the Division Bench was right in the view it took of its powers under the Central Provinces and Berar Moneylenders Act. That is a question wholly outside the terms of reference to the Full Bench. I would, therefore, reserve my opinion on that question. If and when that question properly arises for determination, it will have to be gone into at that time.

55. There cannot be the least doubt that it is open to the Court of appeal to fix a fresh period of grace sometimes for the benefit of the mortgagor, and at other times for the benefit of the mortgagee, according as the justice of the cause may require it. The fixing of a fresh period for redemption of the property is not always for the benefit of the mortgagor. Oftener than not, it is for the benefit of the mortgagee and it is always the effort of the mortgagor to avoid getting a fresh period of grace so as to escape the liability for payment of the contract rate of interest up to the extended period of grace. An instance of this effort is the case ‘Jagannath Prosad v. Surajmal’, 54 Cal 161 : 54 Ind App 1 (PC). In this case the only matter argued before their Lordships of the Judicial Committee was the question of the rate of interest. The trial Court had reduced the rate of interest stipulated between the parties and the plaintiff mortgagee came up to the Calcutta High Court in appeal and the High Court allowed the appeal by granting interest at the bond rate up to the period of grace extended by the High Court. As a result of the judgment of the High Court the decretal sum, fixed as the price for redemption, was considerably increased and that was the only question raised before their Lordships of the Privy Council. The argument on behalf of the mortgagor appellant was that the contract rate should not run up to the six months' period of grace fixed by the High Court but should stop at the end of the six months' period of grace fixed by the original decree of the trial Court. Their Lordships of the Privy Council repelled that contention and held that the decree of the High Court was correct. Hence, that decision of their Lordships of the Privy Council is an authority for the proposition that it is open to the Court of appeal to fix a fresh period of grace and thus allow the bond rate to run up to that period to the prejudice of the mortgagor if the amount of the redemption price had been varied by the appellate Court. But I do not read that decision of their Lordships to mean that in very case where the amount of the mortgaged money is varied either way, it is incumbent on the appellate Court to fix a fresh period of grace. This decision of their Lordships of the Judicial Committee has been mostly relied upon by my learned Brother Hidayatullah, J., for his proposed answer in the affirmative to the question submitted before the Full Bench. In my opinion, it will be reading much more than what their Lordships of the Judicial Committee intended to lay down, if we were to hold that their Lordships ruled that in every case when the redemption is varied by the appellate Court that Court is bound to fix a fresh period of grace. Ordinarily, as a matter of practice it would be necessary in such cases to fix a fresh period of grace, but that is quite a different thing from saying that the Court has no discretion in the matter and must, in every case of variation of the amount of the decree necessarily fix a period of grace, however short.

56. The decision of their Lordships of the Judicial Committee of the Privy Council in ‘Jowad Hussian v. Gendan Singh’, 6 Pat 24 : 53 Ind App 193 (PC), was concerned only with the question whether the period of limitation for an application for a final decree would run from the date of the decree of the appellate Court or from the expiry of the period of grace fixed by the preliminary decree of the first Court. Hence, the only controversy before the Privy Council was the proper construction of Article 181 of Schedule I to the Limitation Act. The question arising before this Full Bench did not even remotely arise in that case. In ‘Fitzholmes v. Bank of Upper India, Ltd.’, 8 Lah 253 : 54 Ind App 52 (PC), a question similar to that in ‘Jowad Hussain v. Gendan Singh’ (‘supra’) was canvassed. The observations of their Lordships that the mortgagors were right in their objection that the decrees should not be enforced till six months had elapsed from the judgment of the High Court was not the ‘ratio decidendi’ in that case. It is a mere side remark which their Lordships made to demonstrate the inconsistency of the position taken by the appellants before them. Hence, that decision also cannot be prayed in aid of the conclusion that it is incumbent on the appellate Court to fix a fresh period of grace in every case in which the amount fixed as the redemption price is varied. The decision of their Lordships of the Judicial Committee in ‘Sateendranath v. Jateendranath’, 63 Cal 1 : 62 Ind App 26-5 (PC), related ‘inter alia’ to the question whether the stipulated rate of interest in a charge bond could be awarded up to the extended date for payment fixed by the appellate Court, thus increasing the liability of the mortgagor in spite of the fact that there was no appeal by the mortgagee. Their Lordships of the Judicial Committee repelled the attack on that provision in the decree of the High Court enhancing the rate of interest, payable after the date for redemption fixed by the trial Court, in these words (page 9):

“This contention though seemingly plausible, cannot be sustained. It is beyond dispute that the stipulated rate of interest can be awarded up to the date of realisation or actual payment, and that, a debtor should not be allowed to keep the money of his creditor at a low rate of interest by mere bringing an unsuccessful appeal. As stated above, the appellant had failed to make the payment within the period fixed by the Subordinate Judge, and his property was liable to be sold for satisfying the respondent's claim. To avoid the sale, he asked the High Court to extend the period, but the learned Judges were not bound to grant his prayer. They, however, acceded to his request; and he can have no legitimate grievance, if while granting the concession, they made him liable for the payment of interest at the contract rate during the period of extension.”

57. It is clear that these observations of their Lordships do not give much assistance in the determination of the controversy before us.

58. I do not find any decision of their Lordships of the Judicial Committee in ‘Naithu Mal v. Ramanlal’, ILR (1937) 18 Lah 245 : 64 Ind App 126 (PC), on the point directly arising for decision before us. Their Lordships decided only one question, namely, the proper construction of the provisions of the deed of mortgage. While making their directions as to the variations in the decree, their Lordships directed that bond rate was to be paid up to the extended period of grace, which was not a matter of any controversy before their Lordships. The only other decision of their Lordships of the Judicial Committee which remains to be referred to is ‘Mohammad Ali v. Ramzan Ali, AIR 1921 PC 100. In that case their Lordships deprived the mortgagee of interest from the date of the decree of the trial Court as he persisted in asserting an unwarranted claim to interest.

59. Thus, none of the decisions of their Lordships of the Judicial Committee cited before us and referred to above directly touches the point in controversy before us. A case is an authority for what it actually decides and not what may logically follow from that decision. That is a well-established proposition. It is thus clear that there is no direct authority either of the Privy Council or of any High Court in India in support of the contention that in every case where the mortgage money is increased or decreased by the appellate Court, that Court is bound to fix a fresh period of grace. It is also clear that the statutory provisions in Order 34 of the CPC do not oblige the appellate Court to do so. Hence, in my opinion, we are not obliged by any precedent or by any statutory provisions to hold that the appellate Court is deprived of its discretion in the matter of fixing a fresh period of grace.

60. The appellate Court, in my opinion, has the fullest discretion in this matter, and, in each case, it has to exercise its discretion according to the requirements of justice. Even where the judgment and decree of the trial Court in a suit for sale or for redemption are affirmed, it is open to the appellate Court in a proper case to fix a fresh period of grace. More so in cases where the amount fixed as the price of redemption is varied either way. Hence, in most cases the appellate Court may find it necessary in the ends of justice to fix a fresh period of grace. But to hold that in cases of variation the appellate Court has absolutely no discretion to refuse to fix a fresh period of grace even if the justice of the cause required it, is to deprive an appellate Court, without any compelling necessity, of its inherent jurisdiction to would its judgment in accordance with the dictates of justice.

61. For the reasons given above, added to the reasons given by my learned brother Sen, J., I would answer the question referred to the Full Bench in the negative.

Hidayatullah, J.:— The question referred to the Full Bench is:

“Whether it is obligatory on a Court of appeal to fix a fresh date for payment in a mortgagor's appeal from a decree for sale when the price of reaemption fixed by the trial Court is reduced in accordance with Section 9 of the Central Provinces and Berar Moneylenders Act?”

62. The question referred does not involve consideration of the point in relation to redemption and foreclosure suits. Emphasis is also laid on the disallowance of interest under the Moneylenders Act and on the fact that the eventual decree is to be for sale which gives the mortgagor a chance of redemption in any event till the sale is confirmed. Since the learned Judges (Rao and Deo, JJ.), have already given their judgment on the merits of the appeal and the question posed ‘ex facie’ premises certain assumptions it is necessary to state the facts of the case and the decision already reached by the Divisional Bench.

63. The suit was brought on the foot of two mortgages dated the 22nd September 1925 and the 15th June 1928 for Rs. 15,600/- and Rs. 6,000/-, respectively. According to the trial Judge the principal of the first mortgage was Rs. 13,661/-. Applying Section 9 of the Central Provinces and Berar Moneylenders Act, the learned Judge limited the amounts due on these mortgages to Rs. 27,322-0-0 and Rs. 12,000/- respectively, that is to say, double the principal of the loan.

64. The rates of interest on the mortgages were 12 annas per cent per mensem and Re. 1-0-0 per cent, per mensem. The learned Judge awarded interest at these rates on the principal sums from the date of suit (13-6-1941), till the date fixed (24-3-1944), for payment. From the 24th June 1944 till realization interest was ordered to be paid at 3 per cent, per annum. The total amount due on the 24th June 1944 was found on accounting to be Rs. 47,081-11-2.

65. The mortgagor on appeal contended ‘inter alia’ that on a true interpretation of Section 9 of the Moneylenders Act no interest could be granted ‘pendente lite’ and more particularly at contract rate since that section controls payment of interest up to the date fixed and not merely till the institution of the suit. It may be mentioned here that the plaintiffs had claimed Rs. 42,945-9-9 as due to them on the mortgages on the 13th June 1941, i.e, the date on which the suit was instituted.

66. This question was considered by the Divisional Bench, and the learned Judges held that the contractual relation between the debtor and the creditor continued till the date fixed for payment by the preliminary decree. It was only then that the matter passed to the domain of judgment, and thus Section 9 of the Moneylenders Act precluded the award of interest ‘pendente lite.’ They purported to follow ‘Jagannath Prosad v. Surajmal’, 54 Cal 161 (PC); ‘Sundae Koer v. Sham Krishen’, 34 Cal 150 (PC); ‘Rajwanta Kuer v. Shiam Narain Singh’, 36 All 220; ‘Kusum Kumari v. Deviprasad’, 15 Pat 210 (PC); ‘Bapurao v. Anant Kashinath’, ILR (1946) Nag 407 and ‘Vithoba v. Cyril Lobo’, F.A No. 72 of 1940 D/- 19-9-1946. The learned Judges, however, granted interest at 3 per cent, per annum after the date fixed. The disallowance of interest ‘pendente lite’ on the two mortgages led to a reduction of Rs. 5,090-11-2 and the decree of the first Court was thus varied.

67. Now, when the appeal was filed. In this Court, the period for redemption fixed by the Court of first instance had already expired. No extension of time during the pendency of the appeal was obtained from that Court. An ‘ex parte’ order was, however, passed by this Court staying the drawing up of a final decree, and the mortgagees apparently content with the interest at 3 per cent, per annum did not seek to get that order vacated.

68. The learned Judges of the Divisional Bench having held that up to the day fixed for payment no interest can be granted, even at the Court rate, in view of the prohibition contained in Section 9 of the Moneylenders Act, felt hesitation in fixing a fresh date for redemption because to do so would deprive the mortgagees of Whatever interest they had earned at the Court rate from the 24th June 1944. They also felt that, inasmuch as the decree would lead to a sale of the security, the appellant mortgagor would, in any event, have a right to pay the amount due till the confirmation of the sale. By this the learned Judges thought, interest would be enabled to run from the 24th June 1944 on the decretal sum (less Rs. 5,909-11-2) at 3 per cent, per annum till realisation A question of principle having arisen, viz., whether the appellate Court is bound to fix a fresh date when the amount is reduced, the matter was referred to this Full Bench.

69. The learned Judges in making the reference observed:

“The decision of this question is complicated by Section 9 of the Central Provinces and Berar Moneylenders Act which precludes an appellate Court from decreeing in respect of any loan made before this Act came into force on account of arrears of interest a sum greater than the principal of such loan.”

70. The question was thus framed, as it was, with emphasis on Section 9 of the Act and the nature of the decree in the suit, which would, in any event, allow a chance of redemption till the confirmation of the sale.

71. I have considered the matter carefully as also the rulings cited at the Bar, and I am of opinion that, the answer to the question must be in the affirmative. The nature of a mortgage as also of the suit based upon it, together with the provisions of Order 34 of the CPC, leave no doubt that when the amount is varied on appeal a fresh date must be fixed either by the appellate Court or if no such date is fixed by the appellate Court, by the trial Court. I am also of opinion that the premises set out in the question do not make any difference to the result, and indeed equities hardly arise because — and I say it respectfully — interest could have been granted ‘pendente lite’ if the justice of the case so desired.

72. I wish to make it clear that the question whether the decision of the Division Bench is correct or not is not before me. The Full Bench is not a Court of Appeal and any observations made by me on the question of interest ‘pendente lite’ are merely evoked because of the way in which the question has been framed.

