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Zabulal Durgalal S/O. Kanhayalal Hiralal Srivastav, Since Deceased by Heirs and ors. Vs. State of Maharashtra and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai High Court
Decided On
Case NumberSpecial Civil Application No. 1070 of 1979
Judge
Reported in1981MhLJ202
ActsMaharashtra Debt Relief Act, 1975 - Sections 4, 6, 7, 8 and 9
AppellantZabulal Durgalal S/O. Kanhayalal Hiralal Srivastav, Since Deceased by Heirs and ors.
RespondentState of Maharashtra and ors.
Appellant AdvocateS.J. Deshpande, Adv.
Respondent AdvocateS.P. Kanuga, A.G.P. for respondent No. 1 and ;D.Y. Loveker, Adv. for respondent No. 3
Excerpt:
property - eviction - sections 4, 6, 7, 8 and 9 of maharashtra debt relief act, 1975 - whether authorised officer entitled to evict person in occupation of mortgaged property inducted on premises by mortgagee in possession - symbolical possession delivered to owners or to original debtor who was predecessor in title - moment statutorily mortgage debt extinguished ownership of owners restored to entitle them all benefits which flow from ownership of property - authorised officer justified in handing over only symbolic possession to original debtor leaving him to follow such remedies under law to take actual possession from tenant inducted on premises by creditor - held, not possible to issue any mandamus to authorised officer directing him to evict tenant and deliver physical possession to..........referred to as 'the act'), falls for consideration in this petition. the question is whether the authorised officer is entitled to evict a person in occupation of mortgaged property inducted on the premises by the mortgagee in possession.2. one zabulal, the original debtor, who is now no mere and is represented by his legal representatives who are hereinafter referred to as 'the owners of the property' had mortgaged a house used for a shop purposes at ambajogi by registered deed of mortgage dated 21st december, 1957 in favour of the present respondent no. 3, the creditor, for a sum of rs. 4700/-. admittedly the mortgagee inducted the present respondent no. 4 as a tenant in the premises. though the exact date when the premises were let out to the tenant cannot be ascertained on record,.....
Judgment:

M.N. Chandurkar, J.

1. An important question with regard to the powers of the Authorised Officer under the Maharashtra Debt Relief Act, 1975 (hereinafter referred to as 'the Act'), falls for consideration in this petition. The question is whether the Authorised Officer is entitled to evict a person in occupation of mortgaged property inducted on the premises by the mortgagee in possession.

2. One Zabulal, the original debtor, who is now no mere and is represented by his legal representatives who are hereinafter referred to as 'the owners of the property' had mortgaged a house used for a shop purposes at Ambajogi by registered deed of mortgage dated 21st December, 1957 in favour of the present respondent No. 3, the creditor, for a sum of Rs. 4700/-. Admittedly the mortgagee inducted the present respondent No. 4 as a tenant in the premises. Though the exact date when the premises were let out to the tenant cannot be ascertained on record, there is no dispute that the tenant has been in occupation of the premises prior to the coming into force of the Act.

3. After the coming into force of the Act, the Tahsildar passed an order on 18th January, 1977 that the possession of the shop should be delivered to the original debtor. It appears that the debtor had applied on 28th September, 1976 to the Tahsildar that possession should be delivered to him and the debt should be treated as having been discharged. The Tahsildar also issued a memo to the Circle Inspector, Ambajogi directing him that the premises should be taken possession of by him and the tenant should be directed to deposit the rent in the Tahsil office. There is on record an agreement dated 31st January, 1977 executed by the tenant which acknowledges the fact that he has taken possession of the premises from the State Government. The agreement also contains an undertaking that he will vacate the premises whenever the Government directs him to do so. Though this document recites that the tenant received possession of the premises from the Government, there can be no doubt that those recitals were formal in nature inasmuch as it is not in dispute that throughout, the tenant has continued to be on the premises and had at no time vacated the premises.

