Kadir Bibi v. M.V. Mailappa Pillai

Sir Lionel Leach, C.J:— This appeal is concerned with the interpretation of section 60 of the Transfer of Property Act.

On 30th January 1929, the tenth defendant executed a usufructuary mortgage of the land in suit in favour of the husband of the first defendant and the father of the second, third and fourth defendants to secure the sum of Rs. 7,000. The mortgagee died before the institution of the action. The mortgage deed provided that the mortgagor should, have the right of redemption after the expiry of the period of three years and three months from the date of the deed. Obviously the three months were added to the three years in order that the right of redemption should fall within the fallow period. The deed further provided that, if the mortgagor did not redeem on the date contemplated by the deed, he should have the right of redemption by paying the amount secured on the 30th Panguni (12th April) of any subsequent year. On 10th July 1942, the plaintiff purchased the equity of redemption and on 13th March 1943 he served upon the mortgagee a notice asserting his right to redeem the mortgage on the 30th Panguni. It was obviously his intention to redeem on that date. Unfortunately, he had not then the money and he took no further steps until 27th September 1943, when he deposited the Rs. 7,000 in Court under section 83 of the Transfer of Property Act. Notice of this deposit was served upon defendants 1 to 4 on 9th October 1943. The cultivation season had then commenced and they refused to accept the money. They maintained that, under the terms of the deed of mortgage, the redemption could not take place until the 12th April next following. The Court accepted the contention and dismissed the plaintiffs application under section 83 of the Transfer of Property Act.

On 17th April 1944, this suit was filed. The plaintiff asked for a decree for possession and for mesne profits from 9th October 1943. A decree in terms of the prayer was granted. Defendants 1 to 4 have appealed. They accept the decree in so far as it gives the plaintiff the right to redeem, but they say that the Subordinate Judge erred in awarding to him mesne profits prior to the date of the plaint.

In deciding for the plaintiff, the Subordinate Judge relied on the decisions of this Court in Suppan Chettiar v. Rangan Chetty and Govinda Menon v. Ghqthu Menon. The judgments in these cases run contrary to the judgments delivered by the Court in Chinnasamy Reddiar v. Krishna Reddy(3) and Kangaya Gurukal v. Kalimuihu Annavi(4). We shall refer to these cases in detail presently; but before doing so we must refer to the provisions of section 60 of the Transfer of Property Act.

The section gives the right to the mortgagor to redeem at any time after the principal money has become due, on payment or tender to the mortgagee, at a proper time and place, of the mortgage money; but it further provides that nothing in the section shall be deemed to render invalid any provision to the effect that, if the time fixed for payment of the principal money has been allowed to pass, or no time has been fixed for its payment, the mortgagee shall be entitled to reasonable notice before payment or tender of the mortgage money. In Muhammad Sher Khan v. Raja Seth Swami Dayal(5), the Privy Council pointed out that section 60 is unqualified in its terms and contains no saving provision, as other sections do, in favour of contracts to the contrary. This does not, however, mean that the parties to a mortgage are precluded from deciding for themselves what is reason able notice.

In Suppan Chettiar v. Rangan Chetty, a deed of mortgage gave the right of redemption after ten years from the date of the instrument and contained a further stipulation that, if the mortgagor did not redeem on that date, he was to be entitled to redeem only on the 30th Ani (13th or 14th July) in any succeeding year. It was held by a Division Bench that this amounted to a clog on the equity of redemption. In delivering the judgment of the Court Venkatasubba Rao, J. expressed the opinion that the stipulation for payment on a particular date was oppressive and unreasonable. On this footing it was decided that the mortgagor in that case was entitled to redeem on 27th July 1921, the date on which he deposited the mortgage amount into Court.

In Govinda Menon v. Chathu Menon Sadasiva Aiyar and Spencer, JJ. held that, when the mortgage debt has become payable under the terms of the deed, a suit for redemption cannot be resisted on the ground, that the money was only payable within certain dates. It does not appear from the report whether the mortgage in that case was a simple or a usufructuary mortgage. If it was a simple mortgage, the judgment is not in point. If, on the other hand, it was a usufructuary mortgage, the judgment must be read as supporting the view expressed in the case first mentioned.

The decision in Chinnasamy Reddiar v. Krishna Reddy is in direct conflict with the decision in Suppan Chettiar v. Rangan Chetty. There, a usufructuary mortgage deed provided that the mortgagor should pay back the amount within three years and, if he failed to redeem then, he should have the right of redemption only in the month of Ani (June-July) in a subsequent year. The Court (Subrahmania Aiyar and Moore, JJ.) held that this was a valid provision and that the mortgagor could not recover the property in any year at a date earlier than June-July as, if he did so, he would deprive the mortgagee of the crops grown on the land.

Kangaya Gurukal v. Kalimuthu Annavi was decided by a Full Bench. This was another case of a usufructuary mortgage. Here the deed contained this provision:

“Thereafter on the 30th Panguni, Bhava year, causing the aforesaid Rs. 200 to be paid (on paying the aforesaid Rs. 200) we shall (redeem or recover back) our land. If on the date so fixed the amount be not paid and the land recovered back, in whatever year we may pay the Rs. 200 in full on the 30th Panguni of any year, then you shall deliver back our lands to us.”

This mortgage is on all fours with the mortgage with which the present appeal is concerned. The Court regarded the payment in any subsequent year on 30th Panguni as a valid term, but the judgment contains no discussion of the question.

Two decisions of the Allahabad High Court also support the contention of the appellants. The first was given in Gokul Kalwar v. Chandar Sekhar where it was held that, in the case of a usufructuary mortgage redeemable during the fallow season, it is for the mortgagor to do everything that is necessary to enable the mortgagee to vacate possession during that particular season. If this is not done, the mortgagee is entitled to remain in possession until the next fallow season and, being thus lawfully in possession, he is not liable for mesne profits. The second case is Kirpal Singh v. Sheoambar Singh. In that case there was a mortgage by conditional sale which gave the mortgagor the right of redemption on payment of the amount in the month of Jeth within fifteen years of the deed. It was held that it did not amount to a clog on the equity of redemption inasmuch as the intention was to permit redemption only at a time when the crops were not standing.

By providing that there should be redemption only on the 30th Panguni the parties in the present case themselves decided what should be regarded as reasonable notice and, as we have seen, under the provisions of section 60 of the Transfer of Property Act the mortgagee is entitled to reasonable notice. It was certainly reasonable to provide that there should be no right of redemption during the cultivation season. It is in fact manifestly fair that redemption should take place during the fallow season. We hold that the provision for redemption on pay merit on the 30th Panguni does not amount to a clog on the equity of redemption and consequently the plaintiff was not entitled to a decree for mesne profits prior to the date of the plaint.

The appeal will be allowed and the decree of the trial Court modified, accordingly.

The appellants are entitled to their costs here and proportionate costs in the Court below as against the plaintiff.

G.R