73. To answer this question it is necessary to refer to certain aspects of mortgages and suits on mortgages to discover their essential nature. There are no express words enjoining upon the appellate Court the duty of fixing a fresh date whenever a decree is varied. The question is whether this follows necessarily from the provisions of Order 34 of the CPC, regard being had to the nature of a mortgage security and the suit thereupon.

74. It is interesting for this purpose to compare the English law of mortgages with the provisions of the Transfer of Property Act and the Code of Civil Procedure. I am aware that their Lordships of the Privy Council have on more than one occasion stated that the English rulings should not be resorted to for interpreting the Indian statute. I, however, repeat what I stated in ‘Pawankumar v. Jagdeo’, ILR (1947) Nag 740 at p. 758:

“My learned brother Bose, J., has pointed out in his lucid opinion that their Lordships of the Privy Council have deprecated the application of English cases to Indian conditions and I agree with him that the matter must finally turn upon a true interpretation of the Indian statute. At the same time, it must not be forgotten that the Indian statute was drafted in England and the English law must have considerably influenced the formulation of some of the principles incorporated in the Indian statute. So long as the necessity of expounding the words of the Indian statute is kept in mind there can be no harm in examining the English decisions.”

75. Their Lordships have on several occasions themselves compared the English law on the subject with the Indian statutes and have drawn conclusions regarding the interpretation of the latter. In attempting to seek a parallel with the English law I am doing no more than was done by their Lordships of the Privy Council in ‘Ram Kinkar v. Satya Charan’, ILR (1939) 1 Cal 283 (PC). In English law before the passing of the Law of Property Act, 1925, a mortgage was nothing more than a transfer by assignment of the mortgagor's interest in the property with a condition for reconveyance upon payment of the loan by a particular date. Once that date was passed the mortgagor possessed no rights in law, though equity used to relieve against the forfeiture because equity considered time not to be of the essence of the contract. The right which arose in equity was called the equity of redemption, and this right continued till by judgment for foreclosure or sale or by the operation of the law of limitation wherever applicable the creditor became the owner of the property. Sometimes on sufficient cause being shown the mortgagor was allowed in equity to redeem the mortgage even after foreclosure had been granted against him. Thus, in English law a distinction was made between the legal estate as such of the mortgagor which was held to have been transferred to the mortgagee and the equitable right to redeem after the date fixed had passed, which was called the equity of redemption and was enforceable in equity.

76. After the passing of the Law of Property Act, 1925, the position has materially altered. The main difference now is that a mortgagor creating a legal mortgage assures his general property to the mortgagee only for a term of years and does not assure it conditionally as was done previously.

77. The Indian Law on the subject is not essentially different, though it differs in one respect. After the passing of the Transfer of Property Act the distinction which used to be drawn in England between law and equity cannot be said to exist in India. Sir George Rankin in ‘Bengal National Bank, Ltd. v. Janaki Nath’, 54 Cal 813 at p. 822, stated that the Transfer of Property Act ‘has left no room for such a distinction.’ It would thus appear that no question of equity such as arose in England prior to the Law of Property Act, 1925, can be said to arise in India.

78. It does not, however, mean that the Indian mortgagor has no rights analogous to those which the English mortgagor had prior to the passing of the Law of Property Act, 1925. In India it is a matter of Law and how much the law allows. Under the Transfer of Property Act read with Order 34 of the CPC the mortgagor retains a right to pay the loan or have the land reconveyed to him, and such a right is a legal right based upon statute. There is no distinction between law and equity in so far as the rights of the mortgagor are concerned. In India the mortgagor has a right to redeem or to a reconveyance before the fixed date has elapsed because he has a contractual right to pay the loan or to have the property reconveyed to him, but after the fixed date has passed the mortgagor has the same right under the Code of Civil Procedure till the Court has passed a decree foreclosing such a right or the property has been sold. In both cases the right is a legal right and is saved to him by the operation of Section 60 of the Transfer of Property Act and Order 34 of the CPC. It may be pointed out here that after a final decree for foreclosure has been passed the mortgagor cannot invoke the equitable jurisdiction of the Court if it ever existed. This has been laid down authoritatively now in ‘Autar Singh v. Mohamad Ejaz Rasool’, AIR 1950 PC 88. His right of redemption in cases in which a decree for sale is passed, however, continues till the sale is confirmed.

79. The intention of the law is thus to allow a final chance to the mortgagor to save his security by payment of the loan. This right is a statutory right which cannot be denied unless either a final decree for foreclosure has been passed or the sale under a final decree for sale has been confirmed. In either case the mortgagor is entitled to know how much he has to pay and must get some time within six months to pay it. The time fixed by the Court can be extended by it for sufficient cause as also by the appellate Court. The question is whether the appellate Court is bound to extend the time when the amount is varied by it by making it either more or less. In my opinion, the Court is so bound unless it leaves the matter to the trial Court by saying nothing about it and this arises from the very nature of a suit on a mortgage.

80. I now propose to discuss the nature of a mortgage suit. This depends entirely upon an examination of Order 34 of the CPC. Here I may mention that the English law and the Indian law are extremely analogous. Indeed, the old sections of the Transfer of Property Act followed closely the English forms, and a comparison of those forms as found in Seton's Judgements and Orders with the provisions of Order 34 and the forms prescribed under the Code of Civil Procedure would show how far the English law has affected the Indian Law. Bakewell (as he then was), in his book on Suits on Mortgages and for Partitions, 1907, has stated:

“The form of decree in use in the Chancery Division of the High Court in England, upon which Section 86 is evidently based, contemplates that an account will be taken by the Master in Chambers, and that the amount due, including interest to the date of his certificate, and further interest for the period of six months from that date, will be entered in his certificate, and provides for the two events of payment and non-payment of this amount by the defendant on the appointed day.”

81. This shows that Sections 86 to 90, 92 and 93 of the Transfer of Property Act, though altered and replaced by Order 34, Rule 2, etc., were based upon English forms and precedents by the drafters of the Indian Act. The change effected by the Code of Civil Procedure is not great, in so far as the present point is concerned.

82. The Indian suit on mortgages is nothing more than a suit for accounts between the mortgagor and the mortgagee. This follows from the words of Order 34 itself. It is not necessary to quote rules dealing with redemption, sale, and foreclosure because they are all analogous. It is convenient to refer to Rule 2 only. In Rule 2 it is provided that in a suit for foreclosure if the plaintiff succeeds the Court shall pass a preliminary decree: (a) ordering that an account be taken of what was due to the plaintiff ‘at the date of such decree’ for principal and interest on the mortgage, the costs of the suit, and other costs, charges, and expenses properly incurred together with interest thereon. The Court ‘then has to declare the amount so due at the date fixed in the decree’, and the mortgagor is required to make the payment by that date, failing which the mortgagee can apply for a final decree for foreclosure. The same applies to a mortgage leading to a sale with the difference that the mortgagor can pay the amount till the sale is confirmed. The same conditions obtain ‘mutatis mutandis’ in a suit for redemption.

83. From this it follows that the functions of the Court in a mortgage suit are nothing more than to take an account of the loan transaction under the mortgage and to determine the exact figure which the mortgagor has to pay before he is entitled to redemption of the property. This follows also from a classic observation of Lord Davey in ‘Sundar Koer v. Rai Sham Krishen’, 34 Cal 150 at p. 161 (PC), which is as follows:

“They think that the scheme and intention of the Transfer of Property Act was that a general account should be taken once for all, and an aggregate amount be stated in the decree for principal, interest and costs due on a fixed day, and that after the expiration of that day, if the property should not be redeemed, the matter should pass from the domain of contract to that of judgment, and the rights of the mortgagee should thenceforth depend, not on the contents of his bond, but on the directions in the decree.”

84. It then follows that though the date fixed in the mortgage bond may have passed the legal right of the mortgagor to redeem the property is not taken away, and by statute the contractual period is extended from the date fixed in the mortgage to the date fixed by the Court.

85. The statutory provisions in India, therefore, replace what in English law would be regarded as the equitable right to redeem. I have shown above that the distinction between equity and law does not exist, but if I may say so the distinction is not of any vital consequence because in India the same result is reached on the provisions of the statute. Thus, though equitable considerations may be out of the picture and we have to ascertain the rights ‘inter se’ of the mortgagor and the mortgagee ignoring the equitable rights such as were considered in England, the resulting position is the same.

86. In saying that the nature of a suit on a mortgage in India is equivalent to a suit for accounts I deliberately draw attention to the basic fact ‘that before a mortgagor can be asked to redeem the property it must be declared what is the exact amount he has to pay for redemption.

87. It is for this reason that a fresh period is required to be fixed because a mortgagor cannot redeem the property if the amount is either not certain or is varied by additions or deductions. It might be different if the amount were correctly determined finally, but that cannot be said when the mortgagor establishes that the amount for which he was asked to redeem was wrongly fixed and he was thus asked to pay more than what was due. Of course, it goes without saying that this would arise whether the mortgagor shows the incorrectness of the account in the Court of first instance or an appellate Court.

88. The law on this subject both in England and in India appears to have been uniformly laid down. It is interesting as well as instructive to note that in English law, whenever a decree is varied it is usual to grant a further period for redemption. This variation may arise either on appeal, or by addition of costs thereof, or by the mortgagee receiving rents etc., during the period fixed by the Court.

89. Cases illustrative of such contingencies can be found in English Reports. In ‘Garlick v. Jackson’, (1841) 49 ER 297, a mortgagee had received some rents between the Master's report and the day fixed for payment. The mortgagor made a default in payment on the fixed date. The Master of Rolls (Lord Langdale) refused the order absolute for foreclosure observing:

“that as the amount due had been varied by the intermediate receipt of the rent, another day must be fixed for payment.”

90. In ‘Alden v. Foster’, (1842) 49 ER 708 and ‘Ellis v. Griffiths’, (1844) 49 ER 994, in similar circumstances the Master was directed to fix a new date. In ‘Henry v. Byar’, (1831) 1 Knapp 388, an appeal from Barbados, only the costs of the appeal to the Privy Council were added yet a direction to fix a fresh date was given. In ‘Allen v. Edwards’, (1873) 42 LJ Ch 455, the certificate of the Master showed £2,252-14-11/- as due. The 8th of February 1873 was the ‘dies datus’, and payment was not made by the mortgagor on that day. It was, however, found that on the 8th October of the previous year, that is to say, before the due date, the mortgagee had received a petty sum of £95-10-0 as rent. The Registrar declined to draw up a decree for foreclosure absolute in consequence of this variation. When the Counsel urged upon the Court to draw up the decree Lord Romiliy, M.R, said:

“that by receiving this sum the plaintiff had opened the account, and the order absolute could not be made, but it must be referred back to the chief clerk to make a fresh certificate, and another day must be fixed for payment.”

91. Other cases can be cited, and reference among others may be made to ‘Monkhquse v. Bedford (Corporation of’) (1810) 17 Ves 330; ‘Jenner-Fust v. Needham’, (1886) 32 Ch D 582; ‘Press v. Coke’, (1870) 6 Ch A 645.

92. These cases are based upon the rules of equity which have been adverted to by me above. The summary of the principles on which action is taken is contained in ‘Weld v. Patre’, (1929) 1 Ch 33, where it was held that the considerations which applied to applications by a mortgagor to redeem were not the same as those which applied to application by a mortgagee to foreclose, and that unless the mortgagor's right to redeem had been destroyed by statute, foreclosure, sale or release, equity ought not to deprive him of the right, provided, when it was asserted, three circumstances co-existed, namely, the debt had been paid or could be paid the security was available and no-one's position had been altered in the meantime.

93. The gist of all the above cases is that during the period of grace granted by the Court there should be no variation of the position of either party, nor must the sum be varied at which redemption can be had. Thus, cases in which the mortgagee had received rents after the date fixed and cases of infructuous appeals or objections received different treatment. See for instance ‘National Permanent Mutual Benefit Building Society v. Raper’, (1892) 1 Ch 54 and the cases cited therein. Where the variation was small or where the chances of redemption were exceedingly remote the full six-month's period was not granted, and it was the rule to fix one month's time for redemption.

94. It may also be pointed out that the accounts in Chambers or in Court are extremely rare in England unless the matter is exceedingly simple. The accounts have to be taken by the Master who certifies the amount due on the mortgage, and if on objection or appeal the amount stated in the Master's certificate is found to be incorrect the case is sent back to the Master with a direction to correct the accounts and to fix a fresh date.

95. The English law of mortgages has its counterpart in India and the pronouncements of the Privy Council show that there is no difference between the two laws. In India the words of Order 34 of the CPC are precise, and the fixing of a fresh date follows by necessary implication. I need not quote all the rules and would again refer only to Rule 2, which is illustrative of all kinds of cases contemplated in the Order. The words of that rule are:

“…….if the defendant pays into Court ‘the amount so found or declared’ on or before such date as the Court may fix within six months ‘from the date on which the Court confirms and countersigns the account’ taken under Clause (a), or ‘from the date’ on which ‘such amount is declared in Court’ under Clause (b) as the case may be…….”

