1940 (11) TMI 37 - HC - Indian Laws

Summary

Issues Involved:
1. Consideration of the mortgage deed.
2. Abandonment of the mortgage transaction.
3. Bar under Order 2, Rule 2, and Section 11, Civil Procedure Code (CPC).

Detailed Analysis:

1. Consideration of the Mortgage Deed:
The plaintiff, Siraj-ud-Din, filed a suit for the recovery of Rs. 12,000 based on a mortgage deed executed by Shuja-ud-Din on 5th August 1925. The principal sum secured was Rs. 8000 with interest. The plaintiff claimed Rs. 4000 as interest, reducing the rate to Re. 1 per cent per mensem. The trial court granted a preliminary decree under Order 34, Rule 4, Civil P.C., but inaccurately declared the total amount due as Rs. 10,000. The appeal by the defendant, Shuja-ud-Din, contested the consideration of the mortgage deed, denying all items except Rs. 500 received before the sub-registrar. The court examined the prior dealings, including an unregistered mortgage deed executed on 13th July 1925 and subsequent transactions on 5th August 1925, involving a sale deed and the mortgage deed in question. The court found consideration for only Rs. 3000 out of the total Rs. 8000, consisting of Rs. 500 admitted payment and Rs. 2500 paid to Badar-ud-Din Qureshi.

2. Abandonment of the Mortgage Transaction:
The defendant argued that the plaintiff had abandoned the mortgage transaction by denying the defendant's title in a previous suit, rendering the mortgage dead. The previous suit, filed on 18th July 1931, sought a simple money decree for Rs. 10,000, claiming the mortgage was invalid due to the defendant's lack of title. The trial court dismissed the suit, and the High Court upheld this decision, interpreting the plaint as based on failure of consideration under Section 65, Contract Act, not on the mortgage deed. The court concluded that the plaintiff's choice to sue for a simple money decree did not constitute abandonment of the mortgage. The plaintiff was misled about the title and chose an alternative form of suit, which did not bar the present suit on the mortgage deed.

3. Bar under Order 2, Rule 2, and Section 11, Civil P.C.:
The defendant contended that the present suit was barred under Order 2, Rule 2, and Section 11, Civil P.C., arguing that the plaintiff should have included the claim on the mortgage deed in the previous suit. The court held that the cause of action in the previous suit was different, based on failure of consideration, not on the mortgage deed. Therefore, Clause (3) of Order 2, Rule 2, did not apply. Additionally, Explanation (iv) of Section 11, Civil P.C., did not bar the suit, as the plaintiff was not bound to include the claim on the mortgage deed in the previous suit. The court rejected the contention that the present suit was barred by the previous litigation.

Conclusion:
The court reduced the amount of the decree to Rs. 6540, payable on 1st May 1941, with future interest at 6 per cent per annum. The direction for a personal decree against the mortgagor and the surplus payment to subsequent transferees were set aside. The appeal was accepted to this extent, and parties were left to bear their own costs throughout.