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K. Nataraja Iyer and ors. Vs. Subbiah Ambalam and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Reported in(1962)1MLJ397
AppellantK. Nataraja Iyer and ors.
RespondentSubbiah Ambalam and ors.
Cases ReferredTirupathi v. Rajagopala Naidu
Excerpt:
.....mortgage, as defined by section 58(d) of the transfer of property act, are clearly present in the suit mortgage. 139 in which the privy council held that a mortgage which was a combination of a simple mortgage and a usufructuary mortgage did not cease to be so and become an anomalous mortgage, because it contained a clause to the effect that the mortgagors should remain entitled to eject tenants, to enhance rent, to cultivate land and to issue leases, and, after enhancement and payment of interest, if there be left any surplus, or if the mortgagors paid any year or each year any amount of money, then, that money should be deemed to have been paid towards the principal and interest and the money paid should be deducted, and that the mortgagee, like the mortgagors, should possess all the..........mortgage, as defined by section 58(d) of the transfer of property act, are clearly present in the suit mortgage. a usufructuary-mortgage does not cease to be such and become an anomalous mortgage only because it contains a personal covenant to pay. exhibit a-2 is still a usufructuary-mortgage notwithstanding the personal covenant added to its terms. no decided-case directly in point has been brought to my notice. my attention has, however, been invited to lai narasingh v. md. taqub khan (1929) 58 m.l.j. 401 : l.r. 56 indap 299 : a.i.r. 1929 p.c. 139 in which the privy council held that a mortgage which was a combination of a simple mortgage and a usufructuary mortgage did not cease to be so and become an anomalous mortgage, because it contained a clause to the effect that the mortgagors.....
Judgment:

Veeraswami, J.

1. The suit out of which this Second Appeal arises, was for recovery of money due on a usufructuary mortgage dated 20th January, 1940. That mortgage was executed by the first defendant in favour of the father of the plaintiffs. The consideration therefor included the principal and interest due on an earlier simple mortgage dated 22nd January, 1932 also executed by the first defendant, in favour of the same mortgagee. Rejecting the contention of the plaintiffs, the lower appellate Court held that the debt was liable to be scaled down under Section 9-A of Madras Act IV of 1938 and confirmed the preliminary decree granted by the trial Court. The lower appellate Court also rejected another contention raised on behalf of the plaintiffs, namely, that the mortgagee not having been put in possession pursuant to the usufructuary mortgage, the plaintiffs were entitled to claim damages for use and occupation of the land. The plaintiffs are the appellants in this Court.

2. On behalf of the appellants, the same two contentions mentioned above were reiterated. So far as the claim for damages is concerned, it is clearly unsustainable. The lower appellate Court found on the evidence that the mortgagor, pursuant to the usufructuary mortgage, had duly delivered possession to the mortgagee. That is a finding of fact which cannot be assailed in Second Appeal.

3. As regards the applicability of Section 9-A, learned Counsel for the appellant first contended that, because the mortgage deed (Exhibit A-2) contained a personal covenant, it was an anomalous mortgage, to which that section would have no application. In the first place, on a reading of the mortgage deed, I do not think that it contained a personal covenant. All that the deed stated was that, if the mortgagor failed to redeem the mortgage, the mortgagee might collect the mortgage money by proceeding against the hypotheca and his other immovable and movable properties, and 'on the guarantee of my person'. Even assuming that this amounted to a personal covenant, it does not, in my opinion, make any difference. All the elements of a usufructuary mortgage, as defined by Section 58(d) of the Transfer of Property Act, are clearly present in the suit mortgage. A usufructuary-mortgage does not cease to be such and become an anomalous mortgage only because it contains a personal covenant to pay. Exhibit A-2 is still a usufructuary-mortgage notwithstanding the personal covenant added to its terms. No decided-case directly in point has been brought to my notice. My attention has, however, been invited to Lai Narasingh v. Md. Taqub Khan (1929) 58 M.L.J. 401 : L.R. 56 IndAp 299 : A.I.R. 1929 P.C. 139 in which the Privy Council held that a mortgage which was a combination of a simple mortgage and a usufructuary mortgage did not cease to be so and become an anomalous mortgage, because it contained a clause to the effect that the mortgagors should remain entitled to eject tenants, to enhance rent, to cultivate land and to issue leases, and, after enhancement and payment of interest, if there be left any surplus, or if the mortgagors paid any year or each year any amount of money, then, that money should be deemed to have been paid towards the principal and interest and the money paid should be deducted, and that the mortgagee, like the mortgagors, should possess all the remaining powers during the period of his possession. It may be noticed that Clause 5 in the mortgage in that case provided that, if the mortgagors failed to pay the mortgage money and failed to redeem the mortgage at the appointed time, then, the mortgagee should have power to realise the money due to him by sale of the mortgaged property, and that, if the mortgaged property should be found to be insufficient to satisfy the full demand, then, the mortgagee should be entitled to recover the balance from the other properties of the mortgagors. The Privy Council did not consider that clause to have the effect of rendering the mortgage to be an anomalous mortgage. I think that, on the same principle, it must be held that the usufructuary mortgage in question did not cease to be such due merely to the presence of the personal covenant.

4. The next contention of learned Counsel for the appellant was that, this being a suit to enforce a mortgage, the respondent could not invoke Section 9-A of the Act in such a suit. In Srinivasaraghava Aiyengar v. Narasimha Muddliar : AIR1952Mad292 , Subba Rao, J., as he then was, observed:

The scheme of the section leaves no doubt in my mind that it is intended only to apply when. the mortgagor seeks to redeem the mortgage.

This decision was followed by Govinda Menon, J., in Tirupathi v. Rajagopala Naidu : (1956)1MLJ1. . There, the defendant, in a suit for recovery of money due on a mortgage, invoked the aid of Section 9-A in his written statement. The learned Judge held that a mere allegation in a written statement that the defendant was entitled to the benefit of Section 9-A of the Act did not amount to the exercise of a right of redemption. The, ultimate relief that the learned Judge granted in that case was, however, based on the special circumstances. In view of these decisions, with which I respectfully agree, I think the contention that Section 9-A of the Act cannot be invoked by the defendant in this suit, is well founded.

5. The result is, the Second Appeal is allowed in part and the judgment and decree of the Courts below are set aside only in so far as they granted relief to the defendant under Section 9-A. In other respects, the Second Appeal will stand dismissed. Time for payment will be six months from to-day.

6. As each party has succeeded in part, there will be no order as to costs.


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