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Shibnarain Mandar And Another v. Ramautar Singh And Others
Structured Summary of the Opinion (Rai, J.)
Factual and Procedural Background
One Bihari Beldar possessed several raiyati holdings in khatas Nos. 15, 52, 64 and 66 in tola Beldari of village Barahmania, district Monghyr. At family partition Bihari and two sons received a 12 annas share in those raiyati lands, and a third son received a 4 annas share.
Prior to partition (4-6-1914) Bihari and his sons executed a usufructuary mortgage bond (Ex. B) in favour of Makhan Choudhary. Makhan assigned his right on 9-8-1916 to Kailash (defendant No. 7). After subsequent family partition in Kailash's family, the sudbharna right was allotted to defendants 9 and 10.
On 21-5-1925 Bihari and his two sons executed a usufructuary mortgage to Kartik Mandal covering most plots in Ex. B. On 26-4-1926 Jagdam (defendant 6), son of Kartik Mandal, assigned his right to the plaintiff. The plaintiff sued on 14-6-1946 seeking realisation of amounts under the 21-5-1925 mortgage by sale of the mortgaged properties, alleging possession by the mortgagee (or predecessor) until dispossession on 30th Baisakh 1353 Fasli.
The plaint also alleged cause(s) of action arising on two dates: 30th Jeth 1341 Fasli (the stipulated payment date) and 30th Baisakh 1353 Fasli (date of dispossession).
Defendants 9 and 10 contested the suit, pleading inter alia that the 21-5-1925 bond was a sham, that the mortgagors lacked title to mortgage plots already mortgaged to Makhan Choudhary (4-6-1914), and that the suit was barred by limitation.
The trial court (Munsif) found the 21-5-1925 bond genuine but held that neither the plaintiff nor his predecessor had ever been in possession of the lands covered by that bond. The trial court further held the suit was within 12 years from the date covenanted to be paid and decreed the suit on contest against defendants 9 and 10 (and ex parte against the rest). The District Judge of Monghyr affirmed these findings on appeal.
Defendants 9 and 10 then filed the present second appeal before this Court.
Legal Issues Presented
- Whether the mortgage bond dated 21-5-1925 constituted a usufructuary mortgage within the meaning of Section 58(d) of the Transfer of Property Act or some other form (e.g., anomalous or mixed mortgage).
- Assuming the bond was a usufructuary mortgage, when did the cause of action to sue for realisation of the mortgage money arise for limitation purposes — at the date covenanted for payment (Jeth 1341 Fasli), upon dispossession of the mortgagee, or at some other time?
- Whether the suit filed on 14-6-1946 was barred by limitation given the facts and the character of the mortgage bond.
Arguments of the Parties
Appellants' (Defendants 9 & 10) Arguments
- The 21-5-1925 instrument was a usufructuary mortgage within the meaning of Section 58(d) of the Transfer of Property Act (as argued by counsel relying on the official translation of the bond).
- On the findings of the courts below that neither Kartik Mandal nor the present plaintiff ever came into possession of the mortgaged properties, the right to sue (in respect of the covenant in Ex. 2) arose soon after execution of the bond when possession was not given; therefore the suit of 14-6-1946 is time-barred.
- Relied on authorities including Afiruddi v. Joy Chandra Naha (1930 Cal 703) and other cases cited to support the contention concerning the date on which the cause of action accrues for usufructuary mortgages.
Plaintiff's (Respondent) Arguments
- The mortgage was not a pure usufructuary mortgage but combined elements of simple and usufructuary mortgages; accordingly the plaintiff could sue to realise the mortgage money by sale within 12 years from the month of Jeth 1341 Fasli when the mortgagor covenanted to repay.
- Even if a cause of action arose earlier, the mortgagee could waive that earlier right and wait until the stipulated payment month (Jeth 1341 Fasli) and then file within 12 years from that date. Reliance was placed on Lasa Din v. Mt. Gulab Kunwar (1932 PC 207).
