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Judgment
Sadasiva Aiyar, J.—The plaintiffs 1 and 2 are the appellants.
The suit was brought for sale of 13 properties hypothecated under 7 hypothecation bonds. The plaint impleaded 17 defendants. The 7th
defendant died after suit and three more defendants (18 to 20) were added as his legal representatives.
As above stated, the suit looks a simple one, but in reality it is very complicated owing to the seven hypothecated documents sued on containing
only one property in common to all of them, namely, item t, a house in Madura which is the most valuable property. Four of them B.C.D. and E,
hypothecated (among others) certain properties which are not included in. the plaint schedule, the plaintiffs having given up their right to proceed
against those properties. The common mortgagor in the documents Exhibits B to G (the later six documents) is the 1st defendant whose undivided
sons are the defendants 2 and 3. The mortgagor who executed the 1st document, Exhibit A is the 1st defendant''s deceased father. The other
defendants 4 to 17 are subsequent mortgagees or alienees of one or more of the 13 plaint properties. While the above facts make the suit
sufficiently complex? more serious complexities are due to two other sets of facts :-(1) the plaintiffs having brought :5 separate suits on the 5 later
documents Exhibit C to G in 1901 in the Madura District Munsif''s Court against the 1st defendant and his sons alone without impleading the
alienees and puisne encumbrancers of some of the properties and having obtained separate decrees for sale which remained unexecuted till the
date of this suit; (2) the plaintiffs having brought two other suits again, 246 and 247 of 1904 in the Madura Munsif''s Court on the first two
documents, (Exhibits A and B) having then withdrawn one of them in order to consolidate the claim therein with that in the other suit as directed by
the appellate Court (when the decrees of the District Munsif in those two suits went up on appeal) and having failed to present the consolidated
plaint to the proper court after so withdrawing one of the suits when the Thirumangalam District Munsif''s Court to which the consolidated plaint
was presented returned that consolidated plaint for presentation to the Madura Munsif''s Court.
The learned Subordinate judge dismissed the suit on the following conclusions:
(1) The plaintiffs having obtained decrees in O.S. Nos. 142 to 146 of 1901 in the District Munsif''s Court of Madura on the five bonds Exhibits C.
to G. are barred by res judicata from bringing the present suit as regards the relicts claimed on those bonds though the present suit includes the
claims on two other bonds A and B and though the present suit has been brought in the Sub Court of Madura which is a superior Court to that of
the District Munsif''s Court of Madura. The plaintiff''s only remedy for recovery of the sums due under the bonds Exhibits C to G is to execute the
decree in those suits. (2) The suit on Exhibit B. is barred by their withdrawal of the former suit No. 247 of 1904 in the Madura Munsif''s Court
(which afterwards became 314 of 1906 in the Thirumangalam Munsif''s Court). Though they withdrew it in order to consolidate the claim in the
connected suit 313 of 1906 in the Thirumangalam Munsif''s Court and though they did present the consolidated plaint in the Thirumangalam
Munsif''s Court, they failed to present the consolidated plaint in the Madura Munsif''s Court when it was returned to them for such presentation by
the Thirumangalam Munsif''s Court. Permission to withdraw the claim of Exhibit B was accompanied fey only a limited and particular permission of
the court, namely, to consolidate it with their claim in the twin suit but they had no permission to consolidate it with six other claims and to bring an
entirely new suit in the Sub-Court. Hence their withdrawal of their claim on Exhibit B stands and they are barred by Order 23 of the CPC from
maintaining the claim on Exhibit B in the present suit. (3) The first two bonds, Exhibits A and B have been discharged partly by payments which
were expressly made by the mortgagors towards those bonds and partly by payments which in law the plaintiffs ought to have credited towards
those bonds. 5. In arriving at those conclusions the learned Subordinate Judge has made some inaccurate statements in his judgment which
however are not material. For instance, he says in para. 23 of his judgment that the execution of the decree in the five suits 142 to 146 of 1901 had
become time barred on the date of this suit. It is admitted for the respondents that the execution had not so become time-barred. Again, in setting
out the facts regarding the withdrawal of the suit O.S. No. 314 of 1906, he states that the consolidated plaint was returned for want of jurisdiction
by the District Munsif''s Court of Madura owing"" to unauthorised additional reliefs having been inserted in the consolidated plaint. This statement is
very inaccurate as the unauthorised additions were afterwards excised and the plaint was returned by the court finally not on account of such
additions but by reason of the transfer of jurisdiction over the mortgaged properties and the return was made by the Thirumangalam Munsif''s
Court. However, as I said, these inaccuracies do not affect the main reasons given by the lower court for its conclusions.
