1. One Venkatrayudu Pantulu mortgaged the plaint properties to one Venkanna by two deeds, Exs. A and B on the 2nd May, 1865. The equity of redemption was sold by the Court in execution of a money decree against the mortgagor and was purchased by the plaintiff. He has brought the suit for the redemption of the mortgage against the defendants who are the representatives of Venkanna alleging that the mortgage debt has been discharged and that he is entitled to have an account taken of the rents and profits of the mortgaged property. The District Munsif held that the plaintiff was not entitled to redeem the mortgage as the term of 55 years fixed in the mortgage deed had not expired and he gave a decree for a certain amount which under the mortgage the mortgagee undertook to pay to the mortgagor. The plaintiff appealed and the Subordinate Judge of Ellore dismissed the appeal. The plaintiff has preferred this Second Appeal.

2. The first contention is that he is entitled to redeem . the mortgage before the expiry of the term as the term is only for his benefit. Mr. Somasundaram who appears for the appellant contends that the presumption is that the term fixed in the mortgage deed is always for the benefit of the mortgagor and that he is entitled to redeem the mortgage at any time he likes. When possession is given to the mortgagee and the mortgagee is asked to pay himself the interest on the mortgage amount from the rents and profits of the mortgaged property and when the rents and profits are liable to fluctuation, it cannot be said that the term fixed in the mortgage is only for the benefit of the mortgagor. In such a case the term is equally for the benefit of the mortgagee as well as the mortgagor. It is well settled that when a term is fixed in a usufructuary mortgage deed and possession is given to the mortgagee, unless there be a clause in the mortgage deed itself enabling the mortgagor to redeem the mortgage at any time he chooses, the mortgagee is entitled to remain in possession till the close of the term. Where the mortgagee is asked to pay himself the principal and interest out of the rents and profits of the mortgaged property, he is entitled to remain in possession till the mortgage debt is wiped off from the rents and profits of the property. The appellant relied upon the case reported in Mashook Ameen Suzzada v. Marem Reddy (1875) 8 MHCR 31 as supporting his contention. The facts in that case, no doubt, are similar to the present. But what the learned Judges held in that case was that it was a mortgage and that the mortgagor was entitled to redeem the property. The case does not support the appellant's contention. In Sri Raja Setrucherla Ramabhadraraju Bahadur v. Sri Raja Vairicherla Surianarayanaraju Bahadur ILR 2 M 314 it was held that

"where the parties agree that possession of the property shall be transferred to a mortgage for a certain term it may be inferred that they intended that redemption should be postponed till the end of the term. But the creation of the term is by no means conclusive on this point."

Ankinedu v. Subbhah ( 1911) ILR 35 M 744 : 21 MLJ 1010 does not help the appellant. All that was held in that case was that a provision in the mortgage deed whereby the mortgagee is to remain in possession after the payment of the mortgage debt is unenforceable as it acts as a fetter upon the right to redeem. In Muhammad Sher Khan v. Raja Seth Swami Dayal ( 1921) ILR 44 A 185 : 42 MLJ 584 it was held that the provisions of Section 60 of the Transfer of Property Act were imperative and that the right of redemption cannot be taken away by any contract between the mortgagor and the mortgagee. Even an anamolous mortgage is subject to the provisions of section 60.

3. The right of the mortgagor to redeem the mortgage is not disputed but the question is, when does the right to redeem accrue? In Bakhtawar Begam v. Husaini Khartum (1914) ILR 36 A 195 at 199 : 26 MLJ 474 (PC) their Lordships of the Privy Council held: "Ordinarily and in the absence of a special condition entitling the mortgagor to redeem during the term for which the mortgage is created, the right to redeem can only arise on the expiration of the specified period;. But there is nothing in law to prevent the parties from making a provision that the mortgagor may discharge the debt within the specified period and take back the property." In Tirugnana Sambandha Pandara Sannadhi v. Nallatambi (1892) ILR 16 M 486 : 2 MLJ 272 Muthuswami Aiyar, J., and : Wilkinson, J., held "Having regard to Sections 60 and 62 of the Transfer of Property Act the Legislature appears to have adopted the principle that in the absence of a stipulation to the contrary the presumption is that the right to redeem and the right to foreclose arise at the same time and that when a date is fixed for the payment of the mortgage debt and the mortgagee cannot foreclose earlier the mortgagor also cannot redeem before the appointed time "See also Gunnam Dorayya v. Vadapalli Ayyamacharlu (1914) 27 MLJ 295 at 298 and Aga Muhammad Ally Beg v. Venkatappayya (1918) 35 MLJ 287.

