Central Co-operative Bank vs Kashi Sahu and Others

Agarwala, J.—The respondents instituted a suit for the sale of mortgaged property to realize their dues under the mortgage. They impleaded as defendants in the suit the mortgagor as defendant 1 and the appellant as defendant 2.

With regard to defendant 2 it was alleged that this defendant was also a purchaser in execution of a decree passed in a rent suit but that that decree was a money decree and not a rent decree as it was not against all the tenants of the holding or in respect of the entire holding. The suit was not contested by the mortgagor but it was contested by defendant 2. In the result a decree was passed directing the sale of the mortgaged property. When the decree-holders applied to execute this decree defendant 2 raised an objection that the mortgaged property could be sold only subject to his prior charge. The prior charge on which he relies is that conferred by Section 65, Bihar Tenancy Act, on a person who purchases in execution of a rent decree. The objection was upheld by the Munsif but has been overruled on appeal on the ground that defendant 2 cannot be permitted at this stage to agitate this question.

It is now contended on behalf of appellant-defendant 2 that as the Court which tried the suit has found that the decree in execution of which he purchased in the rent suit was a rent decree, he is entitled to have the priority which the statute confers on him in spite of the course taken during the trial of the suit itself. Now the question whether the owner of a paramount right is precluded from raising the question of his priority by reason of his having been a party to a suit on a mortgage has been the matter of frequent discussion.

In Sadhu Behera Vs. Dibakar Tarai and Others, it was held that as a general rule a paramount title cannot be drawn in controversy in a mortgage action; but if a plaintiff in such an action alleges a distinct case in his plaint in derogation of the priority which may be claimed by the defendant and seeks in his suit to displace that prior title and postpone it to his own, it is incumbent upon the defendant to establish his priority, and, if he fails to do so, he will not be allowed to raise that question in a subsequent suit of his own. Now, in the mortgage suit with which I am concerned the mortgagee-plaintiff distinctly challenged the priority of defendant 2 by alleging that the latter''s purchase was not in execution of a rent decree but of a money decree. What the position would have been had defendant 2 not taken up that challenge it is unnecessary to discuss because, as a matter of fact, defendant 2 did take up the challenge and claimed priority on the ground that the decree in execution of which he purchased was a rent decree, and he further alleged that he had taken steps u/s 167, Tenancy Act, to annul the plaintiff''s encumbrances. Although the Court found that the decree in execution of which the defendant purchased was a rent decree it held that as the defendant had not annulled the mortgage encumbrances within a statutory period prescribed by the Tenancy Act his holding was subject to the plaintiff''s mortgage and accordingly the plaintiff was entitled to a mortgage decree against both the defendants.

Now, in view of the decision in Mahodev Maharaj Vs. Jagdev Singh and Others, it is clear that the view of the law which the trial Court took was wrong. The mere fact that a purchaser in execution of a rent decree has not availed himself of his statutory right to annul the encumbrances does not, in any way, affect the priority conferred on him by Section 65 of the Act. Be that as it may, there was this decision at the trial and that it was a wrong decision is irrelevant to the present question. The appellant was dissatisfied with that decision and appealed against it but unsuccessfully.

In the circumstances of this case it is clear to me that the appellant sought in the litigation which resulted in this decree to establish his priority and has failed to do so, and that being the case he cannot be allowed now to re-agitate that question in the proceedings in execution of the decree.

The result is that this appeal fails and is dismissed with costs.