Gujarat High Court
Haji vs Fijabhai on 30 November, 2010
Author: H.K.Rathod
Bench: H.K.Rathod
Gujarat High Court Case Information System
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SA/144/1990 10/ 12 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
SECOND
APPEAL No. 144 of 1990
For
Approval and Signature:
HONOURABLE
MR.JUSTICE H.K.RATHOD
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1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To be
referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
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HAJI
ISUFALI ABDULLABHAI JINIA & 1 - Appellant(s)
Versus
FIJABHAI
FAKHRUDDIN CHALLAWALA & 8 - Defendant(s)
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Appearance
:
MR
RN SHAH for
Appellant(s) : 1 - 2, 2.2.1, 2.2.2, 2.2.3, 2.2.4, 2.2.5, 2.2.6,
2.2.7, 2.2.8, 2.2.9, 2.3.1, 2.3.2, 2.3.3,2.3.4
None for
Defendant(s) : 1,8 - 9.
MR MEHUL S SHAH for Defendant(s) : 1.2.1,
1.2.2,1.2.3
MR SURESH M SHAH for Defendant(s) : 1.2.1,
1.2.2,1.2.3
(MR VJ DESAI) for Defendant(s) : 2,
NOTICE SERVED
for Defendant(s) : 3 - 5, 7.2.1, 7.2.2,7.2.3
DELETED for
Defendant(s) : 6 - 7.
UNSERVED-EXPIRED (N) for Defendant(s) :
7,
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CORAM
:
HONOURABLE
MR.JUSTICE H.K.RATHOD
Date
: 30/11/2010
ORAL
JUDGMENT
Heard learned Advocate Mr. RN Shah for appellants and learned Advocate Mr. Suresh M. Shah for respondents. In present appeal, respondents No. 6, 7/1 and 7/4 have been deleted from array of Second Appeal by appellants. Facts relevant to question are to the effect that shop bearing City Survey No. 4317 situated in Mullaji Bazar, Dahod was under ownership of father of plaintiff. This property is more particularly described in paragraph 1 of plaint. This being disputed property, hence, hereinafter referred to as suit property for sake of brevity. By registered Deed dated 4.2.1975, father of plaintiff had gifted said property to plaintiff's brother Shri Nuruddin Yusufali and by Registered Gift Deed dated 5.6.1975, plaintiff's brother Shri Nuruddin gifted said property to present plaintiff, therefore, plaintiff has become owner of suit property. It is submitted by plaintiff that plaintiff's father had executed a mortgage deed in favour of defendants who were tenants of suit property. Registered Mortgage deed was executed on 3.2.1967. No interest was to be paid and period for redeeming mortgage was fixed for eight years from date of the execution of mortgage deed dated 3.2.1967. It is the case of plaintiff that period for redemption was over on 3.2.1975 and plaintiff is willing to redeem mortgaged property but defendants are not willing to redeem the same, therefore, plaintiff was constrained to file suit against defendants for redemption of mortgaged property.(suit property).
Said suit was contested by defendants No.1,3,4 and 5 before trial court by filing their written statement at Exh.10 denying facts of plaintiff that plaintiff has become owner of suit property by virtue of gift deed dated 5.6.1975. The contention raised by defendants that under Mohammedan Law, Gift Deeds dated 4.2.1975 and 5.6.1975 are not valid in law and on basis of these deeds, plaintiff has no right to file a suit for redemption of mortgaged suit property. In fact, ground floor of house property bearing City Survey No. 4317 was let out to defendants firm by father of plaintiff on monthly rent of Rs.20.00 with effect from year 1956. Thereafter, father of plaintiff filed RCS No.28 of 1966 against defendants in civil court at Dahod for recovery of possession of suit property wherein compromise was arrived at between father of plaintiff and defendants and as per terms of compromise, defendants had handed over first floor of house property bearing City Survey No. 4317 to deceased Isufali and they were continued in possession of ground floor as tenants. Thereafter, father of plaintiff was in need of money, therefore, he had mortgaged ground floor of suit property in favour of defendants and recovered amount of Rs.7000.00 as mortgage money from them. Defendants made it clear that they are willing to release mortgaged property but they are not willing to hand over possession of mortgaged property to plaintiff. It is submitted by defendants that after releasing mortgage property, they are willing to continue as tenants of ground floor of suit property on monthly rent of Rs.20.00 per month and they are also willing to execute a rent note in favour of plaintiff. Defendants being a tenant, taking same on mortgage from his landlord does not itself extinguish right of tenancy and effect of such mortgage on the tenant's right is merely that they are kept in abeyance and when landlord redeems the mortgage, parties revert to their former position and landlord is not entitled to get actual possession of mortgaged property and, therefore, ultimately, defendants prayed to dismiss suit of plaintiff with costs.