96. In a simple case the accounting is done by the Court itself, but in a complicated case a commissioner may be appointed to go into the account. An the same the exact amount has to be ascertained, and whether the Court ‘confirms and countersigns’ the account or ‘declares’ the amount in Court the resulting position is the same. Time has to be fixed ‘from the date’ of such confirmation and countersigning or declaration within which the mortgagor has to redeem.

97. I need not go into the question of extension of time granted by the Court. This is possible both in England and in India on good cause being shown why the payment cannot be made. In England it is usual to give an extension on payment of interest and costs and on showing sufficient cause for non-payment. In India under Order 34 the Court can extend the time. During the pendency of an appeal time is extended in England: See ‘Manks v. Whiteley’, (1913) 1 Ch 581, in which time was granted by the Court pending an appeal to the House of Lords. In India the Court of first instance may be moved for extension under Order 34, or the appellate Court for stay under Order 41, Rule 5 of the CPC. These are, however, remedies with which we are not concerned because the stay in this case after the ‘dies datus’ had passed and the Court of first instance was not moved to extend the time.

98. Now, an appeal to superior Court may be (a) withdrawn or (b) dismissed in default for non-prosecution, or the appellate Court may (c) confirm the decree of the first Court or (d) vary it. What happens in these several cases when the ‘dies datus’ has already passed and there has been no stay by the appellate Court?

99. Cases illustrative of the first two categories (a) and (b) above are ‘Chandri Abdul Majid v. Jawahir Lal’, 36 All 350 (PC), and several others which it is needless to cite here. As regards the third category (c) above there are numerous cases in which it has been held that when the decree is confirmed on appeal and there is no variation in the amount of the price of redemption, no fresh time need be granted. The leading cases on the subject are ‘Bhola Nath v. Kanti Chundra’, 25 Cal 311 : ‘Maung Yan Gin v. Katharasan Chetty’, AIR 1921 UB 5 : ‘Maqbul Ahmad v. Pateshri Partab Narain Singh’, AIR 1929 All 677 and ‘Basanta Kumar v. Radha Rani’, AIR 1922 Cal 329, among others. The contrary view expressed in ‘Satwaji Balajirao v. Sakharlal Atmaramshet’, 39 Bom 175, has not been followed. In this Court too the majority opinion is accepted in ‘Madhaorao v. Eknathrao’, ILR (1947) Nag 412, and the earlier view contained in ‘Parashram v. Umrao’, 29 Nag LR 130, has been dissented from. The weight of authoriy is thus in favour of the view that no fresh date need be fixed in such cases. Since the question referred by the Divisional Bench does not involve this aspect of the problem, I do not consider it necessary to pronounce a final opinion upon this subject.

100. This brings me to the fourth category (d) above which is the subject of the question. When variation takes place the amount may be increased or it may be decreased. In my opinion it is impossible to treat these cases differently. The same considerations apply in both cases. As early as ‘Kristg Kinkur Roy v. Rajah Burrodacaunt Roy’, 14 Moo Ind App 465 at p. 489 (PC) their Lordships laid down the law with regard to appellate decrees as follows:

“The state of the Indian authorities upon the general question seems to be this. In the case before us, the High Court obviously proceeded on the principle, that a simple decree of affirmance did not so incorporate the mandatory part of the original Decree as to make, for all purposes, the Decree of the appellate Court the sole Decree to be executed. And this ruling appears to have been followed in the case of ‘Chowdhry Wahed Ali v. Mullick Inayet Ali, 6 Beng LR 52, in which it was ruled that, in order to make the Decree of the appellate Court the final Decree in the suit for all the purposes of execution, it was necessary, that it should have decreed ‘a material modification’ of the original Decree. The rule, ‘so expressed’, seems open to the objection of vagueness. The Full Bench of the High Court of Bengal, however, in the decision of the 12th of June, 1871, already referred to, has ruled that, whether the Decree of the Lower Court is reversed, or modified, or affirmed, the Decree passed by the appellate Court, is the final Decree in the suit; and, in the words of Mr. Justice Mitter, ‘as such the only Decree which is capable of being enforced by execution’. And that is in accordance with the Madras decision already cited. Chief Justice Scotland's words are ‘whether that Decree be in affirmance, or reversal, or modification of the Decree appealed from, it becomes the final Decree in the suit, and therefore the Decree enforceable by execution.”

(underlying (here into single quotations - Ed.) is by me).

“The function of an appellate Court is to determine what Decree the Court below ought to have made. It may affirm, reverse, or vary the Decree under appeal. In the first case, it leaves the original Decree standing, superadding, it may lie, an Order for the payment of the costs of the appeal, or for interest on the amount originally decreed. In the other two cases it substitutes other relief for the relief originally given.”

“In all these cases the Decree of the appellate Court may be regarded either as a direction to the Lower Court to make and execute a Decree of its own accordingly, or as an independent Decree, whether it is to be executed by the appellate Court or by the Lower Court. In the latter case a further question arises, viz., whether the original Decree, if wholly affirmed (or so much of it as has been affirmed, if it has been partially affirmed), is to be treated as merged or incorporated in the Decree of the appellate Court as the sole Decree capable of execution, or whether both Decrees should be treated as standing, execution being had on each in respect of what is enjoined by the one, and not expressly enjoined by the other.”

“In this Country the nature and effect of a Decree on appeal would seem to vary according to the nature of the Decree under appeal, the constitution of the appellate Tribunal, the proceedings in appeal, and the fact whether the record or merely a transcript is brought up. The determination, however, of the question before their Lordships must depend on the provisions of the Indian Code of Procedure, it is clear that, under that Code, whatever Decree is executed, is to be executed by the Lower Court, in which the record remains, or to which it is to be returned.” “But Ss. 360, 361 and 332(a), which prescribe the form of the Decree of the appellate Court, direct a copy of it to be entered on the Register, and treat that Decree as a Decree to be executed, seem to exclude the notion that it is a mere direction to the Lower Court to pass and execute a certain Decree.”

“(a) Section 360. The Decree of the appellate Court shall bear date the day on which the judgment was passed, it shall contain the number of the suit the names and descriptions of the parties, Appellant and Respondent, and the memorandum of appeal, and shall specify clearly the relief granted or other determination of the appeal. It shall also state the amount of costs incurred in the appeal, and by what parties and in what proportions such costs and the costs in the original suit are to be paid.”

“Section 361. A copy of the Decree or other Order disposing of the appeal, certified by the appellate Court or the proper Officer of such Court, and sealed with the seal of the Court, shall be transmitted to the Court which passed the First Decree in the suit appealed from, and shall be filed with the original proceedings in the suit, and an entry of the judgment of the appellate Court shall be made in the original register of the suit.”

“Section 362. Application for execution of the Decree of an appellate Court shall be made to the Court which passed the first Decree in the suit, and shall be executed by that Court, in the manner and according to the rules herein before contained for the execution of original Decrees.”

101. Other cases dealing with the same question can be found in ‘Fitzholmes v. Bank of Upper India’, 8 Lah 253 (PC); ‘Bhup Inder v. Bijai Bahadur’, 23 All 152 (PC) ‘Jowad Hussain v. Gendan Singh’, 6 Pat 24 (PC); ‘Syam Mandal v. Satinath Banerjee’, 44 Cal 954; ‘Gajadhar Singh v. Kishan Jivan Lal’, 39 All 641 FB and ‘Maqbul Ahmad v. Pateshri Partab Narain’, AIR 1929 All 677. The case in ‘Kristo Kinkur Roy v. Rajah Burrodacaunt Roy’, 14 Moo Ind App 465 was applied in ‘Noor Ali Chowdhuri v. Koni Meah’, 13 Cal 13, where a decree under Section 52 of the Bengal Act (VIII of 1869) provided that unless the amount due was paid within fifteen days from the date thereof the tenant (judgment-debtor) would be liable to ejectment. That decree was confirmed in appeal, no steps to execute it having been taken in the meantime. It was held that the appellate decree must be presumed to incorporate the terms of the original decree and was the only decree of which execution could be taken, and that the 15 days must be calculated from the date of the appellate decree.

102. This case, which has been followed in other cases, would show that even where the decree is one of affirmance a fresh period must be granted to the person who is required by statute to do something within a fixed period. This case is analogous to the case in ‘Fitzholmes v. Bank of Upper India, Ltd.’, 8 Lah 253 PC, to which more specific reference shall be made by me hereafter. This would show that the period of time granted by the Court of first instance also merges in the decree of the appellate Court and that the first Court's decree disappears and is replaced by the decree of the appellate Court. If no final decree has been passed, no harm can occur to the mortgagee. It is erroneous to think this grants more time to the mortgagor. Indeed, not to fix a fresh date might well rob the mortgagee of his interest at contract rate which is available only till the ‘dies datus’. I have not to decide this point finally but say this because this reason applies with greater force to appellate decrees varying the amount, as will be pointed out later.

103. Where the amount is varied by the Privy Council we get clear pronouncements from their Lordships on this point. Before I go on to those cases, I wish to refer to certain decisions of this Court. In ‘Parashram v. Umrao Prashad’, 29 Nag LR 130, to which a reference has already been made, it was held that it is necessary to pass a fresh preliminary decree and to fix a fresh date for redemption, whenever the appeal is dismissed. This case was dissented from in ‘Madhaorao v. Eknathrao’, ILR (1947) Nag 412 as already stated above. The observations in the last mentioned case were obiter as that was a decree of affirmance. In ‘Mohammad Hussain v. Balkrtshna’, Mise Civil Case No. 71 of 1948 D/- 22-11-49 and ‘Seth Maganmal v. Md. Yakub’, FA No. 108 of 1940 D/- 24-8-1950, by Mangalmurti and Deo, JJ, it was held that there is no need to pass a fresh decree even though the amount is varied.

104. The latter two cases are directly in point here and, with all due respect to the learned Judges, I must say that they were wrongly decided. They are in direct conflict not only with the decisions of their Lordships of the Privy Council to be cited hereafter but also with the meaning and intent of the thirty-fourth Order of the CPC as analysed by me above. Indeed, the decree of the trial Court stands modified by the variations ordered by the appellate Court and a new decree emerges.

105. In ‘Jagannath Prosad Singh Chowdhury v. Surajmal Jalal’, 54 Cal 161 PC, Lord Phillimore pronouncing the judgment of the Board observed at p. 164 as follows:

“A point was taken that the date when the contract rate expired should be six months from the date of the original decree of the Subordinate Judge, and not six months from the date of the decree of the High Court. Their Lordships think that cannot be so. It might be so if the decree and judgment of the Court of first instance was one which was affirmed; but, ‘inasmuch as it was varied because the sum fixed for redemption was incorrectly calculated’ it is impossible for the appellant, in whose favour that incorrect judgment was given, to rely upon that date as the date from which the redemption period should be calculated.”

(Underlining (here in single quotations - Ed.) is by me.)

106. It would appear that this resulted in a new preliminary decree and if so, fresh period had to be fixed as required by law. Time is calculated from the date of the preliminary decree; and it is idle to say that this was a question of limitation. The emphasis was placed upon the sum found due and, it is manifest from the words underlined (single quoted) that gave rise to a new decree from which time began to run.

107. In ‘Fitzholmes v. Bank of Upper India’, 8 Lah 253 PC, here were two suits, and decrees fixing the amount to be paid and giving six months within which it should be paid were passed in both suits on the 21st August 1919 in one and the 17th December 1919 in the other. The appeal to the High Court was dismissed on the 7th March 1923. On the 13th March 1923 the plaintiff Bank applied for a final decree. The mortgagors objected that six months should be calculated from the decree of the High Court. This objection prevailed. Then the Bank applied for a final decree on the 10th October 1923, and the mortgagors objected that the three years' period under Article 181 of the Indian Limitation Act should be calculated from the decree of the Court of first instance. This was overruled by the Courts in India. On appeal to the Privy Council, their Lordships quoted ‘Jowad Hussain v. Gendan Singh’, 6 Pat 24 PC upholding the decision, and when it was argued that before the decision of the High Court the period of three years and six months had passed and the decree was dead, observed at page 256 as follows:

“….the High Court had a right to determine the appeal, and when the judgment of the High Court is given, though in form it affirms the decree of the Judge of first instance, ‘it works out at a different figure, because the amount of interest is not at the same figure that judgment was passed for in the first instance’. Therefore the High Court having jurisdiction to pass its decrees, those decrees were sought to be enforced in plenty of time. ‘The mortgagors were right in their objection that these decrees should not be enforced till six months had elapsed from the judgment of the High Court’, and it is sufficiently cynical that they should now turn round and take a point which one is glad to think entirely fails.”