I shall now shortly refer to the question whether the plaintiff''s suit on the bonds Exhibit C to G are barred by res judicata. On this question,
several very difficult points of law (with reference to numerous authorities both English and Indian) were argued with much elaborateness before us
on both sides.
Two of those points were (a) whether the causes of action on these five bonds when joined in this present suit with the causes of action on the
two earlier bonds Exhibits A and B do not amalgamate into a single new cause of action so as to relieve the plaintiffs from the bar of res judicata;
(b) whether the addition of numerous defendants joined in this suit including"" alienees and puisne mortgagees (whereas the five suits 142 to 146 of
1901 did not include these additional defendants as parties) do not make the cause of action in this suit different so as to relieve the plaintiffs from
the bar of res judicata.
As regards this latter contention I might remark, in passing that the additional defendants 5 to 17 in the present suit (the defendants 18 to 20
being as stated already the legal representatives of the 7th defendant) would have been wholly unnecessary and superfluous parties in the former
five suits according to the plaintiffs own allegations. For they say in paragraph 33 of their plaint that the alienations made in favour of the defendants
5 to 17 have been made ''benami'', that is, are sham transactions if so, the omission to make them parties to the former five suits could in no way
affect the plaintiff''s rights and the inclusion of such sham alienees in the present suit could not have any legal effect in the matter of effecting a
change in their cause of action so as to make it different from the causes of action in the previous five suits, so far as their claims on those five
bonds are concerned.
Having referred to this question of res judicata in respect of the claims on the five bonds, I do not think it necessary to express an opinion
thereon especially as the question is a very difficult one and very learned judges have expressed conflicting views on the question.
I think that the claims so far as they are based on those five bonds Exhibits C. to G. fail on an independent ground which though not argued in
the lower court was argued elaborately before us and being a pure question of law has been considered by us. That question may be shortly stated
thus : Whether the plaintiffs having obtained decrees in the five suits on the mortgage documents Exhibits C. to G. and having obtained orders
absolute for sale in those suits in accordance with those decrees, the securities had become extinguished by operation of law, that is, by operation
of Section 89 of the Transfer of Property Act and whether therefore no claim could be advanced in the present suit based on those securities. The
five suits of 1901 were brought when Sections 85 to 90 of the Transfer of Property Act were in force, they having been repealed only in 1908 by
the Civil. Procedure Code of that year. The five suits were decreed in March and April 1901. Orders absolute for sale u/s 89 of the Transfer of
Property Act were passed in July and August 1901 (See Exhibit XI series). Section 89 says that on an order absolute being made, the defendant''s
right to redeem and the security shall both be extinguished. In Hur Persad Lal v. Dalmardher Singh ILR (1905) Gal. 891, the first mortgagee not
having notice of a second mortgage, sued the mortgagor alone and obtained a decree on his mortgage. The 2nd mortgagees afterwards obtained a
decree for sale on their second mortgage without making the first mortgagee a party. The first mortgagee''s assignee purchased the property in
execution of his decree for sale. The second mortgagees had previously purchased under their decree for sale and had taken possession. The first
mortgagee''s assignee who was also the court auction purchaser sued the second mortgagees (also court auction purchasers) for possession giving
the second mortgagees the option to redeem the first mortgage. One of the learned Judges (Brett, J.) of the Division Bench which first heard the
second appeal in the Calcutta High Court held that the first mortgagee''s suit was valid against the second mortgagees though the latter were not
parties to the former''s suit and that their only right was to have the option of redemption. As regards Section 89, the learned Judge said "" it is
pointed out that the plaintiff cannot possibly bring a fresh suit on the prior mortgage bond as the mortgage had in fact merged in the decree, which
was assigned to him and as after the sale and his purchase in execution of that decree the lien and the mortgage was extinguished (See Section 89
of the Transfer of Property Act). This contention is in my opinion sound; and as the plaintiff, even if such a suit had not been barred by limitation,
could not have brought on the mortgage of December 1885, his present suit based on the decree assigned to him and the rights purchased by him
in execution of that decree was the only properly framed suit that he could bring for relief ""; (Rampini, J.) the other learned Judge did not refer to
Section 89 but held that the second mortgagees having first purchased in court auction had the superior right to possession and that the 1st
mortgagee''s claim on his first mortgage being barred on the date of his present suit, the second mortgagees were not bound to redeem him. The
case went before the third Judge (Mitra, J.) on account of this difference of opinion and he agreed with Brett, J. though he does not refer io the
observations found in the judgment of Brett, J. in regard to Section 89 of the Transfer of Property Act.
