The following judgments were delivered by the Full Bench:—

Couch, C.J (Kemp and Ainslie, JJ., concurring) (after reading the question referred, continued):— The referring order points out that this question may have to be considered with reference to both ss. 2 and 7 of Act VIII of 1859, but for the present it will be convenient to treat it as only involving the question under the first of these sections; and the first matter for consideration is whether proceedings under s. 53 of the Registration Act of 1866 are to be deemed a suit.

The petition of the person seeking to recover on a specially registered bond duly verified in the manner required by law for the verification of plaints is to be filed in the Court which would have jurisdiction to try a regular suit on the obligation, and that Court is to make a decree, which is to be enforced under the provisions for the enforcement of decrees contained in the Code of Civil Procedure.

The difference between this proceeding and an ordinary suit in which judgment is confessed is that in the first the confession, instead of being directly notified to the Court after a suit has been commenced, is recorded by an officer specially empowered by law to record it in anticipation of any proceedings in Court, and that the Court is specially empowered to act on such confession as soon as it is laid before it.

Special registration was first introduced by Act XVI of 1864; the language of s. 52 of that Act differs materially from the language of the later Act, and it may be doubted whether a proceeding, under s. 52 of Act XVI of 1864, could be held to be a suit. Under that section the obligation was to be enforced “without a suit,” and there was no provision for making a formal decree — the obligation was to be enforced “as a decree in a suit,” but subject to any provisions contained in any law for the time being in force in relation to the enforcement without a suit of bonds or other obligations for the payment of money registered under s. 51. The change of expression must be taken to have been adopted advisedly, and that change supports the opinion that proceedings under s. 53 of Act XX of 1866 are in the nature of a suit. The fact that only certain portions of the Code of Civil Procedure apply to proceedings under the Registration Act — see Gaur Mohan Das v. Ramrup Mazoomdar — is not material; for the substitution of a special procedure up to a decree for the ordinary procedure prescribed in the Code does not alter the nature of the transaction, which is, as in all ordinary suits, a prayer to a competent Court by a person having a claim against another to enforce that claim by the exercise of the authority of the Court. The claim to the money secured by the bond, and the following up of that claim by application to a Court, is a suit of a civil nature within the meaning of s. 1 of the Code of Civil Procedure, independently of any peculiarities in the mode of] prosecuting it.

In considering the nature of proceedings under s. 53 of Act XX of 1866, we must look at the nature of the remedy obtainable there under, and for this purpose it is necessary to examine the effect of decrees for realization of debts made in ordinary suits. A decree under s. 53 is at least equivalent to a money-decree in on ordinary suit, and an examination it seems to us that there is no substantial difference between the effect of an ordinary money-decree on a mortgage-bond, and a decree on the same bond for recovery of the money due by sale of the mortgaged property. So that whether a decree for the money be made under s. 53, or in a regular suit, the remedy of the mortgagee is the same. When a creditor under a bond by which property is mortgaged takes a money-decree and proceeds to attach and sell the mortgaged property, he thereby transfers to the purchaser the benefit of his own lien and the right of redemption of his debtor, and if there be no third party interested in the property, it becomes vested absolutely in the purchaser.

If the sale be under a decree for sale, it can do no more than this. There is, we think, no warrant for holding that, when a sale is under a decree for sale, it conveys the rights of both creditor and debtor; but that when it is in execution of a simple money-decree only, the rights of the debtor pass and the creditor retains his lien. The object of a sale of mortgaged property in execution of a decree is not to transfer the debt from the debtor to the purchaser of the mortgaged property, but to obtain satisfaction out of the security. Thus, whether the decree do or do not direct the sale of the mortgaged property, the mortgagee, when he puts that property up for sale, sells the entire interest that he and the mortgagor could jointly sell.

It cannot be rightly contended that the mere taking of a money-decree extinguishes the creditor's lien. There is a case of Sawruth Sing v. Bheenuck Sahoo, which seems to go to this length; see the passage beginning “now it appears to us,” but these words are qualified by a passage farther on, “we do not say,” &c.; and the case of Ramchurn Lal v. Koondun Koomabree is directly the other way. If then the lien be not extinguished by taking & money-decree, and if it continue an incident of the debt when it passes from a contract-debt into a Judgment-debt, — See Syud Nadir Hossein…Own Of The Defendants; v. Pearoo Thovildarinee…Plaintiff.*, (post, p. 432;) as the creditor cannot sell the property and retain the lien, it must continue in existence so for as may be necessary for the protection of the purchaser. An order for sale cannot conclude persons not parties to the suit, and without such order, in the absence of any third party interested in the property, a complete title passes by the sale in execution of the money-decree.