(underlining (here single quoted - Ed.) is by me.)

108. The same observations which I made about the last case apply to this case also.

109. In ‘Mohammad Ali v. Ramzan Ali’, AIR 1921 PC 100, their Lordships disallowed interest to the mortgagee who had kept the case hung up by his persistence in asserting an unwarrantable claim. Their Lordships' direction in the judgment was:

“The case will go back to the Court of the Judicial Commissioner for remission to the Subordinate Judge to give effect to His Majesty's directions, and the Interest will run from the date of his order in that behalf. The first Court will fix the usual time for redemption and make the consequential decree.”

110. In this case a number of years had passed before the case was decided by their Lordships, and this only shows that a fresh date was fixed because the amount was varied, though it was not considerably reduced. The direction would have been unnecessary if no date need be fixed.

111. In ‘Nathu Mal v. Raman Mal’, ILR (1937) Lah 245 (PC), their Lordships varied the amount by ‘increasing it’. The amount determined by the first Court was Rs. 10,852-14-3. This amount was Increased to Rs. 11,447-5-9 by the High Court as more interest was granted. The appeal to the Privy Council involved only the question whether piecemeal redemption should be allowed. This their Lordships negatived. Since the date of the High Court was reversed on this point and the decree of the Subordinate Judge was restored, their Lordships' observations at page 253 have a great bearing upon the issue before us. They are as follows:

“It follows from what has been said that this appeal should succeed, and accordingly a fresh date for redemption must be fixed (See ‘Jagannath Prosad v. Surajmal’, 54 Ind App 1 (PC) and ‘Satindra Nath v. Jatindra Nath’, 62 Ind App 265 PC. Their Lordships think that in the circumstances a date (hereinafter referred to as the new date for redemption) being two calendar months after receipt by the High Court of His Majesty's Order in Council will be a suitable date. The decree of the High Court must be discharged as also the final decree of the 25th February, 1929. The decree of the Subordinate Judge of the 22nd December, 1928, will be restored, but with the following variations: (1) The new date for redemption must be substituted throughout the said decree for the 22nd February, 1929, and (2) the amount due to Nathu Mal for principal, interest and costs up to the new date for redemption must be calculated upon the footing of Rs. 11,447-5-9 having been due on the 22nd February, 1929, and interest being chargeable up to the new date for redemption at the rate of 9 per cent per annum, and the amount so due must be substituted throughout the said decree for the sum of Rs. 10,852-14-3.”

112. It would follow from this that it was the alteration of the amount which led to the fixing of a fresh date for redemption. Their Lordships relied on ‘Jagannath Prosad v. Surajmal’, 54 Cal 161 PC. which dealt with variation of the sum and ‘Sateendranath v. Jateendranath’, 63 Cal 1 (PC) to which I next turn. If the other relief had been in their Lordships' mind the citation of these two cases would not have been apposite.

113. In the case last mentioned their Lordships approved of the action of the High Court in granting interest when the defendant in appeal was given an extension of time for making payment. They observed that a debtor should not be allowed to keep the money of his creditor at a low rate of interest by merely bringing an unsuccessful appeal and that the appellate Court is not bound to extend the period. The citation of this case in Juxtaposition with the earlier case in which a fresh date was fixed shows that if the mortgagor has got a variation of the decree he can insist that a fresh date for redemption be fixed.

114. Of course it must be remembered that it is not an absolute rule of law that six months should invariably be given for payment see ‘Pathumsa Ammal v. Rajagopala’, AIR 1927 PC 17, but it would appear that some time must be given when the amount for which redemption can be had is varied. Whether that time is granted by the appellate Court after the trial Court does not matter. The appellate Court cannot prohibit the grant of further time which is what the decisions of Mangalmurti and Deo, JJ. imply.

115. The English cases to which I have referred and the judgments of the Privy Council cited here establish the practice of Courts in England and in India. No case to the contrary has been found by me except the two decisions of Mangalmurti and Deo, JJ., and none was cited by the learned Judges or by learned counsel supporting these decisions. Since writing this I have had the opportunity of reading the opinion of my learned brother V.R SEN, J., who has disagreed with me, I shall, deal with the case cited by him and certain reasons given by him hereafter.

116. As I have pointed out above the suit on a mortgage is nothing more than a suit for accounts, and the amount due on the mortgage has to be declared in the decree and a period within six months has to be fixed from the date of such a declaration. If the amount declared is disputed and it is varied by the appellate Court then the exact amount has been declared only when the decree of the appellate Court is passed. As a result of this variation the decree of the first Court disappears and merges in the decree of the appellate Court and it is impossible to say that the mortgagor has been given a chance to redeem after the declaration of the exact amount he is required to pay. It matters not whether there is a locus in preliminary decrees for sale. Such a locus obtains even in foreclosure decrees because the payment can be made till the final decree for foreclosure is passed.

117. It remains now to consider the two premises involved in the questions referred by the Divisional Bench. The above interpretation of the law applies equally to suits for redemption, foreclosure or sale. Indeed, Rr. 2, 4, and 7 of O. 34 are analogous. In all the three suits an account has to be taken, and the exact amount under the mortgage has to be declared before the due date can be fixed. Rules 5 and 8 of the Order provide that in those cases where sale is ordered the defendant or the plaintiff (as the case may be) can make payment into. Court of all amounts due from them at any time before the confirmation of the sale made in pursuance of the final decree.

118. The words ‘before the confirmation of a sale made in pursuance of a final decree passed under sub-r. (3) of this rule’ were added to each of the Rr. 5 and 8, by of the Transfer of Property Act (Amendment) Supplementary Act, 1929. By the same Act, R. 3, which deals with foreclosure suits was amended and the words ‘before a final decree debarring the defendant from, all right to redeem the mortgaged property has been passed’ have been substituted for the words ‘on or before the day fixed’ which occurred in the old R. 3. The amendment gave effect to the rulings in ‘Shaikh Somesh…Judgment-Debtor, v. Ram Krishna Chowdhury…Decree-Bolder, .’, 27 Cal 705; ‘Murugesa Mudaly v. Ramasami Chetty’, 39 Mad 882 and ‘Ishwar Lingo v. Gopal Jiwaji’, 28 Bom 102, though they were Inconsistent with the rules as they originally stood.

119. The effect of these amendments is to give a chance of redemption in foreclosure suits till the final decree is passed and in redemption suits and suits for sale till the sale is confirmed, though the date fixed may have already passed. But the ‘dies datus’ has to be fixed all the same, and such a date has to be fixed ‘after declaring the amount due under the mortgage’, whether the suit be one for foreclosure, sale or redemption. In my opinion, therefore, the fact that the suit out of which the reference arises is one for sale, makes no difference because even in foreclosure suits the right of redemption remains till the final decree is passed. To say that no date for redemption would be fixed in this case after the declaration of the true amount is to ignore the mandatory provisions of O. 34, Rr. 2, 4 and 7. The effect of the amendment is to keep ‘the equity of redemption’ alive till the dates named in the rule, but does not dispense with the necessity of fixing a date for payment. That date may be fixed by the appellate Court or the appellate Court may leave it to the trial Court. The period need not necessarily be six months. It can be as short as possible. But a last chance after accounts must be given. Redemption must follow correct accounts. To hold otherwise would be tantamount to saying “Redemption first — accounts afterwards.”

120. This brings me to the question of the application of Section 9 of the C.P Moneylenders Act to interest ‘pendente lite’. On the principles enunciated above this loses its importance and for this reason, among others, I do not intend dealing with the matter exhaustively. Further, the Full Bench, as already stated by me, is not an appellate Court determining the correctness or otherwise of the decision in the appeal. I have, however, to deal with the matter because the learned Judges have drawn pointed attention to the fact that according to their decision no interest ‘pendente lite’ can be granted because of the Moneylenders Act.

121. The powers of the Court to grant, interest in mortgage suits are now circumscribed by the express provisions of O. 34 of the CPC. In mortgage suits interest on the mortgage money can be awarded not only till the date fixed in the mortgage but till the day fixed for redemption by the Court. After the date fixed by the Court, the Court has a discretion to grant further interest at the Court rate till realization or foreclosure. Under R. 11 the Court has a further discretion to grant interest during the pendency of the suit if the mortgage bond does not carry any interest. Formerly, under S. 34 of the Code read with O. 34 the grant of interest was along similar lines. The enactment of R. 11 has done no more than codify the law on the subject, and it is, therefore, not necessary now to invoke S. 34 of the Code as was done in cases previous to enactment of R. 11.

122. In ‘Kusum Kumari v. Debi Prosad’, 15 Pat 210 (PC), their Lordships laid down:

“Up to the date fixed for redemption the matter between the parties is one of their contract, and what the Court has to consider is how much does the law allow them to recover under it. This is determined by the Regulation and is limited to twice the amount of the principal. If that limit had been reached before the institution of the suit no further interest could be allowed between that date and the date fixed for redemption.”

123. In that case their Lordships were considering the question of interest under S. 6 of the Sonthal Parganas Settlement Regulation (III of 1872) (as amended), which provided ‘inter alia’ as follows:

“‘the total interest decreed on any loan or debt shall never exceed’ one-fourth of the principal sum, if the period be not more than one year, and shall not ‘in any other case’ exceed the principal of the original debt or loan.”

124. The underlined (here single quoted) words are clear and decisive. They refer to ‘total interest’, for which a decree can be passed. It is clear from this decision that under the Sonthal Parganas Settlement Regulation an amount beyond the double of the principal could ‘never’ be decreed. As their Lordships have observed, in every case we have to see how much does the law allow the plaintiff to recover under a mortgage bond.

125. Under the C.P Moneylenders Act the restraint upon the grant of interest is differently provided. Section 9 of the Moneylenders Act enacts that:

“Notwithstanding anything contained in any other enactment for the time being in force, no Court original or appellate shall decree ‘in respect of any loan’ made before this Act comes into force, ‘on account of arrears of’ interest a sum greater than the principal of such loan.”

126. The provisions of this section are different from those of S. 6 of the Sonthal Parganas Settlement Regulation. In applying Section 9 of the C.P Moneylenders Act we have to see whether the Court has any discretion left to award interest from the date of suit to the date fixed for redemption. In other words we have to find out whether under O. 34 there is a discretion to award interest ‘pendente lite’ even though the bond does not provide for interest and further whether the Moneylenders Act prohibits such exercise of discretion.

127. If one were to go by the strict words of their Lordships in the Patna case shorn of the context in which they were used one is apt to think that the Court's discretion during the pendency of the suit is non-existent if the mortgage bond provides for interest. That, however, would not be the effect of their Lordships' words if the context were borne in mind. I have pointed out above that their Lordships were determining the question of interest in relation to the specific provisions, of the Sonthal Parganas Settlement Regulation and did not purport to lay down a general law in relation to all mortgages and all laws controlling the award of interest.

128. To begin with, O. 34, R. 11 itself gives a discretion to the Court. It provides that interest, up to the date on or before which payment of the amount found or declared due is under the preliminary decree to be made by the mortgagor or other person redeeming the mortgage, has to be paid on the principal amount found or declared due on the mortgage at the rate payable on the principal (if legally due), or where no such rate is fixed at such rate as the Court deems reasonable. In accounting the Court has to calculate the amount due on the mortgage, and this amount then carries interest at the contract rate to the ‘dies datus’, but where no such rate is fixed the Court can grant interest at a reasonable rate.

129. It would follow that where the rate is fixed by the bond the Court may grant interest at the rate fixed in the mortgage bond, but where no rate is fixed the Court has a further discretion to grant interest at a reasonable rate. It may also be pointed out that even where the rate is fixed the Court is not bound to grant interest at that rate at all. It was observed by Das, J., in ‘Nemai Chand Sen v. Ram Kewal Sha’, 48 Cal WN 736, that O. 34, R. 11 of the CPC makes a clear distinction between two stages or periods, viz., the period between the date of the decree and the date fixed for redemption and the period between the date fixed for redemption and the date of realization; that during both these periods the mortgagee is not as of right entitled to interest; that during the first period the agreement between the parties as to payment of interest has no inviolable sanctity of its own; that if the interest is legally recoverable and the Court in its discretion thinks fit to allow it, then it has to be calculated at the agreed rate; and that in the second period (i.e after the date of redemption) the agreement of parties has no force at all and the matter is left entirely to the discretion of the Court. The Court thus has a discretion to reduce the rate of interest during the pendency of the suit and is not bound to grant interest at the rate fixed in the mortgage bond.

130. In ‘Raja of Ramnad v. Chidambaram Chettiar’, ILR (1938) Mad 646 (PC) their Lordships approving of the action of the Subordinate Judge in reducing interest during the pendency of the suit from the contract rate to reasonable rate, set aside the order of the High Court which had restored the Court rate.

