1. This rule has been obtained by the mortgagee and raises a difficult point in connexion with an application under Section 26G, Ben. Ten. Act. At the time of the execution of the mortgage, the land was producing nothing. The intention of the mortgagee was to build and there was a clause in the deed to the effect that the mortgagor would only get back possession of the land on paying a fair price for any buildings which might be constructed by the mortgagee. In view of the provisions of Section 26G (5) the debt has now been discharged. Opposite party 1 accordingly filed an application under the sub-section to recover possession. The Munsif neither allowed nor rejected the application in direct terms. He held that the debt was discharged but put the mortgagor on terms that she was to pay Rs. 1100, at which he assessed the value of the structures, as a condition precedent to being put into possession. Both sides appealed. The petitioner was dissatisfied with the Munsif's valuation of the structures but now of course accepts it. The Subordinate Judge held that the petitioner had no right to remain in possession and allowed the application. Mr. Ghose raised two preliminary points in showing cause against the rule. In the first place, he contended that the petitioner should have appealed in stead of filing this application in revision. In view of the peculiar terms of the order made by the Munsif, which neither allowed nor rejected the application, it is very' difficult to say whether there was an appeal or not. I myself should be inclined to hold that the opposite party's appeal in the lower Court was incompetent. But inasmuch as the only point now taken relates to the jurisdiction of the Munsif to make an order, a point which can be taken either in appeal or revision, this is a matter of only academic interest.
2. Then in the second place, Mr. Ghose contended that a mortgagor cannot be put on terms by an order allowing an application under this section. I have no doubt that on a strict interpretation of the section this contention is correct. The learned Munsif, holding that the opposite party was not entitled to immediate possession, should have directed her to convert the application into a plaint or, if she had not sufficient funds to pay into Court what she considererd to be a fair valuation for the structures, left it to her to institute an independent suit. He ought not to have made an order allowing her to recover possession. Similarly, the learned Subordinate Judge, taking the view which he did, was right to relegate the petitioner to a separate suit to recover the value of the structures.
3. The following questions accordingly arise for consideration now: (1) Has the petitioner any other right than that of a mortgagee entitling him to remain in possession? (2) Does the agreement amount to a clog on the equity of redemption? (3) If so, is the opposite party entitled to an order for immediate delivery of possession? Now that the mortgage is extinguished it is not suggested that the petitioner has any title to the property. Mr. Das however contended that in virtue of the agreement he has an equitable right to remain in possession until he is paid for the structures. I accept this position. As the property was not in a position to yield any profits at the time, it is quite clear that the petitioner would not have advanced the money, if he had not been in a position to build. It is equally clear that he would not have been willing to lay out his money in making structures unless he could feel assured that he would be able to recover their value without being compelled to sue. In these circumstances, as he was (induced to lay out money in structures, which would enure to the benefit of the opposite party, on the inducement held out in this agreement, he has an equitable claim to remain in possession in terms thereof.
4. On the second point, I agree with the conclusion of the learned Subordinate Judge. He has not gone so far as to hold that the petitioner is not entitled to recover the value of the structures. But by the agreement the opposite party is prevented from recovering possession until she has paid off a liability other than the money due on the mortgage: this certainly has the practical effect of a clog on the equity of redemption. But after the decision of the House of Lords in Kreglinger v. New Patagonia Meat and Cold Storage Co. Ltd (1914) 1914 A.C. 25 it cannot be contended that any agreement which might have this practical effect can be avoided. It is clear that the present agreement does not come within the test there laid down. For one thing it does not even secure a collateral advantage for the mortgagee but is really for the mutual benefit of both. But whatever may be the exact position with regard to this doctrine at the present time, I am clearly of opinion that it cannot be invoked by a mortgagor against an equity which he has himself created in favour of the mortgagee. It follows from this view that the petitioner has a right to retain possession of the property independent of his right to do so as mortgagee. The application of the opposite party is accordingly liable to be dismissed.
5. I have already said that the petitioner accepts the valuation of the structures and the order made by the learned Munsif. Mr. Ghose stated that he would rather do the same than be relegated to a separate suit. The petitioner obviously has no right to remain in possession of the opposite party's property without paying something in lieu of rent. I should accordingly have declined to interfere in revision if Mr. Das had not accepted Mr. Ghose's reasonable figure of Rs. 6 per months The rule is accordingly made absolute, the order of the lower appellate Court is set aside and that of the Munsif restored with this modification that a sum of Rs. 6 per month will be set-off against the sum of Rs. 1100 with effect from the date, upon which Bengal Act, 6 of 1938, came into force. I make no order as to costs.