Kamakshya Narain Singh v. Ramzan Ali

Chatterji, J.:— This appeal, which, is by the plaintiff, arises out of a suit brought by him for recovery of khas possession, with mesne profits, of village Mohanpur described in the Schedule to the plaint, or in the alternative, for sale of the village for recovery of the proportionate mortgage money chargeable on it under the plaintiff's mortgage bond, dated the 14th August, 1926.

The village Mohanpur forms part of Gadi Sirampur bearing tauzi no. 10 of the Hazaribagh Collectorate. Raja Wazir Narain Singh, who was the proprietor of Gadi Sirampur, mortgaged it for Rs. 1,47,000 under a simple mortgage bond, dated the 14th August, 1926, to the Manager of the Court of Wards in charge of the plaintiff's estate, the plaintiff being then a minor. In 1929, the Manager on behalf of the plaintiff brought a suit to enforce the mortgage, and he obtained a mortgage decree on the 18th September, 1931. In execution of the decree he purchased the mortgaged property on the 6th April, 1935, for Rs. 3,60,000, and obtained delivery of possession through Court on the 16th February, 1936. The Court of Wards released the plaintiff's estate to him on his attaining majority on the 10th August, 1937.

Subsequently the plaintiff came to know that on the 20th July, 1928, Raja Wazir Narain executed a dowami pattah (permanent lease) in respect of the disputed village in favour of one-Mangar Mistri, predecessor-in-title of the defendants who are now in possession of the village. In the mortgage suit brought by the Manager of the Court of Wards on behalf of the plaintiff Mangar Mistri was not made a party as the Manager was not aware of his interest. His dowami lease was not given in the ordinary course of management and is not binding on the plaintiff as it affected his mortgage which could not be fully satisfied by sale of the mortgaged property. The defendants, therefore, have no right to remain in possession of the village. With these allegations the plaintiff instituted the present suit on the 14th June, 1940, that is to say, within 3 years of his attaining majority. In Schedule B of the plaint he gave an account of the proportionate mortgage money chargeable on the disputed village.

The defendants contested the suit mainly on the ground that the dowami lease was granted in the ordinary course of management and was binding, on the plaintiff. They also challenged the correctness of the account given in Schedule B of the plaint.

The learned Subordinate Judge who tried the suit held that the lease in question was not granted in ordinary course of management and had the effect of impairing the plaintiff's mortgage security as his mortgage dues still remained unsatisfied to the extent of about Rs. 60,000 and that, therefore, the lease was not valid and binding against the plaintiff. He, however, held that the defendants had a right to redeem the plaintiff's mortgage on payment of the proportionate mortgage money, but he found that the account given in Schedule B of the plaint was not correct. He accordingly dismissed the plaintiff's claim for khas possession, but allowed the alternative prayer for a decree for sale of the village in question. According to the decree, the defendants are liable to pay Rs. 1,252-12-9 for redemption, whereas the plaintiff claimed Rs. 5,333-8-0.

Dissatisfied with this decree, the plaintiff has preferred this appeal. There is no cross-objection by the defendants.

The first point argued by Mr. Lachmi Kant Jha on behalf of the appellant is that the lease in question having been ‘found to be invalid, the lessee Mangar Mistri was not a necessary party to the plaintiff's mortgage suit, that neither Mangar Mistri had nor the defendants have the right to redeem, and that even assuming that they had such right, it, was extinguished by the sale in execution of the mortgage decree.

Section 91 of the Transfer of Property Act lays down that any person who has any interest in the mortgaged property may sue for redemption. If a person can sue for redemption, certainly be has the right to redeem. A lessee from the mortgagor, though his lease may not be valid and binding against the mortgagee, is still a person having an interest in the mortgaged property, because his lease is certainly good as against the mortgagor. Order XXXIV rule 1 provides that

“all persons having an interest either in the mortgage security or in the right of redemption shall be joined as parties to any suit relating to the mortgage”.

It, therefore, follows that a lessee from the mortgagor, whether his lease is binding on the mortgagee or not, is a necessary party to the mortgage suit. Consequently Mangar Mistri was a necessary party to the plaintiff's mortgage suit.

In Mst. Nand Kuer v. Kunj Bihari Lal a mortgagee obtained a mortgage decree without impleading a mokarraridar of the mortgaged property in the suit and purchased the property in execution of the decree, and being unable to get possession, brought a suit for possession against the mokarraridar after giving him an opportunity to redeem, it was held by this Court that the appropriate remedy of the mortgagee was to bring a fresh suit for sale. The decision proceeded on the assumption that the mokarraridar had a right to redeem and that his right remained unaffected by the mortgage decree and the sale that followed.

In Balmukund Ruyia v. Moti Lal Barman Sir Lawrence Jenkins, C.J with whom's Holm wood, J. agreed, said “it has not been, nor could it be, maintained that the leases did not at least entitle the lessee to redeem”. Thus in the opinion of Sir Lawrence Jenkins the position could not be maintained that the lessee would have no right to redeem.

Mr. L.K Jha relies on the decision of a single Judge of the Madras High Court in Pandela Pundarikakstudu v. Sontineni Kondayya in which it was held that where a lease is void, the lessee has no right to redeem. Of course, if the lease was void in the sense that it was wholly inoperative, the decision is perfectly correct. But if the lease was void in the sense that it was not valid and binding against the mortgagee, I respectfully differ from the decision.

