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Sankaran Parmeswaran Pillay Vs. Sankaran Chandrasekharan Pillay and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKerala High Court
Decided On
Case NumberSecond Appeal No. 398 of 1969
Judge
Reported inAIR1974Ker102
ActsLimitation Act, 1908 - Schedule - Articles 142, 144 and 148; Transfer of Property Act, 1882 - Sections 60
AppellantSankaran Parmeswaran Pillay
RespondentSankaran Chandrasekharan Pillay and ors.
Appellant Advocate T.S. Venkiteswara Iyer,; P.K. Balasubramanyan and; C. Ch
Respondent Advocate P. Kochupappu Achen,; T.A. Gopalakrishna Menon and; K. S
Cases ReferredHarasit Golder v. Jaladhar Biswas
Excerpt:
property - adverse possession - sections 60 and 62 of transfer of property act,1882 and articles 142, 144 and 148 of schedule to limitation act, 1963 - possession by mortgagee whose mortgage has been discharged either by payment or by appropriation of profits of property does not by mere act of extinguishments of mortgage become adverse to mortgagor - contesting defendant to make out how and from what time his possession which started as mortgagee changed character and became adverse - in present case mortgagees are members of tarwad having derived mortgage right by gift from their father - nothing in evidence on record to support case of adverse possession. - - the provisions of the section do not say so and there appears no good reason why the mortgage should continue. it will be..........the section. in addition to these, by the common law applicable to the travancore area, where the suit mortgage was executed, (and where the transfer of property act was not applicable till it was extended by the part b state laws act of 1951), the mortgagee is entitled to be paid the value of improvements effected by him in pursuance of the mortgage, and to remain in possession till the same is paid. this is recognised by the terms of ext. p-6 mortgage itself. this right has since received statutory incorporation, first in the travancore-cochin compensation for tenants improvements act of 1956, and later, in the, kerala compensation for tenants improvements act of 1958, ext. p-7 receipt also contains sufficient indication that amounts by way of compensation for improvements remain to.....
Judgment:

Gopalan Nambiyar, J.

1. Thisis an appeal by the plaintiffs against the decree dismissing their suit, described as a suit for redemption, on the ground that the same is barred by adverse possession. Two items were the subject-matter of the suit. In regard to item 2, it was conceded in the trial court (vide paragraph 8 of the judgment) that the plaintiffs had no right to redeem or recover possession. Despite this concession, in the appeal preferred against the dismissal of the suit, defendants 2 and 3who were interested only in item 2 were also impleaded. The lower appellate court dismissed the appeal with costs of defendants 2 and 3. Despite this, in this second appeal again, the legal representatives of defendants 2 and 3 also have been joined as respondents and relief has been broadly claimed in respect of both the items. We have no hesitation, at the outset itself to dismiss this second appeal with costs as against defendants 2 and 3 (now represented by their legal representatives).

