Gauhati High Court
Bhikari Nunia & Ors vs Ram Narayan Chouhan & Ors on 1 August, 2017
Author: Prasanta Kumar Deka
Bench: Prasanta Kumar Deka
IN THE GAUHATI HIGH COURT
(The High Court of Assam, Nagaland, Mizoram and Arunachal Pradesh)
Case No: RSA 40/2007
Bhikari Nunia & others ...... Appellants
-Versus-
Ram Narayan Chouhan ..... Respondent
:: BEFORE ::
HON'BLE MR. JUSTICE PRASANTA KUMAR DEKA For the Appellants : Mr. SP Choudhury Advocate For the Respondents : None appears Date of Hearing : 25.04.2017 Date of delivery of Judgment and Order : 01.08.2017 JUDGMENT AND ORDER (CAV) Heard Mr. SP Choudhury, learned counsel appearing on behalf of the appellants. None appears on behalf of the respondent.
2. The present appellants are the defendants in Title Suit No. 91/1992 filed in the court of learned Assistant District Judge No. 1 at Silchar. The plaintiff/ respondent filed the suit for declaration and injunction. It is the case of the plaintiff/ respondent that the defendant No. 1, Gopi Hazam, the proforma respondent No. 2 in the present appeal, on 04.04.1985 vide registered deed No. 1383 mortgaged some land measuring 4B 17K 8Ch covered by various Dag Page 1 of 12 RSA 40/2007 numbers of second RS patta No. 136, 137 and 138 described in Schedule 1 of the plaint after receiving Rs. 10,000/- from the plaintiff/respondent. The possession was handed over to the plaintiff/ respondent by the said defendant/ proforma respondent No. 2 with a condition that the plaintiff/ respondent is to retain possession of the said land for 10 years and to enjoy the usufructs thereon. Similarly, the deceased proforma respondent No. 3 in the present appeal also vide registered deed No. 1382 dated 04.04.1985 mortgaged 4B 17K 8Ch of land covered by various Dag numbers under Second R.S. patta Nos. 136, 137 and 138 described in Schedule 2 of the plaint after receiving Rs. 10,000/- and handed over possession to the plaintiff/ respondent on the same condition that the plaintiff/ respondent is to retain possession for 10 years and to enjoy the usufructs thereon. On delivery of possession, plaintiff/ respondent had been enjoying the possession over the suit land by way of cultivation. On the last part of May, 1992, it came to the knowledge of the plaintiff/ respondent that a sale agreement dated 10.04.1986 was executed by the said defendants/ proforma respondents No. 2 and 3 in favour of the present defendants/ appellants for selling Schedule 1 and 2 land by way of a registered agreement for sale bearing No. 990 dated 10.04.1986. The said defendants/ appellants were trying to evict the plaintiff/ respondent from the suit land in clear violation of the condition stipulated in the mortgage deeds both dated 04.04.1985. The defendants/ appellants were also trying to procure sale permission from the concerned authority. The plaintiff/ respondent is entitled to remain in possession of the suit land and to enjoy the benefit of the same until the defendants/ proforma respondents No. 2 and 3 initiated legal proceeding against him as per terms and Page 2 of 12 RSA 40/2007 conditions of mortgage deeds. Therefore, the plaintiff/ respondent preferred the said suit with the following prayers:-
(a) For a decree for declaration that the plaintiff is entitled to remain in occupation of the suit lands as per terms and condition of the (Kot kabala) Mortgage deed on 4-4-85.
(b) For a decree for confirmation of possession in respect of the suit lands
(c) For a declaration that agreement for sale dt. 10-4-86 is illegal, inoperative, void and that the defendants are not entitled to evict the plaintiff from the suit lands as per agreement for sale dtd. 10-4-86 in the basis of any other documents in respect of the suit lands.
(d) For a permanent injunction against the defendant, their men, agents, employees, restraining them not to disturb the peaceful possession of the plaintiff or to maintain status quo ante or to restrain from taking any permission from the competent authorities for purchasing / selling or transfer of in any manner of the suit land.
(e) Other reliefs
(f) Costs of the suit.
In all circumstances the suit be decreed in favour of the plaintiff and against the defendants with interest.
