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Chiman Lal Vs. Amar Chand - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtRajasthan High Court
Decided On
Case NumberCivil Revn. No. 171 of 1964
Judge
Reported inAIR1965Raj3
ActsRegistration Act, 1908 - Sections 17(1), 17(2) and 49; Evidence Act, 1872 - Sections 92
AppellantChiman Lal
RespondentAmar Chand
Appellant Advocate Kishore Singh Lodha, Adv.
Respondent Advocate Prakash Chandra Mathur, Adv.
DispositionRevision partly allowed
Cases ReferredKashinath Bhaskar v. Bhaskar Vishweshwar
Excerpt:
.....2016 exlj cnh 2 n% mkslknyhpun exuyky a n% rkjkpan n% ykypun**by this writing lalchand agreed to relinquish past as well as future interest due on the mortgage-deed......a house in favour of lalchand and bhanwarlal on 18-7-52 for rs. 6,000/- under a registered mortgage-deed. lalchand and bhanwarlal assigned the mortgagee rights in favour of amarchand on 23-1-60 and he instituted the present suit for sale on the basis of the mortgage-deed on 15-5-63. the defendant pleaded that there were two novations of the mortgage deed--one in s. 2009-10 when a new khata was opened by lalchand and bhanwarlal and again on migsar badi 2, s. 2016 (corresponding to 2-12-59) when lalchand executed a writing. no registered document was executed at the time of the alleged novation of contract in s. 2009-10. nor was the writing dated 2-12-59 registered. the learned senior civil judge held under his order dated 31-1-64 that no unregistered agreement varying the terms of.....
Judgment:
ORDER

Jagat Narayan, J.

1. This is a defendant's revision application against two orders of the Senior Civil Judge, Banswara, dated 31-1-64 and 2-3-64.

2. Chiman Lal defendant mortgaged a house in favour of Lalchand and Bhanwarlal on 18-7-52 for Rs. 6,000/- under a registered mortgage-deed. Lalchand and Bhanwarlal assigned the mortgagee rights in favour of Amarchand on 23-1-60 and he instituted the present suit for sale on the basis of the mortgage-deed on 15-5-63. The defendant pleaded that there were two novations of the mortgage deed--one in S. 2009-10 when a new Khata was opened by Lalchand and Bhanwarlal and again on Migsar Badi 2, S. 2016 (corresponding to 2-12-59) when Lalchand executed a writing. No registered document was executed at the time of the alleged novation of contract in S. 2009-10. Nor was the writing dated 2-12-59 registered. The learned Senior Civil Judge held under his order dated 31-1-64 that no unregistered agreement varying the terms of the mortgage could be recognised. This order is correct in my opinion.

3. During the course of the cross-examination of Amar Chand plaintiff the defendant tried to prove the writing dated 2-12-59. The trial Court held by its order dated 2-3-64 that this writing could not be proved as it requires registration because it purports to vary the terms of the mortgage. This order is also being challenged on behalf of the defendant- It is contended that the writing is admissible under Section 17(2)(xi) of the Registration Act. This writing runs as follows:

^^Mkslh dqUtykyth pheuykythckalokM+k uxkor ykypUnth Hkojykyth fy[krksa tkgj caoth vijp rekjk edku uh vkM+jgu uh jftLVh :- 6000 N% gtkj uh geka djks Ns exj reka.ks gekjh enn cgqr djhNs rsuk Fkh geksa reus jkth [kq'kk Fkh O;kt ekQ d:a Nqa vkSj reksa t :i;k HkjkNs rs vly jde esa eqtjk nsoqaxk vkSj rekjk Fkh gekjk eqny :- 3500 ikrjkalksavUnktu ysok Ns tks geka rqekjk Fkh :- 300 rhu lkS lkykuk ysoqaxk vkSj O;kt drS;ekQ ekjh jkth [k'kh Fkh djks Ns lks lgh jgs A laor~ 2016 exlj cnh 2 n% MkSlknyhpUn exuyky A

n% rkjkpan

n% ykypUn**

By this writing Lalchand agreed to relinquish past as well as future interest due on the mortgage-deed. He also stated in it that he shall treat all the payments made hithertofore by the defendant as payments towards the principal and the principal amount remaining due against him would thus come to about Rs. 3,500/-. He agreed to take this amount in yearly instalment of Rs. 300/-each. Section 17(a)(xi) runs as follows:

