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Veeraswami Mandiri Vs. K. Manicka Mudaliar and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Case NumberSecond Appeal No. 1728 of 1963
Judge
Reported inAIR1969Mad27
ActsTransfer of Property Act, 1882 - Sections 92 and 95; Limitation Act, 1908 - Schedule - Articles 134 and 148
AppellantVeeraswami Mandiri
RespondentK. Manicka Mudaliar and ors.
Appellant AdvocateK. Sarvabhauman, ;T.R. Mani and ;S. Narayanaswami, Advs.
Respondent AdvocateP.R. Gopalakrishnan, ;P. Bhaskaran and ;K.N. Balasubramanian, Advs.
DispositionAppeal allowed
Cases ReferredRukmini Ammal v. Venkatarama Iyer
Excerpt:
.....the appellant will be entitled to its benefit. 7. if the plaintiff in this case would look upon muthuvelu pillai as in the position of a mortgagee and rely on article 148, the defendants could well plead, as held in the above decision, on the facts of the case, that the period provided under article 148 was cut down by article 134. the learned judges in the above case referred with approval to the observations of seshagiri ayyar, j. ' the requisite proof is clearly available to the defendants before me. on the evidence it is clearly made out that, for over 20 years to the knowledge of the plaintiff, the transferees from muthuvelu pillai have been in enjoyment of the property in assertion of ownership of the entirety of the property. it follows that the plaintiff's suit for redemption..........has been filed by the 2nd defendant in a suit for redemption of a possessory mortgage of the suit property made by the plaintiff along with his brother venkataswami mudaliar in favour of the 3rd defendant in the suit, and for partition and separate possession of a half share in the suit property. the trial court dismissed the suit holding that the contesting defendants in the suit have perfected their title by adverse possession against the plaintiff; but on appeal, the learned subordinate judge has overruled the defence of limitation and decreed the plaintiff's claim for a half share in the suit property. 2. a brief survey of the salient facts and findings in the case is necessary for appreciating the respective contentions of the parties on the question of limitation, the only.....
Judgment:

Natesan, J.

1. This Second Appeal has been filed by the 2nd defendant in a suit for redemption of a possessory mortgage of the suit property made by the plaintiff along with his brother Venkataswami Mudaliar in favour of the 3rd defendant in the suit, and for partition and separate possession of a half share in the suit property. The Trial Court dismissed the suit holding that the contesting defendants in the suit have perfected their title by adverse possession against the plaintiff; but on appeal, the learned Subordinate Judge has overruled the defence of limitation and decreed the plaintiff's claim for a half share in the suit property.

2. A brief survey of the salient facts and findings in the case is necessary for appreciating the respective contentions of the parties on the question of limitation, the only question for consideration. The suit property, dry land of an extent of 3 acres 20 cents, in North Virinchipuram Village, North Arcot district, belonged to the plaintiff and his elder brother Venkataswami Mudaliar aforesaid. Under Ex-B-3 dated 9-2-1934 the two brothers usufructuarily mortgaged the property in favour of Subramania Mudaliar, 3rd defendant in the suit for a sum of Rs. 400/-. Venkataswami Mudaliar was indebted to one Muthuvelu Pillai under a promissory note, and Muthuvelu Pillai filed a small cause suit, S.C. No. 533 of 1935, on the file of the District Munsif's Court, Vellore. In execution of the decree thereon which had been transferred to the Original Side, Muthuvelu Pillai attached the entirety of the suit property and purchased the same in court-auction, Ex. B-l dated 25-9-1936 is the sale certificate. It is seen from the sale certificate that the property had been sold subject to two agricultural loans of Rs. 150/- each and the suit usufructuary mortgagee Muthuvelu Pillai having taken formal delivery of the suit property through Court on 6-11-1936 discharged the usufructuary mortgage debt due to the 3rd defendant and redeemed the mortgage on 9-11-1936. Pursuant to the redemption which was on 9-11-1936 he entered on possession of the property. The deed of mortgage contains the relevant endorsement of discharge under dated 9-11-1936. There is also documentary evidence of actual possession and enjoyment of the suit property by Muthuvelu Pillai, till he sold the property to the 1st defendant in the suit and her sister one Rajammali under Ex. B-11 dated 24-1-1939. The 2nd defendant purchased the half share of Rajammal in the property under Ex. B-12 dated 19-11-1959 and B-13 dated 21-2-1960 for a total consideration of Rs. 6,000/- and the Courts below, find that after Muthuvelu Pillai, the 1st defendant and Rajammal and after her, the 2nd defendant, had possession and enjoyment of the suit property in their own 'right as absolute owners. In fact, under Ex. B-9 dated 13-4-1942 the 1st defendant usufructuarily mortgaged the property in favour of one Abdul Azeez Sahib, The Trial Court has noticed that the evidence of D.Ws. 1 and 2, that is, Muthuvelu Pillai and the 2nd defendant, to the effect that Muthuvelu Pillai and his suc-cessors-in-title have been in possession and enjoyment of the suit property in their own right as absolute owners from 9-11-1936, the date of endorsement of discharge Ex. B-4, has not at all been challenged in cross-examination in any manner whatsoever by the plaintiff.' It is observed by the Courts below, that the plaintiff has unequivocally admitted in evidence that he knew fully about Muthuvelu Pillai's possession of the suit property from the date of his purchase in court-auction and the possession and enjoyment of the property by the transferees from MuthuveTu Pillai, namely, the 1st defendant and her sister since 1939.