4. In Ex. A the term fixed is 50 years and Ex. B extends the term by 5 years. So the period during which the mortgagee was entitled to remain in possession is 55 years from 1865. There is no provision in either of the deeds for the mortgagor redeeming the property before the expiry of 50 years and the appellant therefore is not entitled to ask for redemption of the mortgage merely on the ground that he has the equity of redemption.

5. The next point urged by Mr. Somasundaram is that the mortgagee has been guilty of a breach of contract and therefore he is entitled to sue for redemption before the expiry of the term fixed in the mortgage deed. Under the contract evidenced by Ex.A it was agreed that the mortgagee should pay Rs. 60 to the mortgagor for his expenses, Rs. 95 towards beriz payable to the circar, and Rs. 5 for village expenses and should apply the balance of the income of the property, namely, Rs. 80 towards the liquidation of his debt, and the debt should be liquidated in the course of 55 years. It is contended by Mr. Somasundaram that the mortgagee failed to pay Rs. 60 to the mortgagor as agreed to by him and failed also for several years to pay the beriz of Rs. 95 and also the amount payable for village expenses and therefore there having been, a breach of contract on the part of the mortgagee the plaintiff is entitled to redeem the mortgage. When the parties to a mortgage agree to certain terms it is the duty of both parties to adhere to the terms of the mortgage. In this case the mortgagee undertook to pay annually Rs. 60 to the mortgagor for his expenses and it is admitted that he did not pay this amount to him. The contention of Mr. Lakshmanna for the respondent is that the mortgagor was entitled to sue for Rs. 60 in case of default and he is not entitled to treat the non-payment of Rs. 60 or failure to pay Rs. 60 per annum as a breach : of the contract between the parties and he relies upon the clause in the document

"If the amount of Rs. 60 payable to me every year is not paid in any year you should relinquish a portion in proportion to the cist payable to me."

He urges that it was open to the mortgagor to have asked the mortgagee to relinquish a portion of the land capable of yielding Rs. 60 and if the latter declined to do so the former should have brought a suit for the amount and he is not entitled to treat the default to pay Rs. 60 as a breach of the condition in the mortgage deed. I am unable to accept this contention. Where the mortgagee undertakes to pay out of the rents and profits of the land mortgaged to him a certain amount for the expenses of the mortgagor he is bound to carry out that term of the contract and when he undertakes to pay beriz on the land, his failure to pay it would amount to a breach of the contract as it would thereby expose the land to be attached and sold for arrears of beriz. In this case the mortgagee undertook to pay three different sums for three different purposes and he not having paid those sums as agreed to by him, I think it is equitable that he should not be allowed to insist upon one of the terms of the mortgage deed being given effect to when he himself gives a go-by to the other terms of the deed. The mortgagee remaining in possession for a number of years is in consideration of his not only applying a portion of the rents and profits towards his debt but also in consideration of his meeting certain demands which ought to be met out of the income of the property. In a case like this I think a Court of Equity ought to give relief to the mortgagor and allow him to redeem the property before the expiry of the term.

