RSA No. 2537 of 2006(O&M) 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH RSA No. 2537 of 2006(O&M) Date of Decision: March 03 , 2010 Haryana Financial Corporation and another ...... Appellants Versus Smt.Phulli and others ...... Respondents Coram: Hon'ble Mr. Justice Ajay Tewari Present: Mr.Kamal Sehgal, Advocate for the appellants. Mr. Arun Jain, Senior Advocate with Mr.Jaivir Chandail, Advocate for the respondents. **** 1. Whether Reporters of local papers may be allowed to see the judgment? 2. To be referred to the Reporters or not? 3. Whether the judgment should be reported in the Digest? Ajay Tewari, J. This appeal has been filed against that portion of the judgment of the learned Lower Appellate Court whereby relief of declaration has been granted to respondents No.4, 5 and 6. Learned trial Court decreed the suit of respondents No.1, 2 and 3 to the effect that the mortgage created by respondents No.1, 2 and 3 in favour of the appellants was fraudulent in as much as they being co-sharers in the property, had never accepted to mortgage the property in dispute. In the reply filed by respondents No. 4, 5 and 6 the plea was advanced that even these respondents had never signed or thumb marked the mortgage deed. The trial Court decreed the suit of the respondents No.1, 2 and 3. The appeal was filed by the appellants and in the RSA No. 2537 of 2006(O&M) 2 Appellate Order it was held that not only respondents No. 1, 2 and 3 even respondents No.4, 5 and 6 have never signed/thumb marked the document creating mortgage and under Order 41 Rule 33 CPC it was declared that the appellants were not entitled to realise the amount of loan by sale of the property in dispute. The following questions have been proposed:- i) Whether the courts below have mis-appreciated the evidence led by the appellant? ii)Whether mere deposit of title deeds is sufficient to create equitable mortgage? iii)Whether the appellate court can grant relied under Order 41 Rule 33 to a defendant in a suit against whom no relief was prayed by the plaintiff and who had prayed for dismissal of the suit? At the outset it must be noticed there is no attack to the finding that none of the respondents No. 1 to 6 ever signed /thumb marked the document in question. The only plea taken is that this relief under Order 41 Rule 33 could not be granted to these respondents since they were proforma defendants. To this learned counsel for the respondents has argued that when the respondents No.4 to 6 filed their own suit, the appellants took the objection that they had already taken the pleas in the suit filed by respondents No. 1 to 3 and prayed for rejection of the plaint. As per learned Senior Advocate it is open to the appellants to show that the relief could not have been granted to the respondents. Learned counsel for the appellants further argued that for creating an equitable mortgage deposit of title deeds is to be seen and not whether the respondents did or did not sign the document in question. In my opinion it is not the mere mechanical act of deposit of title deeds that would give rise to an equitable mortgage. It must be shown that the title RSA No. 2537 of 2006(O&M) 3 deeds were deposited with the intention of creating a mortgage. In the present case both the Courts have come to a concurrent finding of fact that the document by which the title deeds were deposited did not bear the signatures/thumb impression of respondents No.1 to 6. In the circumstances the essential ingredient viz. 'intention to mortgage' is conspicuously missing. As regards question No. (iii) in this regard it would be appropriate to reproduce order 41 Rule 33 CPC which is as under:- “Power of Court of Appeal – The Appellate court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further or other decree or order as the case may require, and this power may be exercised by the court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have filed any appeal or objection [and may, where there have been decrees in cross- suits or where two or more decrees are passed in out suit, be exercised in respect of all or any of the decrees, although an appeal may not have been filed against such decrees]: [Provided that the Appellate Court shall not make any order under section 35A, in pursuance of any objection on which the Court from whose decree the appeal is preferred has omitted or refused t make such order.] A bare perusal of the provision reveals that there is no such limitation on the power of the Court as is sought to be canvassed by learned counsel for the appellants in the said question. In Shanti evi v.Nand RSA No. 2537 of 2006(O&M) 4 Kishore etc. reported as 2003(4) RCR(Civil) 648it has been held as under:- “11. A perusal of Rule 33 of the Order 41 of the Code makes it evident that wide powers have been conferred on the Appellate Court to pass any decree which in law ought to have been passed and which in fact have not been passed by the Subordinate Courts. The Appellate Court may pass a decree