3. The present defendants/ appellants filed their written statement denying the pleadings in the plaint that they were trying to dispossess the plaintiff/ respondent from the suit land. It is pleaded in the written statement that the proforma respondents No. 2, 3 and 4 executed an agreement for sale in favour of one Ramdulal Nunia and the present defendants/ appellants on receipt of part consideration money of Rs. 30,000/- promising to sell the suit land on receipt of the balance consideration money of Rs. 19,000/- within the year 1993. It was further pleaded that the said Rs. 19,000/- was kept for redemption of the mortgage and the proforma respondents No. 2 and 3 entered into the sale agreement with a promise that they would redeem mortgage and execute the sale deed in favour of the present defendants/ appellants. The said proforma respondents in the present appeal delayed execution of the said sale deed by Page 3 of 12 RSA 40/2007 taking the balance consideration money as per sale agreement dated 10.04.1986 and a suit was filed against them by the defendants/ appellants which was pending. While the plaintiff/ respondent found that the said proforma respondents No. 2 to 4 were going to sell the suit land to the defendants/ appellants on redemption of the mortgage within a short period of time, the plaintiff/ respondent filed the present suit hurriedly in order to create hindrance in selling the suit land to the defendants/ appellants. Accordingly, they prayed for dismissal of the suit.
4. The proforma respondents in the present appeal, as the main defendants No. 1 to 3, simply filed a petition before the learned trial court stating that in the event of passing any decree in favour of the plaintiff/ respondent they have no objection.
5. On the basis of the pleadings, the learned trial court framed as many as 7 (seven) issues which are quoted below:-
1. Is there any cause of action for this suit?
2. Is the suit maintainable in its present form?
3. Is the suit bad for non-joinder of Kousalya Nunia as necessary parties?
4. Is the suit barred by limitation?
5. Is the plaintiff entitled to possession of the suit land as per terms and conditions of the mortgage deed (kot Kabala) dt. 4- 4-85, as claimed by him?
6. Is the plaintiff in possession of the suit land?
7. To what relief, if any the plaintiff is entitled?
6. Both the parties adduced their respective witnesses along with documents exhibited therein the suit. However, the present proforma respondents did not adduce any evidence nor they graced the witness box. The learned trial court Page 4 of 12 RSA 40/2007 decreed the suit thereby granting reliefs sought for by the plaintiff/ respondent in prayers No. (a), (b) and (d) referred hereinabove.
7. Being aggrieved, the present defendants/ appellants preferred Title Appeal No. 11/1999 before the learned Additional District Judge, Cachar at Silchar. The said appeal was dismissed vide judgment and decree dated 12.12.2006. The learned first appellate court while deciding issues No. 5 and 6 came to the finding that the present defendants/ proforma respondents No. 2 to 4 admitted the entire claim of the plaintiff/ respondent. Secondly, the present defendants/ appellants also admitted that the suit land was mortgaged to the plaintiff/ respondent by the defendants/ proforma respondents No. 1 and 2 on 04.04.1985 and since then the plaintiff/ respondent has been possessing the suit land. The learned first appellate court on perusal of the Exhibits 1 and 2 (mortgage deeds) came to the finding that by way of the said mortgage deeds, the plaintiff/ respondent paid Rs. 10,000/- each to the defendants/ proforma respondents No. 2 and 3. The condition of the said mortgage was for 7 years each w.e.f. 04.04.1985 and after 7 years, the defendants/ proforma respondents No. 2 and 3 were supposed to redeem the said mortgage within 3 years and if they failed to redeem within a period of 3 years, the plaintiff/ respondent, as the mortgagee, be entitled to mutate the land in his favour. It is also observed by the learned first appellate court that as both the mortgage deeds i.e. Exhibits 1 and 2 are proved, then the contents are also proved.
8. The learned first appellate court came to the finding that the mortgage is a usufructory mortgage with conditional sale. The plaintiff/ respondent is to utilise the rent and profit of the mortgage property against the interest of the Page 5 of 12 RSA 40/2007 loan amount and the mortgagors are entitled to redeem the mortgage after 7 years but within 3 years after the period of 7 years and if they failed to redeem within the said 3 years time schedule, the plaintiff/ respondent is entitled to get the land mutated in his name. It is held by the learned first appellate court further that the plaintiff/ respondent has been possessing the suit land on the strength of the said mortgage deeds and till filing of the suit, the mortgagors had not taken any steps to redeem the said mortgage. The mortgage deeds were executed on 04.04.1985. The period of redemption started from 04.04.1992 and the right of redemption would lapse on 04.04.1995. As the mortgage was not redeemed between 04.04.1992 to 04.04.1995, the plaintiff/ respondent acquired right to get the suit land mutated in his name against the loan paid to the mortgagors i.e. the defendants/ proforma respondents No. 2 and 3. So, the learned first appellate court came to the finding that as the suit was filed on 15.06.1992 i.e. after starting of the period of redemption, it is clear that the plaintiff/ respondent has been possessing the suit land as a mortgagee and during the said period none of the defendants could dispossess him from the suit land. Further, the learned first appellate court came to the finding that as the mortgage is a mortgage by conditional sale and after 04.04.1995, the plaintiff could get the land mutated in his name as purchaser and as such, the defendants/ proforma respondents No. 1 and 2 have no right to sale the suit property to the defendants/ appellants and deliver the possession to them ousting the plaintiff/ respondent from the suit land and further held that the defendants/ appellants have also no right to get the possession of the suit land on the strength of the sale agreement. Thus, it was held that the plaintiff/ Page 6 of 12 RSA 40/2007 respondent has right to remain in possession of the suit land until mortgage is redeemed by the mortgagors within the period specified in the Deeds which is 3 (three) years only which expired on 04.04.1995. Accordingly, the learned first appellate court upheld the findings of the learned trial court.