3. Another fact may be mentioned here, while Muthuvelu Pillai was in possession of the suit property, there was an attempt at trespass on the suit property by the plaintiff, his brother Venkataswami and his aunt Salammal and this led to a criminal complaint by Muthuvelu Pillai. The plaintiff admits that on this complaint of Muthuvelu Pillai for trespass, each of them was fined Rs. 5/-, Also while it is seen that this Muthuvelu Pillai and subsequently his transferees have been in possession and enjoyment of the entire property asserting absolute title in themselves, it is found by the Courts below that under the Court auction sale in execution of the decree against Venkataswami Mudaliar, the interests of the plaintiff did not pass to the court-auction purchaser. The suit was on a promissory note executed by Venkataswami Mudaliar and the plaint clearly established that the promissory note debt was incurred by Venkataswami Mudaliar in his individual capacity. Muthuvelu Pillai had prayed only for a personal decree against Venkataswami Mudaliar and in the circumstances only the right, title and interest of Venkataswami Mudaliar in the suit property could pass to the court-auction purchaser Muthuvelu Pillai. The finding of the Courts below in this regard is that notwithstanding the fact that the decree-holder had proceeded to bring the entirety of the property to sale and purported to purchase the entirety of the property, the court-auction sale was not binding on the plaintiff and it could not pass the interests of the plaintiff to Muthuvelu Pillai. Of course, Muthuvelu Pillai had taken possession of the entirety of the property pursuant to the court sale and had on redemption entered into possession of the entirety of the suit property.

4. On these facts. It is contended for the plaintiff that as he is not bound by the sale, his right of redemption is outstanding and he is entitled to redeem and secure possession of his share in the property. It is said that though Muthuvelu Pillai at the court-auction purchased the entire property subject to the usufructuary mortgage, in law, he acquired only the interests of his brother Venkataswami and stepping into his shoes, he became a co-mortgagor with the plaintiff. He acquired no higher right by the auction purchase. As a co-mortgagor he was entitled to redeem and get possession of the entire mortgaged property on 6-11-1936, his possession was in accordance with law in the right of a redeeming co-mortgagor and his possession could not be considered to be adverse to the plaintiff, His Court auction purchase secured to him only the right, title and interest of the judgment-debtor and nothing more, and his judgment-debtor had only the interests of a co-sharer in the equity of redemption. The stand for the plaintiff to this extent is perfectly justified and correct. Equally the charge and conviction for criminal trespass against the plaintiff, his brother and aunt by itself cannot make the possession of Muthuvelu Pillai hostile to the plaintiff. The attempted trespass was in 1937 and Muthuvelu Pillai's possession was in accordance with law in the right of co-mortgagor who had paid off the entire mortgage amount. Muthuvelu Pillai was in the circumstances entitled to hold on to the property till he was paid as contribution the proportionate part of the mortgage debt and the expenses of redemption by the non-redeeming co-mortgagor-plaintiff. When Muthuvelu Pillai as a co-mortgagor redeemed the mortgage, the mortgage as to his half share in the property was extinguished and as to the share of the plaintiff, he stood in the shoes of the mortgagee he had redeemed, vis-a-vis, the co-mortgagor Muthuvelu Pillai stood subrogated to the rights of the mortgagee who was redeemed -- see Sections 92 and 95 of the Transfer of Property Act, Learned Counsel contended that such being the character of Muthuvelu Pillai's possession the case is governed by Article 148 of the Indian Limitation Act and the plaintiff has 60 years from the date of the mortgage to redeem his half share in the suit property. It was submitted that there has been no redemption by him and that his right of redemption had not been extinguished by any act of his or by any decree of Court to bar him from suing for redemption.

