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Paremajalu Chettiappa Vs. Pattangeri and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKarnataka High Court
Decided On
Case NumberSecond Appeal No. 300 of 1953
Judge
Reported inAIR1954Kant187; AIR1954Mys187
ActsTransfer of Property Act, 1882 - Sections 60, 62 and 76; Coorg Land Revenue Act - Sections 106, 106(4) and 145; Indian Trusts Act, 1882 - Sections 90; Limitation Act, 1908 - Schedule - Articles 12 and 148; Code of Civil Procedure (CPC), 1908 - Sections 11 and 96
AppellantParemajalu Chettiappa
RespondentPattangeri and ors.
Appellant AdvocateK.P. Muddappa, Adv.
Respondent AdvocateV. Krishnamurthy and ;A.C. Nanjappa, Advs.
Excerpt:
.....able as well as bound to pay the land revenue due to government, that in spite of that sale the suit property had continued to remain all along in the possession of defendants 1 to 4 and was never in the possession of defendant 5 or his father; and cannot be invoked to assist a person like defendant 5 or his father, who has been a party to the fraud with the mortgagees and has sought to assist the mortgagee to commit breach of a constructive trust as defined under section 90 of the indian trust act. he is not the mortgagee and does not admit that he is liable to be redeemed in 1951. he claims that he is the owner of the property and if, as has been viewed by the courts below, he is not clothed with any independent title but is merely a name-lender or alias for defendants 1 to 4, he..........sister's husband belliappa, father of defendant 5, who has since died; and that in spite of the sale defendants 1 to 4 have continued to be in possession and enjoyment of the property. defendants 1 to 4 pleaded that the suit, which was brought on 15-5-1944, was premature as the plaintiffs were not entitled to redeem the properties before 19-3-1951. they denied that there was any collusion between them and the 5th defendant's father and pleaded that the lands were sold for arrears of land revenue because they themselves were unable to pay the assessment and that the fifth defendant's father is a bona fide purchaser and not a benamidar for them. defendant 5 pleaded similarly that the property was his by virtue of the purchase in the revenue sale by his father and that the sale was not.....
Judgment:

Vasudevamurthy, J

1. The suit by the plaintiffs for redemption and possession of the plaint schedule lands has been decreed by the Court below and defendant 5 has come up in second appeal. The lands were mortgaged with possession by Pattangeri alias Markje Thammiah, father of plaintiffs 2 to 5, and Belliappa, father of plaintiff 1, in favour of Thekkada Belliappa the father of defendants 1 and 2 and grand-father of defendants 3 and 4 under a usufructuary mortgage deed dated 19-3-1894. According to the plaintiffs the mortgagee was entitled to the usufruct of the property for a period of 50 years from the date of that mortgage. He was bound to pay land revenue and other dues payable to Government upon the said property and to pay himself a sum of Rs. 600/- and interest thereon from the income of the property during that period, and thereafter restore back possession of the property to the mortgagors.

It was also alleged in the plaint that while defendants 1 to 4 were in possession as legal representatives of the original mortgagee they wilfully allowed the property to be sold for arrears of land revenue due to Government and got it knocked down for their benefit in the name of their own sister's husband Belliappa, father of defendant 5, who has since died; and that in spite of the sale defendants 1 to 4 have continued to be in possession and enjoyment of the property. Defendants 1 to 4 pleaded that the suit, which was brought on 15-5-1944, was premature as the plaintiffs were not entitled to redeem the properties before 19-3-1951. They denied that there was any collusion between them and the 5th defendant's father and pleaded that the lands were sold for arrears of land revenue because they themselves were unable to pay the assessment and that the fifth defendant's father is a bona fide purchaser and not a benamidar for them. Defendant 5 pleaded similarly that the property was his by virtue of the purchase in the revenue sale by his father and that the sale was not fraudulent.

2. Both the Courts below who have upheld the plaintiffs' right to redeem have held that the revenue sale was brought about fraudulently by defendants 1 to 4 who were able as well as bound to pay the land revenue due to Government, that in spite of that sale the suit property had continued to remain all along in the possession of defendants 1 to 4 and was never in the possession of defendant 5 or his father; that only nominally the property had been got knocked down in the name of defendant 5's father benami for defendants 1 to 4 and for their benefit and that the plaintiffs' suit was not premature and was maintainable.

