Patna High Court
Dr. Haji Muhammad Ahsanul Tauhid vs Shah Akhtar Hussain And Ors. on 14 May, 1959
Equivalent citations: AIR1960PAT106, AIR 1960 PATNA 106
JUDGMENT Raj Kishore Prasad, J.
1. This is a very unfortunate case in that the plaintiff appellant is going to lose his entire mortgage money due to wrong legal advice,
2. The circumstances in which the present appeal has been brought before this Court by the plaintiff may, briefly, be stated as below :
On the 16th March, 1915, defendant No. 1 executed a usufructuary mortgage bond, exhibit 1(b), for a sum of Rs. 4,000/- in favour of the plaintiff for a term of two years. The due date of redemption, as mentioned in the bond itself, was 15th March, 1947. Subsequently, on the 11th October, 1946, defendant No. 1 executed another usufructuary mortgage bond in respect of the same property for Rs, 2,500/- in favour of the plaintiff, exhibit 1(c). The date of redemption of this bond was 10th October, 1948.
3. After the execution of the first Ijara on 16th March, 1945, the defendant No. 1 took a lease back of the mortgaged house for two years, and executed a kerayannama in favour of the plaintiff (exhibit 3). After the execution of the second Ijara, exhibit 1(c), the defendant No. 1 again took lease back of the mortgaged house for two years, and executed a kerayanama on llth October, 1946, exhibit 3(a).
4. After the expiry of the date of redemption and also after the expiry of the lease, both of which expired in 1948, the plaintiff brought a money suit in 1951 for recovery of the arrears of rent. The suit was decreed on compromise on 26th July, 1951, exhibit 6.
5. This decree money, however, could not be realised, and, therefore, the plaintiff brought the present mortgage suit on 5th October, 1953 for recovery of Rs, 6,500/-, the two principal amounts advanced under exhibits 1(b) and 1(c), and for interest at the rate of eight annas per cent per month, as mentioned in the two bonds themselves.
6. The suit was contested by different sets of defendants, and one of the defences taken was that the suit was barred under Order 2, Rule 2, of the Code of Civil Procedure. The bar under Sec, 4 of the Bihar Money-Lenders Act, 1939 was also pleaded.
7. The learned Subordinate Judge of Gaya held that the suit was barred under Order 2, Rule 2 of the Code of Civil Procedure, and also under Section 4 of the Bihar Money-Lenders Act, and, therefore, he dismissed the plaintiff's suit in toto. The plaintiff, therefore, has preferred the present appeal against the said judgment and decree,
8. It was conceded by Asghar Hussain, who appeared for the plaintiff appellant, that, if the suit of the plaintiff be held to be barred under Order 2, Rule 2 of the Code of Civil Procedure, then the second question, about the suit being barred under Section 4 of the Bihar Money-Lenders Act, will be of no importance. He, however, contended that, if, it be held that Order 2 Rule 2 of the Code of Civil Procedure was not a bar to the present suit, then, even if it be held that Section 4 of the Bihar Money-Lenders Act was a bar to the suit, the plaintiff could, thereafter, assign his mortgage in favour of a registered money-lender, because the statutory period of limitation for enforcing the mortgage has not expired.
9. The crucial question, therefore, for determination is -- Is the suit of the plaintiff barred under Order 2, Rule 2, of the Code of Civil Procedure?
10. It is necessary to read first these provisions. Order 2, Rule 2, Civil Procedure Code, is in these terms :
"2.(1) Every suit shall include the whole of the claim which the plaintiff is entitled to make in respect of the cause of action; but a plaintiff may relinquish any portion of his claim in order to bring the suit within the jurisdiction of any Court.
(2) Where a plaintiff omits to sue in respect of, or intentionally relinquishes, any portion of his claim, he shall not afterwards sue in respect of the portion so omitted or relinquished.
(3) A person entitled to more than one relief in respect of the same cause of action may use for all or any of such reliefs; but if he omits, except with the leave of the Court, to sue for all such reliefs, he shall not afterwards sue for any relief so omitted."
11. In order to answer the question just posed by me, it is necessary, first, to decide if the two transactions, namely, the usufructuary mortgage and the lease back, were both one and the same transaction. If on the true construction of the documents, and after taking into consideration the facts and circumstances of the case, it be held that both formed parts of one and the same transaction, then, obviously Order 2, Rule 2 of the Code of Civil Procedure would be a bar to the present suit.
