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Mumbai Mhijibhai Patel and ors. Vs. Trikamlal Laxmidas and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai High Court
Decided On
Case NumberCivil Reven. Appln. No. 3 of 1957
Judge
Reported in(1958)60BOMLR1092
ActsBombay Agricultural Debtors Relief Act, 1947 - Sections 2(4), 2(5), 4 and 7; Transfer of Property Act, 1882 - Sections 59-A and 60; Code of Civil Procedure (CPC), 1908 - Order 34, Rule 1
AppellantMumbai Mhijibhai Patel and ors.
RespondentTrikamlal Laxmidas and ors.
Appellant AdvocateHemendra K. Shah, Adv.
Respondent AdvocateM.C. Shah, Adv.
Excerpt:
.....of property act (iv of 1882), sections 59a, 60--vendee of equity of redemption retaining amount of mortgage debt and applying under section 4 for adjustment of mortgage debt--maintainability of application--whether section 59a of transfer of property act makes purchaser of equity of redemption personally liable for mortgage debt--successor-in-title of usufructuary mortgagor whether personally liable for mortgage debt.;certain lands were mortgaged by the owner under a usufructuary mortgage to the mortgagee. the mortgagor then sold the equity of redemption to the opponent and the latter after paying a certain amount to the mortgagor retained the amount of the mortgage debt for payment to the mortgagee. subsequently the opponent filed an application under section 4 of the bombay..........and laxmidas, under which laxmidas took the liability of the mortgagor to pay the mortgage-debt, laxmidas would not become personally liable for the mortgage debt. such is not the case of opponent no.1. therefore, tshere is no doubt whatsoever that, having regard to the aforesaid ruling, the mortgage-debt was not one which was due from laxmidas to the mortgagee mahijibhai.(4) mr. m.c.shah, who appears on behalf of opponents no.1, however contends that, when the afoessaid privy council ruling was given, section 59a of the transfer of property act was not in existence. he contends that sec. 59a of the transfer of property act makes the difference. now, that section is as follows:'unless otherwise expressly provided reference in this chapter to mortgagors and mortgagees shall be.....
Judgment:
ORDER

(1) This revision petition raises an interesting point of law. The facts necessary to be stated in order to dispose of this point of law are as follows: One Fakirbhai Jijibhai was the owner of S. No.53. He mortgaged the same on 13-3-1924 to one Mahijibhai Patel for Rs.975/-. The mortgage was a usufructuary mortgage. The mortgagor Fakirbhai subsequently sold on 3-4-1926 his equity of redemption for Rs.1499/-, and the vendee was one Laxmidas. That Laxmidas was the father of opponent No.1. Out of the sum of Rs.1499/-, a sum of Rs.524/- was paid to the mortgagor Fakirbhai a8nd the balance of Rs.975/- was retained by the purchaser for payments to the mortgagee Mahijibhai patel. That mortgagee was the father of the present petitioners. Subsquently, on 3---1926, the mortgagor Fakirbhai again pruported to sell the same equity of redemption for a sum of Rs.1300/- and the vendee was the mortgagee Mahijigbhai himself. In 1947, Laxmidas, father of opponent No.1, filed an application under Sec.4 of the B.A.D.R. Act for adjustment of the aforesaid mortgage-debt. An award was passed by the B.A.D.R..Court on 21-7-1955. From that an appeal was preferred to the District Court and the sam was dismissed on 29-9-1956. The petitsioners have come in revision to this Court against that appellate order.

(2) The only point which is urged on behalf of the petitioners is that, having regard to the aforesaid facts, there was no debt which the purchaser Laxmidas owed to the mortgagee, the father of the petitioners, and, therefore, the application for adjustment of that debt did not lie. The contention is based upon the definition of the word 'debt' as given in section 2 sub-section (4) of the B.A.D.R. Act. Before I mention that definition, ir is necessary for me to state the provisions of Sec.4 of the B.A.D.R.. Act, under which the application was made by Laxmidas, the father of opponents No.1. The relevant portion of that section is as follows:

'Any debtor.... may make an application..... to the Court for adjustment of his debts.'

Therefore, it is quite clear thatthe object of the aforesaid application under Sec.4 is the adjustment of the debt of the debtor. In this connection, it is important to notice that a person ay be a debtor and, satisfy the conditions laid down in sub-section (5) of Section 2, but still, before any debt can be adjusted it is necessary that the debt must be his debt. Therefore, the question for consideration is whether, having regard to the aforesaid facts, the mortgage-debt which is sought to be adjusted in the present case is the debt of the purchaser of the equity of redemption viz. Laxmidas aforesaid.