2. The facts giving rise to this second appeal are briefly these. The properties belonged to the tarwad of the plaintiffs and defendants 1 to 3, and were mortgaged by the karanavan of the tar-wad to the father of defendants 1 to 3 by Ext. P-6 dated 9-12-1063 M.E. for a sum of Rs. 175/-. On the terms of the mortgage, the mortgagee was to appropriate profits towards interest on the mortgage and pay a purappad of 54 rupees per year, to the tarwad. The mortgagee was also to effect improvements in the property and to be entitled to their value. The mortgagee gifted his mortgage-right by Ext. D-2 dated 13-4-1089 to his children, defendants 1 to 3. In a partition among them, the mortgage-right was allotted to the share of the 1st defendant. Certain other properties belonging to the tarwad were assigned to a stranger who was directed to pay off Ext. P-6 mortgage. This was done, and Ext. P-7 dated 23-2-1104, is the receipt for discharge of the said mortgage amount. The suit out of which this second appeal arises was instituted on 22nd March, 1960, styled as a suit for redemption and recovery of possession along with the documents of title relating to the properties. Both the courts below found that after discharge of the mortgage amount under Ext. P-7 receipt, the possession of the mortgagee was adverse to the mortgagor's tarwad, and as the said possession had continued for over 12 years, the plaintiffs' rights had been barred by adverse possession and limitation. On this finding, they dismissed the plaintiffs' suit. We find it difficult to support this reasoning of the courts below. Under Section 60 of the Transfer of Property Act the mortgagor has, on redemption, the right to require the mortgagee: (a) to deliver the mortgage-deed and all documents of title in respect of the mortgaged property; (b) where the mortgagee is in possession to deliver possession thereof to the mortgagor; and (c) at the cost of the mortgagor either to re-transfer the mortgaged, property to him or to such other person as he may direct or to execute and to have registered an acknowledgment that any right in derogation of his interest transferred to themortgagee had been extinguished. Again, under Section 62 of the Act, in the case of a usufructuary mortgage, the mortgagor has a right to recover possession of the property together with the mortgage-deed and all documents, under the contingencies mentioned in the section. In addition to these, by the common law applicable to the Travancore area, where the suit mortgage was executed, (and where the Transfer of Property Act was not applicable till it was extended by the Part B State Laws Act of 1951), the mortgagee is entitled to be paid the value of improvements effected by him in pursuance of the mortgage, and to remain in possession till the same is paid. This is recognised by the terms of Ext. P-6 mortgage itself. This right has since received statutory incorporation, first in the Travancore-Cochin Compensation for Tenants Improvements Act of 1956, and later, in the, Kerala Compensation for Tenants Improvements Act of 1958, Ext. P-7 receipt also contains sufficient indication that amounts by way of compensation for improvements remain to be paid. In the face of the above statutory provisions, and to the provisions in the documents Exts. P-6 and P-7, we find it difficult to hold that the mere payment of the mortgage amount acknowledged under Ext. P-7, would per se convert the possession of the mortgagee thereafter, as adverse to the mortgagor. In Prithi Nath Singh v. Suraj Ahir, AIR 1063 SC 1041 it is observed 3:

'7. It is to be noted that these provisions do not state when a mortgage ceases to be a mortgage. They simply describe the right of a mortgagor to re-deem. Now, what is this right and, in what circumstances does it arise? The right arises on the principal money, payment of which is secured by the mortgage deed, becoming due. The right entitles the mortgagor, on his paying or tendering to the mortgagee the mortgage money to ask him (i) to deliver to him the mortgage deed and other documents relating to the mortgaged property (ii) to deliver possession to the mortgagor, if the mortgagee is in possession; and (iii) to re-transfer the mortgaged property in accordance with the desire of the mortgagor, if the mortgagee receives the money and does not perform any of the three acts required of him to be done, the question arises whether this non-compliance with the demands will make the mortgage continue. The provisions of the section do not say so and there appears no good reason why the mortgage should continue. If the mortgagee is not to perform these acts the mortgagor is not to pay the amount If, however, the mortgage money has been received by the mortgagee and thereafter he refuses toperform the acts, he is bound to do, the mortgagor can enforce his right to get back the mortgage document, the possession of the mortgaged property and the reconveyance of that property through Court. A new right to get his demands enforced through the Court thus arises as a result of the provisions of Section 60 of the Act.

8. If the mortgage money has been paid and then the mortgagor goes to Court to enforce his demands, that would not be to enforce his right of redemption which was really his right to make those demands on payment of the mortgage money. The right to demand the mortgagee to do certain things on payment of the mortgage money is different from enforcing the demands subsequent to the payment of the money. This is also clear from the decree for redemption. Order XXXIV, Rule 7, C.P.C. provides for the preliminary decree in a redemption suit and the preliminary decree is to order that the account be taken of what was due to the defendant, viz., the mortgagee, at the date of decree, and for principal and interest on the mortgage, and other matters. Rule 9 provides that if on such accounting, any sum be found due to the mortgagor, the decree would direct the mortgagee to pay such amount to the mortgagor. If the mortgage money due has been already paid by the mortgagor and has been accepted by the mortgagee in full discharge of the mortgage deed, no occasion for such accounting arises and therefore any suit to enforce the return of the mortgage deed and to get back the possession of the mortgaged property cannot be a suit for redemption.'

