Srinivasa Rao Saheb and Others vs Yamunabhai Ammall and Others

The first and second respondents hereinafter referred to as the respondents, were prior mortgagees of the property ordered to be sold by the

lower Court. In the plaint in the case, the plaintiffs stated that they were subsequent mortgagees, that the respondents were impleaded as they held

a prior mortgage and expressly prayed inter alia that in default of payment of the money due to thorn under their mortgage, the mortgaged property

should be soil subject to the prior mortgage The appellants who were the other defendants in the case being mortgagors or persons claiming

through them also admitted in their written statement the prior mortgage in favour of the respondents. There was thus no matter in dispute either

between the plaintiffs in the suit and the respondents or between the latter and their co-defendants. In this state of things the Court is giving the

decree for sale in favour of the plaintiffs made no reservation therein in respect of the respondents'' prior mortgage

It was argued that in the absence of any such reservation in the decree, it is imperative on the Court to sell the property on the footing that the

respondents'' mortgage was non-existent and to apply the proceeds in payment of the plaintiffs'' mortgage and pay the remainder to the mortgagors

themselves.

Now Section 85 of the Transfer of Property Act, no doubt requires all parties having an interest in the property comprised in the mortgage being

included in any suit on the mortgage. It is open to doubt however whether a suit in which all the parties admit the existence of and intend to raise no

question about a prior incumbrance in favour of a person not impleaded in the suit is liable to be dismissed as one framed in contravention of the

section-Assuming that, even in such circumstances, Section 85, requires the prior incumbrancer to be brought before the Court in the suit, we do

not think that there is anything in the provisions of the Transfer of Property Act which requires that the decree in jibe 4 suit should in terms reserve

his rights and order the sale to be subject to them. Section 96 of the Act does not militate against this view. In laying down that, property subject to

a prior mortgage may be sold by Court free from the same with the consent of the prior mortgagee the section does not necessarily imply that

when the property is not to be sold free from such incumbrance the decree should under all circumstances expressly reserve the prior mortgagee''s

rights. No doubt where any contest arises between a puisne mortgagee-plaintiff and a prior mortgagee-defendant or a contest between a

mortgagor and a prior mortgagee who are co-defendants which it is necessary to decide in order to give relief to the plaintiff, such contest should

be adjudicated upon and the decree framed with reference to the adjudication. But where the right of parties to the suit such as the respondents is

admitted on all hands and further the person claiming relief asks for relief subject to such admitted right, the Court would of course be going out of

the way in granting larger relief than he prayed for; and indeed there is no necessity to construe the decree in the present case as granting what the

plaintiffs themselves did not ask. No doubt to avoid misconceptions the decree might have been in the terms of the prayer of the plaintiffs

themselves, that is to say, the mortgaged property be sold subject to the prior mortgage in favour of the respondents. The proper course to be

observed in drawing up a decree is certainly that pointed out in Lachmi Narain v. Jwala Nath ILR 18 All. 344 still, in construing a decree

admissions in the pleadings or in the course of the case should not be ignored and the decree taken as negativing any right which was conceded by

all parties, with reference to which the Court was not called upon to make any adjudication and in respect of which there was no necessity for the

Court to make reference in terms in the decree provided such a construction does not infringe any statutory provision. It was in consonance with

this view that the plaintiffs, the subsequent mortgagor consented to the sale taking place as applied for by the respondents and the sale-proceeds

being applied, in the first instance, towards the discharge of the prior mortgage. The contention of the mortgagers is therefore on the face of it

unsustainable.

We dismiss the appeal with costs.