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PETITIONER: GYARSI RAI AND OTHERS

       Vs.

RESPONDENT: DHANSUKH LAL AND OTHERS

DATE OF JUDGMENT: 18/11/1964

BENCH: AYYANGAR, N. RAJAGOPALA BENCH: AYYANGAR, N. RAJAGOPALA SUBBARAO, K. DAYAL, RAGHUBAR

CITATION:  1964 AIR 1055            1965 SCR  (1) 154

ACT: Mortgage-Suit  for enforcement of Mortgage with  possession- Preliminary  decree  declaring  amount  due  under  mortgage without asking mortgagee to account for  profits-Mortgagee’s liability  to account for Period before preliminary  decree, and after decree-Code of Civil Procedure (Act 5 of 1908,  0. 34,  rr. 4 & 2-Transfer of Property Act,  s.  76(h)-Estoppel Conditions to be satisfied.

HEADNOTE: A mortgagee in possession of the mortgaged property filed  a suit for enforcement Of the mortgage.  As provided in  0-34, rr.  4 and 2 the trial court framed a preliminary decree  in Form  No. 5A of the Appendix D to the First Schedule of  the Code of Civil Procedure declaring the amount ,due under  the mortgage.  This was done without debiting the profits of the property   realised   by  the  mortgagee   in   the   manner contemplated  by s. 76 Transfer of Property Act.  After  the decree  was passed the mortgagors prayed that the  mortgagee be asked to render accounts.  Their application was rejected by the Trial Court, but the High Court in revision  remanded the case and directed the trial court to declare the  amount due  under  the  mortgage after  taking  accounts  from  the mortgagee.   The  mortgagee’s  legal  representatives   (the present appellants) appealed to the Supreme Court by special leave. The  appellants contended that since the preliminary  decree had  finally determined the rights of the parties  no  claim for  subsequent  accounting could  arise.   The  respondents (mortgagors) on the other hand contended that the appellants had  withdrawn  the  amount  deposited  in  court  in   part satisfaction  of the decree after having given an  assurance that  they  would  render  accounts  of  the  profits,   and therefore  the  appellants were stopped from  denying  their liability to account. HELD  : (i) In a suit on a mortgage for sale the  court  may either  order an account to be taken of what is due  to  the plaintiff  at the date of the preliminary decree, or it  may declare the amount so due on that date.  In the latter  case the decree will be made in Form No. 5A in Appendix D to  the First  Schedule.  In a case where a decree is made in  !Form

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No.  5A it is the duty of the Court to ascertain the  amount due to the mortgagee at the date of the preliminary  decree. The  amount  due cannot be declared unless the  net  profits realised by the mortgagee from the property are ascertained. ’Me  ascertainment of the net profits is therefore a  matter directly  and substantially in issue up to the date  of  the preliminary decree.  If the requisite plea is not raised and the  court does not in framing the preliminary  decree  take into account the net profits a subsequent plea for rendition of accounts by mortgagee would be barred on the principle of res  judicata.  A preliminary decree is final in respect  of disputes  that should have been raised before it  was  made. [159 D-160 D] In the present case therefore the mortgagor could not  claim rendition   of  accounts  for  the  period  prior   to   the preliminary decree. [160 D] 155 (ii) The  same  however cannot be said of the  net  receipts realized  by  the mortgagee subsequent  to  the  preliminary decree  as  no  dispute about them could  have  been  raised before   it  was  made.   As  a  suit  notwithstanding   the preliminary  decree continue till the passing of  the  final decree and therefore any payment made by the judgment-debtor to the decree-holder would go in deduction of his  mortgagee liability.  On the same analogy the net receipts statutorily debited to the mortgagee would equally  be    taken     into consideration in fixing the mortgagor’s ultimate  liability. [160 E-162 B; 162 H] Case law discussed. (iii)     There can be no estoppel unless the person to whom a representation is made acts on that representation to  his detriment.    By   depositing  the   decretal   amount   the respondents had only discharged their legal liability  under the decree and this cannot in any sense of the term be  des- cribed as detrimental to them. [166 D-G]