4. On 6th May, 1978 the Tahsildar, who was the Authorised Officer, directed the Circle Inspector to handover possession of the house in question to the debtor. It appears that accordingly a panchanama came to be executed on 11th June, 1978 evidencing the transfer of possession of the premises from the Circle-Inspector to the debtor. Even with regard to this document there is no dispute that the possession said to have been transferred was in such manner that it was capable of being transferred, namely, that it was a symbolical possession because the premises were in occupation of the tenant. It appears that the original debtor had been repeatedly approaching the revenue authorities such as the Tahsildar and the Commissioner for being actually placed in possession of the premises. In one of his applications to the commissioner he admitted that he was in symbolical possession and only 'right of ownership in given to the applicant and not the actual possession'. At one stage it appears that the Tahsildar directed the debtor to approach the Deputy Collector, Ambajogi, under the Rent Control Act for having the premises vacated.

5. Having been unsuccessful in obtaining vacant possession of the premises via the machinery provided by the Act, the original debtor who is now represented by the present owners of the property have approached this Court under Article 226 of the Constitution for a direction to the Authorised Officer that he should deliver possession of the shop in question. The averments made in the petition seem to make a grievance that the Tahsildar is deliberately avoiding to hand over vacant possession of the premises to the debtor with the result that he was being put to a loss of about Rs. 350/- per month.

6. The tenant who is admittedly in possession of the premises has not cared to appear in these proceedings. The creditor, against whom an order that the mortgage debt stands discharged is made, has appeared in these proceedings before us, but he can hardly resist any claim for possession by the debtor because his debt having been held to be discharged and that order of the Authorised Officer not having been challenged by the creditor, his appearance in these proceedings is really wholly immaterial.

7. The stand taken by the State Government is that only symbolical possession could have been handed over in the circumstances of the case and that the Authorised Officer did not have power to evict a person in occupation of the property.

8. Mr. S.J. Deshpande appearing on behalf of the petitioners has vehemently contended that the Authorised Officer is bound to implement the provisions of the Act. The learned Counsel has relied on the provision in section 4 of the Act, the effect of which is that the debt of the debtor stands wholly discharged on the coming into force of the Act and according to him, it would not be permissible for the person in occupation to resist-possession on the ground that he was a tenant inducted into the premises by the mortgagee in possession. According to the learned Counsel, even under the general law the right of a tenant on the premises by the mortgagee comes to an end on the redemption of the mortgage and the tenant has, therefore, no right to be in possession and if the policy of the Act has to given effect to and the debtor has to be treated as having been wholly discharged from the liabilities arising out of the mortgage, power must be spelt under the Act enabling the Authorised Officer to evict a person in occupation. In other words, according to the learned Counsel, in the case of a mortgage liability which is extinguished under the provisions of the Act unless vacant possession of the mortgaged premises or mortgaged property is handed over full benefit of the Act cannot be said to have been given to the debtor. Any other view, according to the learned Counsel, would default the object of the Act and a construction of the different provisions of the Act which will disable the Authorised Officer from exercising the power to evict a person in occupation must be avoided.

9. A brief reference to the provisions of the Act becomes necessary in order to decide the contentions raised on behalf of the owners of the property. The substantive provision which brings about a discharge of a debt liability and enumerates the consequences of such discharge is to be found in section 4 of the Act. There is no dispute that Zabula was a 'debtor' within the meaning of that term as defined in section 2(f) of the Act. Under section 4 of the Act the debt of the debtor outstanding on the appointed day is statutorily deemed to be wholly discharged by all concerned. Section 4 then sets out the consequences which follow from the discharged of the debt liability. The two clauses referred to before us are Clauses (a) and (e) which read as follows:

'(a) No such debt due from a debtor on the appointed day shall be recoverable from him or from or against any movable or immovable property belonging to him, nor shall any such property be liable to be attached and sold or proceeded against in any manner in the execution of any decree or order relating to such debt against him.'

'(e) Every property pleaded or mortgaged by such debtor shall stand released in favour of such debtor, and the creditor shall be bound to return the same to the debtor forthwith on the debtor making an application in writing in that behalf; and the creditor shall pass a receipt to the debtor of having then the debtor may get the application endorsed to that effect under the signature and date of any of the officers referred to in section 6 or by any person authorised by them in this behalf.'

