Punjab-Haryana High Court
Des Raj (Dead) Through Lrs. vs Kulwant Singh And Anr. on 22 January, 2003
Equivalent citations: (2003)135PLR601
Author: Hemant Gupta
Bench: Hemant Gupta
JUDGMENT Hemant Gupta, J.
1. This is plaintiffs appeal arising out of a suit for possession by way of redemption of a shop. The plaintiff has purchased the shop in dispute from Raunak Ram son of Bishna Mal Aggarwal vide registered sale deed. The shop was mortgaged by the plaintiff with the defendants vide registered mortgage deed dated 15.4.1957 for Rs. 1500/- with possession. The plaintiff sought possession of the shop by way of redemption. However, the defendants admitted mortgage but further stated that they were already in possession of the disputed shop as tenants and thus, the plaintiff can get the shop redeemed but the possession will remain with the defendants as tenant.
2. The learned trial court decreed the suit holding that the defendants were tenants under the plaintiff before the aforesaid shop was mortgaged but they have surrendered their tenancy rights in favour of the mortgagor at the time of execution of the registered mortgage deed and thus, the tenancy rights will not revive. However, the first Appellate Court reversed the finding recorded by the learned trial Court holding that there is no specific plea regarding surrender of tenancy and thus, the plaintiff cannot be allowed to travel beyond his pleading. Consequently, reversed the finding recorded by the learned trial court but modified the decree to the extent that the plaintiff was not held entitled to physical possession of the shop on redemption.
3. I have heard the learned counsel for the parties and with their assistance gone through the records of the case.
4. A perusal of the plaint would show that the plaintiff has not made any pleading regarding the tenancy of the defendants in the shop in dispute. It was during the course of trial, the plaintiff came forward to allege that it was not the defendants who were tenant but Kishan Buttonwala (Shoe seller) when Des Raj appeared as PW5. A perusal of the mortgage deed would show that the recital in the mortgage deed are to the effect that the possession of the shop has been given to the mortgagee at the time of the execution of the deed and also liberty was given to the mortgagee to induct tenant. On the basis of such recitals in the mortgage deed it was submitted by the appellant that the possession has been given on the date of execution of the mortgage deed as mortgagee and further right has been given to induct tenant. It is, thus, evident that the tenancy rights were surrendered only then the question of handing over possession as mortgagee would arise and further right to lease out the premises.
5. Learned counsel for the appellant also placed reliance on Shah Mathuradas Maganlal and Co. v. Nagapipa Shankarappa Malaga and Ors. AIR 1976 Supreme Court 1565, to contend that the learned trial court was right in law in returning a finding that the defendants have surrendered the tenancy rights. In the said case, the Hon'ble Supreme Court was considering a case where the tenancy in favour of the mortgagee was up to 6.11.1953. The deed of mortgage was executed on 21.5,1953 but the period of mortgage of 10 years was to commencence only from 7.11.1953, It was in these circumstances, it was held that since the mortgage period is to commence after the expiry of tenancy period, therefore, it is a case of surrender of tenancy rights. The Hon'ble Supreme Court approved the view expressed by Boiribay High Court in Narayan v. Ramachandra, 1963(65) Bom LR 449, wherein it was held that for a merger to arise as provided under Section 111 of the Transfer of Property Act, a lesser estate and a higher estate should merge in one person at one and the same time and in the same right, and no interest in the property should remain outside. In the case of lease the estate that is in the lessor is a reversion. In the case of a mortgage the estate that is outstanding is the equity of redemption of the mortgagor. Therefore, there cannot be a merger of lease and mortgage in respect of the same property since neither of them is a higher or lesser estate than the other. In para No. 17 it was held as follows:
"17. For a merger to arise, it is necessary that a lesser estate and a higher estate should merge in one person at one and the same time and in the same right, and no interest in the property should remain outside. In the case of a lease the estate that is. in the lessor is a reversion. In the case of a mortgage the estate that is outstanding is the equity of redemption of the mortgagor. Therefore, there cannot be a merger of lease and mortgage in respect of the same property since neither of them is a higher or lesser estate than the other. The view expressed in Narayan v. Ramchandra (1963) 65 BOM LR 449 is correct."
6. The Hon'ble Supreme Court in the case mentioned above further held that the question whether there was surrender of tenancy rights under Clauses (e) and (f) of Section 111 of the Transfer of Property Act, is a question of fact. The implied surrender by operation of law occurs by the creation of a new relationship or by relinquishment of possession. If the lessee accepts a new lease that itself is a surrender. Surrender can also be implied from the consent of the parties or from such facts as the relinquishment of possession by the lessee and taking over possession by the lessor, Relinquishment of possession operates as a implied transfer. It was explained that physical possession may not be necessary but something amount to virtual of taking of possession. Thus, the Supreme Court held as under:-
"19. A surrender under Clauses (e) and (f) of Section 111 of the Transfer of Property Act, is any yielding up of the term of the lessee's interest to him who has the immediate reversion of the like a contract by mutual consent on the lessor's acceptance of the act of the lessee. The lessee cannot, therefore, surrender unless the term is vested in him; and the surrender must be to a person in whom the immediate reversion expectant on the term is vested. Implied surrender by operation of law occurs by this creation of a new relationship, or by relinquishment of possession. If the lessee accepts a new lease that in itself is a surrender. Surrender can also be implied from the consent of the parties or from such facts as the relinquishment of possession by the lessee and taking over possession by the lessor. Relinguishment of possession operates as an implied surrender. There must be a taking of possession, not necessarily a physical taking, but something amounting to a virtual taking of possession. Whether this has occurred is a question of fact. In the present cause if the mortgagor was not able to redeem the appellant mortgagee was to enjoy the property in accordance with the terms of the mortgage and also to sell the property for recovery of debts. This feature shows that the appellant surrendered the tenancy from 7 November, 1953".