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Afiruddi v. Joy Chandra Naha, 1930 Cal 703 (AIR V 17) (A) | Authority relied upon to support that, in the case of a usufructuary mortgage, the cause of action to realise the mortgage money arises on dispossession of the mortgagee. | The Court held the present case was clearly covered by this decision and applied its principle to conclude that the cause of action arose on dispossession, leading to dismissal for limitation. |
| Narsingh Partab Bahadur Singh v. Mohammad Yaqub Khan, 1929 PC 139 (AIR V 16) (B) | Earlier authority that was relied upon in the decision in Afiruddi (as referenced by counsel). | Referenced as a supporting precedent via Afiruddi; the Court's reliance on Afiruddi implicitly incorporates the earlier reliance on this case as noted in the opinion. |
| Kirti Narayan Singh v. Surendra Mohan Singh, 1934 Pat 624 (AIR V 21) (C) | Cited by appellants' counsel in support of the contention regarding the nature/date of rights under the mortgage instrument. | Cited in argument by the appellants; the opinion records the citation but does not elaborate further on its specific doctrinal application. |
| Harnath Singh v. Maiya Ambica Devi, 1941 Pat 301 (AIR V 28) (D) | Cited by appellants' counsel in support of their submissions. | Cited in argument by the appellants; the opinion records the citation but does not describe a detailed application of the case. |
| Lasa Din v. Mt. Gulab Kunwar, 1932 PC 207 (AIR V 19) (E) | Relied upon by plaintiff's counsel to show that a mortgagee might not need to sue immediately on default and that limitation might run from the date covenanted for payment in a simple mortgage context. | The Court distinguished this authority: it was an enforcement of a simple mortgage (involving a covenant to pay and Article 132 of the Limitation Act) and therefore did not apply to the usufructuary-mortgage facts of the present case. |
| Kamal Nayan v. Ram Nayan, 1930 Pat 152 (AIR V 17) (F) | Referenced for the proposition concerning the existence (or absence) of a personal covenant to pay distinguishing simple mortgages. | The Court noted that, unlike the holdings in those cases, the bond before it contained no personal covenant to pay; this supported the conclusion that the instrument was a usufructuary mortgage. |
| Jamuna Singh v. Sheonandan Singh, 1941 Pat 486 (AIR V 28) (G) | Referenced alongside Kamal Nayan regarding the distinction based on a personal covenant to pay. | The Court observed that no personal covenant to pay existed in the present bond as contrasted with these cases, supporting the finding of a usufructuary mortgage. |
| Sidramaya v. Danava, 1954 Bom 407 (AIR V 41) (H) | Cited by the plaintiffs but distinguished; concerned a mortgage bond that lacked the specific provision present in the present bond about entitlement to sue from date of dispossession. | The Court held this authority was not helpful to the plaintiffs because the earlier bond lacked the specific provision entitling the mortgagee to realise the amount with interest from date of dispossession; the Bombay High Court itself distinguished Afiruddi on the same ground. |
Court's Reasoning and Analysis
The Court analyzed the character of the 21-5-1925 instrument and the question of when the cause of action for realisation would arise under that instrument:
- Character of the mortgage: The Court concluded the bond was a usufructuary mortgage (para 13). The judge noted there was no personal covenant to pay as contrasted with certain earlier decisions (Kamal Nayan and Jamuna Singh), and that the bond contained no covenant to pay interest until dispossession occurred (para 14). Those features indicate the mortgagor did not intend a simple mortgage.
- Effect of possession provisions: The bond permitted the mortgagee to remain in possession of properties in lieu of interest and contemplated that such possession would continue until redemption (para 14). The plaint shows the plaintiff sought to enforce rights that would accrue upon dispossession (para 15).
- Date of cause of action for limitation: Given the instrument's terms and the courts' findings (including the finding that the plaintiff or predecessor had not been in possession), the Court treated the dispossession as the operative event giving rise to the right to realise the mortgage money (para 15, 19). The Court found Afiruddi v. Joy Chandra Naha applicable and controlling on this point (para 18, 19).