JUDGMENT: CIVIL,  APPELLATE  JURISDICTION : Civil Appeal  No.  257  of 1963. Appeal  by special leave from the judgment and  order  dated April  5th 1961 of the Rajasthan High Court in S.  B.  Civil Revision No. 181 of 1956. B.   D. Sharma, for the appellants. A.   V. Viswanatha Sastri, Rameshwar Nath, S. N. Andley and P.   L. Vohra, for the respondents. The Judgment of the Court was delivered by Subba  Rao  J.  This appeal by  special  leave  is  directed against  the judgment of a Division Bench of  the  Rajasthan High Court in S. B. Civil Revision No. 181 of 1956. The  plaint-schedule properties originally belonged  to  one Noor  Mohammad,  his wife and son.  On September  14,  1936, they  mortgaged the said properties with possession to  B.F. Marfatia,  for a sum of Rs. 25,000.  On February  22,  1938, the said mortgagors executed a simple mortgage in respect of the  same  properties to one Novat Mal for  Rs.  5,000.   On December  21, 1942, Radha Kishan, Har Prasad and Pokhi  Rain acquired the equity of redemption in the said properties  in an auction sale held in execution of a money decree  against the  mortgagors.  On February 14, 1950, and March 13,  1950, Seth  Girdhari Lal, the husband of Appellant No.  1  herein, purchased  the  mortgagee rights of Novat Mal  and  Marfatia respectively.   On  May  1, 1950, Girdhari La]  was  put  in possession  of the mortgaged properties.  On July 22,  1950,

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Respondents  9 to 11 purchased the equity of  redemption  of the mortgaged properties from Radha Kishan.  Har Prasad  and Pokhi  Ram.   On August 10, 1950,  Girdhari  Lal  instituted Civil 156 suit No. 739 of 1950 in the Court of the Senior  Subordinate Judge, Ajmer, for enforcing the said two mortgages.  In  the suit  he  claimed Rs. 48,919-12-6 as the amount due  to  him under the said two mortgages.  On April 25, 1953, the Senior Subordinate  Judge, Ajmer, gave a preliminary decree in  the suit  for  the  recovery of a sum  of  Rs.  34,003-1-6  with proportionate  costs  and  future  interest;  he  disallowed interest from September 14, 1936, to March 13, 1950, on  the mortgage  of Rs. 25,000.  The plaintiff-mortgagee  preferred an  appeal,  being  Civil  Appeal No. 71  of  1953,  to  the judicial Commissioner, Ajmer, against the said decree in  so far  as  it  disallowed interest  to  him.   The  defendants preferred  cross-objections in respect of that part  of  the decree  awarding costs against them.  On July 25, 1953,  the defendants  filed an application under O.XXXIV, r. 5(1),  of the  Code of Civil Procedure, seeking permission to  deposit the decretal amount in court and praying that possession  of the  properties may be directed to be delivered to them  and also  for directing the decree-holder to render accounts  of the profits of the mortgaged properties received by him.  On July  29, 1953, the respondents deposited Rs. 35,155-2-6  in the  Trial  Court.  On August 17,  1953,  the  decree-holder filed  objections to the said deposit on the ground that  it was much less than the decretal amount.  On August 27, 1953, the  Trial Court made an order permitting the  decree-holder to  withdraw the said amount with the reservation  that  the question  as  to  what was due under  the  decree  would  be decided  On August 25, 1954, both the appeal of the  decree- holder  and  the  cross-objections of  the  defendants  were dismissed.   On  Docember 7, 1954, the defendants  filed  an application  in the Trial Court for the determnation of  the amount  due under the decree and for directing  the  decree- holder  to render accounts of all the realizations from  the mortgaged properties.  On March 14, 1955, the Supreme  Court granted special leave to the decree-holder for preferring an appeal  against  the judgment of the  Judicial  Commissioner dismissing  Civil  Appeal No. 71 of 1953.  On  February  15, 1956, the Trial Court dismissed the application filed by the defendants  for directions on the ground that  the  mortgage deed had merged in the preliminary decree and that the  said decree  contained no directions to the plaintiff  to  render accounts.   On February 29, 1956, the defendants applied  to the  Judicial Commissioner, Ajmer, under s. 152 of the  Code of  Civil Procedure for amending the preliminary  decree  by including  therein  a direction against  the  plaintiff  for rendition  of account in respect of the profits received  by him  from the mortgaged properties.  On April 12, 1956,  the Judicial Commissioner dismissed the said application. 157 On April 25, 1956, the defendants filed a revision  petition against  the  order of the Trial Court  dated  February  15, 1956, in the Court of the Judicial Commissioner, Ajmer.   As by  that time the Supreme Court had given special  leave  to appeal  against the decree of he Appellate Court  confirming the preliminary decree, the Judicial Commissioner, on August 1,  1956,  made  an order adjourning the hearing  -  of  the revision  petition  till after the decision of  the  Supreme Court  in  Civil Appeal No. 383 of 1956.   On  February  17, 1957, the decree-holder died, and his legal representatives, who  are the appellants herein, were brought on record.   On

