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Balvantrao Venkatrao Vs. Satappa Shidappa and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtMumbai
Decided On
Case NumberFirst Appeal No. 43 of 1945
Judge
Reported inAIR1951Bom8; (1950)52BOMLR681
ActsDebt Law; Dekkhan Agriculturists' Relief Act, 1879 - Sections 15D
AppellantBalvantrao Venkatrao
RespondentSatappa Shidappa and ors.
Appellant AdvocateG.R. Madbhavi, ;K.G. Datar and ;H.B. Datar, Advs.
Respondent AdvocateK.N. Dharap and ;V.N. Lokur, Advs. for Nos. 1 and 5, ;T.S. Jahagirdar, Adv. for No. 5, ;A.A. Adarkar, Adv. for Nos. 20, 21 and 23, ;S.M. Shah and ;Arvind D. Desai, Advs. for ;H.M. Choksi, Adv. for No.
Excerpt:
.....but where the true nature of the transaction is in issue between the parties, whether it is a sale or mortgage, then the agriculturist can avail himself of section 15d of the act. therefore section 15d can be requisitioned by an agriculturist even though the transaction may ostensibly be that of a sale but in reality is that of a mortage.;savant v. bharmappa (1983) 35 bom. l. r. 604, followed.;mt. bachi v. bikchand (1910) 13 bom. l. r. 56, p. c., not followed.;krishnaji v. sadanand (1924) 26 bom. l. r. 841, distinguished.;chandabhai v. ganpati (1916) 18 bom. l. r. 768, referred to. - - dharap is perfectly right that section 150 does not permit an agriculturist to avail himself of the special facilities given by this act, if he intends to file a suit to challenge a transaction on..........of law that if the true nature of the transaction is in issue between the parties whether it is a sale or mortgage, then the agriculturist cannot avail himself of section 15d. i should have thought that that is the very purpose for which section 15d was intended. it is not as if section 15d could only be requisitioned when admittedly the transaction between the parties is that of a mortgage. the agriculturist is entitled to the same rights and facilities even though the transaction may ostensibly be that of a sale but in reality is that of a mortgage. it is important to not that in this case the plaintiff is not challenging the transaction. he does not allege that no transaction took place on 2-12-1914, or that that transaction was vitiabed by fraud. in this suit, he stands by the.....
Judgment:

Chagla, C.J.

1. [After narrating facts the judgment proceeded.] A preliminary point has been taken by Mr. Dharap that the suit wasnot maintainable by the plaintiff. Mr. Dharap contends that if the existence of a mortgage ischallenged, then a suit would not lie under Section 15D, Dekkhan Agriculturists' Relief Act, for accounts. According to Mr. Dharap, the plaintiff must first get rid of the impediment of thesale-deed before he could come under Section 15D for accounts. He must first file a suit to set asidethe sale-deed and after that was done then onlyhe could maintain a suit for accounts under theDekkhan Agriculturists' Relief Act. Section 15Dpermits an agriculturist whose property ismortgaged to sue for an account of the amount of principal and interest remaining unpaid on the mortgage and for a decree declaring thatamount. It also permits him at any time beforethe decree to apply for redemption if it be found that on the taking of accounts any amount is due to the mortgagee. Section 10A deals with the power of the Court to determinethe true nature of the transaction, and, contraryto the provisions of Section 92, Evidence Act, to admit oral evidence in contradiction of thewritten document which embodies the transaction between the parties. Therefore, Under Section 10A, it is open to an agriculturist to lead evidence to show that although a document in terms purports to be a sale-deed, it was orally agreed between the parties that the real transaction should be that of a mortgage. Mr. Dharap is perfectly right that Section 150 does not permit an agriculturist to avail himself of the special facilities given by this Act, if he intends to file a suit to challenge a transaction on the ground of fraud or to set aside a document on that ground. It is also true that an agriculturist can avail himself of the provisions of this Act provided there is title in him as the mortgagor. He must come to Court alleging that the equity of redemption is in him and he wants accounts to be taken against his mortgagee. But it is not a correct principle of law that if the true nature of the transaction is in issue between the parties whether it is a sale or mortgage, then the agriculturist cannot avail himself of Section 15D. I should have thought that that is the very purpose for which Section 15D was intended. It is not as if Section 15D could only be requisitioned when admittedly the transaction between the parties is that of a mortgage. The agriculturist is entitled to the same rights and facilities even though the transaction may ostensibly be that of a sale but in reality is that of a mortgage. It is important to not that in this case the plaintiff is not challenging the transaction. He does not allege that no transaction took place on 2-12-1914, or that that transaction was vitiabed by fraud. In this suit, he stands by the transaction of that date, but what he says is that the true nature of the transaction was not what appears on the face of the document, but what was orally agreed to de hors the document. Mr. Dharap has relied on a decision of the Privy Council in support of his contention. That is reported in Mt. Baohi v. Biclcchand 13 Bom. L. R. 56 : 9 I. C. 393 . In that case there was a mortgage of 500 acres of land and subsequently there was a sale of 122 acres, and the result of the sale was that the mortgage on the whole of the property was extinguished, and in the suit which went up to the Privy Council the sale of 122 acres was alleged to be really & mortgage and not a sale. The Judicial Commissioner of Sind held that no suit for redemption would lie because the mortgage was extinguished by the sale of 122 acres and the mortgagors obtained the balance free of the mortgage, and as there was no mortgage, a suit for redemption would not lie. It is important to note that although the existence of the mortgage was in dispute, yet the Judicial Commissioner of Sind did not hold that the suit was riot maintainable, but after investigating into the merits and after ho had held as a fact that there was no mortgage, he dismissed the suit as the plaintiff could not ask for redemption when there was no mortgage at all. In the Privy Council the judgment of the Board was delivered by Lord Macnaghten. It is a very short judgment which confirms the judgment of the Judicial Commissioner of Sind and dismisses the appeal. But there is one sentence in the judgment on which Mr. Dharap has relied. According be the Privy Council, the suit filed by the plaintiffs was a suit to recover property of which the rightful owner had been deprived by fraud. According to their Lordships, the suit was a suit for redemption merely in form, but in reality it was not so, and that, according to their Lordships, settled the case. With very great respect, it is difficult to understand how in the case before them the rightful owner had been deprived by fraud. That does not seem to have been the contention of the plaintiffs from the facts that one can gather from the report of the case. But at the highest, all that the Privy Council decided was that if a particular suit was in substance a suit challenging a transaction on the ground of fraud, then the mere fact that the suit takes a form of a redemption suit would not entitle the plaintiff to maintain it under the Dekkhan Agriculturists' Relief Act. This case has been followed and considered in two Bombay cases on which also Mr. Dharap relied. One isChandabhai v. Ganpati : AIR1916Bom199 . There Sir Stanley Batchelor, A. C. J., and Shah J. held that a suit which was primarily for setting aside of a fraudulent deed of sale was outside the scope of the Dekkhan Agriculturists' Belief Act, although it purported to be a suit for redemption. In the subsequent decision in Krishnaji v. Sadanand 26 Bom. L. R. 341 ; A.I.R. 1924 Bom. 417. :Sir Norman Macleod, C. J. and Shah J. held that the particular suit they were considering did not lie under Section 15D, Dekkhan Agriculturists' Relief Act. In that case the plaintiff came to the Court on the allegation that the equity of redemption sold by his brother was not binding on him, and therefore, before he could maintain a suit for accounts under Section 15D or a suit for redemption, he had to satisfy the Court that the equity of redemption was wrongly alienated and that the equity was still in him, and as Sir Norman Macleod points out (p. 344) :

