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Second Appeal No. 220 of 1953 decided on grid May, 1955, from the decree of the Court of Malik Muhammad Aslam Khan, District Judge, Jhelum, dated the 23rd day of July 1953, affirming that of Sh. Faruq Ahmad, Senior Civil Judge, Jhelum, dated the 5th May, 1952.
S. 55 (4) (b) ‑Part of sale price left with vendee to be paid to a previous mortgagee, remaining unpaid‑‑Amount unpaid as Part of consi deration of sale and is a charge on property sold.
Rs. 2,676 were left by the vendor with the vendee to be paid over to a previous mortgagee Amount due to the mort gagee was found to be Rs. 1,484, and only that much was paid to the mortgagee. Held the balance Rs. 1,192 was a part of the consideration for sale and was a charge on the property sold to vendee.
Abdulla Beary v. Mammali Beary I L R 33 Mad. 446 ref.
Suit for‑Court may make it a condition of decree that defendant has a charge on property the subject of declaration.
The vendor of a piece of land left Rs. 2,676 out of the sale price with the vendee to be paid over to a previous mort gagee. It was found that only Rs. 1,484 were due to the mortgagee which were accordingly paid. Thereupon the vendor asserted a claim upon the land for the balance of Rs. 1,192. The heirs of the vendee lodged a suit for declara tion of title in reply to which the vendor defendant raised the plea that the plaintiffs were bound to pay him Rs. 1,192. The trial Court granted the declaration that the plaintiffs are owners of the land provided they pay Rs. 1,192 to the defen dant. Only one plaintiffs appealed. The District Judge dismissed plaintiff's appeal. On second appeal it was con tended for appellant that a declaration of title cannot be accompanied by any declaration in favour of the defendants.
Held the plaintiffs are owners of the land‑ in suit but they hold the land subject to a charge in favour of the defendant No. 1 for Rs. 1,192.
The relief for declaration is an equitable relief and the Court granting it was to give effect to all the equities arising in favour of the parties before it.
Khalil‑ud‑Din v. Sri Ram A I R 1934 All. 176 and Mst. Komal v. Gur Charan Prasad A I R 1938 All. 242 rel.
Phool Chand v. Mst. Mantia A I R 1938 All. 182 and Manak Chand v. Madan Lal A I R 1936 Lah. 943 distinguished.
Sh. Muhammad Shafi and Ch. Feroze Din, for Appellant.
Mirza Muhammad Abbas, for Respondents.
‑The facts of this case, as found by the lower appellate Court, are these : Muhammad Sarwar Khan defendant No. 1, who was the owner of the land, had mortgaged it to the defendants Nos. 2 and 3, Fazal Karim and Mst. Fatima. The mortgagees brought a suit against the mortgagor on the basis of their mortgage and claimed the amount of Rs. 2,676. The mortgagor disputed his liability for the amount claimed and the matter ultimately came up to this Court in appeal. While the appeal was pending, the defendant No. 1 sold the land in favour of Barkat Ullah, the father of the plaintiffs, for Rs. 7,760, by means of a registered sale deed dated the 16th of April 1946. Out of the sale price, Rs. 5,084 were paid in cash to the defendant No. 1 and the balance, Rs. 2,676 was left with the vendee for payment to the mortgagees. It was ultimately held by this Court that the mortgagees were entitled to only Rs. 1,484 which amount was accordingly paid to them by the vendee. After the decision by this Court of the mortgagees' suit there was a scramble for possession of the mortgaged property between the vendee and the vendor which led to the present suit by the former for a declaration of his title to the property in suit.
One of the pleas raised by the vendor to the present suit was that according to the terms of the sale deed the vendee was bound to pay him Rs. 1,192, the difference between the amount left with him for redeeming the mortgage and the amount of Rs. 1,484 actually paid by him for that purpose. The learned lower appellate Court, in agreement with the trial Court, has found it proved "beyond doubt that Barkat Ullah had agreed to refund to the defendant the balance of the amount that may be left with him after making payment to the mortgagees." On this finding the trial Court granted the plaintiffs a declaration to the effect that "they are owners of the land in dispute provided they pay .Rs 1192 to the defendant No. 1." One of the plaintiffs, Subedar Muhammad Yusuf, appealed to the District Judge, Jhelum; and having failed there has now come up to this Court in second appeal.