Take the simple case of a subsequent purchaser. His purchase is certainly not binding against the mortgagee, but it cannot be denied that he has the right to redeem or that he is a necessary party to the mortgage suit. A lessee, particularly a permanent lessee, is undoubtedly a transferee. His lease may not be binding against the mortgagee, but that is no ground for holding that he has no right to redeem.

It is argued by Mr. Jha that if the lease is not valid and binding on the mortgagee, it is open to him to eject the lessee. In support of this contention reliance is placed on the following observation of C.C Ghose, J. in Kiran Chandra Bose v. Dutt and Co. “if he (the mortgagor) purports to create such a lease or tenancy, the mortgagee or his transferee may proceed to eject the lessee or tenant [see in this connection Doe v. Maisey(5) and Gibbs v. Cruikshank(6)].” The reference to the English cases suggests that his Lordship was speaking of a legal mortgage in England. In Balmakund Ruyia's case Sir Lawrence Jenkins pointed out the distinction between a legal mortgage in England and a simple mortgage in India as follows: “The relative position of a mortgagee and of a tenant under a tenancy created by the mortgagor after a legal mortgage is well settled in England, but it would be a mistake to apply these English rules to the relations resulting from an Indian simple mortgage. The rule of Keech v. Hall, the leading English case, is one of conveyancing but under a simple mortgage the mortgagor does not part with possession, and the right of a mortgagee is merely to cause the mortgaged property to be sold for the payment of his debt.”

In my opinion, the defendants have the right to redeem and their right in this respect was not affected by the plaintiff's mortgage decree or his execution-purchase.

The next point argued by Mr. L.K Jha is that the defendants, if they want to redeem, must redeem the entire mortgage. He relies on the decisions of this Court in Mir Wajid Ali v. Alidad Khan and Promotho Nath Mitter v. Ram Kishun Singh and of the Privy Council in Yadalli Beg v. Tukaram and Sham Ram Chand v. Pandit Parbhu Dayal.

In the first three cases it was held that where a mortgagee obtains a mortgage decree without impleading a purchaser of a portion of the mortgaged property and in execution of such decree purchases the property, it is open to the purchaser who was omitted from the mortgage suit to sue for redemption of the entire mortgage. These are converse cases which have no application where, as in the present case, the mortgagee himself has split up the mortgage and asked for a decree for sale of part of the mortgaged property for realization of the proportionate amount of the mortgage money chargeable on that part.

In Sham Ram Chand's case their Lordships of the Privy Council held that redemption of a portion of the mortgaged property cannot be allowed except in the only case referred to in the last clause of section 60 of the Transfer of Property Act, namely, where the mortgagee has acquired in whole or in part the share of a mortgagor. But section 60 does not prevent the mortgagee himself from splitting up the mortgage. The section can have no application to the present case where the mortgagee himself has split up the mortgage and asked for a decree for sale of a portion only of the mortgaged property.

If the appellant's contention based on section 60 were to be accepted, the suit, so far as a decree for sale is asked for, must be held to be not properly constituted, because neither the mortgagor nor the other persons interested in the mortgaged property have been impleaded nor has the entire mortgaged property been included in the suit.

The last point argued by Mr. Jha is that the amount of mortgage-money claimed by the plaintiff, must be taken as if it was the entire amount due on the mortgage after relinquishing the balance and that, therefore, the Court below was not justified in going behind the account given in the plaint and further reducing the amount. There is no substance in this point. The account given in Schedule B of the plaint shows that what is claimed is the proportionate liability on the disputed village determined on the principle of section 82 of the Transfer of Property Act, that is to say, the amount claimed bears the same ratio to the entire mortgage money as the value of the disputed village bears to the value of the entire mortgaged property. The Court below proceeded on the same principle, but found on the evidence that the income of the entire mortgaged property was understated, whereas that of the disputed village was overstated. After determining the correct valuation of these properties the Court found out the actual amount of redemption money payable for the disputed village. No exception can possibly be taken to this method.

Mr. G.C Mukherji on behalf of the respondents attempted to support the decree of the Court below by showing that the finding that the lease in question is not valid and binding on the plaintiff is not correct. If this attempt were to succeed, the entire suit would be liable to be dismissed. But the defendants not having preferred any appeal from the mortgage decree passed in favour of the plaintiff, the question at once arises whether it is permissible for the defendants to challenge the finding. However, in the view I take, it is unnecessary to go into this question.

The contentions raised by the appellant fail, and I would dismiss the appeal with costs.

Reuben, J.:— I agree.

As regards Mr. Jha's last point, the position as I see it is this. The plaintiff has acquired the mortgage property, and is asking the defendants to redeem their share of the property. He is, therefore, seeking to allow redemption on the basis that after the redemption he, the mortgagee, will continue to own a portion of the mortgage property. If this is allowed, it makes the last clause of section 60 of the Transfer of Property Act applicable, and the defendants are entitled to redeem on payment of the proportionate part of the mortgage money due. This the Subordinate. Judge has rightly given them a chance of doing.

H.R.K

Appeal dismissed.