12. As observed by B. P. Sinha, J., (as he then was), and with whom FazI Ali, C. J., (as he then vvas), agreed, in Umeshwar Prasad Sinha v. Dwarika Prasad, AIR 1944 Pat 5, it is neither possible nor desirable to lay down any hard and fast rule which could be said to govern such cases, and, therefore, the safest rule to follow is to say that each case must be judged on its own facts as disclosed in the transaction between the parties evidenced by one or more than one document. His Lordship further observed :
"But I may suggest that one test may gene-rally be applied to enable the Court to say that the two documents form part of one and the same transaction, where it appears on a reasonable construction of the documents that the properties were given in security not only for the principal amount secured under the sudbharna bond but also for the interest accruing thereupon. In other words, where the Court finds that though the documents have taken the shape firstly of a mere usufructuary mortgage bond, the mortgagee purporting to take possession of the mortgaged properties, but in reality the second document whereby possession is purported to be given back to the mortgagor is merely a device to ensure regular payment of the interest, which also is secured on the same mortgaged properties, it may generally be said that they are parts of the same transaction. Such a transaction may be evidenced by more than one document which may have been executed on different dates with varying periods of their operation, and possibly, even in the name of different parties, benami for the real mortgagor and mortgagee. The Court has to look upon the transaction as a whole after tearing off the veil attempted to be thrown round the real intent of the parties."
I express my cordial assent to the above observations, which, if I may say so with respect, represent the correct position in law.
13. Bearing these general observations in mind, the nature of the present transaction has to be gathered from the deeds mentioned before.
14. The first usufructuary mortgage (Exhibit l(b)) was executed on 16th March, 1945 for two years, from 16th March, 1945 to 15th March, 1947. The very next day, the mortgagee gave a lease back (exhibit 3) of the mortgaged property to the mortgagor, and, the mortgagor, on 17th March, 1945, executed a kerayanama in favour of the plaintiff. There is, therefore, no doubt that exhibits 1(b) and 3, the usufructuary mortgage and the lease back, were almost contemporaneously executed. In the Ijara, exhibit l(b), the rate of interest mentioned is 6 per cent per annum. Calculating on this basis, the interest on Rs. 4,000/-, which was secured by the mortgage, would be Rs. 240/- per year.
Under exhibit 3, the kerayanama, the lease was to continue for two years from 17th March, 1945 to 16th March, 1947, and the rental payable was Rs. 20/- per month, according to which the annual rental would be Rs. 240/-.
15. The second Ijara, exhibit 1(c), was executed during the continuance of the first Ijara, in respect of the same house on 11th October, 1946 for two years, from the 11th October, 1946 to 10th October, 1948, for a sum of Rs. 2,500/-, and the interest payable was 6 per cent per annum. On the same day, the lease back, exhibit 3(a), by the mortgagee was given, and the mortgagor, on 11th October, 1946, executed a kerayanama in favour of the mortgagee stipulating to pay a monthly rental of Rs. 32/8/-, which would come to Rs. 390/- annually.
16. From these documents, therefore, what we find is that both exhibits 1(b) and 3 were contemporaneously executed, and exhibits 1 (c) and 3 (a) were both executed on the same day. The period of the continuance of the Ijaras and the leases back were the same, the total interest on Rs. 6,500/- secured by the two Ijaras, exhibits 1(b) and 1(c), at the rate of 6 per cent per annum, came to Rs. 390/-, and the rental under the second lease, exhibit 3(a), was Rs. 390/- per annum, There is, therefore, no doubt that the lease was in the nature of a machinery for the purpose of realising interest due on the mortgage, and the lease was a component part of the mortgage transaction.
In the plaint itself, it is admitted that the rent payable in respect of the mortgaged house under the two leases represented the interest payable on the mortgage bonds, as will appear from paragraphs 14, 16 (g) and 19 of the plaint. There can, therefore, be no doubt that, on a true construction of these documents, both the mortgage and the lease formed one and the same transaction.
17. It is true, as observed by Patanjali Sastri J. (as he then was) in Abdul Khadir v. Subramanya Pattar, AIR 1940 Mad 946, that-
"though the mortgage and the lease back can and must in a case of this kind, be taken to form part of the same transaction, effect must be given to each according to its terms and the Court cannot, by reading the two together, spell out a transaction totally different in character and incidents."
18. It is, therefore, no doubt permissible, as a matter of construction, to look behind the form of a transaction to ascertain its substance and give effect to it according to the intention of the parties, but it is a different thing to ignore the form in which the parties have deliberately cast their bargain, when such form is intended to govern their mutual rights and obligations.
In the present case, however, on a true construction of the documents, there is absolutely no doubt that both the transactions, the usufructuary mortgage and the lease, exhibits 1 (c) and 3 (a), should be read together as they form parts of one transaction, the lease being in the nature of machinery for the purpose of realising the interest due on the mortgage.