“Their Lordships will, therefore, humbly advice his Majesty to discharge the decrees of the Judicial Commissioners and to restore that of the Court of First Instance, but they desire to make in addition the following declaration: that the defendant shall not be entitled to interest, during the pendency of the appeals from the judgments and decrees of the Subordinate Judge, the District Judge and Judicial Commissioners. The case has been hung up by his persistence in asserting an unwarrantable claim to interest from the inception of the mortgage. Their Lordships do not think that it would be justifiable to allow him interest for this period. The decree of the Subordinate Judge gave him interest up to the time of his decree, and he would be entitled to that amount.”

131. See also ‘Jaigobind Singh v. Lachmi Narain’, AIR 1940 FC 20 at p. 23.

132. The question thus is whether the converse of this rule, viz., the grant of interest under the discretionary powers of the Court is equally available to Courts when they find that interest cannot be granted at the contract rate either because there is no provision for interest in the bond or some law disallows interest at the contract rate. Here in the first case the words of R. 11 of O. 34 of the CPC themselves provides for such a contingency and the discretion can be exercised. In the second case we have to see what the law lays down. The words of the Bihar Moneylenders Act (S. 7), the Sonthal Parganas Settlement Regulation (S. 6), the Bengal Moneylenders Act (S. 31), and the C.P Moneylenders Act (S. 9) are different. Nor is the rule of damdupat uniformally incorporated in them. Cases under different statutes will accordingly have to be decided on the terms of the statutes controlling them. It is impossible to consider the application of ‘Thakurain Kusum Kumari v. Debt Prosad’, 15 Pat 210 (PC), as conclusive for the interpretation of other statutes.

133. Now Section 9 of the C.P Moneylenders Act speaks of decree ‘on account of arrears of interest’. These words obviously control the grant of interest in a decree but only ‘on account of arrears of interest’. Thus, the Court can find out the amount due on the mortgage cutting down the ‘arrears of interest’ in accordance with the section and then award interest at the Court rate on the amount found. The accounting in a mortgage suit is done up to the decree if the interest can be awarded up to that date, but, if the interest stops short before the institution of the suit, there is no accounting during the period of the suit. The Court having cut down interest legally, is free to grant interest under the powers granted by O. 34, R. 11 of the CPC. If interest is granted not as arrears on the mortgage bond and in respect of that loan but in exercise of the powers granted under Order 34 of the CPC it cannot be said that the grant of interest is against the intent and purport of the enactment. It is instructive to note that in ‘Sourendra Mohan v. Hari Prasad’, 5 Pat 135 (PC) a similar question had arisen with regard to the grant of interest under the discretion of the Court during the pendency of the suit. That case also related to the Sonthal Parganas Settlement Regulation. The High Court had then considered whether interest ‘pendente lite’ should or should not be granted under the discretionary powers then existing under Section 34 of the CPC read with the provisions of O. 34. The Privy Council in that case considered the observations of the learned Chief Justice of the Patna High Court and observed at p. 151 as follows:

“That the High Court carefully considered whether interest should or should not be allowed by the High Court from the date of the institution of this suit is apparent from the following passage in the judgment of the Chief Justice. He said: ‘It is not very clear why the learned Judge awarded interest only upon the amount of the personal decree and not on the amount of the mortgage decree, but there is no cross-appeal on this question. I think there is much to be said for the argument that the Santal Parganas Regulation applies only to the interest to be decreed under the bond, and does not limit the powers of a Court under Section 34 of the CPC to award interest on the decretal amount until realization. But it has been held in this Court in ‘Keshobati Kumari v. Satya Niranjan’, 1918 Pat HCC 305, that interest under the Code should not be awarded upon the decretal amount in so far as it includes interest on the principal debt or loan, but only upon the amount of the principal debt itself, as to do so would contravene the provisions of the Regulation relating to compound interest. The principle underlying this decision applies equally where the amount decreed as interest already equals the sum advanced. Although I have some doubt as (sic) the propriety of the decision mentioned, I am not prepared to differ from the conclusion there arrived at, and I think we should follow that decision.”

134. Their Lordships did not comment upon this exercise of discretion as being entirely outside the competence of the High Court.

135. Cases under the law of damdupat are also instructive. In ‘Hiralal v. Narsilal’, 40 Ind App 68 (PC) their Lordships observed at page 73 as follows:

“The only other point raised by the appellants on the hearing of this appeal related to the interest allowed on the redemption money for the period between the date of suit and the actual date of redemption. It was not contested that the rule of damdupat applied in the present case and that therefore ‘the amount of arrears of interest to be allowed up to the date of suit was limited’ to an amount equal to the capital sum. By his decree the judge of first instance had given to the appellants no interest from the date of suit. The appellants admitted that it was discretionary whether he should grant any and what interest for that period, and that if he did exercise his discretion on the point they could not under the circumstances of the present case appeal against it. But they contended that the omission to give interest for that period had been by oversight. The only support for such contention was that in the judgment of that Judge no reference was made to the point. On the hearing before the High Court that Court refused to accept that contention and treated the District Judge as having declined to award any interest for the period in question and held that it was a matter left to his discretion, and that under the circumstances of the case that discretion had not been unreasonably exercised. Their Lordships agree with this decision and the grounds on which it resits. No application was made to the District Judge to repair the alleged omission before the order was perfected, or at all; and, therefore, it must be taken that the order made by him represents in all respects his decision on the matter in plaint, and their Lordships see no reason to differ from the view of the High Court that the discretion was not unreasonably exercised.”

136. This case has been followed and distinguished on occasions. See also ‘Dhondshet v. Raoji’ 22 Bom 86; ‘Achyut v. Ramchandra’, AIR 1925 Bom 362; in the matter of ‘Harilal Mullick, 33 Cal 1269 and ‘Bapurao v. Anant Kashinath’, ILR (1946) Nag 407 among others.

137. In this Court there is a difference of opinion on the point mooted before their Lordships. I need not go into this here as it is not my intention to decide this matter finally, in ‘Ram Sarup v. Mukhi Singh’, 187 Ind Cas 132 (Pat) the learned Judges, though they do not refer to ‘Kusum Kumari v. Debi Prosad’, 15 Pat 210 (PC), distinguish that case and hold that the prohibition in the Bihar Moneylenders Act does not apply to interest during the pendency of the suit. That Act provided this specifically by enacting “for an amount of interest for the period preceding the institution of the suit”, thus making a difference from the Sonthal Parganas Settlement Regulation. Section 9 of the C.P Moneylenders Act, though it does not enact the words ‘for the period preceding the institution of the suit’ means the same thing. Simply because the account in a mortgage suit is carried forward to the ‘dies datus it does not mean that interest is ‘always’ awarded during the period ‘under the contract.’ The arrears of interest may continue right up to the date fixed for payment. They may equally come to an end by operation of the Moneylenders Act, even before the suit is instituted. It is impossible to say that where the second event happens a grant of interest under the powers of the Court is grant of interest in respect of the loan.

138. The words ‘arrears of interest’ connote that no interest directly arising on the mortgage bond can be awarded beyond what is provided in the Act. Where, however, the arrears of interest pave already reached the limit before the institution of the suit it is possible to hold that there is no rate of interest provided, and the discretionary powers under Order 34, Rule 11, are attracted.

139. It was for this reason that in ‘Sardau Amarsingh v. Seth Tulshiram’, ILR (1948) Nag 853, Pollock, J., and myself considered that the award of interest ‘pendente lite’ was within the discretionary powers of the Court, but we did not consider ourselves bound to award it because the mortgagee had earned a compound interest at an exhorbitant rate previously. This consideration of the award of interest was not under Section 34 of the CPC but under the discretionary powers envisaged by Rule 11 in those cases where no interest is provided by the mortgage bond.

140. It is true that in ‘Vithoba v. Cyril Lobo’, F.A No. 72 of 1940 D/- 16-6-1947, Grille, C.J, and myself disallowed interest during the pendency of the suit. In that case interest was allowed ‘under the mortgage’ though at a rate reduced by statute. That obviously could not be done because the Moneylenders Act disallowed a decree on account of arrears of interest beyond the double of the principal of the loan. No question of the grant of interest under the discretionary powers of the Court was raised and the Court was not invited to grant interest under its discretionary powers. The amount of the decree was therefore cut down to double the principal, and no other interest was substituted in its place under the discretionary powers of the Court. To quote the words of their Lordships in ‘Jagannath Prosad v. Surajmal’, 54 Cal 161 PC, in which they explained ‘Raghunath Prasad v. Sarju Prasad’, 3 Pat 279 (PC):

“The explanation must be that, for some reason or other, their Lordships thought that the respondents, who were doing very well, were prepared to leave this particular matter in their Lordships' hands. If the respondents, when their Counsel received the print of the judgment; had been so minded as to come to the Board and say that this had passed ‘per incuriam’ they would have been heard and the matter would, have been fully discussed.”

141. For these reasons, I am of opinion that interest from the institution of the suit to the ‘dies datus’ could have been granted if the justice of the case so demanded. I must make it clear that though this opinion has been expressed by me it is done with the utmost respect to the Divisional Bench making the reference. As stated by me, the learned Judges having decided the case and then formulated the question subject to their decision has forced me to examine briefly the reasons of the Division Bench in relation to the question.

142. As pointed out by me already, my opinion has been dissented from by V.R Sen, J., and I have had the privilege of reading the opinion which the learned Judge proposes to deliver. I shall briefly deal with some of the reasons which have impelled him, to my misfortune, to differ from me.

143. My learned brother, V.R Sen, J., has posed several questions some of which are answered in this opinion but others need more specific consideration. Sen, J. apprehends that the effect of the opinion I have recorded would necessitate the fixing of a fresh ‘dies datus’ every time the account is reopened by the payment of a part of the money. He thus apprehends in the words of Sir Rashbehary Ghose that:

“this may lead to the repeated reopening of the account and thus make it impossible for the mortgagee to overtake the mortgagor, as in the old Green puzzle of Achilies and the tortoise.’

144. If I may point out respectfully, this would not happen once the account is finally settled. During the period of grace the mortgage must be redeemed as a whole but extension of the period is possible from time to time on terms like payment of interest etc. This does not affect the account settled at all.

145. It is true that Order XLI of the CPC does not contain provisions analogous to Order XXXIV (‘ibid’) and no special forms are provided for appellate decrees in mortgage suits. But if a fresh preliminary decree comes into being the decree of the lower Court is itself changed ‘mutatis mutandis.’ There are two courses then open after the correct sum is declared or an account is ordered either to fix the date as was done in ‘Nathu Mal v. Raman Mal’, ILR (1937) Lah 245 (PC), or to leave it to the trial Court as was done in ‘Mohammad Ali v. Ramzan Ali, AIR 1921 PC 100. If the appellate Court says nothing about it the trial Court is bound to fix a date for redemption and this explains ‘Vithoba v. Cyril Lobo’, F.A No. 72 of 1940 D/- 19-9-1946. I may also mention with all due respect that Rule 33 of Order XLI of the CPC, has no relevance in this context at all.

146. Nor does the fact that there is a sale after final decree in the suit and a stranger auction purchaser has bought the property of any material consequence. In suitable cases the final decree would be discharged, leaving nothing on which the sale would rest. In ‘Birdichand v. Ganpatsao’, ILR (1940) Nag 302, the amount was not varied in appeal but only the relative shares of father and son were adjusted. Since a mortgage has to be redeemed as a whole, this did not make the slightest difference to the original decree and the sale could only be set aside if Order XXI, Rules 89 and 90, had been complied with, since the relative shares were readjusted the learned Judges held that in the purchase money the relative shares of the father and son would be as found by the appellate Court. The case is not an authority for the wide proposition for which it is cited and no principle as has been deduced flows from it.

147. My learned brother has relied upon ‘Tukaram v. Laxminarayan’, AIR 1926 Nag 207, in which Kinkhede, A.J.C, has ruled that it is not necessary to fix a fresh ‘dies datus’ even if the decree is varied. The learned Judge has given no reasons and I am therefore unable to accept the case. As regards ‘Periakaruppan Chettiar v. Venugopala Pillar, ILR (1947) Mad 132, the principles of ‘Jowad Hussain v. Gendan Singh’, 6 Pat 24 PC, were extended to those cases in which the preliminary decree is varied. With all due respect, I do not agree as the learned Judge has overlooked the clear dictum of Turner, L.J, in ‘Shama Purshad v. Hurropurshad’, 10 Moo Ind App 203 PC, that final decrees passed during the pendency of appeals from preliminary decrees are subordinate and dependent decrees and their Lordships do not think that these decrees can be held to have remained in force when the decree on which they were dependant had been reversed.” Earlier in the same report it was observed as follows at page 211:

“There is no doubt that, according to the law of this country — and their Lordships see no reason for holding that it is otherwise in India — money recovered under a decree or judgment cannot be recovered back in a fresh suit or action whilst the decree or judgment under which it was recovered remains in force; but this rule of law rests, as their Lordships apprehend, upon this ground, that the original decree or judgment must be taken to be subsisting and valid until it has been reversed or superseded by some ulterior proceeding. If it has been so reversed or superseded, the money recovered under it ought certainly to be refunded, and, as their Lordships conceive, is recoverable either by summary process, or by a new suit or action. The true question, therefore, in such cases is, whether the decree or judgment under which the money was originally recovered has been reversed or superseded; and applying this test to the present case, their Lordships are of opinion, that the decrees obtained by Tara Pershad against Doorga Parshad were superseded by the Order of Her Majesty in Council pronounced in the year 1849.”

