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Mohammad Karamat Ali Khan Vs. Ganeshi Lal and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtAllahabad
Decided On
Reported inAIR1927All552; 101Ind.Cas.516
AppellantMohammad Karamat Ali Khan
RespondentGaneshi Lal and anr.
Excerpt:
- - the mortgagee might very well have chosen particular persons out of the mortgagors as the persons to whom he would let out the property. as to the second plea that the suit was bad because in effect it was a suit by a mortgagee for interest and not a suit by a landholder for rent, it appears to me impossible to deny a usufructuary mortgagee the right to lease the mortgaged land to the mortgagor and by so doing to bring what under a simple mortgage would have been interest into the category of rent......by ignoring the provisions as to occupation by the mortgagee, in view of the fact that the apparent right of occupation was contradicted by a stipulation in the form of a colourable lease that the mortgagor should continue occupation. the deeds were, therefore, construed as simpler mortgage-deeds. in the present case the right of the mortgagee to recover interest was confined to the contingency of the profits on the land realized by means of a lease to the mortgagor not reaching a certain amount. the mortgagee before claiming any interest under that mortgage would be bound to show that he had done everything that he could to realize profits up to the amounts stated. he would, thus, be bound to show that he had taken full advantage of the lease given to the mortgagee. in the present.....
Judgment:

Makerji, J.

1. This appeal arises out of a suit for arrears of rent for the years 1328 to 1330 F. under the following circumstances.

2. The defendants-respondents are father and son. The Defendant No. 1 as the lather of two minor sons of his and the Defendant No. 2 as an adult son mortgaged their zemindari property to the appellant's father Kunwar Latafat Ali Khan. This was on the l0th of May 1913. The defendants alone (without the minor sons of the Defendant No. 1) executed on the same day, 10th of May 1913, a counterpart of a lease (qabuliat) by which they purported to take over the mortgaged property under a lease and agreed to pay a certain amount of rent. Subsequently, on the 20th of September 1915, the original mortgagors, lather and sons, borrowed a further sum of money from the same mortgagee and gave a mortgage-deed. On the same day, the two defendants agreed by a document to pay enhanced rent the amount added being the amount due as interest on the money subsequently borrowed. When the appellant brought his suit for arrears of rent, one of the pleas taken up was that the two transactions or rather the several transactions of mortgages and qabuliats formed a consolidated simple mortgage and the plaintiff's remedy was by a suit for recovery of interest or principal and interest as the case might be, and not by a suit for arrears of rent.

3. The plaintiff put forward a plea that his father had previously obtained a decree for arrears of rent and that decree operated as res judicata. The learned Assistant Collector who heard the suit framed several issues and by a very short judgment decided that the several transactions formed a simple mortgage and that the ex-parte decree could not operate as res judicata.

4. In this Court it has been contended for the appellant that the defence was barred as res judicata and further, on the merits, the suit for arrears of rent should have succeeded.

5. On the first point it was argued on behalf of the respondents that the question of res judicata could be decided only after the appeal has been decided on the merits. It was urged that if the first suit was not cognizable by the revenue Court the second suit was also not cognizable by the revenue Court. In, my opinion this contention is not right. Both the suits were for arrears of rent and as such both were cognizable by the revenue Court. The defendants no doubt sought to get the suit dismissed on the plea that no relation of landlord and tenant subsisted between the parties. This was really a question of fact. If it had been held in the first suit that no such relation existed, the suit would have been dismissed on the finding, but not because the suit, as brought, was not cognizable by the revenue Court. The ex-parte judgment of the revenue Court established that the relationship of landlord and tenant does exist between the present parties. In my opinion the former judgment does operate as res judicata.

6. On the merits too, I am of Opinion that the appellant is entitled to succeed. I have already mentioned that the mortgagors and the lessees are not identical. The mortgagors included two minors while the lessees are only the adults among the mortgagors. The mortgagee might very well have chosen particular persons out of the mortgagors as the persons to whom he would let out the property.

7. The second point to be noticed is that there is a right reserved by the mortgagee to eject the lessees in the case of a breach by them of any of the conditions of the lease. Thus, although, to start with, the lease and the mortgage were to be contemporaneous, it was open to the mortgagee to rescind the lease and to take over possession of the leased property in the case of a breach of any of the covenants contained in the lease.

8. The third point is that the mortgage deeds do not contain any stipulation by which the mortgagee could recall his money. If all the four transactions specified above formed but one simple mortgage, one would expect that the mortgagee would be entitled to ask for Mis money and interest. But no such provision has been pointed out. It is clear, therefore, that the mortgage was a usufructuary one and nothing but an usufructuary one; That being' do, the mortgagee was entitled to be in possession and it cannot be said that the lease was merely a method of recovering the interest and the lease should be treated as a part of the mortgage. There is nothing in the law which may prevent a usufructuary mortgagee from entering into any arrangement which might facilitate the recovery of what he might consider to be a reasonable return for his money. One of the methods usually adopted is the leasing out of the mortgaged property either to third parties or to the mortgagor himself.

9. As regards the two cases quoted in the judgment of the Court below, they were decided on the particular documents before the learned Judges and I do not propose to consider the terms of the documents considered there.

10. I would, therefore, allow the appeal set aside the decree of the Court below and remand the suit to it for decision on the merits. I would direct that the costs here and the costs in the Court below should be costs in the cause.

Ashworth, J.

11. I concur in the above finding. I agree with the reasons for holding that a previous suit for arrears of rent operated as res judicata and debarred the respondents from pleading that the relationship in the present suit of landholder and tenant did not exist. As to the second plea that the suit was bad because in effect it was a suit by a mortgagee for interest and not a suit by a landholder for rent, it appears to me impossible to deny a usufructuary mortgagee the right to lease the mortgaged land to the mortgagor and by so doing to bring what under a simple mortgage would have been interest into the category of rent. He could lease to a third party and why not to the mortgagor? In the decisions relied upon by the lower Court, Baghelin v. Mathura Prasad [1882] 4 All. 430 and Altaf Ali Khan v. Lalta Prasad [1897] 19 All. 496 the facts were different. There the mortgagee was given a right to realize under the mortgage the whole interest on the mortgage loan. He was also given the right to realize this interest as rent under a contemporaneous lease. The former provision was inconsistent with the latter, for it was inconsistent with the mortgagee being given a right of occupation which he could pass back to the mortgagor by a lease. There could not have been an intention that the mortgagee should at the same time have a right of occupation by the mortgagee in lieu of interest and a right to interest. There was thus an ambiguity in the mortgage-deeds which the Courts avoided by ignoring the provisions as to occupation by the mortgagee, in view of the fact that the apparent right of occupation was contradicted by a stipulation in the form of a colourable lease that the mortgagor should continue occupation. The deeds were, therefore, construed as simpler mortgage-deeds. In the present case the right of the mortgagee to recover interest was confined to the contingency of the profits on the land realized by means of a lease to the mortgagor not reaching a certain amount. The mortgagee before claiming any interest under that mortgage would be bound to show that he had done everything that he could to realize profits up to the amounts stated. He would, thus, be bound to show that he had taken full advantage of the lease given to the mortgagee. In the present case, therefore, the mortgagee had not only a right to sue on the lease but was bound to do so. The decision referred to, if rightly construed, appears to me to be no authority for holding that a usufructuary mortgagee cannot at the time of mortgage (i.e., in the same transaction), lease to the mortgagor the land, occupation of which is being transferred to him (the mortgagee) under the mortgage, or for holding that, where the object of the lease is merely to facilitate collection of what would have been interest (and not rent) if the mortgage had not been usufructuary, the lease will be inoperative.


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