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Jalappa Vs. Narasimha Setty and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtAndhra Pradesh High Court
Decided On
Case NumberLetters Patent Appeal No. 141 of 1960
Judge
Reported inAIR1963AP420
ActsTransfer of Property Act, 1882 - Sections 60
AppellantJalappa
RespondentNarasimha Setty and ors.
Appellant AdvocateK. Venkataramaiah, Adv.
Respondent AdvocateT.S. Narasingarao, Adv.
DispositionAppeal dismissed
Excerpt:
.....act, 1882 - father of appellant mortgage property in favour of respondent - appellant filed suit for redemption of mortgage property - respondent claimed suit for redemption misconceived - appeal filed before high court - extinguishment of right of redemption can be made by act of parties or by decree of court - no particular form of redemption needed - evidence showed appellant sold mortgaged property to respondent - respondent appropriated sale amount towards such mortgage property in his accounts - condition for payment of amount borrowed after 5 years does not restrict extinguishment before such period with consent of parties - no subsisting mortgage as mortgaged property sold to respondent - held, suit for redemption cannot be filed. - - as per the terms of the mortgage,..........as stated already.4. later, pedda narasappa, the elder of the brothers, executed a registered sale deed dated 15-4-1932 in respect of items 1 to 3 of the hypothecated properties for a sum of rs. 400/-(ex. b. 2). it was recited therein that the sale price was adjusted towards the debt due under the possessory mortgage deed, the original of ex. a.1. on the same day the said pedda narasappa also executed a registered sale deed in respect of the fourth item of the hypotheca in favour of one pennayya, a resident of chadam village for rs. 80/-. (ex. b. 3). it was expressly recited in that sale deed that that sum was paid to the mortgagees towards the mortgage debt.5. one of the mortgagees, china kristappa is dead now. but, he had given evidence as d.w. 2 in the court of the first instance.....
Judgment:

Narasimham, J.

1. This is a Letters Patent Appeal against the judgment of Srinivasachari, J. in S.A. 693 of 1956 affirming the judgment of the Subordinate Judge, Anantapur in A.S. 3 of 1955 and dismissing the plaintiff's appeal.

2. The appellant herein was the plaintiff. The suit was instituted for redemption of certain properties which were originally mortgaged by the plaintiff's father, one Chinna Narasappa and his (plaintiff's father's) elder brother, Pedda Narasappa under a usufructuary mortgage deed D/- 24-2-1928. A registration copy of it was exhibited as Ext. A-1. The mortgagees were impleaded as defendants 1 and 2. The alienees of portions of the hypotheca and those in possession were impleaded as the other defendants in the suit.

3. The facts of the case are these : Pedda Narasappa and China Narasappa were two undivided brothers who were living in Chadam Village in Rayadurg taluk of Anantapur District. They were having the business of running toddy shops. They acquired some lands and house in Chadam Village. They executed a possessory mortgage of two items of land and two houses situated in the village borrowing Rs. 500/-from one China Kristappa and Ramappa, two brothers of Rayadurg village. Ex. A-1 is the registration copy of the said mortgage deed. As per the terms of the mortgage, the mortgagees should enjoy the income for 5 years and at the end of 5 years, the mortgagors agreed to pay the amount borrowed under the mortgage deed. The mortgaged properties consisted of four items as stated already.

4. Later, Pedda Narasappa, the elder of the brothers, executed a registered sale deed dated 15-4-1932 in respect of items 1 to 3 of the hypothecated properties for a sum of Rs. 400/-(Ex. B. 2). It was recited therein that the sale price was adjusted towards the debt due under the possessory mortgage deed, the original of Ex. A.1. On the same day the said Pedda Narasappa also executed a registered sale deed in respect of the fourth item of the hypotheca in favour of one Pennayya, a resident of Chadam village for Rs. 80/-. (Ex. B. 3). It was expressly recited in that sale deed that that sum was paid to the mortgagees towards the mortgage debt.

5. One of the mortgagees, China Kristappa is dead now. But, he had given evidence as D.W. 2 in the court of the first instance about the mortgage and the sales. He stated that the mortgage was discharged by the payments under the sales and that the mortgage deed was returned to Pedda Narasappa with an endorsement of discharge and that as Pedda Narasappa could not pay anything more on account of poverty, he left off the balance of Rs. 20/- due under the mortgage deed.

6. The mortgagees effected certain alienations of the properties sold. Those alienations do not now concern us and therefore need not detain us.

7. Pedda Narasappa and his brothers (the mortgagors) subsequently migrated to Bellary. Chinna Narasappa moved to Bellary first. At that time the plaintiff was 14 years of age. Pedda Narasappa also joined his younger brother in Bellary two or three years later. Pedda Narasappa died shortly thereafter. Chinna Narasappa, the appellant's (Plaintiff's) father, also died a year after Pedda Narasappa's death.