9. The defendants/ appellants thereafter preferred this second appeal against the judgment and decree of the learned first appellate court which was admitted on 18.05.2007 on the following substantial questions of law:-
1. Whether the learned Courts below misconstrued section 61(a) of the Limitation Act, 1963, in holding that the defendants No. 1, 2 and 3's right of redemption had lapsed on 4/4/1995?
2. Whether the learned Courts below misinterpreted the mortgage deed (Exhibits 1 and 2) to brand the transaction therein as mortgage by conditional sale?
3. Whether the learned Courts below erred in holding that non-
impleadment of Kausalya Nunia, mother of Ramdulal Nunia (since deceased), a signatory in the agreement of sale (Exhibit-3) was not fatal for the suit?
10. Mr. Choudhury, learned counsel for the appellants, submits that he would confine his submission with regard to the substantial question of law No. 1 as the findings of the same has a direct bearing on the outcome of the dispute between the parties. The learned counsel submits that the question of limitation is a pure question of facts and law. The present suit being on the basis of a mortgage and the terms governing the mortgage are to be looked into. The learned courts below failed to appreciate the same and tried to impose the period of redemption of 3 years only on the face of the law holding the field as stipulated under Article Page 7 of 12 RSA 40/2007 61(a) of the Limitation Act, 1963 which prescribes a period of 30 years for redemption or recovers possession of immovable property mortgaged. He also submits that the said period of 30 years is to be counted when the right to redeem or recover possession accrues on the mortgagors. Accordingly, he submits that both the courts below had went wrong in passing the judgment thereby granting the relief as prayed for by the plaintiff/ respondent in the plaint. As apparent from the reliefs, so prayed, the plaintiff/ respondent shall maintain his possession all throughout on the ground that the mortgagors failed to redeem the mortgage within a period of 3 years as stipulated in the mortgage deeds and that cannot be the intent and purpose of the stipulations made in the said agreement rather, Mr. Choudhury submits that the suit is in disguise for obtaining the relief by way of depriving the defendants/ appellants including the mortgagors from their right prescribed under the Limitation Act for redemption. As such, Mr. Choudhury submits that the substantial question of law No. 1 is to be decided in favour of the appellants.
11. Considered the submissions of the learned counsel for the appellants. In the opinion of this court, both the learned courts below failed to consider the said period of 3 years for redemption in its proper perspective whether the said condition is a clog on equity of redemption keeping in view the stipulations of Section 60 of the Transfer of Property Act, 1882. Moreover, in the suit the mortgagors failed to come to depose before the court. Merely a petition was filed as hereinabove stated which cannot be considered as an admission on the part of proforma respondents No. 2 and 3 nor the plaintiff/ respondent pressed for passing any admission decree on the basis of the said petition. In the case of Page 8 of 12 RSA 40/2007 Ganga Dhar v. Shankar Lal and others reported in AIR 1958 SC 770 , the Hon'ble Apex Court held as follows:-
"(7) The right of redemption, therefore, cannot be taken away. The Courts will ignore any contract the effect of which is to deprive the mortgagor of his right to redeem the mortgage. One thing, therefore, is clear, namely, that the term in the mortgage contract, that on the failure of the mortgagor to redeem the mortgage within the specified period of six months the mortgagor will have no claim over the mortgaged property, and the mortgage deed will be deemed to be a deed of sale in favour of the mortgagee, cannot be sustained. It plainly takes away altogether, the mortgagor's right to redeem the mortgage after the specified period. This is not permissible, for "one a mortgage always a mortgage" and therefore always redeemable. The same result also follows from S. 60 of the Transfer of Property Act. So it was said in Mohammad Sher Khan v. Seth Swami Dayal, 49 Ind App 60 at p. 65 : (AIR 1922 PC 17 at p. 19) (C).