Now the question whether when Sections 85 to 90 of the Transfer of Property Act were in force and when the first mortgagee had brought a
suit without impleading the second mortgagee and obtained a decree and an order absolute for sale, he could afterwards bring a fresh suit against
the second mortgagee alone for sale and whether if he could bring a second suit for sale, he should or could make the mortgagors also parties
though the mortgagor''s rights had been sold away in execution of his first decree or questions on which there has been difference of opinion. I shall
refer to only two clases. In Jugdeo Singh v. Habibullah Khan (1907) CRI.L.J. (1) that very learned Judge (Mookerjee, J.) says '' It is unnecessary
for our present purpose to consider whether it is open to a mortgagee who has omitted to implead a neccessary party to maintain another suit to
enforce his security against the party excluded; that he may do so under exceptional circumstances, appears to have been affirmed by the
Allahabad High Court in Dharam Singh v. Angan Lal ILR (1899) All. 301 and Muhammed Askarl v. Radha Rani Singh ILR (1900) All. 307, but
even if it be assumed that it is open to a mortgagee to enforce his security by a fresh suit for sale against an excluded party, which hoever we must
not be taken to affirm, it is well settled that it is not obligatory upon him to do so.'' In Ghnnu Pillay v. Venkalaswamy Chettier ILR (1915) Mad. 77
: 30 M.I.J. 347. Srinivasa Aiyangar, J. expresses the opinion at p. 88 that where the first mortgagee had omitted to make the second mortgagee a
party and proceeded to sale, "" the purchaser whether himself or another, can bring a fresh suit for sale making the second mortgagee a party."" He
does nor refer to the above decision in Jugdeo Singh v. Habibullah Khan (1907) Cri.L.J. (1) where Mookerjee, J. was not at all prepared to affirm
the existence of any such right. I am myself inclined to hold that where the first mortgagee had notice of a second mortgage (which he must be
presumed to have where the second mortgage is registered) and where he omits to make the second mortgagee a party as he was bound to do u/s
85 of the Transfer of Property Act and Order 34, Rule 1 of the present Civil Procedure Code, he ought not to be allowed to bring a second suit
for sale against the second mortgagee with or without the addition as party of the original mortgagor against whom he had already obtained a
decree, simply because he finds his first decree valueless against the second mortgagee and is confronted with difficulties owing to the second
Mortgagee''s putting forward his rights. It is however unnecessary to pursue this point further for the decision of this case.