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December 16, 1960, this Court delivered judgment in the said appeal modifying the preliminary decree made in the suit and directing the Trial Court to pass a fresh final decree.   On April 5, 1961, the High Court accepted the revision petition filed  by  the defendants, remanded the case  to  the  Trial Court  and  directed it to take an account of  the  receipts from the mortgaged properties and expenses properly incurred for   the  management  etc.  of  the  said   properties   as contemplated under s. 76(g) and (h) of the Transfer of  Pro- perty  Act and to determine what sum remained to be paid  to the  mortgagees  taking into account the  decision  of  this Court.  Hence the present appeal. The  gist  of  the arguments of Mr. B.  D.  Sharma,  learned counsel  for  the  appellants may be stated  thus  :  (i)  A preliminary decree settles the rights of parties by deciding all  the controversies between them relating to  a  mortgage transaction and gives all necessary directions for  carrying into  effect  those rights, while a  final  decree  concerns itself  with the working out of those rights;  further,  the mortgage  merges into the preliminary decree and  thereafter no relief can be given on the terms of the mortgage; on  the basis  of the said two principles it must be held  that,  as the  preliminary decree in the present case did not give,  a direction  to the mortgagee for rendition of an  account  of the  profits of the mortgaged properties, the Court  has  no jurisdiction  to direct such a rendition of accounts  on  an application  filed by the mortgagors after  the  preliminary decree  was made. (2) The High Court went wrong  in  holding that the appellants were estopped from raising the plea that the  mortgagee  was not liable to render  accounts  for  the period between the date of the filing of the plaint and that of  the preliminary decree.  And (3) the High  Court  should have taken into consideration the equities in favour of  the mortgagee. The  arguments of Mr. A. Viswanatha Sastri, learned  counsel for   the  respondents,  may  be  summarized  thus   :   The relationship  of mortgagor and mortgagee continues upto  the date of the final 158 decree.   The statutory liability of a mortgagee to  account for the profits received by him and credit the same  towards the  mortgage.  debt  also  subsists  till  that  date  and, therefore,  the  fact  that  the  amounts  realized  by  the mortgagee  were  not  given credit to  in  ascertaining  the amount  due  to him under the mortgage at the  time  of  the making  of  the  preliminary decree would  not  relieve  the mortgagee  of his liability to account for the same.  It  is further contended that though the rents realized could  have been  taken into account at the time the preliminary  decree was  made,  the mortgagee was not bound to  appropriate  the amount  towards the debt before the preliminary decree,  for he  could  do so after the decree though  the  amounts  were realized  before the decree.  In any view, it is  contended, as  the mortgagee did not deny his liability to account  for the  profits realized by him from the  mortgaged  properties before  the preliminary decree was made, he could not  evade his statutory liability to account for the profits  realized and  to appropriate the same towards the mortgage debt  till the relationship of mortgagor and mortgagee came to an end. The  main question in the appeal is whether the  preliminary decree  passed  in  the  suit  debars  the  mortgagors  from claiming  that the mortgagee has to account for the  profits realized  by  him  from  the  mortgaged  properties  in  his possession; if he is not so debarred, what is the period for which the mortgagee could be compelled to render accounts in