(3) Now turning to the word 'debt' it is defined as follows:

'debt' means any liability in cash or kind, whether secured or unsecured due from a debtor whether payable under a decree or order of any Civil Court or otherwise (and includes mortgage money the payment of which is secured by the usufructuary martgage of immoveable property) but does not include arrears of wages patable in respect of agricultural or manual labour.'

Therefore, in order that a thing may come within the definition of the word 'debt', it is necessary that there should be a liability, and rthar liability must be due from a debtor. Now, having regard to the aforesaid facrs the debt which was owed by the mortgagor Fakirbhai Jijibhai. Therefore the mortgage debt was the debt which was owed by Fakirbhai. The question for consideration is whether, having regard to the fact that Laxmidas became the purchasers of the equity of redemption, and also, having regard tothe fact that Laxmidas retained a sum of Rs.975/- from out of the purchase price to be paid to the mortgagee mahijibhai Patel, Laxmidas became a debtor of the mortgagee Mahijibhai in respect of the aforesaid moretgage debt. Mr. Hirendra K.Shah, who appears on behalf of the petitioners, contends that, by the aforesaid, Laxmidas, did not become a debtor of the mortgagee Mahijibahi. For this purpose, he relise on the ruling reported in Jamnadas v. Ram Autar Pande 39 Ind App 7 . In that case, it was held.

'that the purchaser of an equity of redemption who by agreement with hig vendor the moretgagor retains the amount of the mortgage debt out of the price due does not thereby become personally liable to the mortgagee in respect thereof. The mortgagee was not a party to the agreement, and Sec.90 of the Transfer of Property Act does not apply.'

This is a direct rullingwhichs is on all fours with the fact of the present case, and, having regard to this particular rulling, there is no doubt whatsoever that, unless the opponent N.1 is able to satisfy that there was a tripartite agreement between the mortgagor, the mortgagee and Laxmidas, under which Laxmidas took the liability of the mortgagor to pay the mortgage-debt, Laxmidas would not become personally liable for the mortgage debt. Such is not the case of opponent No.1. Therefore, tshere is no doubt whatsoever that, having regard to the aforesaid ruling, the mortgage-debt was not one which was due from Laxmidas to the mortgagee Mahijibhai.

(4) Mr. M.C.Shah, who appears on behalf of opponents No.1, however contends that, when the afoessaid Privy Council ruling was given, section 59A of the Transfer of Property Act was not in existence. He contends that Sec. 59A of the Transfer of Property Act makes the difference. Now, that section is as follows:

'Unless otherwise expressly provided reference in this Chapter to mortgagors and mortgagees shall be deemed to include references to persons deriving title from them respectively.'

Now in my opinion this section cannot be brought into aid for making a purchaser of the equity of redemption personally liable for a mortgage debt, where,otherewise, he is not so liable. This section only states that wherever the word mortgagor occurs in the Chapter IV of the Transfer of Property Act,the word Mortgagor shall also mean a transferee from the mortgagor. But that does not necessaraily mean that the transferee from the mortgage be comes personally liable for the mortgage-debt. Unless and until Mr.M.C.Shah is in a position to show some section in the Transfer of Property Act shich makes a purchaser of the equity of redemption personally liable for the debt, the aforesaid argument cannot be accepted. Then Mr.M.C.Shah referred me to Sec. 60 of the Transfer of Property Act. That section only gives a right of redemption to the transferee from the mortgagor. But it does not state that the transferee form the mortgagor will be personally liable for the mortgager debt, where, otherwise, according to the substantive law he is not so liable.

(5) The next argument of Mr.M.C.Shah is based upon Sec.7 of the B.A.D.R.Act. That section is as follows::

'No application shall lie under Sec.4 for adjustment of any debt due from a debtor to whome such debt has been transferred or assigned after the 1st January 1938 by any person who is not himself a debtor'.

Mr. M.C.Shah contends that this section is clearly an uthority for the proposition that an application for adjustment of debts can be made not only by a person who is personally jiable for the debts. I cannot agree with this submission. In the first instance, it is important to noticve that athis is a disabling section. it does not confer any righ t upon anu person to make an application fpr adjustment of debts. That right is conferred only by Sec.4 and it is to the section that one must turn tso answer the questsion raised. But even it purpose of interpreting Sec.4 of the B.A.D.R. Act, in my opinion it does not hip opplonent No.1 in meeting the point which is raised on behalf of the petitsioners. Even if sthe aforesaid section is so interpreted as to confer a right upon a transferee or assignee of the original debtors, the transferee or assignee, in order to succeed must prove that he is either a transferee or an assignee of the mortgages debt. Therefore, in my opinion, Sec.7 of the B.A.D.R. Act cannot heop opponent No.1.