The language of Section 89 is quite clear that on the passing of the order absolute in a suit for sale brought by a mortgagee, '' the security'' (that
is, his security) shall be extinguished. It does not state that the security shall be extinguished only if all the persons entitled to redeem have properly
been made parties to the suit. Mr., Ananthakrishna Aiyar argued that the security should be deemed to be extinguished only so far as the persons
who were made defendants to the suit were concerned and not as regards the second mortgagee who was not made a party to the first suit for
sale. But the language of the section is perfectly general and in Het Ram v. Shadi Ram ILR (1918) All. 407, Viscount Haldane while delivering the
judgment of the Privy Council in a case where the facts were similar, made the following pronouncement : "" u/s 85, the first mortgagee was bound
to make the second mortgagee a party to the suit for sale, and as he did not do so, the second mortgagee was not bound by the order for sale
which could only have been operative subject to his title. Section 89 is important. Under this section, where an order, for sale u/s 85 has been
made such as was made here in 1892 "" (in this case it was in 1901) "" in favour of the first mortgagee, the mortgagor or the second mortgagee, if he
has been made a defendant would have had the right to redeem if he had paid within the date fixed by the decree the amount due. If such payment
is not made, a decree absolute may be passed such as was made in 1895,"" (in this case decree absolute was passed in July and August 1901) "" for
sale and for payment of the amount realised into court. The section then provides that the defendant''s right to redeem and the security shall both be
extinguished. The construction which their Lordships put on the language so used is that on the making of the order absolute, the security as well as
the defendant''s right to redeem are both extinguished and that for the right of the mortgagee under his security, there is substituted a right to a sale
conferred by the decree. '''' I do '' not think that this language of their Lordships can be construed as meaning that the security was extinguished
only so far as the mortgagor was concerned, but remained alive in respect of the puisne mortgagee. Section 89 of the Transfer of Property Act has
no doubt now been replaced by Order 34, Rule 5 of the CPC and this rule does not contain the words "" and thereupon the defendant''s right to
redeem and the security shall both be extinguished."" It may be a question therefore whether the second suit on the security may not lie under certain
circumstances against parties other than the defendants in the first suit even though a final decree for sale had been passed in the former suit under
Order 34, Rule 5 of the CPC of 1908. But as I said before, the decree in the five suits on the bonds C to G had been passed when Sections 88
and 89 of the Transfer of Property Act were in force and I consider myself bound by the dictum of their Lordships of the Privy Council in Het Rant
v. Shadi Ram ILR (1918) All. 407 to hold that where a decree had been obtained against a mortgagor who had not lost the right of redemption
though the second mortgagee had not been made a party, the security itself became extinguished if an order absolute for sale had been made u/s
89 of Act IV of 1882. When the security itself that is, the mortgage document creating the mortgage charge becomes inoperative as security, it
follows that it could not be again sued upon as if it continued to have force as a mortgage bond securing Immovable property for payment of the
loan, that is, as if the '' security '' created under it had not become extinguished. I would therefore confirm the dismissal of the suit so far as it relates
to the claims made on Exhibits C to G though on a different ground from the grounds relied on by the lower court.
The next question is whether Exhibits A and B have both been discharged by payments. To deal intelligibly with this question, it is necessary to
enter into the following details. I shall first deal with Exhibit B. Exhibit B is dated 23rd March 1892 for Rs. 300 and provides for re-payment in six
months with interest at 1 1/8th per cent, per mensem and in default with interest at 1 1/8th per cent. per mensem compound interest with six
month''s rests. One of the properties mortgaged under Exhibit B is Kathirithundu or Peria Kathirithundu. This property was afterwards mortgaged
in May 1893 to one Sundararaja Aiyangar under Exhibits XVI for Rs. 150 and out of that money interest up to 14th October, 1893 was paid
towards Exhibit B as endorsed upon Exhibit B. The learned Subordinate Judge thought that besides this Rs. 150 another Rs. 150 had been paid
about that time to the plaintiffs by the first defendant. This finding of the payment of another Rs. 150 rests in my opinion on mere surmises and not
on any tangible evidence. Taking it therefore that only Rs. 150 was received by the plaintiffs in September 193, the Subordinate Judge considers
that the whole of that amount should have been credited in payment of the sum due under Ex. B, that is, Rs. 64 towards interest and Rs. 86
towards principal. The plaintiff however in his account, Exhibit G 1, has credited only Rs. 64 towards interest of Exh. B and the balance of Rs. 86
(along with some other amount) towards the interest of Exhibits A and C and towards sums due on promissory notes executed by the mortgagor.
At that time, that is in 1893, there were no pusine mortgagees to protect and 1 accept the plaintiff''s evidence that the balance of 86 Rupees was
credited towards the interest due on Exhibits A and C and towards the discharge of certain promissory notes with the consent of the mortgagor.
There was no specific contract between the mortgagor and the mortgagee that sums realised by the mortgagors through dealings with Kathirithundu
should be wholly applied in reduction of the amount due under Exhibit B so that the amount due under B became at once diminished by the amount
of Exhibit XVI as soon as Exhibit XVI was executed (as in the English case quoted by the respondent''s vakil Mr. K.V. Krishnaswami Aiyar).
There was nothing therefore to prevent the mortgagor and the mortgagee from appropriating the sum of Rs. 150 as they pleased at that time.