8. While so, the appellant instituted the suit O.S. 393 of 1951 in the court of the Additional District Munsif, Bellary for redemption of the mortgage, Ex. A. 1, alleging that the sale of items 1 to 3 of the hypotheca was vitiated by fraud and misrepresentation and did not confer any rights on the mortgagees, that the sale was taken without the knowledge or concurrence of the co-mortgagor, that Pedda Narasappa was not authorised to sell the mortgaged properties to the mortgagees and that in any event Pedda Narasappa could not convey title to more than a half share in the property.

9. The suit was resisted on pleas that Pedda Narasappa was the manager of the joint family comprising of himself and his brother and he had every right to deal with the properties, that the allegations of fraud and misrepresentation in respect of the sale of the properties to the mortgagees were untrue, that the mortgage having been discharged, a suit for redemption would not lie and that in any event the suit for possession was barred by time as having been filed more than 12 years after the mortgage was discharged.

10. The learned District Munsif upheld the pleas raised in defence and dismissed the plaintiff's suit. His express findings were : that Pedda Narasappa was the manager of the joint family consisting of himself and his brother China Narasappa, that the sales were effected for the discharge of the mortgage debt which was incurred for family necessity, that the mortgage debt became discharged by the sales under Exs. B. 2 and B. 3 in 1932 and that the suit for redemption failed.

11. The matter was carried in appeal to the Subordinate Judge, Anantapur, in A.S. 3 o) 1955. The learned Subordinate Judge confirmed the findings of the District Munsif and dismissed the appeal.

12. In Second Appeal, our learned brother, Srinivasachari, J. affirmed the decision of the lower appellate court.

13. In this Letters Patent Appeal, Sri Venkatramayya for the appellant-plaintiff has presented the appellant's case of redemption thus : The usufructuary mortgage deed, Ex. A. 1, has specifically stated that the amount borrowed under the mortgage bond was payable at the end of 5 years. It having been agreed that way, the question of redemption arose only at the end of 5 years and not earlier. When one of the executants effected a sale of the properties comprised in the hypotheca without the knowledge of the other, that would not disentille the co-mortgagor to treat the mortgage as still subsisting and redeem the property. In any event, the share of the co-mortgagor in the hypotheca remains unaffected.

14. In support of his contentions, he relied on the express language of Section 60, which deals with a right of mortgagor to redeem and a decision of the Oudh Court in Kishen Gopal v. Abdul Latif, AIR 1940 Oudh 97.

15. Before we address ourselves to these contentions, we may recall the concurrent findings of the Courts below that the mortgagors were undivided brothers, that Pedda Narasappa was the manager, that the mortgage debt was incurred for family necessity, and that Pedda Narasappa discharged the said mortgage debt by sales of hypotheca under Exs. B. 2 and B. 3 of even date. Both the courts, below have also accepted the case of the mortgagees that the mortgage was discharged by Pedda Narasappa.

16. It may be recalled that it was the plaintiff's case that the sale to the mortgagees was brought about by fraud and misrepresentation and that was found against.

17. On these findings, it would be apparent that the mortgage debt was incurred by the manager of the family for necessity and that the mortgage was also discharged by the manager of the family by effecting sales under Exs. B. 2 and B. 3.

18. With this background, the mortgage having been discharged by Pedda Narasappa on 15-4-1932, the son of China Narasappa has now come forward with a suit for the redemption of the mortgage. His main plea to get rid of the sales having failed, the sales will have to be accepted and valid and binding on the plaintiff.

19. Sri Venkatramayya's contention is that Pedda Narasappa could not have redeemed the mortgage by sale of the properties before the expiry of 5 years stipulated under the mortgage bond. Even so, we have not been referred to any authority which precludes the redemption of a mortgage by consent of the mortgagees prior to the period stipulated under the mortgage deed.

20. We would now refer to the express terms of Section 60 of the Transfer of Property Act in so far as it is relevant :

'Section 60. At any time after the principal money has become due, the mortgagor has a right, on payment or tender, at a proper time and place, of the mortgage-money, to require the mortgagee (a) to deliver to the mortgagor the mortgage deed and all documents relating to the mortgaged property which are in the possession or power of the mortgagee, (b) where the mortgagee is in possession of the mortgaged property, to deliver possession thereof to the mortgagor ......

Provided that the right conferred by this Section has not been extinguished by act of the parties or by decree of a court.

The right conferred by this section is called a right to redeem and a suit to enforce it is called a suit for redemption.'

The express terms of the section postulate the right of redemption provided that it is not extinguished. An extinguishment of the right to redeem could be by act of parties or by a decree of court. A purchase by the mortgagee subsequent to the mortgage of the equity of redemption will extinguish the right to redeem, by act of parties. There is no particular form in which redemption is required to be made. It can be evidenced by the facts of a case and the conduct of the parties. Thus, where the mortgagor sold his property to the mortgagee and the sale price, equal to the mortgage money, due on the date, was appropriated by the mortgagee towards the mortgage in his accounts, it was held that the sale deed and the conduct of the parties were sufficient proof of redemption of the mortgage. Vide Kunj Behari Lal v. Bisheshwar Singh, AIR 1934 Oudh 98.

