Uchait Mandar v. Gosain Singh Bait

1. In this case the defendants first party executed a usufructuary mortgage in favour of the plaintiffs on 25th Savan 1305, the date stipulated for repayment being 30th Baisakh 1306, which corresponds to sometime in April 1899. In 1902 the third party defendant sued the mortgagors and the plaintiffs for declaration of title to and recovery of possession on half of this property and succeeded. The plaintiffs were thereby dispossessed of half their mortgage security. Then in 1915 the mortgagors sold to defendants second party by a kabala the remaining half of the property and the purchasers, on the strength of that kobala, dispossessed the plaintiffs. The second party defendants then deposited in Court the whole amount of the mortgage-money, which was Rs. 498. On 15th May, 1915 the plaintiffs brought the present suit for recovery of the principal sum with interest at 2 per cent, per mensem from 1902 up to the date of the suit. There is a prayer for the sale of the mortgaged property inasmuch as it is a composite mortgage, viz., a usufructuary mortgage as well as a simple mortgage.

2. The plaintiffs, however, have remitted a sum of Rs. 403 on account of interest and claim only Rs. 377. The precise reason for this remission is not intelligible, but it is alleged in para. 7 of the plaint that as the value of the mortgaged property is not sufficient, so a remission is made of Rs. 403. The Munsif decreed the suit for Rs. 498 (which the plaintiffs have withdrawn under protest) with interest at 24 per cent per annum and fixed six months for the payment; and in default ordered that 5 bighas 5 cottas, being half of the mortgaged property, be sold. On appeal the Subordinate Judge found that the mortgagees had acquiesced in the dispossession of 1902 and were not entitled to claim any interest. He accordingly decreed the suit only for Rs. 498 and disallowed the sum of Rs. 377 for interest. The present second appeal is preferred by the plaintiffs and there is also a cross-appeal by the defendants second party.

3. The learned Subordinate Judge has relied upon the case of Partap Bahadur Singh v. Gajadhar Bakhsh Singh(1). In that case the mortgagor made a usufructuary mortgage and then took the property in lease from the mortgagee. He also stipulated that he would pay interest at 24 per cent, per annum until delivery of possession. He failed to, deliver possession of half the property and after the mortgagee had been in possession of the remaining half for 31 years, the mortgagor brought a suit for redemption offering to the mortgagee only the principal amount. The mortgagee refused and demanded the payment of the principal amount with interest at 24 per cent, for the whole period. Their Lordships of the Privy Council held that the mortgagee had acquiesced in the failure to deliver possession and that as the profits from the remaining half of which he had been in possession were sufficient, he was not entitled to claim interest as a condition necessary to redemption at the rate stipulated in the bond. It appears from the judgment of their Lordships that the view that they took of the bond: was that the interest was payable only on failure to deliver possession and that there was no contract by which the-mortgagor bound himself to pay interest on dispossession after delivery of possession.

4. It is sought to distinguish the above-mentioned case from the present case by showing that the bond now in suit specifically provides that interest at 24 percent, per annum shall be paid upon dispossession of the mortgagee after delivery of possession. The case of Khuda Bakhsh v. Alim-unnissa(2) was similar to that of Partab Bahadur's case. The same-principle was followed in Junku Singh v. Chatkan Singh(3). In the latter case the condition was that if there was any defect in the mortgaged property and any-manner of defect arose in the mortgagee's-possession, the mortgagee would be entitled to interest; and their Lordships-held that the defect referred to related to defect in the title of the mortgagor whereby the mortgagee should fail to get possession, or having got possession should lose it. They also held that the mortgagee, having allowed the mortgagors to retain possession of a part of the mortgaged property and having made no claim-in respect of the stipulation in the mortgage-deed as to interest was bound by his acquiescence. The learned vakil for the appellants has no case which will meet this case; but he relies on a decision of their Lordships of the Calcutta High Court in Ananda Chandra Sen v. Parbati Nath Sen(4) in which the legal meaning of acquiescence has been explained. The learned vakil contends that the mortgagor could never have been led to believe that the mortgagee would not press his claim for interest inspita of the omission to make this claim for over 12 years, and he relies upon the principle that in order to establish the plea of acquiescence it must be shown that a decision to the contrary would amount to assisting a fraudulent transaction. In my opinion the question is one of inference to be drawn from facts. In this case the mortgage-bond entitled the mortgagee to claim interest in the event of the mortgagor's dispossessing him from a single inch of land; and in the alternative, the mortgagee has the further right of claiming damages. So far as damages are concerned, a suit is partly barred by limitation and I think the present suit must be taken to be one entirely upon the mortgage within the purview of Section 68 of the Transfer of Property Act.

5. The mortgagee was content to accept the income of half of the property for 12 years, namely, from 1902. We do not know whether the income of the property was more than the interest, if it was, then his claim for interest would not be maintainable. I cannot agree with the proposition that even if the profits received were in excess of the interest claimed, the mortgagee would be entitled to claim interest upon the contract as damages. Therefore if we consider the suit as one based solely on the mortgage bond, what is the inference to be drawn from the conduct of the parties? The learned Subordinate Judge was of opinion that the proper inference is that the mortgagee was satisfied with the security that he got, apparently on the ground that it was sufficient to discharge the interest on his money. If it was open to the learned Subordinate Judge to draw this inference, the question becomes one of fact and not one of law. It would only be a question of law if such an inference could not possibly be drawn from the facts. In my opinion the inference could be drawn and therefore, the finding of the learned Subordinate Judge is conclusive.

6. But even if it was a question of law and open to revision by me in second appeal, I am of opinion that the view taken by the teamed Subordinate Judge was correct. No reason has been shown for the mortgagee's failure be object to the defect in the security for so long and, in my opinion, a reasonable belief was engendered in the mind of the mortgagor that he was entitled to sell the remaining half of the security to the defendants second party.

7. In these circumstances the decision of the learned Subordinate Judge is correct and the appeal must be dismissed with costs. As to the cross appeal, the lower appellate Court has approved the Munsif's decree granting costs to the plaintiffs on the ground that the defendants second party forcibly dispossessed the plaintiffs. In my opinion this discretion was judicially exercised and probably the plaintiffs would not have instituted this suit at all if this dispossession had not taken place. The cross-appeal is, therefore, dismissed with costs.

V.S/R.K

8. Appeal dismissed.