The next relevant transaction is the following:
The mortgagor''s rights in another property in Pallichanthai village hypothecated under Exhibits B and A were lost by his othi rights in that property
having been redeemed in June 1894 by the owner of that property on payment of Rs. 250. That sum was received by the plaintiffs. Instead of
crediting the whole of that amount towards B, the 1st plaintiff credited Rs. 60 out of it towards interest due on Exhibit A till 14-10-94, Rs. 42
towards interest on B till 14-10-94, Rs. 63 towards interest on C till 14-10-94 and the balance towards unsecured debts. But he was not entitled
to do so as it would affect the puisne mortgagee Ramaswami Aiyar, whose mortgage over the item i (and other properties) had come into
existence on 8th January 1894 (See Exhibit VIII). That puisne mortgagee''s rights are now vested in the 7th defendant and his heirs. It seems to me
a settled principle of law that a mortgagee over several items of properties, who is paid out of the proceeds obtained by the realization of one of his
securities cannot be allowed to appropriate the amount towards sums due to him on unsecured debts or on debts secured on other properties so
as to affect subsequent mortgagees, who have lent on the security of properties of the mortgagor. As said by Dr. Rash Behari Ghose at page 510
of his work "" There is a well settled rule that if the mortgagee received any money by means of or by virtue of the security, it must be applied in
reduction of the mortgage debt. Thus, if a mortgagee releases a portion of the premises to a purchaser of the equity of redemption of that portion,
the money paid for such release cannot be applied in discharge of other debts due to him from the mortgagor"". I therefore agree with the
Subordinate Judge that this Rs. 250 should be wholly credited towards Exhibit B. So appropriating it to the account of B, the mortgage account of
B stands thus: The principal alone was due on 14-10-93 and it is Rs. 300-0-0. Interest for six months at the original rate of 1 1/4 per cent. (the
enhanced rate of 1 1/4 being held penal as admitted by the conduct of both sides in the calculation of interest in the accounts) is Rs. 20-4-0; total
Rs. 320-4-0. Compound interest for six months till 14-10-94 is 21-9-11; total Rs. 341-13-11 paid on 24-6-94. Rs. 250 which with the interest
Rs. 10-5-0 up to 13-10-94 amounts to Rs. 260-5-0, the balance due on 14-10-94 is 81-9-0. This sum of Rs. 81-9-0 with compound interest up
to the date of this suit 22-1-12 comes to Rs. 477-8-o. But this calculation of the amount due under Exhibit B is made on the assumption that
notwithstanding the withdrawal of the suit 314 of 1906, plaintiffs are not barred from putting forward their claim on that document in this suit. I shall
deal with this question of law later on.
Coming to Exhibit A, the principal sum due under it on 14-10-93 was Rs. 500-0-0, interest till then having been paid up according to the
endorsement thereon. With compound interest at the original rate, the amount due on 14-10-94 was Rs. 786-12-2. Meanwhile, in December
1896 the 1st defendant sold the cocoanut tope at Manalur (see Exhibit 15) which along with the Madura house item 1 were hypothecated under
A. Plaintiffs on n-3-97 received Rs. 650 of the purchase money. Instead of crediting the whole of this Rs. 650 towards Exhibit A, the plaintiff has
in his plaint credited out of it the interest up to 12-7-98 due on the document A and credited the balance towards interest due on four other
documents B, C, I) and E. His statement in the plaint paragraphs 12 and 13 that endorsements have been made on all those documents by the 1st
defendant of the payments of interest out of this Rs. 650 on those documents themselves is inaccurate, at least to some extent as no such
endorsement is found on Ex. B. When the 1st defendant executed Exhibit F however in July 1898 some such appropriation of what had been
received long ago in December, 1896 by sale of Manalur tope seems to have been agreed upon between the plaintiff and the 1st defendant. For
the reasons already given, the whole of this sum of Rs. 650 obtained by sale of one of the securities mentioned in Exhibit 16. A ought to be
credited towards Exhibit A itself. Thus crediting Rs. 650 as paid on 11-3-1897 towards A and adding interest up to 13-10-97 Rs. 46-2-5, the
balance due on 14-10-97 under A is only Rs. 90-9-9. Calculating compound interest with yearly rests on that sum, the amount due on date of suit
would be Rs. 457-6-1 and on the date of next rest-day after this decree (14-10-1919) is Rs. 1096-7-7.