So far as Clause (a) above is concerned, it prohibits the recovery of the debt in question either from the debtor or from any movable or immovable property belonging to him and no property of the debtor is liable to be attached or sold or proceeded against in any manner in the execution of any decree or order relating to such debt against the order. We are really not concerned with Clause (a) in this petition because the creditor is not seeking to enforce any liability arising out of the mortgage debt in question either against the debtor or against any of his movable or immovable properties. Stress has been laid by the learned Counsel on Clause (e) and, according to the learned Counsel, Clause (e) refers to property pledged or mortgaged by the debtor and such property, whether pledged or mortgaged, has to be returned by the creditor to the debtor forthwith, the only requirement being that the debtor has to make an application in writing in that behalf. Under Clause (e) if the creditor refuses to pass a receipt acknowledging the receipt of the application, then the debtor can get the application endorsed to that effect by any officer referred to in section 6 or by any person authorised by them in that behalf. Now, according to the learned Counsel, when Clause (e) refers to the property mortgaged of pledged being released in favour of such debtor, that creates a right in the debtor to obtain vacant possession of that property. The learned Counsel, has then referred us to the provisions of section 7 which really refer to the proceedings which commence on the dispute raised by a creditor with regard to the eligibility of the debtor to claim relief under the Act. Now, admittedly the present proceedings or the order made therein does not emanate from any dispute raised by the creditor. Indeed it appears that the creditor has acquiesced in the order made by the Authorised Officer that the debt shall stand discharged and that the debtor is entitled to possession of the property.

10. The original application made by the debtor to the Authorised Officer cannot be treated as an application under section 7 because it is the creditor who has to make an application under the provision. However, without going into the technicalities of the question, we may assume that application was essentially an application calling upon the Authorised Officer to Implement the provisions of the Act and give effect to the statutory discharge of the liability flowing out of the mortgage debt under section 4 of the Act. The question which, therefore, has to be decided is, what is the extent of the power of the Authorised Officer in such a case. It is significant that specific provisions in respect of pledged property have been made by the Legislature. Those provisions are to be found in sections 8 and 9. In case, the property pleaded or mortgaged by the debtor which under Clause (e) of section 4 is to stand released in favour of the debtor is not returned by the creditor, then it is open to the debtor to request the officers refereed to in section 6 of the Act to enforce the delivery of possession of such property. These officers are the Commissioner of Police, the District Magistrate, or as the case may be, the Superintendent of Police. These officers are empowered under section 6 to take such steps or use or cause to be used such force as may be reasonably necessary for securing the delivery of possession of the property to the debtor. The contention of the learned Counsel is that when section 6 refers to the property described in section 4(e), the reference must be read as being to both pledged and mortgaged property. According to the learned Counsel, when section 6 requires steps to be taken for securing delivery of possession of pledged or mortgaged property, that must be construed as delivery of vacant possession of the property after ousting the occupant therein.

11. It is useful to refer to the provisions which specifically deal with pledged property. As already pointed out, section 7 enables the credit or to raise a dispute before the Authorised Officer that the person who claims to be his debtor is not a marginal farmer, a rural artisan, a rural labourer or a worker. A creditor can dispute the eligibility of the debtor on any other ground including the valuation of immovable property of a worker. Now, when such an application is made, there is express provision in sub-section (3) of section 7 which provides that no such application shall be entertained by the Authorised Officer unless the creditor either deposits the pledged property or any document evidencing such pledged or both or the value of such property. Under sub-section (8) of section 7 if the decision is in favour of the debtor, then the said pledged property has to be delivered to the debtor forthwith. Under section 8 there is a power of entry and search given to the officers referred to in section 6. This power, as the section shows, can be exercised only in respect of movable property which may be in the form of the pledged article on which may be a document evidencing transaction as relating to a loan given to any debtor if the said property is kept or concealed. In such a case, the officers have the right to enter and search any place without any warrant, where the officer has reason to believe that the property of the debtor or any document evidencing transactions relating to a loan is kept or concealed. Section 9 once again refers to the liability of the creditor to pay the debtor the value of the pledged property if it cannot for any reason as delivered to him. These provisions of the Act, therefore, show that so far as delivery of pledged property is concerned, specific provision has been made. In so far as pledged or mortgaged property is concerned, the words used in Clause (e) of section 4 are 'return the same to the debtor' and in section 6 the words used are 'delivery of possession of the property to the debtor.'

