; Redemption of Mortgage-Attaching Creditor whether entitled to redeem Mortgage on attached property-Civil Procedure Code (Act X of 1877), sections 276, 282, 295. An attaching creditor, as such, has no right to redeem a mortgage upon the property attached by him. THIS HIS was a suit by an attaching creditor, against his judgment-debtor, to redeem a mortgage upon his house which the plaintiff had attached in execution of a decree. The suit came on for settlement of issues on the 7th July. Mr. Justice WILSON took time to consider the matter, and on the 21st July delivered the following judgment : The plaintiff obtained a decree against one Kisto Chunder Chowdry, and in execution of that decree he attached a house of his judgment-debtor. The defendants held a mortgage on the house. The plaintiff in this suit claims to redeem that mortgage. The case came on for settlement of issues. The first question that arises is, whether an attaching creditor is entitled, as such, to redeem a mortgage subsisting prior to his attachment. If this question be answered in the negative, it is unnecessary to consider any of the other questions of law or of fact which have been raised. The position of an attaching creditor, and his rights with respect to the land, are dependent entirely upon certain sections of the Civil Procedure Code. The governing section is 276:-" When an attachment has been made by actual seizure, or by written order, duly intimated and made kuown in manner aforesaid, any private alienation of the property attached, whether by sale, gift, mortgage or otherwise, and any payment of the debt or dividend, or a delivery of VOL. VII. 26 1880 SOOBUL CHUNDER v. NETYE CHURN the share to the judgment-debtor during the continuance of the attachment, shall be void as against all claims enforceable under the attachment." The attaching creditor may follow up his attachment by sale, and in that case he and all other creditors who obtain orders of Judgment. attachment before realization will share the proceeds, rateably.— Section 295. Under English law, as a general rule, any person interested in the equity of redemption may redeem. The interest may be limited in time-as an estate for life-or perpetual. It may be limited to a portion of the land, or affect the whole of it. The person so interested is entitled to redeem, subject of course to the equities of all other persons interested-Pearce vs. Morris, L. R., 5 Ch., 227. I do not think that the interest of an attachingcreditor is an interest at all closely similar to those which have been held to give a right to redeem. There is no analogy between the position of an attaching creditor here, and that of an execution creditor in England. Under English law, in the case of a legal interest in real property, the creditor takes under his elegit an actual legal estate in the land as tenant by elegit, and receives satisfaction out of the rents and profits. An equity of redemption being not a legal but an equitable interest, is not affected by an elegit-and the intervention of a Court of Equity is requisite to make it available in execution. But when an order of Court has been obtained, the interest taken by the execution creditor is closely analogous to that of the tenant by elegit. In this country the attaching creditor neither has, nor can ever, as such, acquire any beneficial interest in the property attached. But the Code has not left the matter to rest upon general principles. It has dealt expressly with the attaching creditor's rights in relation to mortgages. And, an examination of the clauses bearing upon the matter makes it, I think, tolerably clear that the Legislature did not intend to give an attaching creditor the right to redeem a mortgage. Mortgages are dealt with in two sections. Section 282 is one of a group of sections which deal with claims raised adversely to the attaching creditor. It says: "If the Court is satisfied that the property is subject to a mortgage or lien in favour of some persou not in possession, and thinks fit to continue the attachment, it may do so, subject to such mortgage or lien." If it had been intended that the attaching creditor should have the alternative right to redeem the mortgage, it must, I think, have been so stated. Mortgages are again dealt with in section 295-a section whose subject is the sale of properties attached. It says:-" Provided that, when any property is sold subject to a mortgage or charge, the mortgagee or incumbrancer shall not, as such, be entitled to share in any surplus arising from such sale." "Provided also that when any property liable to be sold in execution of a decree is subject to a mortgage or charge, the Court may, with the assent of the mortgagee or incumbrancer, order that the property be sold free from the mortgage or charge giving to the mortgagee or incumbrancer the same right against the proceeds of the sale as he had against the property sold." Here again, if it were intended that the attaching creditor should have a right to redeem, I think it must have been so said. The first paragraph of the same section confirms this view. It prescribes how the proceeds of an execution are to be applied. -"Whenever assets are realized by sale or otherwise in execution of a decree, and more persons than one have, prior to the realization, applied to the Court by which such assets are held for execution of decrees for money against the same judgmentdebtor and have not obtained satisfaction thereof, the assets, after deducting the costs of the realization, shall be divided rateably among all such persons." It cannot be supposed that the attaching creditor is to be at liberty to take an assignment of the mortgage, and then sell subject to the mortgage, retaining the mortgage for his own benefit. But if he is to sell, the property discharged from the mortgage, how is he to get credit for what he has paid to discharge it. It would, I think, be a strained construction of the words "costs of realization" occurring in the contest in which they do to make them include a mortgage debt paid off. I am of opinion that an attaching creditor has not, as such, any right to redeem a mortgage. This suit will, therefore, be dismissed with costs. 1880 ང་ SOOBUL CHUNDER PAUL v. BYSACK. Judgment. Usury-Promissory note--Hindu Law, Rate of interest under-Interest under By Hindu Law arrears of interest more than sufficient to double the principal sum are not recoverable, section 10 of the Contract Act, notwithstanding. THIS HIS was a suit upon a promissory note, whereby the defendant promised to pay to the plaintiff the sum of Rs. 400 with interest at the rate of 5 per cent. per meusem. The amount claimed for principal and interest up to the date of the institution of the suit was Rs. 1,101-5-4. Both parties were Hindus. Trevelyan, for the Plaintiff, contended that the whole amount claimed was recoverable, and he relied on Section 10 of the Contract Act as having altered the rule of Hindu Law as to the amount of arrears of interest recoverable. No one appeared for the Defendant. The judgment of the Court (1) was as follows :— WILSON, J. WILSON, J. :— This suit, which was undefended, was upon a promissory note. The note was for Rs. 400, was dated the 4th June 1877, was payable on demand, and bore interest at 5 per cent. monthly. The only question was, what amount was recoverable in respect of interest. The parties are Hindus, and it is clear that their rights are governed by the Hindu Law, unless there be some statute providing a different rule. I think it is also well settled that by Hindu Law arrears of interest, more than sufficient to double the debt, are not re (1) WILSON, J. 1880 AUDHICARY coverable; Menu, Chapter VIII, 151; Colebrooke's Dig., Book 1, Has then any statute altered the Law upon the point to be applied to Hindus in this Court? The Bombay cases above referred to decide that Act XXVIII of 1855, the Act for the repeal of the Usury Laws, has no such effect. See also per PEACOCK, C.J., in Ram Lal Mookerjee vs. Haran Chundra Dhar, 3 Beng. L. R. (O. C.) at p. 134; and per PHEAR, J., in the case of Mia Khan vs. Bibi Bibijan, 5 B. L. R., 500. It was, however, argued that the Contract Act had altered the law upon the point in question; and section 10 of the Act was referred to. That section says:-" All agreements are contracts if they are made by the free consent of parties competent to contract for a lawful consideration, and with a lawful object, and are not hereby expressly declared to be void." This section does not, however, in my judgment make any thing lawful which was otherwise unlawful. Moreover I doubt whether the rule of Hindu Law in question has properly any thing to do with the legality or illegality of any contract. I think it is rather a rule of limitation. As therefore no statutory provision has been pointed out controlling the Hindu Law in the matter, I am, I think, bound to apply that law to the present case. And the decree will be for the principal and a sum for interest equal to the principal, in all Rs. 800, without costs. v. DUTT. Judgment. WILSON, J. |