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respect  of the said profits ? The suit was filed on  August 10, 1950; the preliminary decree was made under 0. XXXIV, r. 4,  of the Code of Civil Procedure on April 25,  1953.   The preliminary decree does not contain any direction  directing the  mortgagee to account for the profits realized from  the mortgaged  properties  in his  possession.   The  contention briefly  stated  is that, as there is no  direction  in  the preliminary  decree,  the mortgagee  escapes  his  statutory liability to render accounts under S. 76 of the Transfer  of Property  Act.  To appreciate this contention  the  relevant provisions  of the Code of Civil Procedure and those of  the Transfer of Property Act may be considered.  Under 0. XXXIV, r. 4, of the Code of Civil Procedure, in a suit for sale, if the  plaintiff succeeds, the Court shall pass a  preliminary decree to the effect mentioned in cls. (a), (b) and (c)  (i) of  sub-r.  (1)  of  r.  2;  under  r.  2,  in  a  suit  for foreclosure, if the plaintiff succeeds, the Court shall pass a  preliminary decree ordering that an account be  taken  of what is due to the plaintiff at the date of such decree  for (i)  principal and interest on the mortgage.  Form No. 5  of Appendix D to the First Schedule to the Code prescribed  the form for directing the accounts to be taken and Form No.  5A thereof 159 provides  for a decree which by itself declares  the  amount due to the plaintiff on the mortgage.  Section 76(h) of  the Transfer of Property Act says :               "When, during the continuance of the mortgage,               the   mortgagee   takes  possession   of   the               mortgaged  property,  his  receipts  from  the               mortgaged property, or, where such property is               personally occupied by him, a fair occupation-               rent   in   respect  thereof,   shall,   after               deducting  the expenses properly incurred  for               the   management  of  the  property  and   the               collection of rents and profits and the  other               expenses mentioned in clauses (c) and (d), and               interest  thereon, be debited against  him  in               reduction of the amount, if any, from time  to               time due to him on account of interest and, so               far as such receipts exceed any interest  due,               in  reduction  or discharge of  the  mortgage-               money;  the surplus, if any, shall be paid  to               the mortgagor.". The  gist of the said provisions may be stated thus :  In  a suit  on a mortgage for sale the Court may order an  account to  be taken of what is due to the plaintiff at the date  of the  preliminary decree and in that case the decree will  be made  in Form No. 5 in Appendix D to the First  Schedule  to the Code; or it may declare the amount so due on that  date, in  which case a decree will be made in Form No. 5A  in  the said Appendix.  In a case where a decree is made in Form No. 5A, it is the duty of the Court to ascertain the amount  due to the mortgagee at the date of the preliminary decree.  How can  the  amount  due to the mortgagee as  on  the  date  of preliminary  decree  be  declared  unless  the  net  profits realized  by  him from the mortgaged  property  are  debited against  him ?  The statutory liability of the mortgagee  to account upto the date of the preliminary decree would be the subject-matter  of dispute in the suit upto the date of  the said  decree.   The Court has to ascertain  the  amount  due under the mortgage in terms of the mortgage deed and  deduct the net realizations in the manner prescribed in s. 76(h) of the  Transfer of Property Act and ascertain the balance  due to the mortgagee on the date of the preliminary decree.   If

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the mortgagee did not raise the plea, he would be barred  on the  principle of res judicata from raising the same as  the said matter should be deemed to have been a matter which was directly  and substantially in issue in the suit up to  that stage.  It is settled law that though a mortgage suit  would be  pending  till  a final decree  was  made,  the,  matters decided or ought to have been 160 decided  by the preliminary decree were final.  Suppose  the mortgagor  paid certain amounts to the mortgagee before  the preliminary  decree; if these were not given credit  to  the mortgagor   and  a  larger  amount  was  declared   by   the preliminary  decree  as  due  to  the  mortgagee,  can   the mortgagor,  after preliminary decree, reopen the question  ? Decidedly he cannot.  This is because the preliminary decree had become final in respect of the disputes that should have been raised before the preliminary decree was made.  So too, under  S.  76(h) of the Transfer of Property  Act,  the  net receipts  of the mortgaged property have to  be  statutorily ,debited  against the mortgagee in deduction of  the  amount due  under  the  mortgage from time to time  in  the  manner prescribed  thereunder.  The principle underlying  the  said clause  is  that  the usufruct  of  the  mortgaged  property represents  the  mortgagors money.  On the same  analogy  of voluntary  payment,  if  a preliminary decree,  by  a  wrong decision or by reason of an omission of the requisite  plea, ignored  the net realization in ascertaining the amount  due to the mortgagee, it must be held that the Court refused  to give  credit to the said receipts.  We therefore, hold  that in  the  present  case so far  as  the  amounts  statutorily debited  to the mortgagee under s. 76(h) of the Transfer  of Property  Act before the date of the preliminary decree  are concerned, they could not be taken into account as the Court did not take those amounts into consideration at the time it made the said decree. But the same cannot be said of the net receipts realized  by mortgagee subsequent to the preliminary decree.  None of the principles  relied  upon  by the  learned  counsel  for  the appellants  helps  him in this regard.  It is  true  that  a preliminary decree is final in respect of the matters to  be decided  before  it  is made : see Venkata  Reddy  v.  Pethi Reddy(1),  and s. 97 of the Code of Civil Procedure.  It  is indisputable  that  in  a mortgage suit there  will  be  two decrees,  namely, preliminary decree and final  decree,  and that ordinarily the preliminary decree settles the rights of the  parties and the final decree works out those  rights  : see   Talebali   v.   Abdul   Azia(2),   and   Kausalya   v. Kauleshwar(3).   It  cannot also be disputed  that  mortgage merges  in the preliminary decree and the rights of  parties are  thereafter  governed  by the said decree  :  see  Kusum Kumari v. Debi Prosad Dhandhania (4) . But we do not see any relevancy of the said principles to the problem that  arises in this case in regard to the liability of the mortgagee  to account for the net receipts under s. 76(h) of the  Transfer of  Property  Act.  A preliminary decree is  only  concerned with dis- (1)  [1963]  Supp. 2. S C. R. 616. (2)  [1930] 1. L.  R.  57 Cal. 1013. (3) [1945] I. L. R. 25 Pat. 305.  (4) [1935] L. R. 63 I.  A. 114. 161 putes  germane to the suit upto the date of the  passing  of the said decree.  The net receipts of the mortgaged property by  the mortgagee subsequent to the preliminary  decree  are outside  the  scope  of the preliminary decree  :  they  are