''But it seems to me that it will be impossible for the plaintiff to succeed until be can satisfy the Court that the alienation was bad as far as his share in the equity of redemption was concerned, and that he was entitled to consider his rights as mortgagor under his sale-deed from the descendants of Kusaji were still in existence.'

There is a sentence in the judgment of the learned Chief Justice which lends some support to the contention of Mr. Dharap, and the sentence is this (p. 344) :

'It will be seen therefore that a suit of that land will only lie on the presumption that there was a mortgage in existence by an agriculturist and that an issue whether or not a mortgage was in existence could not be entertained.'

And Mr. Dharap says that in this suit also an issue does arise whether a mortgage was in existence or not and such an issue cannot be entertained in a suit under Section 151). With great respect to the learned Chief Justice, that particular observation must be read in its own context and in the light of the facts which the learned Chief Justice was called upon to decide, and, as I have already pointed out, the facts in that case clearly show that an impediment had to be removed by the plaintiff before he could get accounts under Section 15D, Dekkhan Agriculturists' Relief Act, and the impediment was the alienation of the equity of redemption by his brother. Then there is a judgment of Sir John Beaumont in Savant v. Bharmappa 35 Bom. L. R. 604 : A. I. R. 1938 Bom. 306. That case is directly in point, and the learned Chief Justice sitting singly held that under Section 15D of the Act an agriculturist mortgagor can sue for accounts although the suit may involve a preliminary inquiry whether the transaction in suit is a mortgage or a sale. Asthe learned Chief Justice points out under. Section 15D of the Act the plaintiff, has to prove his mortgage, he comes to Court on the allegation that there is a mortgage and then he seeks to prove that mortgage with the help of special rules of evidence contained in Section 10A of the Act. If Mr. Dharap's contention were to be accepted, even where the suit is in respect of a transaction which has taken the form of a mortgage, the plaintiff has to prove that document if the execution is put into issue by the defendant. Therefore, the result would be that as soon as the defendant denied that the transaction was a mortgage, the plaintiff could not avail himself of Section 15D, Dekkhan Agriculturists' Relief Act. We do not accept Mr. Dharap's contention that the judgment of Sir John Beaumont is in conflict either with the decision of the Privy-Council or with the decision of the divisional benches in Chandabhai v. Ganpati : AIR1916Bom199 and Krishnaji v. Sadanand 26 Bom. L. R. 341 : A. I. R. 1924 Bom. 417. The preliminary point, therefore, fails, and, in our opinion, the plaintiff was competent to maintain the suit. [The rest of the judgment is not material to this report].


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