'Any endorsement on a mortgage-deed acknowledging the payment of the whole or any part of the mortgage-money, and any other receipt for payment of money due under a mortgage when the receipt does not purport to extinguish the mortgage.'

4. This came up for interpretation before their Lordships of the Supreme Court in Kashinath Bhaskar v. Bhaskar Vishweshwar, AIR 1952 SC 153. The rate of interest agreed upon in the mortgage-deed was -/14/- per cent, per month. It was reduced to -/8/- under an unregistered agreement. It was held that the unregistered agreement limited the interest in immovable property. They observed:

'One part of the 'interest' which a mortgagee has in mortgaged property is the right to receive interest at a certain rate when the document provides for interest. If that rate is varied, whether to his advantage or otherwise, then, in our judgment, his 'interest' in the property is affected. If the subsequent agreement substitutes a higher rate, then to the extent of the difference it 'creates' a fresh 'interest' which was not there before. If the rate is lowered then his original 'interest' is limited.'

5. It was argued before their Lordships that it was always open to a mortgagee to release or remit a part of the debt, and when he does so he does not limit or extinguish an interest in immovable property any more than when he passes a receipt acknowledging payment of the whole or part of the money. Their Lordships did not accept this argument. They observed:

'There is a difference between a receipt and a remission or a release. A receipt is not the payment, nor does the document in such a case serve to extinguish the mortgage or limit the liability. It is the payment of the money which does that and the receipt does no more than evidence the fact. Not so a release. The extinguishment or diminution of liability is in that event effected by the agreement itself and not by something external to it. If the agreement is oral, it is hit by proviso 4 to Section 92, Evidence Act, for it 'rescinds' or 'modifies' the contract of mortgage. If it is in writing, it is hit by Section 17(1)(b), Registration Act, for in that case the writing itself 'limits' or ''extinguishes' the liability under the mortgage,'

It is to be observed that when the mortgagor pays money due on the mortgage, in whole or in part, he is carrying out the terms of the bond and is not making any alteration in it, and even though the fact of payment may limit or extinguish the mortgagee's interest that is only because the bond is working itself out by the force of its own terms and not by reason of some new agreement which seeks to modify it or limit or extinguish the interest which it creates.'

6. In other words a payment made in discharge of the obligation created by the mortgage-deed in accordance with its tenor is a payment made in satisfaction of the mortgage and does not in any way extinguish the mortgage. But if the obligation under the deed is discharged, not according to its tenor but by a fresh act of will of the mortgagee in the absence of which it would not be so discharged, then it involves a variation in the terms of the mortgage which is not permissible except by a registered deed and this sort of discharge is tantamount to extinction of the mortgage.

7. So far as part of the writing dated 2-12-59 relinquishing past and future interest and agreeing to accept the balance of the amount due on the mortgage in instalment of Rs. 300/- each per annum is concerned it limits the interest of the mortgagee and as the document, is unregistered it is inadmissible for the purpose of proving such an agreement. The document however also recites that after crediting all the payments made towards the principal amount and after relinquishing past and future interest a sum of about Rs. 3500/- was due against the defendant. The inference from this is that Lal Chand admitted having received payments totalling about Rs. 2,500/-. So far as this document evidencing the receipt of this payment towards the mortgage is concerned it is admissible under Section 17(2)(xi).

8. The defendant should therefore be allowed to prove this document for the above limited purpose. I accordingly allow the revision application in part as indicated above. In the circumstances of the case, I direct that parties shall bear their own costs of this revision application. Let the record be returned to the trial Court.


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