12. So far as the pledged property is concerned, there is no dispute that the property as such can be delivered only by a physical transfer of possession and in case such physical transfer of possession is not possible, the market value of that property has to be paid by the creditor. Now, so far as mortgaged immovable property is concerned, the question is whether the concept of returning the property or delivery of possession of the property necessarily contemplates a delivery of vacant possession of the property if it was legally or judicially in possession of a third person.

13. Mr. Deshpande was vehemently contended on the authority of the decisions of the Supreme Court which were considered by a Full Bench of the Gujarat High Court in Lalji Purshottam v. Madhavji Meghaji, : AIR1976Guj161 , that the tenancy of a tenant inducted on the premises by a mortgage comes to an end with the redemption of the mortgage and that such a tenant is not protected by the provisions of the Rent Act. In Lalji Purshottam's case, the Full Bench of the Gujarat High Court has held on a review of the decisions of the Supreme Court that the tenancy of a tenant inducted on the property by the mortgagee with possession is not binding on the mortgagor after the redemption of the mortgage and is not protected under the provisions of the Bombay Rents Hotel and Lodging House Rates Control Act, 1947, (hereinafter referred to as 'the Bombay Rent Act'). There is an earlier decision of this Court in Kamlakar & Co. v. Gulamshafi Imambhai Musalman, : AIR1963Bom42 , in which the Division Bench has held that the monthly tenancy created by a mortgagee in possession in respect of the mortgaged premises would come to an end when the mortgagor subsequently files a suit and obtains a decree for redemption and the decree would be binding on the tenant and he is not entitled to claim the protection of the Bombay Rent Act when the mortgagor seeks to evict him from the mortgaged premises. Recently the learned Single Judge of this Court has after considering the decisions of the Supreme Court taken the view in Mahadeo Maruti Bhagwat v. Kantilal Khemchand v. Gujar and others, : AIR1980Bom79 , that a tenant inducted by a mortgagee in possession cases to be a tenant on redemption irrespective of whether the property is a agricultural or urban and that it is only when some law other than the Transfer of Property Act steps in and gives protection de hors the Transfer of Property Act that such a tenant cannot be evicted by the mortgagor on the ground that the mortgage has been redeemed.

14. Now, what the learned Counsel for the petitioners contends is that statutorily the mortgage debt having been discharged, the person in occupation has no right to continue in occupation and, therefore, if full benefit has to be given to the debtor of the provisions of the Act, then the occupant must be summarily evicted from the premises.

15. The present petition is neither the proper proceeding nor is it necessary for our present purpose to go into the controversy as to what is the status of the person occupation. For the purposes of the present petition we can proceed on the assumption that respondent No. 4 was a tenant inducted by the mortgagee and the tenancy has come to an end by the statutory discharge of the liability under the mortgage. What has, however, to be decided is whether the Authorised Officer functioning under the limited jurisdiction under the Act has the power to deliver possession of the mortgaged property after physically evicting the occupant or whether it is sufficient compliance with the provisions of the Act if consequent upon a statutory discharge of the liability, a symbolic possession is given to the owners of the property and they are left to the normal remedies under the general law to secure actual possession of the property.