148. Indeed, in the same case Rajamannar, J., (as he then was) makes the following observation towards the end of his judgment:

“Rankin, C.J, pointed out in 57 Cal 1013 that the appellate Court when setting aside or varying the final decree can and should give directions for setting aside or varying the final decree if the existence of the final decree is brought to its notice as in all cases it should be.”

149. I do not consider that the Madras case helps. The matter is not before me as the question referred does not contemplate the existence of a final decree. If I may say so respectfully as at present advised I do agree with all the conclusions in the case and agree with the contrary view of Krishna-swami Aiyangar, J., in ‘Balakrishnayya v. Linga Rao’, ILR (1943) Mad 804 and ‘Gajadhar Singh v. Kishen Jivan Lal’, 39 All 641.

150. Finally, I must say that this matter was complicated by the operation of Section 9 of the Moneylenders Act and the consequent refusal to grant interest after the double had been reached. My learned Brother V.R Sen, J., has not considered this question. It was absolutely necessary to consider this question in this context, in those cases where the decree carries interest, the fixing of a fresh ‘dies datus’ has not only to be ordered under law but should also be ordered even under discretionary powers though the variation be out small. One is tempted to ask for whose benefit is the ‘dies datus’ fixed? In a mortgage suit leading to a sale the mortgagor would anyhow be able to redeem the property till the confirmation of sale if he be so minded. It is the mortgagee who would lose his interest at contract rate if the ‘dies datus’ is not brought forward and interest awarded for all the years that have intervened. It is only where the interest is not awarded or awardable that the question could legitimately arise. In other cases, the fixing of a fresh ‘dies datus’ (apart from law) should be the rule. Nor do I see any difficulty in adjusting equities. If the mortgagor files an infructuous appeal or nearly so, he must pay interest for all the intervening period. If the mortgagee did that he may be deprived of his interest either wholly or partly as may seem just.

151. For these reasons, my answer to the question raised in the reference is in the affirmative, though I would add that the appellate Court may leave the matter to the trial Court.

V.R Sen, J.:— The material facts which have given rise to the present reference are these. One Shankerrao Kalar executed a deed of mortgage on the 22nd September 1925 in favour of Sir Shankarrao Chitnavis and his son Krishnarao, plaintiff, in consideration of Rs. 15,600. The rate of interest was -/12/- per cent, per month and the loan was to be repaid in 11 instalments. The last instalment was payable on the 31st May 1936. It was agreed that if the amount secured by the mortgage was not paid, the mortgaged property would be sold for satisfying the debt. In case of deficiency, the balance was to be satisfied out of other properties of the mortgagor. Certain payments were made before the suits towards the mortgage debt. The amount due on this mortgage, according to the plaintiff, was Rs. 27,589-9-9 on the date of the suit.

152. A second mortgage deed was executed by the same mortgagor on the 15th June 1928 in consideration of Rs. 6,000 in favour of the plaintiff and his father. The rate of interest was 1 per cent per month and the loan was to be repaid in annual instalments of Rs. 600/- each together with interest. One of the terms was that the mortgaged property was to be foreclosed or sold at the option of the mortgagee if the amount was not repaid. No repayments were made towards the mortgage. The amount due on this mortgage was Rs. 15,356. The immovable property covered by the two mort gages need not be described.

153. The suit was filed on the 13th June 1941 to enforce the two mortgages by sale of the mortgaged properties. The lower Court by its judgment, dated the 23rd December 1943, determined the principal amount due on the first and the second mortgages at Rs. 13,661 and Rs. 6,000 respectively. It held that the provisions of Section 9 of the Central Provinces Moneylenders Act, hereafter called the Act, which are as follows.

“Notwithstanding anything contained in any other enactment for the time being in force, no Court original or appellate shall decree, in respect of any loan made before this Act comes into force, on account of arrears of interest, a sum greater than the principal of such loan.’

154. Applies and the amount of Interest till the date of the suit could not, therefore, exceed the principals. It, however, allowed interest on Rs. 13,661 and on Rs. 6,000 at 9 per cent and 12 per cent per annum respectively from the date of the suit to the 24th June 1944 the date fixed for payment. The amount declared by the preliminary decree for sale was as follows:

1st Mortgage.

(1) Principal sum secured by the mortgage .. Rs. 13,661-0-0 (2) Interest thereon upto the date of the suit .. Rs. 13,661-0-0 (3) Interest on Rs. 13,661 from the 13th day of June 1941 to the 24th day of June 1944 at the rate of 9 per cent per annum .. Rs. 3,728-0-0 (4) Costs of the suit (court-fees on plaint) .. Rs. 1.205-0-0 Total Rs. 32,255-0-0

2nd Mortgage.

(1) Principal sum secured by the mortgage .. Rs. 6.000-0-0 (2) Interest thereon upto the date of the suit .. Rs. 6,000-0-0 (3) Interest on Rs. 6,000 from the 13th day of June 1941 to the 24th June 1944 at the rate of 12 per cent per annum .. Rs. 2,181-11-2 (4) Cost of the suit (court-fees on plaint) .. Rs. 645-0-0 Total Rs. 14,826-11-2

155. Interest at 3 per cent per annum on the amount found due from the date fixed for payment till its realization was also awarded.

156. The defendants appealed on the 26th June 1944 two days after the ‘dies datus.’ They also filed an application for stay of proceedings for drawing up a final decree which was allowed. The order was passed ‘ex parte.’

157. The Division Bench held ‘inter alia’ that the plaintiff was not entitled to interest from the date of the suit till the date fixed for payment in view of Section 9 of the Act. The amounts of Rs. 3,728 and Rs. 2,181-11-2 were consequently disallowed.

158. In view of the modification of the amount due on the mortgages, it was argued on behalf of the appellants before the Division Bench that it was necessary to pass a preliminary decree and fix a fresh date for payment. It was also argued that the direction in the preliminary decree that future interest at 3 per cent, per annum from the date fixed for payment till realization should operate not from the 24th June 1944, the date fixed by the preliminary decree, but from the date to be fixed by the appellate Court. The learned Judges observed that in view of the divergence of opinion revealed in the decisions examined by them about the necessity to fix a fresh date for redemption when the redemption amount was reduced in appeal, it was desirable that the controversy should be set at rest by a Full Bench. They stated that the question was of importance because the mortgagee would lose interest for the period between the date fixed for payment by the lower Court and a fresh date that may be fixed by the appellate Court if the contention of the appellant was accepted. They accordingly referred the following question for decision by a Full Bench:

“Whether it is obligatory on a Court of appeal to fix a fresh date for payment in a mortgagor's appeal from a decree for sale when the price of redemption fixed by the trial Court is reduced in accordance with Section 9 of the Central Provinces and Berar Moneylenders Act?”

159. In my opinion, the real question which requires consideration is whether it is obligatory on a Court of appeal to fix a fresh date for payment in a mortgagor's appeal from a decree for sale when the price of redemption is varied by the appellate Court. It is not necessary to consider the case of a decree for foreclosure as the question referred to us specifically relates to a mortgage decree for sale.

160. A mortgagor has a statutory right of redemption by virtue of Section 60 of the Transfer of Property Act and Order XXXIV of the CPC. This right of redemption is called in English law the equity of redemption. In view of the clear provisions in the Indian law, I do not, consider it necessary to go into the history of the English law bearing on the equity of redemption. The right can be exercised until it is extinguished by a decree of the Court in the case of mortgages by conditional sale and until confirmation of sale in the case of mortgages providing for sale of the mortgaged property.

161. The decree which has to be passed in the first instance by the trial Court in a suit for sale is provided in Order XXXIV, Rule 4 of the Code. According to that rule, if the plaintiff succeeds, the Court shall pass a preliminary decree.

(a) ordering that an account be taken of what was due to the plaintiff at the date of such decree for:

(i) principal and interest on the mortgage;

(ii) the costs of suit, if any, awarded to him, and

(iii) other costs, charges and expenses properly incurred by him up to that date in respect of his mortgage-security, together with interest thereon; or

(b) declaring the amount so due at that date; and;

(c) directing—

(i) that, if the defendant pays into Court the amount so found or declared due on or before such date as the Court may fix within six months from the date on which the Court confirms and

countersigns the account taken under Cl. (a), or from the date on which such amount is declared in Court under Cl. (b), as the case may be, and thereafter pays such amount as may be adjudged due in respect of subsequent costs, charges and expenses as provided in R. 10, together with subsequent interest on such sums respectively as provided in R. 11, the plaintiff shall deliver up to the defendant……and shall if so required, re-transfer the property to the defendant at his cost free from the mortgage and from all incumbrances created by the plaintiff……and shall also, if necessary, put the defendant in possession of the property……….

162. The relevant portion of Rule 5 which deals with the final decree in a suit for sale is as follows:

(1) Whether, on or before the day fixed or at any time before the confirmation of a sale’ made ‘in pursuance of a ‘final decree’ passed under Sub-rule (3) of this rule, the defendant makes payment into Court of all amounts due from him under sub-r. (1) of R. 4, the Court shall, on application made by the defendant in this behalf, pass a final decree, or if such decree has been passed, an order

(a) ordering the plaintiff to deliver up the documents referred to in the preliminary decree, and, if necessary,

(b) ordering him to transfer the mortgaged property as directed in the said decree, and, also, if necessary,

(c) ordering him to put the defendant in possession of the property.

(3) Where payment in accordance with sub-r. (1) has not been made, the Court shall, on application made by the plaintiff in this behalf, pass a final decree directing that the mortgaged property or a sufficient part thereof be sold, and that the proceeds of the sale be dealt with in the manner provided in sub-r. (1) of R. 4.

163. Rules 7 and 8 of O. XXXIV deal with preliminary and final decrees in a suit for redemption by a mortgagor. It will be seen from a perusal of the rules that the trial Court is required to grant time to the mortgagor to pay the amount and redeem the mortgage. It is not an absolute rule of law that six months' time which is usually granted should invariably be given for payment.

164. After a preliminary decree is passed, it is open to a mortgagor to pay the full or a part of the amount. If he pays the full amount, he can ask for a final decree in terms of R. 5(1) of O. XXXIV. What is the effect if a part of the amount is paid? Is the mortgagor entitled to ask the Court to pass a fresh decree and change the ‘dies datus’ on the ground that the payment has caused an alteration in the amount determined by the decree? My answer is no. The rules do not say that a fresh decree should be passed and time extended whenever there is a change in the amount found due by the preliminary decree. What the Court will do is to deduct the sums paid when it proceeds to pass or execute the final decree. It may also, if good cause is shown, extend the time for payment under O. XXXIV, R. 4(2) of the Code.

165. There is no express provision of law which compels an appellate Court to draw a fresh preliminary decree either when it confirms or modifies the decree of the trial Court. The provisions dealing with appeals are contained in O. XLI. In this Order, there is no rule corresponding to the rules relating to preliminary and final decrees under O. XXXIV. Order XLI, R. 35 of the Code provides for contents of an appellate decree. The form of the appellate decree as set out in form No. 9, appendix D, does not require the passing of a fresh preliminary decree. There is also no provision in O. XXXIV requiring the appellate Court to draw a preliminary decree to fix a fresh date for payment if it modifies the price of redemption.

166. Order XLI, R. 33 of the Code is as follows:

“The appellate Court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further or other decree or order as the case may require, and this power may be exercised by the Court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have filed any appeal or objection:

Provided that the Appellate Court shall not make any order under S. 35-A, in pursuance of any objection on which the Court from whose decree the appeal is preferred has omitted or refused to make such order.”

167. The appellate Court has power to deal with the case in any way that may seem equitable to all the parties concerned. It has power to pass not only any decree or order which ought to have been passed, but, also such further or other decree or order as the nature of the case may require. The appellate Court undoubtedly has the power to grant further time and pass a fresh preliminary decree and fix a fresh date for payment. The question whether this power should be exercised to safeguard the interests of parties and prevent injustice is a matter for the appellate Court to consider.