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analogous  to  amounts paid to a mortgagee  by  a  mortgagor subsequent to the preliminary decree. Realizing this difficulty, Mr. Sharma contended that it must be  held  that the question of statutory  liability  of  the mortgagee to account for the receipts must be deemed to have been  decided in favour of the mortgagee by the  preliminary decree.   It  is true that the mortgagee may, if  he  chose, have  raised this untenable contention that for some  reason he  was  not  under a statutory  liability  to  account  for receipts under s. 76 of the Transfer of Property Act; and if the  Court wrongly decided in his favour, the finding  might have  been binding on the mortgagor in respect of the  mort- gagee’s  liability  to  account for receipts  even  for  the subsequent  period subsequent to the preliminary decree  was neither  expressly  He had conceded  his  general  statutory liability, but, by some mistake, it was not quantified  upto the  date  of the preliminary decree and deducted  from  the mortgage amount.  His liability for the period subsequent to the  preliminary decree was neither expressly nor  impliedly negatived  by the preliminary decree.  In this context,  the decision  of the Judicial Committee in Madan Theatres,  Ltd. v. Dinshaw & Co. Ltd.(1) may usefully be cited.  There,  the question  arose whether after the preliminary  decree  there could  be  an adjustment of the suit within the  meaning  of O.XXIII, r. 3, of the Code of Civil Procedure.  The Judicial Committee observed :               "A decree holder need not, of course, agree to               any  adjustment  or accept  payment  otherwise               than  into  court,  but  in  their  Lordships’               opinion it is open to the debtor to allege and               prove  that an adjustment has taken  place  or               payment in whole or in part has been made  and               received....... Admittedly the suit  continues               until the final decree is passed, and there is               no  time  limit for  recording  the  agreement               arrived at as there is under Or. 21, r. 2- As a suit, notwithstanding the preliminary decree, continued till the passing of the final decree any payment made by the judgmentdebtor  to the decree-holder after  the  preliminary decree would go in deduction of his mortgage liability.   On the  same analogy, the net receipts statutorily  debited  to the mortgagee would equally be (1)(1945) L. R. 72 I. A. 277,286. 162 taken into consideration in fixing the mortgagor’s  ultimate liability.   This question was considered by Clark,  J.,  in Satyanarayana  v.  Suryanarayana(1).  There,  the  appellant mortgaged  certain property to the respondent’s father,  who went  into  possession of the same.  In the usual  course  a preliminary  decree  was made in favour  of  the  mortgagee. After   the  preliminary  decree  the  mortgagor  filed   an application  for  an  account to be  taken  of  the  profits received by the mortgagee after the date of the  preliminary decree  and before the passing of the final decree.  It  was contended  that  in  the absence of  any  provision  in  the preliminary  decree  for  taking of  any  account,  no  such account  could be ordered.  Rejecting that  contention,  the learned Judge observed :               "That  he  (the mortgagor) is so  entitled  is               well-settled  law.  A mortgage suit  continues               until  the  final  decree is  passed  and  the               relationship  of  a  mortgagor  and  mortgagee               continues until then.  Accordingly a mortgagee               in  possession  has until the expiry  of  that               period  the liabilities imposed on him  by  S.