16. The Authorised Officer under the Act is an authority with enumerated powers and where ever certain powers were intended to be exercised by the Authorised Officer or any other Officer entrusted with the duty to enforce the provisions of the Act, such provisions have been expressly made. The elaborate procedure in section 7 and the powers of entry and search in section 8 indicate that the legislature was carefully enough to entrust such powers as, according to its view, were necessary for the purpose of enforcing the provisions of the Act. We cannot forget that the Act is enacted essentially to deal with the relationship between the creditor and the debtor. The statutory effect brought about by section 4 is the discharge of a debt liability. It is nobody's case that merely because physical possession of the property is not handed over to the owners, the mortgage debt does not stand extinguished. As already pointed out, that is not even disputed before us on behalf of the creditor in these proceedings. No doubt, normally as a natural consequence of a discharge of the debt liability the legislature has provided that the consequence of a restoration of the property, which was security for the debt to the debtor must follow. In the case of pledged property the power of search and seizure can be exercised to find out property if it is hidden or concealed. In the case of a creditor disputing the right to the debtor to claim benefits under the Act, the pledged property is first required to be produced before any further enquiry at the instance of the creditor is made. In case the pledged property is not traceable, an equivalent money value of the property is required to be deposited. No express provision seems to have been made enabling the Authorised Officer to oust a person in possession in respect of immovable property. We are dealing in this case with a plea for dispossession of the person who was inducted as a tenant by the mortgagee. We are not expressing any opinion as to whether the mortgagee, if he was in possession, could be straightway dispossessed.

17. It is no doubt true that Clause (e) of section 4 refers to the liability of the creditor to return the same. Now, as section 4 itself will indicate, the several clauses in section 4 set out the statutory consequence of the statutory discharge of the debt liability. When section 4(e) refers to the fact that the creditor will be bound to return the same, refers to the liability of the creditor to return the same. In case immovable property is not returned, how that liability is to be enforced is not very clear from the act except the provisions of section 6. It is only section 6 which provides for the steps to be taken in case the property is not returned by the creditor. The authorities referred to in section 6 are, as already pointed out, the Commissioner of Police or the District Magistrate of the Superintendent of Police and they have to exercise their powers with the aid of section 8. Now, when section 6 refers to these authorities being entitled to use such force as may be reasonably necessary for securing the delivery of possession of the property, it is difficult for us to read that provision as enabling the police authorities to throw out a person whose possession is juridical. It is well-known that a tenant whose tenancy stands terminated does not become a trespassers. His possession is not that of a trespasser. It is still juridical possession and he is to be dispossessed in accordance with law. Use of force permissible under section 6 cannot, in our view, be intended by the legislature for dispossessing a person who is in juridical possession. In the absence of any express power under the Act enabling any of the authorities to forcibly throw out a person in possession, who is entitled to be there till he is dispossessed in accordance with law, it is not possible for us to hold that the delivery of the possession contemplated by section 6 is a delivery of vacant possession after ousting a third party who was earlier lawfully inducted as a tenant. Indeed it is well-known that possession can be delivered even symbolically. With the recognised distinction between symbolical possession and actual possession cannot be delivered as the property was in possession of the tenant whose tenancy is claimed to have stood determined by law will also amount to a delivery of possession under the law as between the creditor and the debtor. If, as already pointed out, third parties whose interests are created by the creditor are not intended to be dealt with by the provisions of the Act, which is essentially a law dealing with the debtor and the creditor, we would be reluctant to extend those provisions so as to affect persons other than the debtor or the creditor.

18. Admittedly in this case, even according to the owners, symbolical possession has been delivered to them or to the original debtor who is their predecessor-in-title. The moment statutorily the mortgage debt was extinguished, the ownership of the owners has been restored, which will entitle gushed, the ownership of the owners has been restored, which will entitle them to all the benefits which flow from the ownership of the property in question which would include the right to recover rent or such amount that may be payable by the person in occupation depending upon whether the owner would choose to treat him as a tenant or as a person who was liable to be evicted. The authorised officer was, therefore, in our view, quite justified in handing over only symbolical possession to the original debtor leaving him to follow such remedies as may be permissible under the law to take actual possession from respondent No. 4 who was originally a tenant inducted on the premises by the creditor. It will be open to the petitioners to recover rent or to recover any amount the character of which may be either rent or compensation for use and occupation from respondent No. 4 because that right to recover it has already vested in them. The petitioners will also be entitled to the amounts which may be lying in deposit made by respondent No. 4.

In the view which we have taken, it is not possible for us to issue any mandamus to the Authorised Officer directing him to physical by evict respondent No. 4 and deliver physical possession to the petitioner. The petitioner, therefore, fails and is dismissed. However, there will be no order as to costs.


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