I shall next refer to the question whether the claim under Exhibit B is barred by the plaintiff''s having withdrawn the suit O.S. No. 314 of 1906
based on that bond. This is again a very difficult question which was elaborately argued. Order 23, Rule 1, of the CPC relates to withdrawal of
suits. So far as an unconditional withdrawal is concerned, it is of course wholly at the option of the plaintiff and the Court has nothing to do with it
except as regards providing for costs already incurred (See Order 23, Rule 1 Clause 1). It is only where he wants some permission that he has to
make an application under Clause 2. But the only permission contemplated under Clause 2 is permission to institute a fresh suit in respect of the
subject matter of the suit, or such part of the claim as is withdrawn or abandoned. The permission granted in suit O.S. No. 314 of 1906 seems to
have been not to institute a fresh suit but to consolidate the claim in that suit with the claim in suit O.S. No. 313 of 1906. Assuming that such a
permission ought not to have been granted, the order is not a nullity. See Tuljaram Row v. Gopala Aiyar (1910) 32 M.L.J. 434. And without
strictly following the permission, the plaintiffs could not be heard to say that the proper order which ought to have been passed was to have
allowed them to institute a fresh suit. The further argument on the plaintiffs'' side was to the effect that though the suit was withdrawn without liberty
to bring a fresh suit but with liberty only to consolidate the claim in the withdrawn suit with the claim in another suit, the penalty mentioned in Clause
3 of Order 23, Rule 1, namely that the plaintiff should be precluded from instituting a fresh suit in respect of such subject-matter, did not follow
because there was some sort of permission. I am unable to follow this argument that where the permission granted is not the permission referred to
in Sub-rule 2 (that is, is not the permission to institute a fresh suit), the plaintiff escapes the penalty of being precluded from instituting a fresh suit in
respect of such matter. I therefore hold that the claim under Exhibit B is barred by Order 23 of the Civil Procedure Code.
In the written statements of the defendants 2 and 3 (defendants 1,8,9,11, 13 and 16 having been exparte) no defence was raised as regards
the claims under A and B except the two, namely, (a) that the documents had been discharged by payments if appropriated in a proper manner;
and (b) that the claim on B was barred by its withdrawal. I have found that on the date of the suit Rs. 457 and odd was due under A, and Rs.
477-8-0 under B. So far as the claim under Exh. B is concerned, I have just now held that it is barred by the withdrawal of suit O.S. No. 314 of
1906. The plea of full discharge of Ex. A having been found against, it follows that a decree should be passed for the sum of Rs. 420 and
subsequent interest due on the claim under Ex. A in the usual form of a mortgage decree, the sum of Rs. 1096 and odd being due on 14-10-1919
and subsequent interest at 6 per cent, being calculated till 14-4-1920, the date fixed for redemption. No further interest will be allowed after 14-4-
1920.
The 4th defendant and some of the other defendants, however, contended generally that the claims under all their documents, were barred by
limitation. The second issue in the case raises that question of limitation. The learned Subordinate Judge held in para. 25 that the claim under none
of the documents was barred because the first defendant had on 30-1-1901 admitted in G (the bond of 30-1-1900) that he was liable for the
claims under Ex. A and B and all the other previous bonds. This suit was brought on 20-1-1912. Mr. K.V. Krishnaswami Aiyar for the
respondents contended (as he was entitled to support the Subordinate Judge''s dismissal of the suit on any ground decided against him in the
Lower Court), that the Subordinate Judge was wrong on the question of limitation as regards the bond A (which alone we need consider now) and
that the first defendant''s acknowledgment would not save limitation so far as the puisne mortgagees and the alienee (fourth defendant) are
concerned. In Krishna Chandra Saha v. Bhlmachandra Saha ILR (1905) Cal. 1077, Maclean, C.J. and Mittra, J. held that such an
acknowledgment would give the mortgagee a fresh start even against puisne mortgagees provided the mortgagor when making the
acknowledgment had a substantial interest in the mortgage contract. This case is quoted with approval by Benson and Sundara Aiyar, JJ. in
Velayudam Plllai v. Vythlingam Plllai (1912) 24 M.L.J. 66. Mr. Krishnaswamy Aiyar argued however that the difference in language between
Sections 19 and 20 of the Limitation Act was not given due weight in the Calcutta case and in the Madras case; in Section 19, the words are ''
acknowledgment signed by the party against whom such property or right is claimed'' or "" by some person through whom he derives title or
liability. "" In Section 20 the words are "" paid by the person liable to pay the debt"" "" by the debtor or by his agent. "" He therefore argued that while
payment of even one pie towards interest or part payment of one pie towards principal in the handwriting of the mortgagor would revive time
against the puisne mortgagee even a complete acknowledgment would bind only the mortgagor and not the puisne mortgagee if the latter is a party
against whom the mortgagee claims ""rights "" or ""property."" But in both the cases above cited, the mortgagor making the acknowledgment seems to
have been considered as included in the expression "" some person through whom he"" (the party sought to be charged, namely the puisne
mortgagee) "" derives title or liability"" found in Section 19, though the title of the puisne mortgagee might have been derived before the date of
acknowledgment provided however the mortgagor retained some substantial right in the properties at the date of the acknowledgment. Mr.