5. Per contra, It was urged for the defendants that Muthuvelu Pillai and after him, his transferees have been openly and notoriously proclaiming against the plaintiff, rights in the entirety of the suit property and that therefore they have prescribed title to the entirety of the suit property by adverse possession. It is this argument that found acceptance at the hands of the learned District Munsif. The learned Subordinate Judge on appeal accepted the contention on behalf of the plaintiff that the plaintiff as one of the mortgagors had 60 years to redeem and he cannot be forced to redeem at an earlier date merely because Muthuvelu Pillai and his transferees were asserting rights putting forward adverse claims. The learned Subordinate Judge was of the view that the plaintiff was not legally bound to sue for possession merely because adverse claims were put forward by Muthuvelu Pillai and his transferees. Reliance was placed by the learned Subordinate Judge on the decision in Kelu v. Chekkara Cheppan, AIR 1937 Mad 451 and this decision is now again pressed for the plaintiff. It is observed in that case as below:--

'When a person who is not a mortgagor, under a mistaken claim, pays off a mortgage debt, he cannot extinguish It; for he has no right to do so. The only person who can extinguish a mortgage, is the person who is entitled to redeem that mortgage and merge the mortgage in his own rights of mortgagor or mortgagee,'

Learned Counsel for the plaintiff lays considerable stress on this observation. But I fail to see its application to the facts of the present case. That is a case of a person in the bona fide belief that he was entitled to redeem, redeeming the mortgage. In that case it is observed that when a person believes that he was entitled to redeem the mortgage either under the impression that he was a mortgagor or that he had some other right in the property which would entitle him to redeem, on payment he would be entitled to the rights of the mortgagee by way of subrogation or a like equitable principle. But on such payment the mortgage debt as such was not extinguished. It is also observed examining the question of adverse possession by the person so redeeming, that the mere assertion by a person in possession of the property when the mortgagor had no immediate right to possession, which was not coupled with some act definitely interfering with the rights of the mortgagor, would not amount to an ouster of the mortgagor, that would force him to take some immediate action under pain of losing rights to the property by adverse possession. It was held in that case that a mortgagor who had 60 years to redeem could not be forced to redeem at an earlier date, merely because some one was asserting adverse claims to the property. It is said that the correct test applicable in these cases is whether the possession and acts of the person claiming adversely can be referred to any legal right that he possessed. Submissions were made based on this decision and other decisions were also referred to for contending that Muthuvelu Pillai and the transferees from him must be looked upon only as mortgagees.

6. The facts of this case are not so simple for the application of the decision in : AIR1937Mad451 . It may be that if possession had continued in Muthuvelu Pillai, the plaintiff could rely on Article 148 of the Limitation Act and claim full 60 years, from the date of the mortgage. But here Muthuvelu Pillai had conveyed the entirety of the property, as absolute owner even in 1939 under Ex. B-11 dated 24-1-1939 in favour of Unnamalai Ammal, the first defendant and her sister Rajammal. Unnamalai Ammal and Rajammal had entered on the property as absolute owners and admittedly to the knowledge of the plaintiff they have been asserting rights in the property as owners. The suit was filed only on 22-11-1960. From 1939 the 1st defendant and her sister have been enjoying the property as owners. After 20 years of enjoyment, Rajammal conveys her half share in the property under two sale deeds. Exts. B-12 and B-13, one in 1959 and another in 1960 to the present 2nd defendant. In my view whether Article 144 of the Limitation Act could be availed of or not by the defendants, dearly Article 134 of the Indian Limitation Act will apply. Under Article 134 of the Limitation Act, a period of 12 years is provided for a suit to recover possession of immovable property mortgaged and afterwards transferred by the mortgagee for valuable consideration, the period commencing to run from the date when the transfer becomes known to the plaintiff. The decision in : AIR1937Mad451 distinguishes the case therein under consideration from cases to which Article 134 is applicable. My attention was drawn by the learned Counsel for the plaintiff to the decision in Karuppanan Servai v. Daivasigamania Pillai, : AIR1954Mad650 . This again does not help the plaintiff, but on the contrary it is a decision directly in favour of the defendant. Learned Counsel for the plaintiff relied on the observations in that judgment to the effect:

'The transfer by the mortgagee as owner does not operate as a discharge of the mortgage by the mortgagor and the transferee is entitled as against the mortgagor at least to what his transferor was entitled. If he is then entitled as against the mortgagor to the rights of the original mortgagee, is he not also subject to the obligations of his transferor in favour of the mortgagor? The real question in such cases is not what the transferee purported to acquire, but what in fact he did acquire and if what he did acquire was only the interest of the mortgagee, he is liable under the law to be redeemed as a mortgagee and Article 148 will apply.'