- Distinction from authorities relied on by plaintiff: The Court explained that Lasa Din concerned enforcement of a simple mortgage containing an express covenant enabling an action to be brought after default and involved Article 132 of the Limitation Act; that reasoning did not fit a usufructuary mortgage where the mortgagee's right to realise the principal accrues upon dispossession (paras 16–18).
- Consideration of Sidramaya: The Court rejected reliance on Sidramaya v. Danava because that decision dealt with a bond that did not contain the specific provision present in the present mortgage entitling the mortgagee to realise the amount with interest from the date of dispossession; hence it was distinguishable (para 20).
- Application to facts and limitation: On the combined factual findings of the courts below (notably that the mortgagee/plaintiff never came into possession) and the contractual stipulation, the Court concluded the cause of action arose on dispossession and that the suit, filed more than 12 years after that date, was barred by limitation (para 19–21).
Holding and Implications
Core Ruling: The decrees of the courts below are set aside and the suit is dismissed.
Disposition: The suit was dismissed as barred by limitation because, on the Court's view of the instrument as a usufructuary mortgage, the cause of action to realise the mortgage money arose upon dispossession; the plaintiff's suit filed more than 12 years after dispossession was therefore time-barred. The dismissal is with costs payable to defendants 9 and 10 (paras 19–21, 23).
Implications: The direct consequence is that the plaintiff's claim is dismissed and the lower courts' decrees are set aside; costs were awarded to defendants 9 and 10. The opinion distinguishes prior authorities and applies established principles concerning usufructuary mortgages, but it does not announce or describe any broader new legal rule beyond the application of those principles to the facts before the Court.
Judge Kanhaiya Singh expressly agreed with the reasoning (para 22). The formal result recorded: "Decrees set aside." (para 21 and concluding note).
Rai, J.:— Some of the important facts leading to the institution of this second appeal may shortly be stated as follows: One Bihari Beldar had a number of raiyati holdings included within khatas. Nos. 15, 52, 64 and 66 situated in tola Beldari appertaining to village Barahmania, district Monghyr. At the time of partition of the family properties, Bihari Beldar and his two sons got 12 annas share in the raiyati lands appertaining to the above mentioned khatas, and his third son got 4 annas share in those lands.
2. Before the date of partition Bihari and his sons had executed on 4-6-1914, a usufructuary mortgage bond (Ex. B) in favour of Makhan Choudhary in respect of some of their lands. On 9-8-1916, Makhan Choudhary assigned his right in favour of Kailash, the present defendant No. 7. After partition in the family of Kailash the sudbharna right was allotted to share of defendants 9 and 10 of the present suit. On 21-5-1925, Bihari and his two sons gave in usufructuary mortgage to one Kartic Mandal most of the plots covered by the usufructuary mortgage bond (Ex. B). On 26-4-1926, Jagdam, defendant 6, son of Kartic Mander, assigned his righti in favour of the plaintiff. On 14-6-1946, the plaintiff instituted the present suit for realisation of the amount lent under the mortgage bond dated 21-5-1925, by sale of the mortgaged properties. It was alleged by him that by virtue of the said mortgage bond the predecessors-in-interest of the plaintiff and after the assignment in his favour the present plaintiff had remained all along in possession of the mortgage properties until his possession was disturbed on the 30th of Baisakh 1353 Fasli which led him to institute the present suit.
3. In the plaint it was alleged that the cause of action arose on the 30th of Jeth 1341 Fasli, the day on which the payment of the amount was stipulated and on the 30th of Baisakh 1353 Fasli when the plaintiff was dispossessed.
4. The suit was resisted by defendants 9 and 10 who pleaded, inter alia, that the usufructuary mortgage bond dated 21-5-1925, was merely a sham document, and it had not created any right in Kartik Mander. It was further pleaded that Bihari and his two sons had no right to give in usufructuary mortgage the plots which had already been so given to Makhan Choudhary by the usufructuary mortgage bond dated 4-6-1914. Thus the defendants also pleaded that the present suit was barred by limitation. On these and other pleas they asserted that the suit was fit to be dismissed.
