Report No. 144
Clarification is needed on the point discussed above. The Supreme Court Judgment1 of 1958 indirectly lends support to the wider view. In our opinion, the wider view should be codified as it is desirable that a provision of the nature under discussion should be comprehensive and should be available to juridical persons.
1. Nagpur Electric Light and Power Co. v. Pathirao, AIR 1958 SC 658.
9.1.10. As a matter of legislative policy, it does not appear proper that artificial persons should be deprived of the benefit of Order 33, rule 1. Even if corporations may not usually need it, there may be cases where other juristic persons-such as a deity-may have to take recourse to this provision. It is, therefore, suggested that a rule may be added at the end of Order 33, to provide as under:
"The provisions of this Order shall apply to persons other than human beings, with such modifications as may be appropriate to facilitate such application."
9.2. Order 33, rule 1, Clause (a), Explanation I
9.2.1. Under Order 33, rule 1 a suit may be instituted by an indigent person subject to the provisions of the Order. Explanation I to clause (a) of the rule provides as under:-
"A person is an indigent person-
(a) if he is not possessed of sufficient means (other than property exempt from attachment in execution of a decree and the subject-matter of the suit) to enable him to pay the fee prescribed by law for the plaint in the suit."
9.2.2. Question for consideration-The Explanation to Order 33, rule 1, inter alia, stresses the element of "possession". A question has arisen whether a mortgagor who has mortgaged his property, can be said to be "possessed" of the property.
9.2.3. There is also an exclusion, by virtue of the Explanation, for the subject-matter of the suit. A conflict of decisions has arisen on the question whether the mortgagor's equity of redemption can be said to be "subject-matter" of the suit. There is some obscurity also, on the question whether such equity can be said to be "possessed" by the mortgagor.
9.2.4. The High Court of Calcutta1 has held that in a suit for the enforcement of a mortgage filed by mortgagee, the equity of redemption is not subject-matter of suit. No doubt, as a result of the decree for sale, the mortgagor's equity of redemption would be lost. But the subject-matter of the suit is only the money claimed by the mortgagee which is charged on the immovable properties that are mortgaged.
1. Suhodh Chandra Nag v. K.L. Bank, AIR 1941 Cal 659 (660, 661) (R.C. Mitter & Khandar, JJ.).
9.2.5. According to the Patna High Court also1 the equity of redemption cannot be excluded where the mortgagee sues for enforcement of the mortgage.
1. Durga Prasad v. Srinivas Sureka, AIR 1930 Pat 368.
9.2.6. However according to the High Court of Andhra Pradesh, in the mortgagee's suits, such equity must be excluded.1 The High Court agreed with the Madras view on the subject2 and held, that even though the mortgagor was in possession of the mortgaged house, yet, as it had already been the subject-matter of a preliminary decree, in favour of the mortgagee (against which decree, the mortgagor was now seeking permission to appeal as an indigent), "if it is considered to be the subject-matter of the suit, then the respondent (mortgagor) would be under heavy pressure, either to part with the property or to further encumber the property at disadvantageous terms to secure the court fee.
Under the circumstances, I am of the view that a broad construction is called for, in construing the words " subject-matter of the suit" and, if so construed , I am of further view that the house subject of the mortgage should be exempt from the subject-matter of suit, as provided under Explanation 1(a) of rule 1 of Order 33".
1. Sreeramulu v. M. Adinarayan Rao, AIR 1985 AP 62 (64) (Ramaswamy, J.).
2. For the Madras cases, see infra.
9.2.7. What would be the position in redemption suits? A view (in favour of exclusion) has been taken in two Madras cases, relating to suits for redemption.1-2
1. Manicka v. Narayanaswamy, AIR 1933 Mad 679 (Cornish, J.).
2. Devaki v Rajagopal, AIR 1956 Mad 628 (629) (Basheer Ahmed Sayed, J.).
9.2.8. But the Allahabad view on the subject is to the contrary, holding that even in a redemption suit, the equity of redemption must be included in calculating the means of the applicant for indigent status.1
1. Kapil Deo Singh v. Ram Rikha Singh, 1911 ILR 33 All 237.
9.2.9. Thus, in this situation, there is a conflict between Allahabad and Madras. It may also be mentioned that in the Andhra Pradesh case of 1985 (though it was a suit by the mortgagee), the High Court expressly expressed1 its agreement with the two Madras cases which were concerned with suit by the mortgagor. The position has become more complicated by reason of the fact that in a Calcutta case2 (which itself was a suit for enforcement of mortgage), the court observed, with reference to the Allahabad ruling,3 as under:-
"But we does not wish to place much reliance upon the decision of the Allahabad High Court, reported in 33 All 237, for the reason that in that case, the suit was not a suit for enforcement of the mortgage, but it was a suit for redemption. It may be possible to take the view that in a suit for redemption is the subject-matter of the suit. But we may point out that, in spite of such a contention, the Allahabad High Court took the view that in considering the application to sue in forma pauperis in a suit for redemption, the value of the equity of redemption will have to be taken by the court in considering the question of the ability of the applicant to pay the requisite court fees".
1. Sreeramulu v. Adinarayana, AIR 1985 AP 62 (65), para. 7.
2. Subodh Chandra v. K.L. Bank, AIR 1941 Cal 659 (660).
3. Kapil Deo v. Ram Rikha Singh, 1911 ILR 33 All 237.