or an order which would advance the interest of justice. The afore-mentioned provision came up for consideration before the Supreme Court in the case of Giani Ram v. Ramji Lal, AIR 1969 SC 1144. While interpreting the expression “which ought to have been passed”, their Lordships observed as under : “The expression “which ought to have been passed” means “which ought in law to have been passed”. If the Appellate court is of the view that any decree which ought in law to have been passed,but was in fact not passed by the subordinate Court,if may pass or make such further or other decree or order as the justice of the case may require.” The aforementioned interpretation has also been accepted by the Supreme Court in Kok singh v. Deokabai, AIR 1976 SC 634 wherein the argument similar to the one raised by the counsel for the plaintiff-appellant, in the instant appeal, was rejected by the Court in the following words: “The second point raised by the appellant was that the respondent did not appeal from the decree of the trial court negativing her claim in the suit for a charge on the property. It was contended that the High court was wrong in granting a decree for encroachment of the charge as the decree of the trial Court became final so far RSA No. 2537 of 2006(O&M) 5 as the respondent was concerned as she did not file any appeal therefrom. We are unable to accept this contention. Under Order 41, Rule 33 of the Civil P.C. the High Court was competent to pass a decree for the enforcement of the charge in favour of the respondent notwithstanding the fact that the respondent did not file any appeal from the decree.” A reference may also be made to the views of the Constitution Bench of the Supreme Court expressed in the case of Panna Lal v. State of Bombay, AIR 1963 SC 1516. It is apposite to reproduce paras 12 and 18 of the judgment. “Even a bare reading of O.41 Rule 33 is significant to convince any one that the wide wording, was intended to empower the appellate court to make whatever order it thinks fit,not only as between the appellant and the respondent but also as between a respondent and a respondent. It empowers the appellate Court not only to give or refuse relief to the appellant by allowing or dismissing the appeal but also to give such other relief to any of the respondents as “the case may require”. In the present case, if there was no impediment in law the High court could, therefore, though allowing the appeal of the State by dismissing the plaintiff's suits against it, give the plaintiff a decree against any or all the other defendants who were parties to the appeal as respondents. While the very words of the section make this position abundantly clear the illustration puts the position beyond argument.”(emphasis supplied). xx xx xx xx xx xx xx xx RSA No. 2537 of 2006(O&M) 6 “In our opinion, the view that has now been accepted by all the High courts that O.41 R.22 permits as a general rule, a respondent to prefer an objection directed only against the appellant and it is only in exceptional cases, such as when the relief sought against the appellant in such an objection is intermixed with the relief granted to the other respondents, so that the relief against the appellant cannot be granted without the question being re-opened between the objecting respondent and other respondents, that an objection under O.41 Rule 22 can be directed against the other respondents, is correct. Whatever may have been the position under the old S. 561, the use of the word “cross-objection” in O.41 R.22 expresses unmistakably the intention of the legislature that the objection has to be directed against the appellant.” At one stage it had been proposed that the suit filed by the respondents No. 4 to 6 should be proceeded in case the appellants agree that they would not take any objection regarding maintainability. It must be stated that Sh. Kamal Sehgal has accepted the proposal that in case the suit filed by respondents No. 4 to 6 is revived no objection regarding maintainability would be taken by the appellants. However, learned Senior Advocate for the respondents has argued that in the present case once on facts it is upheld that even respondents No. 4 to 6 did not append their signatures on the document creating the title deed it would be highly inequitable to again force the respondents to undergo further litigation. I am inclined to agree with learned counsel for the respondents. As mentioned above, no ground has been raised challenging the finding that RSA No. 2537 of 2006(O&M) 7 even respondents No. 4 to 6 did not execute the document by which the title deed was deposited. In the circumstances it would be unfair to subject them to further trial. Keeping in view the above exposition of law even question No. (iii) has to be answered against the appellant. Consequently holding all the questions proposed against the appellant, this appeal as well as the application for stay are dismissed. No costs. (AJAY TEWARI) JUDGE March 03, 2010 sunita