If there be persons not parties to the suit claiming an interest in the property, no form of dealing with the property in their absence can prejudice their rights. The decision of the Full Bench in Gupinath Singh v. Sheo Sahay Singh is clear on this point. It seems to us that that decision does no more than declare this as a fundamental rule. The expression “he is simply in the position of an ordinary judgment-creditor in respect of his decree, and can only sell the rights and interests of his debtor,” could not be intended to limit the decree-holder's power of selling the rights confered by his lien.

Reading these words with the context, they seem to us only to import that the subsequent incumbrancer cannot be concluded by any order made otherwise than in a suit to which he is a party; but as to whether this is to be brought by the first creditor or his assignee under the execution-sale, there is nothing said. The Judgment only deals with the case of a creditor himself seeking to enforce his lien, and who has not assigned it to another by a sale in execution.

The fact that property is mortgaged to one is no bar to a mortgage or sale of the equity, or right of redemption to another.

The remedy of the mortgagee under a mere money-decree and under a decree for sale being indentical so far as the parties to the suit are concerned, he cannot have a right to a second suit against the same parties to enforce what he has already obtained. Of course, there may be a right of suit remaining against third persons not parties to the first proceeding, but that in no way affects the question before us. The fact that a creditor taking a money-decree has already obtained as complete a remedy against the persons sued as he can have against them, appears to us very strong ground for holding, that proceedings under s. 53 of the Registration Act are as much suits as any other proceedings to which s. 1 and the rest of Act VIII of 1859 apply.

Inasmuch as the creditor who takes a specially registered mortgage bond may be said to have stipulated not only for a summary decree, but also for a right to have specific property sold for satisfaction of his debt if, by a decree made under s. 53 of the Registration Act, he could not get the full benefit of his contract, it might be doubted whether it would be a reasonable conrtruction of the 2nd section of the Procedure Code to hold that he has exhausted his remedy by a proceeding under the first named section, but inasmuch as he does get the full benefit thereof as against the contracting parties, and there is nothing in the fact of his having taken a decree against them under that section to restrain him from proceeding against third persons by a separate suit, there seems to be no ground for holding that the provisions of s. 2 of Act VIII of 1859 do not apply where the first suit is in the form of a proceeding under 8, 53 of the Resgistration Act.

In this view of the case, it is unnecessary to consider the question under s. 7 raised by the referring order.

Jackson, J. (after stating the facts of both the cases) proceeded; — It will be convenient to deal in the first instance with the suit before the Subordinate Judge. That was on a bond containing an obligation to pay money and a simple mortgage, The nature of the suit to be brought on such an instrument is described in Macpherson on Mortgage (5th edition), p. 10; and if the plaintiff succeeds in such a suit, he obtains a decree for the money, with a declaration that he is entitled to have it satisfied by the sale of the land. Such a decree could not be had in a Court of Small Causes, nor could it be made under the 53rd section of the Registration Act.

But the lender had thought fit to protect himself still further by the form of special registration; and as it appears to be optional in the case of such bonds to proceed under s. 53, or by suit in the ordinary way, he had thus, as it seems to me, secured to him the choice of two remedies or modes of obtaining relief — either the common suit by which he could obtain complete relief, including the enforcement of his mortgage lien, but subject to the necessity of proving his case and to the incidents of appeal and the various delays of regular litigation, or the rapid procedure of s. 53, precluding appeal or even defence, but limited as to the relief afforded. He chose the latter and obtained a decree which completely exhausted his cause of action in so far as that arose out of the non-payment of the money and his right to recover it. And the contract-debt had thus, as it seems to me, merged or passed in rem judicatam, so that no further suit for the same debt could be maintained, and both on general principles and by the terms of 8. 2 the matter was concluded. I have no doubt that, for the purposes of this discussion, the proceeding under s. 53 was a suit brought in a particular form, and regulated by a particular procedure. And the difference between the plaintiff's position with such a decree, and what it would have been at the conclusion of a regular suit is this, that he would have, over and above the judgment for his money, a right created by the deed, but undeclared by the decree, to enforce that judgment by sale of the property mortgaged.

It is not necessary here to state precisely how the difference would affect the decree-holder, it is enough to say that he would be in a distinctly less favorable position as regards third parties. If the land continued in the hands of the debtor, it would probably make no difference at all, for he could always attach the land in execution, and the 11th section of Act XXIII of 1861 would prove abundantly efficacious for the decision of any question which might arise between debtor and creditor: As regards third parties, if the land had been intermediately alienated, it seems to me that the creditor would have a good cause of action against his borrower and the purchasers from that person, upon the separate contract to hold the land at his disposal for the satisfaction of his claim. For these reasons I conceive that the decision of the Subordinate Judge and of the District Judge are both erroneous and ought to be reversed.