7. The said view of the Supreme Court was affirmed in Cheriyan Sosasmnma and Ors. v. Sundaressan Pillai Saraswathy Amma and Ors. AIR 1999 Supreme Court 947 when it was held:-
"The question whether upon redemption of usufructuary mortgage a tenant-mortgagee was required to deliver actual or physical possession of the mortgage property to the lessor-mortgagor, depends upon the intention of the parties at the time of the execution of the mortgage deed. There is no automatic merger of the interest of a lessee with that of a mortgagee when the same person is the lessee as well as the mortgagee, in the absence of proof of surrender of the lease. Unless there is merger of both rights in redemption of the mortgage, the plaintiff is not entitled to recover physical possession of the property. The right of lessee to continue in possession would survive after redemption."
8. Subsequently, in Nirmal Chandra v. Vimal Chand, (2001) 1 Supreme Court cases 51, it has been again reiterated by the Supreme Court considering the entire case law to the effect that all depends on the intention of the parties at the time of execution of the document by the parties as well as from the circumstances as to the fact whether tenant has surrendered tenancy rights. The question of actual surrender of rights depends upon the intention of the parties at the time of execution of mortgage. It would be a question of fact depending upon evidence. In the absence of proof of surrender of lease by the defendants, there is no automatic merger of an interest as a lessee with that of a mortgagee when the same person is a lessee as well as mortgagee. It was held by the Hon'ble Supreme Court:
"From a perusal of the decisions of this Court as indicated above, it clearly emerges that there is no automatic merger of two rights where mortgage is executed in favour of a tenant and on redemption of mortgage, the tenancy rights kept in abeyance would revive and entitle the tenant to continue in possession even after the redemption of the mortgage. On execution of mortgage, tenancy rights would terminate only if it is clear expressly or impliedly by conduct or other related circumstances that the parties had intended so which would be a question of fact. Thus, as a normal rule except in intention being to the contrary, mortgage and lease operate independent of each other and on mortgage coming to an end by redemption, tenancy would revive."
9. As a matter of fact, the plaintiff has not even admitted the defendants to be tenants under him. He, in fact, projected that one Kishan a shoe seller was the tenant prior to the execution of the mortgage deed. However, it has been found by both the courts below on the basis of numerous documents including the rent receipts given by Binder Kumar i.e. son of the plaintiff that the defendant was tenant prior to mortgage. The defendants have also produced their neighbour i.e. D.W. 1 Ram Gopal as well as produced record from the Punjab State Electricity Board to the effect that electric connection in the shop in dispute is in the name of Kulwant Singh, defendant. Since the defendants were in possession prior to the execution of the mortgage deed and per documents on record as tenant and therefore, it was for the plaintiff to prove that there was either express or implied surrender of tenancy rights. Learned counsel for the appellant could not dispute the finding recorded by both the courts below that in fact, the defendants were tenants prior to the execution of the mortgage deed but contended that the execution of the mortgage deed itself would prove that the defendants have surrendered their tenancy rights which is evident from the recital that the possession has been given and that the mortgagees are entitled to induct tenants. As held by catena of judgments, some of them mentioned above, that there is no automatic merger of lease hold rights with mortgage rights, therefore, it was incumbent upon the plaintiff to prove that there was express or implied surrender of tenancy, which he has failed.
10. Learned counsel for the appellant has also relied upon Food Corporation of India and Anr. v. Hardial Singh and Ors., (1996-3)114 P.L.R. 207 to contend that Section 91 of the Evidence Act is an absolute bar to the production of any oral evidence to prove the terms of a contract which has been reduced to writing. The learned counsel for the appellant has contended that a reading of the mortgage deed itself would show that the tenancy rights were surrendered in favour of the plaintiff and thus, the finding recorded by the first Appellate court is not sustainable. It was further contended that since the terms of the mortgage has been reduced into writing, any oral evidence in respect of the contents of the documents is not admissible in view of the Section 92 of the Evidence Act.
11. There is no recital in the mortgage deed regarding the surrender of tenancy rights, therefore, the parties were at liberty to adduce oral evidence on the issue of surrender of tenancy. It has been held in Tamil Nadu Electricity Board and Anr. v. N. Raju Reddiar and Anr., (1996) 4 SCC 551 that where the agreement between the parties is a written, the parties are bound by the terms and conditions of the agreement.
It is not open to any of the parties to prove the terms of the contract with reference ,to oral or documentary evidence to find out the invention of the parties. Under Section 92 of the Evidence Act where the written instrument appears to contain the whole terms of the contract then parties to the contract are not entitled to lead any oral evidence to ascertain the terms of the contract. It is only when the written contract does not contain the whole of the agreement between the parties and there is any ambiguity then oral evidence is permissible to prove the other conditions which also must not be inconsistent with the written contract.
12. Keeping in view the said principle even though there is no express clause of surrender of tenancy still the parties could lead oral evidence to prove surrender of tenancy if as such proof is not contradictory to the written agreement. However, the plaintiff has again failed to prove the surrender of tenancy, as a matter of fact, the plaintiff has not even admitted the defendants as his tenants and therefore, he could not claim that the defendants surrendered their tenancy rights.
13. Thus, there is no illegality in the findings recorded by the first Appellate Court to the effect that the plaintiff is entitled to redeem the property but not entitled to actual physical possession of the shop as the possession of the defendants as tenants would re vive on redemption. Consequently, the present appeal is dismissed with no order as to costs.