If they are so read, it is obvious that the so called rent payable under the kerayanama kabuliyat represents the interest payable on the mortgaged property and not a rent for use and occupation, the kabuliyat being a device for regular payment of interest on the mortgage money, and the relation created between them is not of a landlord and a tenant, but of a mortgagor and a mortgagee:
(Ramnarain Pasi v. Sukhi Tiwary, AIR 1957 Pat 24, in which AIR 1944 Pat 5: ILR 22 Pat 320, was relied upon, and Jyoti Pandey v. Nagendra Nath, 1956 BLJR 125).
19. Mr. Asghar Hussain relied on a Bench decision of the Kerala High Court in Venkappa v. Gangadhara, AIR 1959 Kerala 112, in which it was observed that -
"It cannot be held that whenever as part of the same transaction, property which is usufructuarily mortgaged is leased back to the mortgagor, the rent accrued is really interest and automatically becomes a charge on the property, to be paid as part of the mortgage money at the time of redemption if it remains in arrears".
In my opinion, this observation of their Lordships has no application to the present case, for the simple reasons that the plaintiff admitted in his plaint that the rent payable for the house really represent-ed the interest on the mortgage money, which fact is further proved by the documents themselves, which clearly indicate that the interest payable on the mortgage money and the rent realisable in respect of the house are both one and the same and identical, the rent payable in respect of the mortgaged house representing the interest payable on the mortgage money.
20. The next question, which then arises, is --What legal consequence flows from this finding?
21. The result of the non-payment of the house rent, as agreed between the parties, and, which represented the interest payable on the mortgage money, amounted to dispossession of the plaintiff, and, in case of dispossession, the mortgage deed provided that the plaintiff was entitled to recover the mortgage money with interest at 6 per cent. per annum, In this view of the matter, there is no doubt that the claim for rent, which was in lieu of interest on the mortgage money, arose out of one and the same transaction, namely, the mortgage debt, and was a claim under the mortgage, arising out of it and not independently of it, and, therefore, the two reliefs which were open to the plaintiff constituted the same cause of action, and, as such, it could not be split up and claimed in different suits; and, in such a case, as held by a Bench of this Court in Phulchand Shah v. Dinkar Prasad, AIR 1955 Pat 297, the subsequent suit would be barred under Order II, Rule 2, of the Code of Civil Procedure, as it applied to the claim in the- present suit.
22. Mr. Hussain placed reliance on an earlier Bench decision of this Court in Ramnarayan Singh v. Bishvanath Missir, 1 Pat LT 694: (AIR 1920 Pat 723), in support of his contention that the claim for rent on the basis of the lease in the previous suit could not be said to be a claim under the mortgage, and, therefore, the two transactions could not be said to be parts of the same transaction so as to bring the plaintiff's case within the mischief of Order II, Rule 2 of the Code of Civil Procedure.
In that case, the lease back was executed seven years after the mortgage, and, therefore, their Lordships held that it could not be said to be a part of the same transaction, and accordingly, it was held that the suit in that case was one between a landlord and a tenant, and not between a mortgagor and a mortgagee, the claim being based, not upon the mortgage, but upon the independent contract of lease, and, therefore, Order XXXIV, Rule 14, of the Code of Civil Procedure did not bar the sale of the equity of redemption.
In the present case, as I have shown before, that is not the position. The lease and the mortgage both were executed almost contemporaneously, in one case, and, on the same day, in the other, and, as I have held, they formed parts of one and the same transaction; and, therefore, in 1951, when the plaintiff brought the suit for rent, the due date for payment of the mortgage money had already expired, and, under the mortgage deed itself, the plaintiff was entitled to sue for the mortgage money.
But he was ill advised to bring a suit for rent only, and to leave his claim for the mortgage money to be sued upon later on. In these circumstances, I have no doubt that the Court below has correctly decided the suit in holding that it was barred by Order II. Rule 2, of the Code of Civil Procedure. I, therefore, hold, in agreement with the trial Judge, that the suit is barred under Order II, Rule 2 of the Code.
23. In view of this decision, it is not now necessary, as conceded by Mr. Husain, to consider if the plaintiff's suit is also barred by Section 4 of the Bihar Money Lenders Act.
24. The question whether the plaintiff would be entitled to realise his money decree which he has obtained or to put it into execution does not arise to be decided in the present suit, and, therefore, it is not necessary to say any further on this question.
25. It may be mentioned that the mortgagor has not appeared in the appeal, which has been contested only by defendants 2, 3 and 5, who are subsequent mortgagees.
26. In the result, the appeal fails, and it is dismissed; but, in the circumstances of the case, there will be no order for the costs of this Court.
27. In the present case, however, I feel that it was not a case in which any costs should have been awarded against the plaintiff to the defendants, because the plaintiff foolishly has lost his entire mortgage money. I think, therefore, that the Court below did not exercise its discretion properly in awarding costs against the plaintiff. I would, therefore, set aside the decree for costs awarded against the plaintiff.