3. Mr. Muddappa, learned counsel who appears for the appellant, has urged that the suit is barred under Section 106 Clause 4 of the Coorg Land Revenue Act. That section is meant to bar a suit against a real purchaser in a revenue sale, where a certificate has been issued to him and he has been put in possession, for a declaration that the sale is benami; and cannot be invoked to assist a person like defendant 5 or his father, who has been a party to the fraud with the mortgagees and has sought to assist the mortgagee to commit breach of a constructive trust as defined under Section 90 of the Indian Trust Act. He was in reality merely an agent of defendants 1 to 4 and what they could not gain if they had purchased the property themselves personally cannot be permitted to be achieved if they bought it through an agent. See -- 'Deo Nandan Prashad v. Janki, Singh', AIR 1916 P.C. 227 (A) which was a similar case of a benami purchase. Section 106(4) is designed to prevent fraudulent claims and to use it in the way now sought as against the plaintiffs would be to use it as a machinery to effect and perpetuate a fraud.

In -- 'Nuzar Ally Khan v. Ojoodhyaram Khan', 10 Moo Ind. App. 540 (B) which was also a similar case of benami purchase in revenue auction to defraud a mortgagee their Lordships of the Privy Council held that as the sale was a fraudulent one brought about by the mortgagee's representative in possession, the Act under which it was held did not apply so as to defeat the mortgagor's equity of redemption. The sale was to be considered as nothing more than a private sale and impressed a trust on the estate which passed under it. There had been a fraudulent agreement between the mortgagee's representative in possession and the purchaser at the Government sale and so both were estopped as against the mortgagor from relying upon the sale. Even Section 145 of the Coorg Land Revenue Act provides for a revenue sale being set aside by a Civil Court when such a sale is vitiated by fraud. In view of the concurrent findings of the Courts below that the revenue sale was fraudulently brought about by defendants 1 to 4, mortgagees, that the purchase by defendant 5's father was really by them alone and was for their benefit though nominally the bid was knocked down in the name of defendant 5's father, neither Section 106(4) nor Section 145 of the Coorg Land Revenue Act can operate as a bar to the plaintiff's present suit for redemption and possession of the mortgaged property which has been really in the possession of the mortgagees.

4. He has next urged that the plaintiffs should have brought a suit within one year of the sale for setting aside of the revenue sale under Article 12 of the Limitation Act and that not having done so their suit is barred by time. This is not a case where the plaintiff has brought a suit against the Government or against the person who has purchased the property in a revenue auction complaining of irregularity or fraud committed in the conduct of the sale or its earlier proclamation or later confirmation.

After the sale the plaintiffs applied to the revenue authorities for the same being set aside, but the revenue authorities saw no reason to do so apparently as the sale had been properly conducted and that is all they were then concerned with; they were not concerned to see whether defendant 5's father had purchased the property for himself or fraudulently as benamidar of defendants 1 to 4. If defendant 5's father is merely a benamidar or name-lender for defendants 1 to 4 it is as though defendants 1 to 4 themselves have purchased the property. The finding of the Courts below is that defendant 5's father was living with defendants 1 to 4 and their father, and that the former or defendant 5 never paid kandayam for the suit lands except in 1045-46 and that the same was done by defendants 1 to 4 who have continued to remain in possession all along. There was therefore no need at all for the plaintiffs to sue for setting aside the revenue sale because they could ignore it as, In spite of the revenue sale, the property continued to remain with the mortgagees, who held it subject to the mortgage and the plaintiffs are entitled to redeem it. See -- '10 Moo Ind. App. 540 at 543 (PC) (B).

5. It has next been urged that the plaintiffs' suit is premature. That plea is not raised in the written statement of the 5th defendant and I do not see how he could be allowed to raise such a plea. He is not the mortgagee and does not admit that he is liable to be redeemed in 1951. He claims that he is the owner of the property and if, as has been viewed by the Courts below, he is not clothed with any independent title but is merely a name-lender or alias for defendants 1 to 4, he cannot resist the suit for redemption when they themselves had put forward that plea in the Courts below and have failed. Defendants I to 4 have not appealed to this Court and the judgment of the Courts below that the suit is not premature and that they are liable to be redeemed and to deliver up possession with mesne profits has now become final.