(6) Mr.M.C.Shah also referred to Order 34,rule 1. He contended that, in a suit for redemption the mortgagor is a necessar party. This is so. But that does not mean that the debt which is to be adjusted is the debt od the purchaser of the equity of rredemption. It may be that if Fakirbhai himself had filed and application under Sec.4 of the B.A.D.R. Act, then, Fakirbhai would have been entitled to get the present mortgage-debt adjusted.

Whether a purchaser of the equitsy of redemption would have got any benefit out of that or noat is a question which does not fall to be detemined in tshe present application. But the fact is that Fakirbhai has not made an application. The fact that Fakirbhai would be a necessaary party to a suit for redemption doesnot necessarily mean that the debt is one in which Laxmidas is personally interested.Therefore, in my opinion order 34, rule 1 of the Civil Procedure Code also cannot help opplonent No.1 in meeting the aforesaid point.

(7) The last point which was urged by Mr. M.C.Shah was based upon the definition of the word'debtor' as given in the B.A.D.R. Act, in section 2,sub-section (5). That section states that a debtor is one who, amongst other things, is indebted. Mr.M.C.Shah contended that a person may be indebted althougsh he may be personally liable for the debt. He contended that though tshe word 'debt' has been defined in sub-section (4) of Sec.2 aforesaid the word 'Indebted' has not been defined. He contended that, having regard to the object of the B.A.D.R.Act, which was toadjust all thedbts of agricultural debtors, in whatever way they may have been incurrred, I should put a liberal construction upon the word 'indebted' and construe the word in such a way as to include the case of opponents of Mr. Shah were to be upheld, it would not help him at all. This is so person may be entitled to make an application under Sec.4 of the B.A.D.R.. Act the debt to be adjusted must be his debt. If a debtor has an adjustable debt and is entitled to make an application even then, he is not entitled to include in the application a debt which is not his own according to the substantive law. The debt included before a person can succeed in an application must be 'his debt'. Therefore, before a person can succeed in an application for adjutment of a debt, it is necessary for him to establish that the debt which he seeks to adjust is his debt.

(8) In view of the aforesaid discussion, I have come to the conclusion that the opponents No.1 has failed to establish that the mortgage debt, which he seeks to adjust in the present case is his debt and, consequently in my opinion, the award which was passed by the B.A.D.R. Court and upheld by the appellate Court is not sustainable.

(9) The view which I have taken that a purchaser of equity of redemption is not liable for asthe mortgage-debt also detives support from the observations made by Mr.Mulla in his Transfer of Property Act(4th Edn.) at page 444. This is what Mr. Mulla says:

The personal covenant dos not run with the land and no personal decree can be made against 39 Ind App.7 (PC) a purchaser of equity of redemption retained a part of the purchase money under an agreement with the mortgagr to pay the mortrgage not personally liable to the mortgagee under Sec.90 of the Transfer of Property. Order 34, rule 6, as he was not party to the sale nor could he be held liable on the ground that he held the money in trust for the mortgage.

Before I part with this case, there is one more point which I wish to mention and that is regarding that part of the definition of the word 'debt' which states that the'debt' includes mortgage money the payment of which is secured by the usufructuary mortgage of immovable property.' In my opinion, this part of the definition does not make the successor-in-title of a usufructuary mortagagor personally liable for the debt. The aforesaid part of the definition a case which otherwise would have ben excluded from its purview by the general law, and would have debarred a usufructuay mortgagor from taking advantage of the B.A.D.R.Act. The general law is that usufructuary mortgagor is not personally liable for the mortgages debt. Therefore, if the aforesaid part of the definition were not there, then it could have been contended that the usufructuary mortgagor was not sliable for payment of the mortgage debt, and therefore not entitled to make an application under the B.A.D.R. Act. It is in order to meet such an arguments that the aforesaid part of the definition appears to have been intsroduced by an amendment which was made in the Act by Bombay Act 70 of 1948.

(10) For the aforesaid reasons, I have come to the conclusion that the debt which the present opponent No.1 seeks to adjust is not his debt within the meaning of section 4 of the B.A.D.R.. Act, and consequently, sthe application for adjustment of that debt did not lie. The revision application therefore, deserverse to be allowed. Accordingly, I make the rule absolute. The award and the order of the Appellate Court are set aside. The B.A.D.R. Application is dismissed.

(11) Having regard to the fact that this point was not raised in any of the Court below and was raised for the first time in this Court, there will be no order as to Costs

(12) Revision allowed.


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