But proceeding, their Lordships have discussed the relative scope of Articles 134 and 148 and it is observed:--

'If the defendant is under liability to be redeemed under Article 148, he is also entitled to the protection afforded by Article 134.'

The question now under consideration is whether the defendants could claim the benefit of Article 134 and whether the requirements of that Article are satisfied. As pointed out in the said decision at page 20,

'To understand the true scope of Article 134 it is necessary to read it along with Article 148. Article 148 provides a period of 60 years for redemption of a mortgage and Article 134 cuts down that period to 12 years when there is a transfer by the mortgagee. Article 134 's therefore, an exception to Article 148. In both the Articles the same word mortgagee is used. It must clearly have the same meaning in both the Articles. If 'mortgagee' in Article 148 should mean only the original mortgagee, then the present action for redemption of Exhibit P-1 would not be maintainable as against the defendant who is purchaser from Balaguru. But if 'mortgagee' in Article 148 includes all persons who succeed to the interest of the mortgagee, it must bear that meaning under Article 134 as well and the appellant will be entitled to its benefit. If the defendant is under liability to be redeemed under Article 148, he is also entitled to the protection afforded by Article 134. Likewise, the right of a mortgagor to redeem under Article 148 is subject to the bar enacted in Article 134 in favour of a transferee,'

In that case while the Court auction purchase by which Balaguru Naidu became entitled to the property was held not to confer the protection of Article 134, the transfer under Exhibit D-14 by Balaguru which purported to convey the full title with land to the purchaser was held to be a transfer within the meaning of Article 134, and a finding was called for whether the plaintiff or his predecessor-in-title who had instituted the suit for redemption had knowledge of the conveyance by Balaguru and, if so, was it more than 12 years prior to the suit. It was held that the conveyance in question which purported to transfer all the property absolutely and not a mere assignment of the mortgage would fall within the scope of Article 134 and on the finding received that the plaintiff and his predecessor-in-title had knowledge of the transfer more than 12 years prior to the institution of the suit, the claim for redemption was dismissed.

7. If the plaintiff in this case would look upon Muthuvelu Pillai as in the position of a mortgagee and rely on Article 148, the defendants could well plead, as held in the above decision, on the facts of the case, that the period provided under Article 148 was cut down by Article 134. The learned Judges in the above case referred with approval to the observations of Seshagiri Ayyar, J., in Muthaya Shetti v. Kanthappa Shetti, 34 MLJ 431 AIR 1919 Mad 1097 that Article 134 is really a branch of the law of prescription and the reason for giving the protection of the statute of repose is weightier in the case of the transferees from representatives of the mortgagee than in the case of transferees from the original mortgagee. The defendants referred in this connection to the decision in Rukku Shetty v. Ramachandrayya, ILR 49 Mad 29 AIR 1926 Mad 81 which ]s referred to in : AIR1954Mad650 . In this case Article 134 was applied to a case where a mortgagee in possession transferred the property under a sale deed for consideration to another and put him in possession and what was bargained for by the transferee was an absolute sale though he knew that the transferor had only a mortgagee's interest, on a suit instituted by the mortgagor. In Nani Bai v. Gita Bai, : [1959]1SCR479 it is said by the Supreme Court

'Article 134 of the Limitation Act contemplates a sale by the mortgagee in excess of his interest as such. The legislature, naturally, treats the possession of such transferees as wrongful, and therefore, adverse to the mortgagor, if he is aware of the transaction. Hence the longer period of 60 years for redemption of the mortgaged property in the handi of the mortgagee or his successors-in-interest, is cut down to the shorter period of 12 years' wrongful possession, if the transfer by the mortgagee is in respect of a larger interest than that mortgaged to him. In order, therefore, to attract the operation of Article 134, the defendant has got affirmatively to prove that the mortgagee or his successor-in-interest has transferred a larger interest than justified by the mortgage. If there is no such proof, the shorter period under Article 134 is not available to the defendant in a suit for possession after redemption.'