168. I will now consider the effect of a mortgagor's appeal against a preliminary decree of sale on the proceedings in the trial Court. Mere presentation of an appeal does not operate as a stay of proceedings under a decree or order. These proceedings can be stayed by the appellate Court under O. XLI, R. 5 of the Code on an application of the appellant. I will take the case in which there is no stay. The mortgagee after the ‘dies datus’ can apply for making the decree final. The trial Court has jurisdiction to make a decree final during the pendency of an appeal against a preliminary decree: see ‘Sat Prakash v. Bahal Rai’, 53 All 283 (FB); ‘Bhola Nath v. Jogendra Mohan’, ILR (1939) 1 Cal 477; ‘Koyakutti v. Veerankutti’, AIR 1937 Mad 421; ‘Veeran v. Koya’, ILR (1939) Mad 828; ‘Somar Singh v. Deonandan Prasad Singh’, 6 Pat 780 and ‘Ishwari Prasad Singh v. Raghubans Lal*’, 13 Pat 379. If no good cause is shown for extending time for payment, the Court will make the decree final. Thereafter the decree-holder can proceed to execute the decree by sale of the mortgaged property. Suppose the appeal is dismissed and the decree of the trial Court confirmed by the appellate Court after the passing of a final decree. What is the consequence? Is the appellate Court obliged to pass another preliminary decree and fix a fresh date for payment when it dismisses the appeal? There is no express provision of law which enjoins passing of a fresh decree and giving of further time for payment in such a case. If the contention were to prevail, the result would be that an appellant by merely filing an appeal would get extension of time for payment. An appeal may take several years before it is decided. While the trial Court has no jurisdiction to extend time unless good cause is shown: ‘Motilal v. Ujiar Singh’, 24 Nag LR 182 PC. The appellant would get the benefit of some years by instituting an appeal though his appeal may be devoid of substance and may be ultimately dismissed. He would succeed as a matter of law in delaying the satisfaction of the decree.

169. The final decree passed on the basis of the preliminary decree of the trial Court is not wiped out. It is a good decree and capable of execution. The mortgagee is not required by law to apply afresh to pass another final decree.

170. I will now consider the case in which there has been a stay of proceedings and a final decree has not been passed. The dismissal of the appeal would not render the preliminary decree ineffective. A mortgagee is entitled to apply to the trial Court for passing a final decree on the basis of the preliminary decree passed by it. Only the costs of the appeal will be added to the decretal amount. The appellate Court, when it dismisses the appeal, in my opinion is not required to pass a fresh preliminary decree and give further time for payment. I respectfully disagree with the view of Macnair, J.C in ‘Parashram v. Umrao Prashad’, 29 Nag LR 130. I may here refer to the following observations of the Division Bench of this Court in ‘Madhaorao v. Eknathrao’, ILR (1947) Nag 412 at p. 421:

“In ‘Parashram v. Umrao Prashad’, 29 Nag LR 130, Macnair, J.C laid down that notwithstanding the dismissal of an appeal from a preliminary mortgage decree, it is necessary for the appellate Court to pass a fresh decree fixing a fresh date for payment and making a fresh calculation of the amount which will be due on that date. The decision purports to be based on ‘Jowad Hussain v. Gendan Singh’, 6 Pat 24 PC. We respectfully disagree with the decision of Macnair, J.C as in our opinion, their Lordships of the Judicial Committee did not lay down any such proposition in ‘Jowad Hussain v. Gendan Singh”.

171. These observations are not ‘obiter’.

172. In ‘Bhola Nath v. Kanti Chandra’, 25 Cal 311, it was held

“Where, in a suit on a mortgage, the decree of the Appellate Court simply dismisses the appeal, leaving the decree of the first Court untouched, the time for redemption would run from the date of the decree of the first Court.”

173. The same conclusion was reached by Newbould and Cuming, JJ. in ‘Basanta Kumar v. Radha Rani Dasi’, AIR 1922 Cal 329. In ‘Maung Yan Gin v. Katharasan Chetty’, AIR 1921 UB 5, the learned Judge ruled:

“Where a preliminary decree in a mortgage suit fixes a certain date and that decree is affirmed on appeal, although the date of the appellate decree is subsequent to the date fixed in the preliminary decree under appeal, the latter date cannot be taken to be extended. It is open to the mortgagor to apply in the appellate Court to have a fresh day fixed for payment.”

174. In ‘Maqbul Ahmed v. Pateshri Partab Narain Singh’, AIR 1929 All 677, Sulaiman and Pullan, JJ. held:

“The appellate Court when it affirms the preliminary decree of the lower Court is neither bound to fix a period of six months for payment after its decree, nor is it bound to extend the time fixed by the Court below.”

175. This view is contrary to ‘Parashram v. Umrao Prashad’, 29 Nag LR 130. In ‘Madhaorao v. Eknathrao’, ILR (1947) Nag 412, a Division Bench of this Court held

“A fresh preliminary mortgage decree need not invariably be passed after the dismissal of an appeal against the preliminary decree fixing a fresh date for payment when a final mortgage decree had been passed by the trial Court during the pendency of the appeal against the preliminary decree. But an appellate Court should give directions for the setting aside or the ??? of the final decree when the preliminary decree is superseded in the appeal, whether the appeal is brought before or after the passing of the final decree.”

176. I respectfully disagree with the view taken in ‘Satwaji Balajirav v. Sakharlal Atmaramshet’, 39 Bom 175, which was not accepted in ‘Basanta Kumar v. Radha Rani Dasi’, AIR 1922 Cal 329. I may also refer to the case in ‘Veeran Kutti v. Koya Kutti, 1939-2 Mad LJ 86 in which the appellant was the defendant in a mortgage suit in the trial Court. A preliminary decree was passed against him and an appeal was preferred by him. No stay of proceedings was obtained pending the appeal and hence a final decree for sale was subsequently passed by the trial Court. The appeal against the preliminary decree was dismissed subsequently and later, that is, within three years from the date of the appellate decree, the decree-holder applied for execution of the final decree. The point raised there was that the decree-holders were not entitled to execute the final decree obtained by them before the dismissal of the appeal against the preliminary decree, but should have obtained a fresh final decree after the decision of the appeal against the preliminary decree. It was held that a fresh application for a final decree or amendment of the original decree was not necessary.

177. I do not agree that, even though the decree is one of affirmance, a fresh period must be granted to the mortgagor to pay the amount. I do not think that their Lordships of the Privy Council in ‘Fitzholmes v. Bank of Upper India Ltd.’, 54 Ind App 52 (PC) intended to lay down that the period of time granted by the lower Court merges in the decree of the appellate Court and that the trial Court's decree disappears and is replaced in its entirety by the decree of the appellate Court. The question was one of limitation in that case. The Bank of Upper India had instituted two suits, — one was against the husband and wife and the second was against wife only. Decrees stating the amount to be paid and giving 6 months time within which it should be paid were passed in both the suits on August 21, 1919 in one, and on December 17, 1919 in the other. The mortgagors appealed and the High Court dismissed the appeals on March 7, 1923. On March 13, the Bank applied for final decrees. Objections were taken by the mortgagees that the application was not maintainable as 6 months had not expired since the decree of the High Court. The objection was upheld. On October 10th, the Bank applied for final decrees for sale and an order was made on October 20th. Thereupon, the mortgagors appealed to the High Court on the ground that under Article 181 of Schedule I of the Limitation Act, the decrees could not be executed. The contention was not accepted and the appeal was dismissed; the mortgagors appealed to the Privy Council which reiterated the decision in ‘Jowad Hussain v. Gendan Singh’, 53 Ind App 197 (PC) and held that the applications were not out of time. Reliance, however, is placed on the following observation:

“The mortgagors were right in their objection that these decrees should not be enforced till six months had elapsed from the judgment of the High Court……”.

178. The facts are not fully stated and the exact form and contents of the decree of the High Court are not known. I do not think that their Lordships intended to lay down the rule that a mortgagee could not apply for or execute a final decree before the expiry of the period fixed by the trial Court calculated from the date of the appellate decree. If a mortgagee is not prevented from applying for or executing a final decree during the pendency of the appeal, I do not see why his position should be worsened by the dismissal of the appeal. For purposes of computing limitation under Articles 181 and 182 of the Limitation Act, the date of the appellate decree is the material date. The doctrine of merger in the appellate decree does not imply that even though the appeal is dismissed, the unsuccessful appellant would be entitled to a fresh period from the date of dismissal of the appeal. This view will lead to a conflict with the provisions of O. XXXIV, R. 4(2) which requires a mortgagor to show good cause to obtain extension of time. If the doctrine of merger in respect of nil the Incidents of the original decree is accepted, the result would be that a mortgagor even on the basis of a frivolous appeal will automatically secure extension of time. The interpretation placed on this decision is opposed to the decisions cited earlier in paragraph 17 and is not warranted by O. XXXIV or by any other provision of law.

179. The following example will reveal the unsoundness of the contention of the mortgagor regarding the obligation of the appellate Court to pass a fresh decree for sale and give time for redemption. A mortgagee obtains a preliminary decree for sale. The mortgagor appeals, but either does not apply for or fails to obtain stay of further proceedings. The mortgagee, during the pendency of the appeal applies for a final decree and obtains it. Later, the mortgaged property is sold and purchased by a stranger auction-purchaser no application is made to set aside the sale under Rr. 89, 90 and 91 of O. XXI. It is the duty of the Court to confirm the sale in such a case. After the sale is confirmed, the appeal is decided and the appellate Court varies the amount. What will be the result of passing a fresh preliminary decree for sale in such a case. The sale stands and the auction-purchaser cannot be deprived of possession of the mortgaged property. A ‘bona fide’ purchaser who is a stranger to the decree does not lose his title to the property by the subsequent reversal or modification of the decree. The mortgagor even though a fresh date for redemption is fixed by the appellate Court will not be able to redeem. The decree will be ineffective. The appellate Court thus cannot be obliged to pass a fresh preliminary decree and give further time irrespective of the circumstances of the case.

180. In ‘Birdichand v. Ganpatrao’ ILR (1940) Nag 302, a Division Bench of this Court held:

“An auction-sale in favour of a stranger cannot be set aside merely because the decree in execution of which the sale was held, has been varied in appeal. The Court is bound to confirm the sale under O. XXI, R. 92 of the CPC, unless there is a successful application under Rr. 89, 90 or 91 of O. XXI of the Code.”

181. In that case the lower Court had set aside the sale for the reason that the sale was held in execution of a final decree passed by the trial Court following upon a preliminary decree which final decree was passed during the pendency of an appeal taken from the preliminary decree which appeal was partly successful. The original preliminary decree was passed on the basis that both the father and the son were liable for the whole decretal amount and in appeal the quantum of liability was somewhat reduced, but the son's liability was very considerably reduced from about Rs. 18,000 to about 7,800, and the balance was held binding on the father alone. The purchaser at the Court auction was a third party.

182. I will now consider whether the appellate Court is required by law to pass a fresh preliminary decree and fix another date for payment when it varies the amount found by the trial Court. There is nothing in the rules under the Code requiring the appellate Court to do so. It may be necessary in some cases that the appellate Court should grant further time and pass a fresh decree. The appellate Court undoubtedly has the power of the original Court to pass a preliminary decree. In the exercise of its powers under the Code it can pass a proper decree to meet the ends of justice. The possession of this power, however, does not imply an obligation on the Court to exercise it. The matter is one of discretion for the appellate Court. Even while affirming the decision of the trial Court, it may extend the time granted by the decree of the trial Court.

183. In ‘Periakaruppan Chettiar v. Venugopal Pillai’, ILR (1947) Mad 132, a preliminary mortgage decree was passed on the 4th of May 1929. An appeal was filed against it by one of the defendants. Pending the appeal, as further proceedings in the suit had not been stayed, the trial Court passed a final decree on 23rd September 1933, on the basis of the preliminary decree passed on the 4th May 1929. On the 26th November 1934 the appeal was allowed in part, which had the effect of reducing the decretal amount. No fresh final decree was passed on the basis of the appellate decree. After the decision of the High Court, the decree-holder filed an execution petition on the 23rd September 1936 to execute the final decree passed on the 23rd September 1933 and again another execution petition in 1939 and finally another one on the 31st March 1942. Along with the last execution petition he filed an application for amendment of the execution petition by substituting the amount awarded by the appellate decree in place of the amount awarded by the final decree, dated the 23rd September 1933. The District Judge allowed the application for amendment and adjourned the execution petition for further steps. The judgment-debtors appealed from the above order. It was held that “where the preliminary decree is affirmed in toto or is varied to any extent or in any particular, the final decree can be executed with such modifications as may be necessary in the circumstances, which might as well be made in the execution petition filed after the appellate decree. Further, it is the duty of the Court which passes a final decree to carry out such, modifications as may be necessary by reason of the decision of an appellate Court in an appeal against the preliminary decree when its attention is drawn to the necessity for such alteration by the decree-holder.”