6. However, as it has been urged before me that the plaintiffs' suit is premature, I may consider that plea also. The learned Munsiff, on a reading of the document, has held that the period of 50 years must be counted from the date of the mortgage. On the other hand the learned District Judge has observed that 50 years may have to be counted after the expiry of 7 years during which period the property had already been mortgaged with possession to one Derappa whose rights had been assigned in favour of the mortgagees earlier to the date of Ex. A, I have gone through the document and I think that the learned Munsiff's interpretation of the document may be preferred to that of the learned District Judge. (His Lordship then referred to the document and after quoting a portion of the text of the document in Kannada, proceeded:)

The learned District Judge has, in spite of his observation, agreed with the learned Munsiff in holding that the suit is not premature and in allowing redemption. The ground on which that has been done by both the Courts is that the mortgagee, having failed to perform the duty cast on him to pay the land revenue assessment and having allowed the property to be sold for arrears of land revenue, cannot insist on the mortgagor keeping to one of the terms of the mortgage, namely, the period of 50 years. Such a plea is also unreasonable and self contradictory. If the mortgagors like the plaintiffs simply kept quiet and waited for the period of mortgage to run, they might later on be met by plea of limitation or adverse possession as has been put forward by defendant 5 in this case.

7. There is no doubt that when a mortgagee, who is liable to pay arrears of land revenue either as an usufructuary mortgagee under Section 76(c)) of the Transfer of Property Act or under an agreement with the mortgagor, fails to so pay the land revenue and allows the mortgaged property to be sold and purchases it himself, he holds it as trustee and for the benefit of 'the mortgagor. See Section 90 of the Indian Trusts Act -- Illustration A. (S) It has been held in -- 'Narasimha Rao v. Immani Seshayya', AIR 1925 Mad 825 (C) that when a term is fixed in a usufructuary mortgage deed and possession is given to the mortgagee, it is the duty of both the parties to adhere to the terms of the mortgage, and that if the mortgagee committed breach of any of the terms 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 has given a go by to the other terms of the deed.

9. Similarly hi -- 'Chhatku Rai v. Baldeo Shukul', 34 All 659 (D) redemption was allowed before the expiration of the period fixed on the ground that it was equitable to do so as the defendants had not performed the contract so far as they were concerned. In -- 'Rashik Lal v. Ram. Narain', 34 All 273 (E) referred to for the Appellant the distinction between a contract and a conveyance is pointed out and it has been held that the mere fact that a part of the mortgage money is not paid does not render the mortgage itself invalid. That case has no bearing on the question which has arisen in this case.

10. In -- '1 Mys LJ 30 (F) where a mortgaged property which was sold for arrears of land revenue owing partly to the default of the mortgagee & purchased by a stranger was subsequently purchased by the mortgagee himself, the mortgage, it was held, was revived and could be redeemed by the mortgagor or his heirs; and it was immaterial that the default of the mortgagee was not the sole cause of the sale or that it was not intentional, the reason being that no man was to be allowed to take advantage of his own wrong, a principle embodied in Section 90 of the Indian Trusts Act. -- '10 Moo. Ind. App. 540 (B)'; -- Kalappa v. Shivaya', 20 Bom 492 (G); -- 'Sanagapally Lakshmayya v. Intoory Bolla Reddy1, 26 Mad 385 (H) and other cases have been relied on in that decision.

11. Mr. V. Krishnamurthy, learned Counsel for the respondents has also referred to Jones on Mortgages 8th Edn. page 714 where it is said:

'when the payment of the taxes is a duty on the part of the mortgagee he is like a trustee and cannot affect the right of the mortgagor by purchasing the property at a sale for such taxes........... if the mortgagee has bought the tax title for the benefit of the mortgagor as well as for his own benefit he cannot afterwards set it up against the mortgagor to defeat redemption by him.'

12. In the result, I find there are no grounds to interfere with the judgments and decrees of the Courts below. This appeal is accordingly dismissed with costs of plaintiffs 1 to 5.

13. Appeal dismissed.


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