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             76,  T.P.  Act.  It is true that 0. 34,  r.  8               does not in terms provide that a mortgagor  in               a  suit  for redemption applying for  a  final               decree is entitled to have an account taken of               the  profits  received  by  the  mortgagee  in               possession between the date of the preliminary               decree and the date when possession is  given;               but  the provisions of 0. 34 read as  a  whole               clearly  indicate  that such an  account  must               necessarily  be taken.  Even if they did  not,               the right of the mortgagor to such an               account is established beyond question by  the               provisions  of S. 76, T.P. Act.  Again  it  is               beyond  question that when a suit whether  for               sale  or redemption of a mortgage is filed  it               is  the  duty of the Court to decide  in  that               suit  all  the  claims of  the  mortgagor  and               mortgagee  under the mortgage up to  the  date               when  the final decree is given.  Such  claims               can  and  indeed  must  be  included  in   the               mortgage  suit.  If they are not included  the               person  failing  to  include  them  is  barred               thereafter under the provisions of 0.2, R.  2,               Civil  P.C. from filing a suit in  respect  of               them." The learned Judge cited a number of decisions in support  of his conclusion.  These observations appear to be rather wide and  comprehensive  enough  to take in the  liability  of  a mortgagee to account for the net receipts from the mortgaged property even for the period before the preliminary  decree. But the facts of (1)  A. 1. R. 1949 Mad. 613, 614.                             163 that  case show that the learned Judge was only  considering the question of the mortgagee’s liability for a period after the preliminary decree was made, even though the preliminary decree did not contain a direction that the mortgagee had to account  for  the  said  receipts.   We  agree  with   these observations  with  the  limitation  mentioned  above.   We, therefore,  hold that as regards the net receipts  from  the mortgaged  properties  subsequent  to  the  making  of   the preliminary decree the Court was right in giving credit  for them to the mortgagor in fixing his liability. Mr.  Viswanatha  Sastri next argued that  the  mortgagee  is debarred  by  the  doctrine of  estoppel  from  denying  his liability to account for the net receipts from the mortgaged properties for the period between the date of the plaint and the date of the preliminary decree.  The plea of estoppel is based  upon  the  following facts : On July  25,  1953,  the respondents filed an application in the Court of the  Senior Subordinate Judge, Ajmer, wherein they mentioned that  under the preliminary decree the amount due was Rs. 958-4-0,  that the  amount  realized  by the appellants as  rent  from  the tenants  up  to  the date of the said  application  was  Rs. 4,250,  that  the costs awarded by the  Court  against  them against which they were going up in appeal was Rs. 2,553-1-6 and  the balance payable to the appellants  after  deducting the  said  amounts was Rs. 35,155-2-6.  ’Me  prayer  in  the petition  was  that the appellants be  directed  to  deliver possession of the said properties to them and also be called upon  to render true and correct account of  the  recoveries made  by the mortgagee as rent from the date of suit to  the date of his handing over possession of the said  properties. To  that  petition the mortgagee filed  a  counter-affidavit wherein he admitted that he had realized only Rs.  4,488-2-0