6. I am supported in this view by the observations of Richards, C. J. and Banerji, J. in Chhotku Rai v. Baldeo Shukul (1912) ILR 34 A 659 at 662: "We think that on equitable grounds the defendants not having performed what we deem to be a most essential part of the contract so far as they are concerned, the plaintiffs ought to be allowed to redeem the property before the expiration of the period of 10 years." No doubt the facts in that case are not very similar to those of the present. There the mortgagees failed to discharge prior encumbrances which they had undertaken to discharge and they having been in possession of the mortgaged property, and in receipt of rents and profits thereof, allowed interest to accumulate in respect of the encumbrances. The learned Judges held that "if the mortgagees were allowed to remain in possession of the property over the full period of 10 years taking the profits the plaintiff will be without any proper or effectual remedy." The principle of the decision is applicable to the present case. Mr. Lakshmanna contends that the mortgagor should have enforced payment of the amount payable to him by a suit. I do not think that the mortgagor should have been driven to file a suit year after year for the recovery of the amount payable to him by the mortgagee, nor was he bound to pay beriz on the land year after year and bring a suit every year against the defendant for the amount paid by him. In order to show that both mortgagors and mortgagees should carry out the terms of the contract embodied in the mortgage deed I may refer to the case in Seaton v. Twyford LR 11 Eq. Cases 591. Sir James Bacon, V.C. observed as follows: "The mortgagor who stipulates that he shall have 5 years to pay the mortgage money must of necessity, whether it is expressed or not, undertake at the same time that if he fails to do that which is incumbent upon him during the period of 5 years to do, the restriction upon the mortgage shall thereupon cease." In India the non-payment of interest by the mortgagor to the mortgagee is not a sufficient ground for the mortgagee to bring a suit for sale before the expiry of the period fixed for payment of the principal but the decision shows that both parties should carry out the terms of the contract entered into by them.

7. If the mortgage amount has been paid off the right to redeem accrues, and if a suit for redemption is not brought within the statutory period it will be barred. The Privy Council held in Bakhtawar Begam v. Husaini Khanum (1914) ILR 36 A 195 : 26 MLJ 474 (PC) that a suit for redemption was barred in as much as it was alleged by the plaintiff that the mortgage debt became satisfied in 1838. The mortgagee not having paid the amount payable to the mortgagor was bound to apply that amount in reduction of the mortgage debt. When the mortgagee is in possession of Kinds arising from the rents and profits of the mortgaged premises he is entitled to pay himself first the interest on the mortgage amount and whatever remains over and above he is bound to apply towards the reduction of the capital. The mortgagee is not bound to accept the mortgage amount from the mortgagor if he tenders it before the expiry of the term. But where he is in possession of the mortgaged property and unless there is a stipulation that all the rents and profits should be applied towards interest, whatever remains over and above the interest due on the mortgage amount is bound to be applied towards the reduction of the principal. This is clear from Thompson v. Hudson L. R 10 Eq. Cases 497. In that case Lord Romilly, M. R. held that when the mortgagees received a considerable sum of money by sale of a portion of the mortgaged property they were not entitled to charge interest on the whole of the principal amount mortgaged and keep the amount realised by sale in their hands. He held that that sum should have been applied in part payment of the mortgage amount. I may refer in this connection to an observation of Mr. Justice Mahmood in Jaijit Rai v. Gobind Tiwari (1884) ILR 6 A 303 at 308 :

"By a long course of decisions it has been settled in India that even a special agreement to the effect that the mortgagee shall remain in possession until the payment of the debt is made in one sum does not prevent the mortgage from being at an end whenever the mortgagee has realised both the principal and interest upon the usufruct. This rule, though it probably originated in the express provisions of the old Regulations, is so consonant with equity that it deserves recognition by the Courts even irrespective of statutory provisions."

8. It was next argued by Mr. Somasundaram that the term of 55 years expired in 1920 after the decree in the District Munsif's Court and before the appeal was filed in the District Court and he is therefore entitled to ask for an account. In the view I have taken of the right of the mortgagor to ask for redemption I do not think it is necessary to discuss this point in detail. In Sri Rajah Setrucherla Ramachandra Raju v. Maharajah of Jeypore (1916) 1 MWN 354 the learned Judges observe:

"It has been held in several cases that the Appellate Court can take cognizance of matters which happened after the institution of the suit for the purpose at any rate of moulding the relief which the plaintiff was entitled to. This will be done only in exceptional cases where it is necessary to prevent injustice or avoid multiplicity of proceedings."