The requisite proof is clearly available to the defendants before me. For the defendants, reliance is also placed on the decision in Palanithurai Madikondar v. Veerappa Thevar, : AIR1966Mad64 where Article 134 was applied to a case where the successors-in-interest of the original mortgage claiming absolute interest in the properties mortgaged purported to transfer full ownership thereof to the transferee. It is not necessary to refer to all the decisions relied on by the plaintiff or for the defendants. Learned Counsel for the plaintiff drew my attention also to the decision of a Full Bench of this Court in Valliamma v. Sivathanu, : AIR1964Mad269 (FB) where again it is pointed out that while a redeeming co-mortgagor has a period of 12 years under Article 132 of the Limitation Act for recovery from his other co-mortgagors, the aliquot share of the mortgage money, there should be a corresponding right in a non-redeeming co-mortgagor to obtain possession of the properties on payment of their share of the mortgage money within that period. The following observations in the Full Bench were referred to:--

'It will be plain that there will be two periods within which a non-redeeming mortgagor can obtain his property from his co-mortgagor who had redeemed, the first is based on the rule of subrogation and the second is correlative obligation in the redeeming co-mortgagor to give up the property belonging to Ms co-mortgagor on being paid the money due by him. in the former case where the mortgage is possessory the period of limitation will be governed by Article 148 ......and the starting point for limitation will be same as for the original mortgage redeemed. In the latter case, the non-redeeming co-mortgagor will have a period of 12 years from the date of redemption of the original mortgage by the other co-mortgagor. It will be open to the non-redeeming co-mortgagor to take advantage of any one of these periods whichever is to his advantage.' These observations cannot help the plaintiff in this case as the persons in possession who have to be dispossessed by the plaintiff are not redeeming co-mortgagors but transferees from him who claim under conveyances by the redeeming co-mortgagor of the entirety of the property as if he had absolute title to the property. It is this transfer in this case that attracts Article 134 of the Limitation Act.

8. Reference may be made to the Full Bench decision of our High Court in Rukmini Ammal v. Venkatarama Iyer, : AIR1964Mad281 (FB). In that case one of the co-mortgagors in two other mortgages purported to sell the entire mortgagor's interest to a third party who filed the suit for redemption and after he secured possession, the other co-mortgagor filed a suit for redemption, partition and separate possession of his half share in the properties and the question that arose for consideration was the plea of limitation. The purchaser who redeemed the entirety of the properties relied on Article 144 of the Limitation Act. There was no further transfer in that case and the person in possession who was sought to be redeemed had acquired possession of the property only on redemption. It was observed:

'A claim by a non-redeeming co-mortgagor to recover his share of the mortgage property from the redeeming co-mortgagor who came into possession of it on redemption, can be made on payment of his share of mortgage amount, costs of redemption etc. No, right to possession exists without such payments as under the law the redeeming co-mortgagor is subrogated to the rights of the original mortgagee; the co-mortgagor's suit even if it be for possession will in substance be only for redemption.......Therefore, the period of limitation applicable for redemption by the non-redeeming co-mortgagor of his share of the property will be the same as that for. redemption of the original mortgage.'

In that decision the Court did not rule nut the possibility of adverse possessionand the applicability of Article 144 even in such cases, but on the facts of the case, held that there was no ouster of the non-redeeming co-mortgagor by the other party. In fact they observed:--

'This does not mean that there could be no adverse possession with regard to a share in an equity of redemption. What all we say is that there is nothing in the present case beyond the notice dated 23-9-1934 to show that the first respondent's father had prescribed any title by adverse possession to a half share in the equity of redemption possessed by the other mortgagor.'

In the absence of ouster or adverse possession, a preliminary decree for redemption was granted.

9. in the present case, if the plaintiff would have the suit as one for possession on redemption and rely on Article 148, in its wake, it will draw in Article 134. If the plaintiff would look upon Muthuvelu Pillai as mortgagee for purposes of Article 148, the persons claiming under him would be transferees from him for purposes of Article 134. There is no dispute that in this case Muthuvelu Pillai had transferred a larger interest than what he acquired in law under the Court auction purchase in execution of the decree, against his mortgagor. As a matter of law, the Courts below have found that the interest of the plaintiff in the property had not been transferred by the court auction sale to Muthuvelu Pillai. It is admitted by the plaintiff that he has been aware of the transfer by Muthuvelu Pillai and the possession of the defendants following such transfer. On the evidence it is clearly made out that, for over 20 years to the knowledge of the plaintiff, the transferees from Muthuvelu Pillai have been in enjoyment of the property in assertion of ownership of the entirety of the property. It follows that the plaintiff's suit for redemption has to fail under Article 134. It is not necessary to consider the defence based on Article 144 of the Limitation Act. If Article 144 is applied, even then clearly, the action is barred.

10. In the result, the second appeal is allowed, the decree and judgment of the lower Appellate Court are set aside and that of the Trial Court dismissing the suit restored. Having regard to all the circumstances, the parties will bear their respective costs throughout.

11. No leave.


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