184. Rajmannar, J. (now, C.J) in repelling the argument of the appellant that ‘Veeran Kuth v. Koya Kutti’, 1939-2 Mad LJ 86, cited ‘supra’ was inapplicable observed: The learned advocate for the appellant sought to distinguish this decision on the ground that it dealt with a case of the affirmance of the triad Court's decree by the appellate Court and a different rule should obtain when the appellate Court modifies to any extent the preliminary decree passed by the trial Court. We fail to see any ground for making this distinction. On principle we do not see why, if in spite of the fact that certain modifications would be perforce necessary to be made by reason of the affirmance by the appellate Court of the preliminary decree passed by the trial Court, such as for instance with regard to the costs of the appellate Court, the old decree could be executed, it should be different when the modifications are in respect of other particulars such as the amount payable, or the parties or the properties against whom the decree should run…….. If this function of a final decree for sale is borne in mind it becomes clear that on principle there ought not to be any distinction between a case of an affirmance and a case of variation of the preliminary decree by an appellate Court. The final decree passed in the case, if it was passed before the disposal of the appeal against the preliminary decree, would in our opinion automatically operate on the preliminary decree as affected by the decision of the appellate Court. It might be affected to a greater or lesser degree. The alterations which may be necessary, if they have to be made formally in the final decree already passed, would be practically the same whether the appellate decree is one of affirmance or of variation.” I respectfully agree with this view. In ‘Tukaram v. Laxminarayan’, AIR 1926 Nag 207, Kinkhede, A.J.C held:

“An appellate Court modifying a redemption decree need not, in every case, necessarily change due date of payment of redemption money.”

185. In ‘Vithoba v. Cyril Lobo’, FA Nos. 72 & 73 of 1940 D/- 19-9-1946, decided by Grille, C.J, and Hidayatullah, J., the trial Court had passed decrees in the case of Lobo brothers for Rs. 20,000 together with interest ‘pendente lite’ up to the ‘dies datus’, that is to say, from the 30th April 1937 to the 29th August 1940 amounting to Rs. 2,333-5-4 together with costs and in the case of Mrs. Menezes for Rs. 60,000 with interest ‘pendente lite’ up to the ‘dies datus’ of Rs. 7,070 and with costs. The learned Judges held that the parties were governed by the terms of Section 9 of the Moneylenders Act and the decree must be modified to the extent of reducing the additional interest awarded. Though the amount was reduced, fresh date for payment was not fixed. The decree in First Appeal No. 72 of 1940 which was passed was not a preliminary decree for sale and was as follows:

“That the appeal is allowed and the preliminary decree for sale passed by the lower Court declaring the amount of Rs. 23358-1-4 as due to plaintiffs from defendants, directing defendants to pay the said amount to plaintiffs, and directing sale of the property described on the reverse on defendants' failure to pay the said amount, be and is hereby modified by substituting the sum of Rs. 21024-12-0 (Rs. 20,000 principal and Rs. 1024-12-0 costs) in place of Rs. 23358-1-4.”

186. The decree in First Appeal No. 73 of 1940 was in similar terms. In ‘Mahamud Husain v. Balkrishna’, FA No. 71 of 1948 D/- 22-11-1949, decided by Mangalmurti and Deo, JJ. and ‘Seth Maganmal v. Mohammad Yakubkhan’, FA No. 108 of 1940 D/- 24-8-1950, decided by Mangalmurti and Deo, JJ. held that there was no provision of law under which an appellate Court must pass a fresh preliminary decree fixing a fresh date for payment and the matter was entirely within the discretion of the appellate Court.

187. In ‘Jagannath Prod v. Surajmal’, 54 Ind App 1 (PC), the only matter to which Counsel for the appellant confined themselves was the question of the rate of interest and whether it should be simple or compound from the date either of the decree of the High Court or the decree of the Court of first instance. The suit was brought by the plaintiffs to enforce by sale a mortgage bond, dated the 2nd May 1907. The bond provided for interest at 12 per cent per annum with quarterly rests. The Subordinate Judge allowed interest at 9 per cent until the date of the institution of the suit and at 6 per cent from that date until payment. The defendant did not appeal, but the plaintiffs appealed on the question of interest. The High Court allowed the appeal and made a decree for interest at 12 per cent per annum with quarterly rests to the date fixed by decree for payment and thereafter at 6 per cent per annum. The defendant appealed to the Privy Council. Lord Phillrmore, who delivered the judgment, observed at page 4:

“A point was taken that the date when the contract rate expired should be six months from the date of the original decree of the Subordinate Judge, and not six months from the date of the decree of the High Court. Their Lordships think that cannot be so. It might be so if the decree and judgment of the Court of first instance was one which was affirmed; but, inasmuch as it was varied because the sum fixed for redemption was incorrectly calculated, it is impossible for the appellant, in whose favour that incorrect judgment was given, to rely upon that date as the date from which the redemption period should be calculated.”

188. Reliance is placed on these observations by the learned Counsel for the appellants. I am unable to regard this decision as an authority for the proposition that the appellate Court is bound to pass a fresh preliminary decree and fix a fresh date for payment. The question which arises here did not fall for consideration in that case. The observations have to be construed in the context of the contention in respect of the rate of interest raised before their Lordships who expressed their concurrence with the view in ‘Sundar Koer v. Rai Sham Krishen’, 34 Ind App 9 (PC). It does not appear from the report that the High Court had passed a fresh preliminary decree.

189. In ‘Satindra Nath v. Jatindra Nath’, 62 Ind App 265 (PC), the respondent Instituted a suit against the appellant for the amount due with interest at 12 per cent per annum. The Subordinate Judge decreed the amount claimed with interest at the contract rate to the date of the decree. In default of payment within 1 month the property charged was to be sold. Subsequent interest was awarded at 6 per cent and a personal decree for any deficiency was also granted. The date fixed for payment was the 27th July 1929. On appeal by the defendant, the High Court upheld the findings of the Subordinate Judge, but substituted for the personal decree a decree for realization of any balance due from other movable or immovable property of the debtor and on the application of the defendant extended the time for payment till the 31st March 1933 allowing interest at the contract rate for the extended period. The decree directed the defendant to pay the amount claimed in the plaint with interest thereon at 12 per cent per annum from the date of the suit upto 31st March 1931. It was only after that date that interest was to run at 6 per cent per annum. The defendant appealed to the Privy Council. The following observations by their Lordships show that the High Court (appellate Court) was not bound to grant further time though the decree had been modified:

“As stated above, the appellant had failed to make the payment within the period fixed by the Subordinate Judge, and his property was liable to be sold for satisfying the respondent's claim. To avoid the sale, he asked the High Court to extend the period, but the learned Judges were not bound to grant his prayer. They, however, acceded to his request; and he can have no legitimate grievance if, while granting the concession, they made him liable for the payment of interest at the contract rate during the period of extension. Otherwise, a debtor has only to prefer an appeal in order to withhold the payment of money to his creditor for a long period without incurring liability for interest at the rate which he himself had agreed to pay and which he could not challenge on any valid ground. Such a device, if permitted, would lead to manifest injustice.”

190. Reliance is placed by the learned Counsel for the appellant on the following passage at page 133 in ‘Nathu Mal v. Raman Mal’, 64 Ind App 126 (PC):

“If follows from what has been said that this appeal should succeed and accordingly a fresh date for redemption must be fixed (see ‘Jagannath Prosad v. Surajmal’, 54 Ind App 1 PC and ‘Satindra Nath v. Jatindra’, 62 Ind App 265 (PC). Their Lordships think that ‘in the circumstances’ a date (hereinafter referred to as the new date for redemption) being two calendar months after receipt by the High Court of His Majesty's Order in Council will be a suitable date. The decree of the High Court must be discharged as also the final decree of February 25, 1929.”

191. A close examination of the facts will reveal that it was not the mere alteration of the amount which led to the fixing of a fresh date for redemption. A fresh decree was drawn up in that case as the appeal of the mortgagee Nathu Mal was allowed as against Raman Mal on a question of a construction of the mortgage instrument. The parcels which constituted the security for the loan consisted of two houses and a shop in Amritsar and two shops in the city of Lahore. A preliminary decree for sale dated the 22nd December 1928 which fixed the 22nd February 1929 as the date for redemption was passed by the Senior Subordinate Judge. The amount declared due to Nathu Mal for principal, interest and costs calculated up to that date was Rs. 10,852-14-3, and that such amount was to carry interest at 6 per cent per annum until realization; that the amount due to Raman Mal on his prior mortgage was Rs. 1900 and on his subsequent mortgage was Rs. 3533-4-0, calculated up to the 22nd February 1929. There was direction in the decree that the Amritsar property was to be sold first and only in the event of the proceeds of this sale proving insufficient to answer the claims of Nathu Mal the Lahore property was to be sold. This was done to preserve the priority of Raman Mal's prior mortgage. No redemption having taken place on or before the appointed day, a final decree for sale was passed on the 25th February 1929.

192. Raman Mal appealed from the preliminary and final decrees. He asked for a declaration added to the decree that he had a prior charge on the Lahore property to the extent of the money received by Nathu Mal out of the proceeds of the sale to Raman Mal, and the amount spent by Raman Mal on repairs and improvements to the property. The appeals of Raman Mal succeeded upon a point which, according to their Lordships, ‘apparently had not been argued or suggested before the Subordinate Judge and which does not appear in Raman Mal's grounds of appeal namely, that upon the true construction of Nathu Mal's mortgage deed there was conferred upon the mortgagors, or upon Ram Das, a power which enabled them or him at any time to sell and transfer any part of the mortgaged property freed from the mortgage security, without either knowledge or consent on the part of the owner of the security.’

193. Their Lordships did not agree with the interpretation of the High Court of the terms of the mortgage instrument and held that ‘the clause in the deed did not import a power to sell free from the encumbrance. Where it is possible to draw more than one inference from a clause in a deed of mortgage that inference should be drawn which is not inconsistent with or repugnant to the deed in preference, to an inference which may result in the destruction of the security.’

194. It will thus be clear that it was in view of the special circumstances on the reversal of the decision of the High Court that a fresh date of redemption was fixed. Their Lordships did not lay down the rule that a fresh date of redemption had to be fixed whenever, variation is made in the amount by an appellate Court. I accept the proposition that an appellate Court can fix a fresh date and pass a fresh decree when it varies the amount. What I do not accept is the proposition that the rules or the decisions of the Privy Council enjoin upon an appellate Court ‘the duty’ of drawing up a fresh decree and giving further time when the amount is varied in appeal.

195. The mortgagor is not in any way prejudiced by the non-fixation of a fresh date for payment. The alteration in the amount of the decree or the absence of a fresh date does not in any way prevent him from exercising his right of redemption which continues till the confirmation of sale. All that the mortgagor has to do to redeem the property is to pay the amount decreed by the trial Court less the amount allowed in his favour in appeal. On payment of the amount, he has the right of asking the Court to pass a final decree in terms of R. 5(1) of O. XXXIV. In the circumstances I am unable to see how a mortgagor is deprived of his right of redemption. I am unable to discover any mandatory provision requiring the appellate Court to fix a date irrespective of the circumstances.

196. The English practice does not warrant the conclusion that the appellate Court must fix a fresh date for redemption. The cases in ‘Garlick v. Jackson’, (1841) 49 ER 297; ‘Alden v. Foster’, (1842) 49 ER 708 and ‘Ellis v. Griffiths* (1844) 49 ER 944, do not relate to appellate decrees. I may also point out that the report of these cases is very brief and there are insufficient statements of the facts. The decision in ‘Henry v. Byar’, (1831) 1 Knapp 388, only relates to an appellate-decree. The decisions do not say that the Court must grant a further period. They only show that, it is usual. In England to give further period for redemption when the amount is varied. That, however, is a matter of practice. Neither the provisions in O. XXXFV, nor the decisions of the Privy Council or of the English Courts establish the existence of a rule imposing a duty on an appellate Court to fix a fresh date for payment, when it varies the price of redemption. The opposite view will require the appellate Court to grant further time even if the variation is to the extent of a few rupees and even though the mortgagor had several years to make payment. In applying the decisions of the Privy Council, we must bear in mind the principle that every judgment must be applicable to the facts proved or assumed to be proved in the case. It is an authority for what it actually decides-and cannot be quoted as an authority for a proposition that, may seem logically to follow from it; ‘Bilimoria v. Central Bank of India, Ltd., Bombay’, ILR (1944) Nag 1 FB. My conclusion is that an appellate Court is vested with power to fix a fresh date, but it is not required by law to exercise that power as a matter of course in all cases of variation. It follows that it is not obligatory on the appellate Court to fix a fresh date when, it reduces the price of redemption by applying S. 9 of the Act. The question of fixing a fresh cate is Within the discretion of the appellate Court.

197. As the question regarding the power of a Court to grant interest ‘pendente lite’ in a suit based on a mortgage and the application of S. 9 of the Act has not been referred, I do not express any opinion. My answer to the question is in the negative.

198. Answer accordingly.