Mr. Lakshmanna relies upon Ramanadhan Chetty v. Pulikutti Servai ( 1898) ILR 21 M 288 : 8 MLJ 121 and Govinda v. Perumdevi ( 1888) ILR 12 M 136 and contends that what happened subsequent to the institution of the suit should not be taken as a ground for giving relief to the plaintiff. In Govinda v. Perumdevi ( 1888) ILR 12 M 136 the plaintiff sued for a declaration that a certain alienation made by a widow was in-.valid. Pending the appeal the widow died. He applied to amend the plaint by adding a prayer for possession. The Court held that it could not give permission to amend the plaint. In Ramanadhan Chetty v. Pulikutti Servai ( 1898) ILR 21 M 288 : 8 MLJ 121 the person who acquired the lessor's title brought a suit to eject certain trespassers from the leasehold property. Pending the appeal the term of the lease expired. He asked leave to amend the plaint pending the appeal by adding a prayer for possession. The Court held that such an amendment could not be granted. In the two cases there were two causes of action. The cause of action on which the suit was based was one and a different cause of action arose when the appeal was pending. But here the cause of action is the same, namely, the right of the plaintiff to redeem the mortgage. The plaintiff asks for redemption on the ground that the mortgage has been discharged and now the term having expired pending the appeal he relies upon that and says he is entitled to redeem. Possession of the mortgaged properties has been given to the plaintiff. So the question of redemption of the mortgaged properties is only of an academic interest. The real question is whether he is entitled to an account. It would not be right to drive the plaintiff to another suit for the purpose of taking an account on the ground that on the date of the suit the term of the mortgage had not expired. But as I have already held that the mortgagor was entitled to bring a suit on the date of the discharge of the mortgage amount, the contention of the respondent that the plaintiff is not entitled to rely upon what happened subsequent to the institution of the suit need not be considered.

9. The plaintiff is entitled to have an account taken of the rents and profits of the mortgaged premises. There is no question of limitation arising in the case. So long as the relationship of mortgagor and mortgagee subsists the mortgagee who is in possession of the mortgaged premises is bound to account for the rents and profits of the land. Vide Parasurama Pattar v. Venkachalam Pattar (1913) 25 MLJ 561. It was observed in that case:

"So long as the relationship of mortgagor and mortgagee continues, the obligation of the mortgagee to make all payments provided in the mortgage deed also subsists. At (he time of redemption when the mortgagor is required to pay the amount due by him under the mortgage deed the mortgagee is also bound to give him credit for all payments which he is bound to make under it."

See also Jaijit Rai v. Gobind Tiwari ( 1884) ILR 6 A 303 at 310. The plaintiff is entitled to be given credit for all the sums received by the mortgagee. His contention is that the mortgage was discharged so far back as 1887. The amounts which the mortgagee undertook to pay the mortgagor and to the Zamindar and for village expenses should be applied in taking an account towards the reduction of the principal amount of the mortgage. See in this connection Ramavatar v. Tulsi Prosad Singh ( 1911) 14 CLJ 507.

10. It was feebly urged by Mr. Lakshmanna that the amount of Rs. 60 was a personal allowance and the plaintiff as an auction-purchaser of the equity of redemption was not entitled to get that amount. There is nothing in the document, Ex. A, to show that Rs. 60 payable to the mortgagor was a personal allowance. That amount was agreed to be paid by the mortgagee as only a portion of the rents and profits was sufficient for liquidating the debt, and the plaintiff who has purchased the equity of redemption is entitled to rely upon the terms of the document. 1 do not think there is anything 'in this contention. The plaintiff is entitled to the amount of Rs. 60 payable to the mortgagor in whose shoes he stands.

11. The plaintiff is entitled to have an account taken of the sums received by the mortgagee. I set aside the decree of the Lower Courts and direct the District Munsif to take an account of the rents and profits of the mortgaged property. In taking the account, sums payable by the mortgagee should be applied towards the liquidation of the mortgage amount and after the date of the discharge of the mortgage amount, the mortgagee is liable for the rents and profits to the mortgagor. The plaintiff is entitled to the costs of this appeal, and to the costs in the Lower Courts.

12. The Memorandum of Objections having been posted to be spoken to this day, the Court delivered the following

13. The Memorandum of Objections is dismissed.

14. Appellant is entitled to refund of Court-fee paid in this Court.