In the face of these observations, it may not altogether be correct to refer to the suit instituted in this case as a suit for redemption. There is also abundant authority to the effect that possession by a mortgagee whose mortgage has been discharged either by payment or by appropriation of profits of the property, does not by the mere act of extinguishment of the mortgage, become adverse to the mortgagor. See for instance the decisions in Habib-Ullah v. Abdul Hamid, (1912) ILR 34 All 261: Gobind Ram v. Mt. Ram Koer. AIR 1924 All 522; Bishnath Singh v. Basdeo Singh, AIR 1926 All 136 (1): Keshab Lal Goswami v. Bholanath Gangapadhya, AIR 1926 Cal 910; Harasit Golder v. Jaladhar Biswas, AIR 1930 Cal 15 and Mulchand Nanak-ram v. Mt. Ganga, AIR 1951 Nag 366, Among these decisions. It will be interesting to note that the decision of Sulaiman J. in Bishnath Singh's case. AIR 1926 All 136 (1) states the principle that a suit for possession against a mortgageewhose mortgage had been extinguished by payment or by appropriation of rents and profits would not be governed either by Article 148, or by Article 142 of the Indian Limitation Act, 1908, but only by Article 144. Article 142 is ruled out as inapplicable on the ground that the case would not be one of possession followed by dispossession. The same reasoning is also adopted and followed by Mudholker J. in Mulchand Nanakram's case, AIR 1951 Nag 366. In the light of the principle of these decisions, it would be for the contesting defendant to make out how, and from what time, his possession which started as a mortgagee, changed its character and became adverse. Particularly is it so, when, as in this case, the mortgagees are themselves members of the tarwad, having derived the mortgage right by gift from their father tinder Ext. D-2 dated 13-4-1089 M.E. From this point of view, there is nothing in the evidence on record to support a case of adverse possession. We therefore cannot endorse the finding of the court below.

3. We would have therefore allowed this appeal. But the courts below have not considered the other issues arising for consideration in the case, and a remand for that purpose is anyway indicated. What is more counsel for the respondents 8 to 11, the legal representatives of the 1st defendant-respondent, raised the contention before us, that quite irrespective of the plea of adverse possession, he is entitled to the benefits conferred by Section 4-A of the Kerala Land Reforms Act (Act I of 1964). It was contended that Ext. P-6 being a usufructuary mortgage of the year 1063 M.E. and the mortgagee and his predecessors-in-interest, having remained in possession for a continuous period of over fifty years, they were entitled to the benefit of the section for the appellant it was contended that once the mortgage amount had been paid off although the payment by itself would not entitle the mortgagee to contend that his possession thereafter was adverse to the mortgagor, nevertheless, the mortgagee would not be entitled to say that he was still continuing as a mortgagee or that the transaction of mortgage was still subsisting. This, it was claimed was the effect of the principles stated by the Supreme Court in Prithi Nath Singh's case, AIR 1963 SC 1041. We think it unnecessary to pronounce on the contention of either party at this stage. The matter has to go back any way to the lower court for consideration of the other issues. Even in regard to the applicability of Section 4-A of the Kerala Land Reforms Act. we think it, very desirable and necessary that the parties should be given an opportunity of filing fresh pleadings and of adducing such evidence bearing on the case as they may deem fit to adduce, before the trial court.

In the result, while reversing the finding of the court below that the plaintiffs' claim regarding possession of item 1 of the plaint-schedule is barred by adverse possession we remand the suit back to the trial court as far as item 1 alone is concerned, for fresh disposal in accordance with law and in the light of the observations contained in this judgment. The appellants and respondents 8 to 11 will bear their costs incurred so far. As stated, the second appeal will stand dismissed with costs against the legal representatives of defendants 2 and 3.


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