5. The learned Munsif who tried the suit came to the conclusion that the usufructuary mortgage bond dated 21-5-1925, was a genuine document. He, however, held that neither the plaintiff nor his predecessor-in-interest was ever in possession of the lands included in the usufructuary mortgage bond in favour of Kartik Mander (Ex. 2)). On the question of limitation, the trial court came to the conclusion that the suit having been filed within 12 years from the date on which the amount was covenanted to be paid was not barred by limitation. On these findings the suit was decreed on contest against defendants 9 and 10 ex parte against the rest.
6. Defendants 9 and 10 thereafter went in appeal before the District Judge of Monghyr which was ultimately dismissed. The learned District Judge also affirmed the findings of the trial court on all the points. Defendants 9 and 10 thereafter came up in second appeal before this Court.
7. Learned counsel for the appellants contended before us that the mortgage bond dated 21-5-1925, was really a usufructuary mortgage bond within the meaning of Section 58(d) of the Transfer of Property Act. He placed before us the official translation of that mortgage bond and contended that by that document a usufructuary mortgage had been created and not an anomalous mortgage.
8. Mr. L.K Choudhary further argued that on the findings of both the courts below that neither Kartik Mander nor the present plaintiff had ever come in possession of the mortgaged properties, the right to sue on the basis of the covenant contained in Ex. 2 arose soon after the execution of the mortgage bond. In this connection he drew our attention to the following passage in the bond;
“I, the executant shall pay in cash and in one lump sum the entire amount of debt in Jeth 1341 Fasli and resume direct possession of the mortgaged property. If I fail to pay the debt on the due date of payment, then till the repayment thereof, this very document along with all its recitals and the possession and the occupation of the mortgagee shall remain intact just as before. In contravention of the terms of this deed either overtly or covertly, we the executants or our heirs and representatives shall not dispossess the mortgagee and his heirs from the mortgaged property within or after the period without repayment of the amount of debt.
9. If we do so, we shall be liable to pay the entire debt even before the expiry of the period, with interest at Rs. 3/2/- per hundred per month, from the date of dispossession till realisation from the mortgaged property and also from our person and our other properties. We have therefore executed this usufructuary mortgage bond sc that it may be of use when required.”
10. On the basis of this recital, Mr. L.K Choudhary contended that the cause of action had arisen in favour of Kartick Mander soon after the execution of the usufructurary mortgage bond in May 1925 when he was not given possession by the mortgagors, & he having failed to institute any suit for realisation of the amount covered by the document, the present suit which was filed on 14-6-1946, was clearly barred by time.
11. In support of his contention he relied on the decision in the case of ‘Afiruddi v. Joy Chandra Naha’, 1930 Cal 703 (AIR V 17) (A), in which the decision in the case of — ‘Narsingh Partab Bahadur Singh v. Mohammad Yaqub Khan’, 1929 PC 139 (AIR V 16) (B), had been relied upon. Mr. Choudhary referred in this connection also to the cases of — ‘Kirti Narayan Singh v. Surendra Mohan Singh’, 1934 Pat 624 (AIR V 21) (C) and — ‘Harnath Singh v. Maiya Ambica Devi’, 1941 Pat 301 (AIR V 28) (D).
12. Mr. Goswami, who represented the plaintiffs before us, contended, on the other hand, that the mortgage covered by the bond in question was not a usufructuary mortgage. He submitted that the mortgage combined both the elements of a simple mortgage and a usufructuary mortgage and, as such, the plaintiff was entitled to sue for realisation of the mortgage money by sale of the mortgaged properties within 12 years from the month of Jeth 1341 Fasli when the mortgagor had covenanted to repay the money. He also submitted that even if a cause of action had arisen earlier in favour of Kartik Mander, he could have waived that right and waited until the expiry of the month of Jeth 1341 Fasli when the money was payable and file a suit for realisation of the amount due on that bond within 12 years from that date. In support of his contention he relied on the decision in the case of — ‘Lasa Din v. Mt. Gulab Kunwar’, 1932 PC 207 (AIR V 19) (E).