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towards  rent  from August 10, 1950, to July 28,  1953,  and that  he  had  incurred  an  expenditure  of  Rs.  1,897  in connection with the management of the said properties during the  said  period  and  that  the  respondents  should  have deposited  Rs.  30,515-10-0 in the Court  according  to  the "present" decree.  The sum of Rs. 39,515-10-0 was arrived at by adding the net receipts of rents from August 10, 1950, to July  28, 1953, to the amount sought to be deposited by  the respondents  in  Court.  It is, therefore,  clear  that  the mortgagee admitted that he had to account to the respondents for  the  receipts  of  the  mortgaged  properties.    After depositing Rs. 35,515-2-6, the respondents filed on December 7,  1954,  an application in the Court  of  the  Subordinate Judge  stating  that they were prepared to deposit  all  the remaining amounts which would on settlement of accounts,  be found duly payable to the 164 mortgagee.  They also prayed that the mortgagee be  directed to  produce the accounts of all the rents and profits  which he  had  realized  so that the  Court,  after  checking  the aforesaid accounts, might decide what amount was exactly due to the mortgagee.  To that application the mortgagee filed a counter-affidavit, wherein ’he stated thus :               "That  the plaintiff has no objection to  give               an  account as to the amount of rent  realised               by him and the expenses incurred by him in the               management  and preservation of the  mortgaged               property but he maintains that he has a  right               to  remain in possession of the  property  and               enjoy its usufruct till the last penny due  on               the mortgage in his favour is paid up to  him.               The plaintiff is therefore entitled to  remain               in possession of the property till the  amount               of  Rs.  14,916-11-0 on  account  of  interest               wrongly  disallowed  by the learned  Court  is               also  paid to him alongwith the other dues  or               till  the said interest is finally  disallowed               by  Honourable the Supreme Court of  India  in               appeal." It  will  be seen again that the mortgagee  in  clear  terms admitted ’his liability to account for the net receipts from the  mortgaged properties; but he claimed that he  would  be entitled  to be in possession till the interest  amount  due was  also  paid  to him.  On August  27,  1953,  the  Senior Subordinate  Judge ordered that the amount deposited by  the mortgagors  less  the  amount  attached  by  the  Income-tax Officer  may be paid to the mortgagee.  As by that time  the appeal  and the cross-objections filed by the mortgagee  and the  respondents  respectively were not  disposed  of,  the, learned  Subordinate Judge left open the question as to  the amount  that  would actually be due to  the  mortgagee  till after  they  were  disposed of.  It appears  that  the  said amounts were drawn out by the mortgagee.  From the aforesaid documents  it  is clear that the respondents  deposited  Rs. 35,515-2-6  in  the  Court after  taking  the  net  proceeds alleged  to  have been realized by the  mortgagee  from  the mortgaged properties and prayed that the mortgagee should be directed  to render true and correct accounts from the  date of  the suit to the date of his handing over  possession  of the  said  properties  to the  respondents.   The  mortgagee admitted his liability to account for the receipts and  only claimed  that  he was entitled to be in  possession  of  the properties  till  the interest disallowed by the  Court  was paid  to  him.  From the said facts it is  argued  that  the respondents  would not have permitted the mortgagee to  draw

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out the amount if he had not admitted his liability 165 to   account  for  the  net  receipts  from  the   mortgaged properties  and that the mortgagee having drawn that  amount subject  to the liability, he is now estopped  from  denying his  liability.  Under s. 115 of the Evidence Act  when  one person  by  his declaration, act or  omission  intentionally caused  another person to believe a thing to be true and  to act upon such belief, he cannot deny the truth of the thing. The doctrine of estoppel embodied in s. 115 of the  Evidence Act  has been explained by the Judicial Committee in  C.  D. Sugar Co. v. C. N. Steamship(1) in the following terms               "estoppel is a complex legal notion, involving               a  combination of several essential  elements,               the statement to be acted upon, action on  the               faith of it, resuling detriment to the actor." To invoke the doctrine of estoppel three conditions must  be satisfied  : (1) representation by a person to another,  (2) the other shall have acted upon the said representation, and (3) such action shall have been detrimental to the interests of the person to whom the representation has been made.   In the  instant  case  it  may  be  said  that  the  first  two conditions are satisfied : the appellant represented to  the respondents that he was liable to render accounts to them in regard to the net proceeds of the mortgaged properties  from the  date  of  the plaint to the  date  of  the  preliminary decree,  and  on  the said  representation  the  respondents agreed to the appellant drawing out from the Court about Rs. 35,515  deposited  by  them.  But can it be  said  that  the respondents  had in any way acted to their detriment on  the basis  of  the representation made by the  appellant  ?  The respondents had to pay the decretal amount to the  appellant if  they wanted to get possession of the  properties.   What they  paid  was  less than what they had to  pay  under  the decree.   By  paying the said amount they did  nothing  more than  discharging  their liability under  the  decree.   The discharge by the respondents of their legal liability  under the  decree cannot in any sense of the term be described  as detrimental to them.  Whether the representation was made or not  they had to pay that amount and by paying  that  amount they  had secured a benefit in as much as from the  date  of payment the interest on that amount ceased to run.  There is no scope, therefore, in this case to invoke the doctrine  of estoppel.   We,  therefore,  hold  that  the  order  of  the Rajasthan  High Court was correct, except in regard  to  the direction given by it to the Subordinate Judge to take  into account  ,ill the receipts of the mortgaged properties  from August 10, 1950, (1)  A. 1. R. 1947 P. C 40. 166 to  July  25,  1953.   The  order  of  the,  High  Court  is accordingly  modified.   The parties will  pay  and  receive proportionate costs here and in the High Court. Order modified. 167