Krishnaswami Aiyar relied upon some English cases in support of his contention against the views enunciated in the above two cases, but I am not
inclined to follow those English cases especially as according to the Indian Act, acknowledgment is not merely an evidence of a new promise to
pay which it seems to be under the English Law. On the whole, I think (though not without hesitation) that a mortgagor whose interest in the
mortgaged property or liability under the mortgage contract had not wholly ceased to exist can make an acknowledgment of liability in favour of
the first mortgagee so as to bind the puisne mortgagees also.
Mr. Krishnaswami Aiyar who argued the respondent''s case with much resourcefulness and ability attempted to support the lower court''s
dismissal of the claim under Ex. A on the further ground that as the claim under A was not reserved by the plaintiffs when they obtained decrees for
sale of item No. 1 and other property in the five suits 142 to 146 of 1901 brought on the subsequent bonds, there were implied decisions in those
suits that the plaintiffs had not rights as mortgagees under either of the previous documents Exs. A and B and hence the claim under Exh. A is
barred by res judicata or some principles of law analogous thereto. In Subramanier v. Balasubrahmaner ILR (1915) Mad. 927. : 29 M.L.J. 195. I
approved (if I may respectfully say so) of the judgment of Beaman, J. in Dhindo Ramachandru v. Bhikaje ILR (1914) Bom. 38 The learned Judge
held that a mortgagee who had two mortgages of different dates on the same property, having sued upon the mortgage of the later date and having
had the property sold without reference to the prior mortgage, cannot afterwards bring a suit on the prior mortgage though the causes of action for
the two suits were distinct. ""This rule is not the result of Order 2, Rule 2 of the Code of Civil Procedure, but it depends upon the principle of res
judicata."" In the present case, however, no sale has been effected under any of the decrees in the five suits and though the plaintiffs cannot claim
priority for the mortgage under Ex. 21. A over the five mortgages on which they have obtained decrees for sale that does not preclude them from
suing on Ex. A as an independent cause of action so long as the property remains largely charged under that mortgage, that is, so long as it had not
been sold away in such a manner in execution of any of the other decrees as to extinguish their mortgage rights under Ex. A also. Such an
extinguishment will take place if and when item No. 1 is sold under any of the five decrees in the suits in which they had not reserved their rights
under Ex. A but till then, it is not extinguished and till then they could maintain the suit on their distinct causes of action on Ex. A. v
In the result, in modification of the lower court''s decree dismissing the whole suit, there will be a mortgage decree stipulating that if Rs. 1096-
7-7 and interest at six per cent, till the date fixed by this decree for redemption, namely 14-4-1920 be not paid into Court a final decree for sale of
item No. 1 shall be passed on the application of the plaintiffs. As the appellants have substantially failed, they should pay one set of costs in this
appeal, to the principal contesting respondents, namely, 7th, 18th, 19th and 20th respondents and bear their own. Interest shall as said before
cease to run from 14-4-1920. The plaintiffs and other defendants will bear their own costs in this Court. The Lower Court''s decree as to costs
incurred in that Court is confirmed.
Burn, J.
I agree.