13. In my opinion, the contention raised on behalf of the appellants is well founded in law and must prevail. I agree with Mr. Choudhary that the mortgage in question was a usufructuary mortgage, and that there was no personal covenant to pay as was held in the case of ‘Kamal Nayan v. Ram Nayan’, 1930 Pat 152 (AIR V 17) (F), and in the case of — ‘Jamuna Singh v. Sheonandan Singh’, 1941 Pat 486 (AIR V 28) (G).
14. In the bond in question there is no covenant to pay any interest until the question of dispossession arises. This also shows that the mortgagor did not intend to execute a simple mortgage bond. On the contrary, the mortgagee was entitled to remain in possession of the properties in lieu of interest and his possession was to continue until the mortgage was redeemed.
15. From the plaint of the present suit also it transpires that the plaintiff is seeking to enforce the right which accrued to the mortgagee or his successor-in-interest by virtue of the dispossession, from the mortgaged properties because it was only in that event the mortgagee was entitled to realise interest at the rate of Rs. 3 and odd annas per hundred per month which is the amount claimed in the suit. Thus it is clear that the cause of action for the institution of the present suit was the date of dispossession.
16. The decision in the case of 1932 PC 207 (AIR V 19) (E), relied on by Mr. Goswami does not, apply to the facts and circumstances of this case. In that case the mortgage bond contained the following covenant:
“In case of default, the said creditor shall, at all times, within and after the expiry of the stipulated period of six years aforesaid, have the power to realise the entire mortgage money and the remaining interest and compound interest due to him in a lump sum, through Court, by attachment & sale of the said mortgaged share, as well as from my person and all other kind of my property, both movable and immovable, together with costs of Court, and I, my heirs, relations and representatives shall have no occasion for objection and refusal; that the aforesaid rate of interest, fixed by me, shall stand within and after the stipulated period and after the decree till payment of the entire demand hereunder and that I shall at no time demand reduction in interest.”
17. It was held in that case on the basis of the above covenant that it was open to the mortgages not to avail of the right that had accrued to him to bring an action for realisation of the entire amount after the default in payment of the interest had occurred and wait until the period of six years had expired. That was the case of enforcement of a simple mortgage bond, and the question that was to be considered in that case was as to the date from which the period of limitation began to run under Article 132 of the Indian Limitation Act.
18. In the present case, however, we have to take into consideration the right of the usufructuary mortgage to bring an action for realisation of the principal amount after he was dispossessed from the land given in usufructuary mortgage. In my view, the case is clearly covered by the decision in the case of 1930 Cal 703 (AIR V 17) (A).
19. On the findings of the courts below and on the stipulation given in the mortgage bond in suit, the cause of action to bring an action for realisation of the mortgage money arose when the mortgagee was dispossessed in this case, and the present suit having been filed more than 12 years after that date is clearly barred by limitation.
20. The decision in — ‘Sidramaya v. Danava’, 1954 Bom 407 (AIR V 41) (H), also is not of much assistance to the plaintiffs-respondents, because in that case the mortgage bond in question contained no specific provision as has been included in the present mortgage bond entitling the mortgagee to bring an action for realisation of the entire amount with interest from the date of dispossession. Their Lordships of the Bombay High Court had referred to this distinction in para. 7 of their judgment, while distinguishing the case which they were dealing with the case reported in 1930 Cal 703 (AIR V 17) (A). The result is that the decrees passed by the courts below are set aside and the suit is dismissed with costs thoughout payable to defendants 9 and 10.
Kanhaiya Singh, J.:— I agree.
D.S.P
21. Decrees set aside.
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