The only point argued before me by the appellant's learned counsel is that his client was entitled to an uncondi tional declaration of his title. It has not been held‑and indeed, in the circumstances of this case, it could not have been held‑that the title to the property did not pass to the plaintiffs. The title which passes to a vendee on the execu tion of a sale deed does not remain incomplete until the payment of the balance, if any, of the sale consideration. The plaintiffs are, therefore, clearly entitled to an uncondi tional declaration of their title. The question, however, still remains whether, in the circumstances of this case, the Court cannot, at the same time, declare that the property in their names is subject to a charge to the extent of the unpaid sale consideration, namely Rs. 1,192.
It was contended by the appellant's learned counsel on the strength of a ruling of the Madras High Court in Abdullah Beary v. Mammali Beary (I L R 33 Mad. 446) that the amount of Rs. 1,192 was not a charge on the property purchased by the appellant. It is clear from the following headnote of the report that the proposition contended for the appellant was not laid down in that case :‑
"When a purchaser of immovable property covenants, in consideration of the transfer of such property to him, to discharge certain liabilities of the seller and further stipulates that, upon his failure to do so, he shall be liable for any damages resulting from such default
Held, that upon breach of such a covenant the seller is entitled to be compensated in damages but has no charge upon the property in the hands of the purchaser under section 55, clause 4 (b) of Act IV of 1882."
In this case a part of the purchase‑money was left with the vendee with an express stipulation in the sale deed itself, as held by both the lower Courts, that if anything less was found payable to the mortgagees the difference would be paid to the vendor. It is thus a part of the sale‑consideration itself which remains in the hands of the vendee and is now being claimed by the vendor. That the purchase‑money, or any unpaid portion of it, is charge on the property in the hands of the vendee is clear from the following passage in the Madras ruling :‑
"The Courts below have treated the suit as one for the purchaser‑money. They have held the plaintiff to be entitled to a charge upon the property in the hands of the buyer under section 55, clause 4 (b) of the Transfer of Pro party Act. If this were correct, the plaintiff's suit would of course be in time under article 132 of the Limitation Act."
I, therefore, reject the appellant's contention and hold that the amount of Rs. 1,192 is a charge upon the property in dispute.
It was next contended for the appellant that a declaration of title cannot be accompanied by any declaration in favour of the defendants. I am unable to accept this broad proposition. The relief for declaration is an equitable relief and the Court granting it has to give effect to all the equities arising, It was held by the in favour of the parties before it. Allahabad High Court in Khalil‑ud‑Din v. Sri Ram (A I R 1934 All. 176) that the granting of a relief by declaration is discretionary and it is open to Court in a suit for declaration that certain property is waqf and hence not liable to attachment to, grant the declaration asked for subject to conditions consistent with the terms of the deed of waqf. In another case, namely Mst. Komal v. Gur Charan Prasad (A I R 1938 All. 242) that Court again laid down as follows :‑
"It is quite true that Courts of equity are not restrained in the same way in which Courts of common law are restrained and the former Courts can adjust their decrees so as to meet certain exigencies, and they may vary, qualify, restrain and model their remedy in order to control the equities and substantial rights of all the parties, . . . ."
In the peculiar circumstances of that case, however, their Lordships did not find any equity in favour of the defendant.
The appellant has strongly relied on the rulings in Phool Chand v. Mst. Mantia (A I R 1938 All. 182) and Manak Chand v. Madan Lal (A I R 1936 Lah. 943.). Both these rulings, however, are clearly distingush able inasmuch as they only lay down that in a suit for mere declaration the plaintiff: cannot be put on terms, that is to say, he cannot be ordered to do anything‑which is entirely different from making a declaration in favour of the defendant. The case of Phool Chand v. Mst, Mafia was considered by the Allahabad High Court in the subsequent case of Mst. Komal v. Gur Charan Prasad and was not considered by their Lordships as contrary to the proposition laid down by them in that case.
In this case it is apparent that the plaintiffs have wrong fully tried to keep back a part of the purchase‑money and have gone to the length of‑ even denying their liability for it. Their denial, after a full investigation, has been found by the lower Courts to be false; and it would be unfair to the vendor to allow them to reagitate the matter in a subsequent suit for the amount. They have come to Court asking for an equitable relief and the Court cannot grant it to them without, at the same time, doing the same kind of justice to the defendants. I, therefore, modify the decree of the lower Courts and order that the following declaration be substituted for the declaration granted by the lower Courts :‑
"The plaintiffs are owners of the land in suit but they I hold the land subject to a charge in favour of the defendant No. 1 for Rs. 1,192 and interest thereon at the rate of six per cent. per annum from the date they redeemed the mortgage on that property in favour of the defendants No. 2 and 3."
I accordingly allow the appeal in part to the extent indicated above. As, however, the appellant has failed substantially. I order that he shall pay the respondents Nos. 1 to 3 their costs in this Court.
A. H. Appeal partly allowed.
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