In the case before the Munsif, which is the subject of the second special appeal (No. 222), the plaintiff sought a fresh decree for the unsatisfied portion of his claim, as well as a declaration of his lien as against the alienees. Upon the considerations already stated, I am of opinion that the Munsif who granted only the latter prayer was right, and that the Judge who altered his decree was wrong.

Markby, J.:— I concur in thinking that the proceeding under s. 53 of Act XX of 1866 is a suit which terminates in a decree.

But it is said that, inasmuch as the creditor stipulated not only for a decree but for a right to sell specific property in satisfaction of his debt, it might not be a reasonable construction of the Statute to hold that he has exhausted his remedy by a proceeding under Act XX, s. 53, if under the decree so obtained, he cannot get the same right to sell the property as he could obtain in a regular suit.

I have had some doubt whether this argument sufficiently disposes of the question, what is the cause of action in the proceeding under Act XX, s. 53, and wherein does it differ from the cause of action in the suit now before ns? But assuming that the difference in the remedy would take the case out of the rule of res judicata, still the question arises, could the plaintiff get any remedy in the present regular suit which he could not have got on his decree in the summary suit under Act XX, s. 53?

The plaintiff's rights as decree-holder under s. 53, Act XX, are those of a bond-holder with security who has obtained a simple decree for his debt, or as it is generally called a money-decree. All he could get in the regular suit is a decree against the very same person, namely, his debtor, with the additional declaration, which is now very often inserted in the decree that the property comprised in the bond is to be sold in satisfaction of the debt. The question then is whether there is any difference between these two decrees.

The course of procedure in both cases after decree is precisely the same. The property must be attached and Bold by the ordinary process of law in execution of the decree. The thing sold will be the same. A notion has, it is true, been started that only what is (as I consider inaccurately) called the debtor's equity of redemption is sold under a money-decree, that is to say, that the property will be sold subject to the bond-holder's lien. But it is agreed that that is not so, and that the purchaser takes all that the creditor as well as the debtor is able to convey: I may mention that the case of Erskine & Co. v. Dhun Kishen Sein, which is sometimes relied on as a decision to the contrary, has been reviewed, and an entirely different conclusion arrived at by Loch and Mitter, JJ., who heard the case after the review was admitted.

As regards third persons not parties either to this or the former suit, the result is the same whether the property be sold under a money-decree, or under a decree declaring the lien. Their rights are not affected more or less in the one case than in the other. As against third parties, the declaration of the lien contained in the decree can have no operation what-soever; they can only be affected by a declaration in a decree in a suit to which they have been made parties If the rights of claimants to the property subsequent to the security-bond are in any way affected, it cannot be by reason of the declaration made in a suit to which they are no parties, it can only be by reason of the sale. Whether the rights of third parties are in any way affected by the sale or not, is not a matter which, as it appears to me, we are called upon to decide in the present case. There are decisions upon this point — Sheo Prosun Singh v. Brojoo Sahoo and Brajaraj Kisori Dasi v. Mahamed Salem; and I should desire farther consideration before holding that in no case the rights of third persons, created subsequent to the security, are in any way affected by a sale under the security-bond, that is to say, so far as it can be said to affect their rights that the whole property pledged should be turned into money at the instance of the first pledgee. As a general principle of law, I should be inclined to say that the right to sell the very thing pledged is inherent to the pledgee, and as a general rule I should also say that no claimants upon the property posterior to the first pledgee can interfere with this right, though, of course, they may have a right to redeem before sale; and they may have a very effectual claim on the surplus-proceeds, if there are any left after satisfying the first pledgee. In England the law has been somewhat slower than elsewhere in giving to the pledgee a right of sale, but neither in the English law nor in any other law, as far as I am aware, has there been any doubt that, if the pledgee can sell at all, what he sells is the property pledged: and it appears to me to be very doubtful whether it would not be undesirable both for pledgor and pledgee that there should be a sale of any thing else; because I think such a sale as seems to me to be suggested by three of my learned colleagues might lead to the property being sold at a very inadequate price, as it will be uncertain whether the purchaser is buying the property itself, or a mere right to hold it subject to some claim of third parties.

All, therefore, that I wish to say in this case is that a money-decree against the debtor himself is neither better nor worse than a decree against the debtor himself which declares the-lien. If, in order to get the full benefit of his pledge, the bond holder has to sue third parties, there is nothing to prevent his doing so.