21. So, the relevant question in this case is whether there has been an extinguishment of the right to redeem by act of parties.

22. The stipulation in the mortgage bond for the payment of the amount borrowed 'at the end of 5 years' cannot in law preclude such an extinguishment before the stipulated period by consent of parties.

23. In K. Satyavatamma v. G. Padmavatamma, 1956 Andh L. T. 478 : (AIR 1957 Andh Pra 30) a similar question was considered. Chief Justice Subbarao, as he then was, observed thus with regard to the pertinent question :

'The Judicial Committee in Bakhtwar Begum v. Husaini Khanum 26 Mad L.J. 474 : (AIR 1914 P.C. 36) laid down that there can be a contract to the contrary between the parties conferring upon the mortgagor a right to redeem earlier than the term for which the mortgage was created. Mr. Ameer Ali, who delivered the judgment on behalf of the Board, observed at p. 477 (of Mad LJ): (at p. 37 of AIR) :

'Ordinarily, and in the absence of special condition entitling the mortgagor to redeem during the term for which the mortgage is created, the right of redemption can only arise on the expiration of the specified period and take back the property. Such a provision is usually to the advantage of the mortgagor'.

The well established principle, therefore, is that ordinarily the right to redeem cannot be exercised till the mortgage amount becomes due unless there is a specific term conferring such a right on the mortgagor to redeem it earlier ... But, as was held by the Judicial Committee, it is subject to a specific contract between the parties'.

24. The aforesaid observation of the learned Judge lends support to the view that the mortgage could be redeemed before the period stipulated by consent of parties.

25. There is sufficient proof in this case that there was such extinguishment of the right of redemption by act of parties and both the fact finding courts have repelled the contention that the mortgagees had played a fraud in obtaining the sale of the hypotheca. We therefore find that there was such extinguishment by act of parties in this case.

26. Sri Venkatramayya had placed reliance on a decision of Oudh Court in AIR 1940 Oudh 97. The facts of the case were : One Abdur Rahman Khan was the owner of the property in dispute. He mortgaged with possession the entire property on 8th September 1884. His sons : Abdul Ghafoor Khan, Abdul Majeed Khan, Abdul Hameed Khan and Abdul Hasan Khan were added as the executants of the deed. In 1893 the mortgagee assigned his mortgage rights in favour of one Ram Karan. In 1894 Abdul Majid Khan and Abdul Hameed Khan among the executants and others sold the entire property under mortgage to the mortgagee for a consideration of Rs. 2850/-. A sum of Rs. 2500/- was recited to have been left with the mortgagee as due on the mortgage. The sale deed was ratified by Abdul Hasan sometime later. Thereafter, some of the representatives of the original mortgagor, Abdur Rahman Khan, laid the suit for recovery of the property by redemption of the mortgage.

27. The suit was resisted on the footing that the equity of redemption was purchased.

28. It was found as a fact in that case that plaintiffs 1 and 2 or the predecessors-in-interest of plaintiffs 3 to 11 were no parties to the sale and it was admitted that their interests did not pass by it. It was also found as a fact that there was no evidence to indicate that the plaintiffs or their predecessors-in-interest ever exhibited any acquiescence on their part amounting to a release of their interest in the equity of re-demption or any consent, express or implied, to the change in the mortgagee's possession from a mere mortgagee to a full owner. On these findings, the learned Judges expressed themselves thus at p. 102 :

'In our opinion the correct law is that where there are several co-mortgagors and the entire equity of redemption in the mortgage is transferred to the mortgagee by some only of the co-mortgagors, the possession of the mortgagee as regards other co-mortgagors remains only that of a mortgagee.'

and further thus :

'In our opinion the sale of 1894, although purporting to be in respect of the entire equity of redemption as against plaintiffs 1 and 2 and predecessors of plaintiffs 3 to 11 who were no parties to it, was a nullity and did not affect their share in it at all. The effect of the sale deed was to bring about a sale of the share in the equity of redemption only of those mortgagors who were proper parties to it and to that extent the mortgagee became full owner of the property but as regards the shares of plaintiffs 1 and 2 and predecessors of plaintiffs 3 to 11 his possession as a mortgagee did not undergo any change'.

29. It is manifest that those who purported to sell could not convey full title to the property.

30. That decision renders little assistance to Sri Venkatramayya, in support of his contention as formulated supra. We may recall that this was a case of manager of a family creating a mortgage for family necessity and discharging it by sale of a brunt of the properties to the mortgagees. One of the mortgagees, who had since died, had deposed to the discharge of the mortgage by the sale under Exs. B. 2 and B. 3. So, the decision cited is clearly inapplicable.

31. We may also recall that no exception could be taken to the sales for the discharge of a mortgage debt incurred for legal necessity.

32. In the result, therefore, we find that the suit for redemption now laid is misconceived and does not He. A suit for redemption could lie only if there is a subsisting mortgage. The mortgage having been discharged, the suit is manifestly misconceived.

33. We, therefore, dismiss the Letters Patent Appeal with costs.


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