(8) Under the section, once the right to redeem has arisen it cannot be taken away. The mortgagor's right to redeem must be deemed to continue even after the period of six months has expired and the attempt to confine that right to that period must fail. The term in the mortgage instrument providing that the mortgage can be redeemed only within the period of six months and not thereafter must be held to be invalid and ignored. The learned Judicial Commissioner took the same view and this has not been challenged in this appeal on behalf of the respondents."
In the case of Pom al K anji Govindji and others v. Vrajlal K arsandas Purohit and others reported in (1989) 1 SCC 458 , the Hon'ble Apex Court held as follows:-
"26. Whether in the facts and the circumstances of these cases, the mortgage transaction amounted to clog on the equity of redemption, is a mixed question of law and fact. Courts do not look with favour at any clause or stipulation which clogs equity of redemption. A Page 9 of 12 RSA 40/2007 clog on the equity of redemption is unjust and unequitable. The principles of English law, as we have noticed from the decisions referred to hereinbefore which have been accepted by this Court in this country, looks with disfavour at clogs on the equity of redemption. Section 60 of the Transfer of Property Act, in India, also recognises the same position."
12. Keeping the ratio laid down by the Hon'ble Apex Court in view, before entering into the issue involved in the substantial question of law No. 1, it must be kept in mind that whether the term stipulated in the mortgage deed is a "clog on the equity of redemption" and for the said purpose, the surrounding circumstances at the relevant point of time when the mortgage was created and the subsequent move on the part of the mortgagee is also to be considered. In the present case in hand, the plaintiff/ respondent filed the suit in order to enforce the terms stipulated in the mortgage deeds, more specifically, the stipulation that if there is failure on the part of the mortgagors to redeem the mortgage within 3 years, he would be entitled to mutate his name. It is also stipulated in the said mortgage deeds that the mortgagors would execute registered sale deed. Thus, it is apparent that the plaintiff/ respondent, as the mortgagee, at the time of lending money and taking the security, entered into an agreement in such a manner that the stipulations, so made in the said mortgage deed, clearly indicates the effect by which the mortgagors should have no equity of redemption.
13. The said intention is very much clear from the subsequent acts on the part of the plaintiff/ respondent i.e. filing of the present suit. The agreement for sale entered into by the present defendants/ appellants clearly stipulates about the mortgage and it is also stipulated therein that the sale transaction would be Page 10 of 12 RSA 40/2007 completed in the year 1993 i.e. after 7 years of the date of creation of the mortgage. The vendors, defendants/ proforma respondents No. 2 to 4, failed to perform their part of contract as per promises made in the said agreement for sale and as such, the defendants/ appellants preferred the suit for specific performance of contract. The plaintiff/respondent has no right to interfere so far the stipulations in the agreement for sale are concerned. The action of filing of suit itself shows the intention which the plaintiff/ respondent carried at the time of execution of the mortgage deeds, Exhibits 1 and 2 and it can very well be prepondered that with an oblique intention stipulations were made in the said Exhibits 1 and 2 restricting the period of redemption only to a period of 3 years. The execution of the registered sale deed and mutation of the name of the plaintiff/ respondent were the prime intention of the plaintiff/ respondent No. 1 and the same was in his mind at the time of execution of Exhibits 1 and 2. Admittedly, the plaintiff/ respondent pleaded in his plaint that the mortgagors needed money at that relevant point of time.
14. The clause of execution of registered sale deed, so stipulated in Exhibits 1 and 2, if arrived at and stipulated in a separate agreement subsequent to the creation of the mortgage, it could have been easily prepondered that the said agreement for execution of registered sale deed was not contemporaneous to the Exhibits 1 and 2, then that would have created a separate view. But as the same being contemporaneous, this court has nothing but to hold that the said stipulations are clog on the equity of redemption of the mortgagors.
15. As held in Ganga Dhar v. Shankar Lal and others (supra), such stipulations whereby the right of redemption is curtailed, the court has the power Page 11 of 12 RSA 40/2007 to ignore any contract to that effect. Once the right to redeem has arisen, the said right must be deemed to be continued even after the period of 3 years stipulated in the said agreement until a decree for foreclosure is obtained by the mortgagee. From the discussions made hereinabove, it can very well be concluded that the substantial question of law No. 1, so formulated, wherein the learned courts below held that the right of redemption had lapsed on 04.04.1995, is totally a wrong finding and as such, the same is answered in the affirmative. The rest of the substantial questions of law have no bearing in deciding the substantial dispute between the parties and as such, the submission of the learned counsel for the appellants is accepted. Accordingly, the judgment passed by the learned first appellate court upholding the findings of the learned trial court is hereby set aside and the second appeal accordingly succeeds.
No order as to costs.
16. Send down the lower court records.
JUDGE BiswaS Page 12 of 12 RSA 40/2007