Defendants No.2 and 6 were served but they had not appeared before trial court and, therefore, ex parte order was passed against them by trial court below Exh.1 on 29.4.1981. Trial Court has framed issues at Exh. 37.
Before trial court, plaintiff Fakhruddin Isufali is examined at Exh. 47. Plaintiff also produced oral evidence of his witness Rababbai d/o. Isufali at Exh. 59 and Nuruddin Isufali at Exh. 61. Before trial court, defendant Kutbuddin Sharafalibhai Jinia was examined at Exh.
63. He produced oral evidence of his brother Shri Kantilal Gopaldas Suthar at Exh. 68. Certain documents are produced on record by both parties as under, before trial Court:
Exh.48 is certified copy of decree passed by learned Jt. Civil Judge, (JD) , Dahod in RCS No.28 of 1966.
Exh.49, original mortgage deed executed by defendant No.1 in favour of father of plaintiff on 3.2.1967.
Exh.
50, office copy of notice given by mortgagor to mortgagees.
Exh.51 to 57 are copies of property card of disputed property.
Exh.58, reply to notice.
Exh.65 is original power of attorney executed by defendants in favour of Shri Kutbuddin Sarafali Jinia.
Exh.67, original writing executed by defendants in favour of plaintiff regarding reparation of ground floor of suit property by their own costs.
Trial Court has, by judgment dated 26th November, 1984, passed Preliminary Decree in favour of plaintiff for redemption of mortgaged property against which, Regular Civil Appeal No. 159 of 1984 was preferred by defendants before District Court Panchmahals at Godhra which came to be decided by Extra Assistant Judge, Panch Mahals at Godhra on 16.5.1989 as same was dismissed. The lower court examined an important question whether, upon redemption of a usufructory mortgage, a tenant mortgagee could be directed to deliver actual or physical possession of mortgaged property to lessor-mortgagor or not, when tenant is having tenancy rights in respect to suit property of ground floor and thereafter, mortgage deed had been executed between defendants and father of plaintiff without surrendering actual possession of suit property to landlord. Lower Court considered that it depends upon what was the intention of parties at the time of execution of mortgage deed in favour of sitting tenant to be gathered from terms and conditions of mortgage transaction in light of surrounding circumstances of case. Exh.49 mortgage deed nowhere mentions for handing over possession of mortgaged property, therefore, according to appellants, on redemption of mortgaged property, tenancy rights of present appellants automatically gets renewed relying upon decision of apex court reported in AIR 1976 SC 1565. According to appellants before lower appellate court, in mortgage deed, no specific period for redemption of mortgage has been mentioned, therefore, plaintiff is not entitled to get relief as prayed for. As against that, plaintiff has relied upon decision of apex court in case of Shah Mathurdas Maganlal and Company versus Nagappa Shankarappa Malaga and others, AIR 1976 SC 1565 and another decision of apex court in case of Gambanji Appelaswamy Naidu and others v/s. Behara Venkataramanayya Petro, AIR 1984 SC 1728.
In light of aforesaid contentions raised by both parties and relying upon decision cited by both parties, trial court and lower appellate court considered mortgage deed Exh.49. After considering mortgage deed Exh. 49, lower appellate court observed as under in para 15 of judgment:
15. The few things become amply clear on a fair reading of the aforesaid document:
(1) There was surrender of tenancy and the appellants were only a mortgagees.
(2) There was a surrender of tenancy right.
(3) Delivery of possession was immediately followed by a re-delivery of possession of the appellants as mortgagees.
(4) The period for redeeming the mortgage was fixed for eight years from 3rd February, 1967.
(5) The mortgagees can make repairation in the mortgaged property after giving a written information to the mortgagor.
Aforesaid aspect has been considered and examined by lower appellate court in para 16 to 22 which are quoted as under:
16. By producing oral evidence vide Exh.47, the plaintiff has very specifically submitted in his evidence that by Registered Mortgage Deed dated 3.2.1967, the defendants became mortgagees of the ground floor of the suit property and as per the terms of the mortgage deed, the period of redeeming the mortgage was fixed for eight years from 3.2.1967.It also appears from the evidence of the plaintiff that after execution of the mortgage deed, his father had gifted the property bearing City Survey No.4317 to his brother Nuruddin by Registered Gift Deed dated 4.2.1975 and, thereafter, his brother Nuruddin had gifted his property to him by Registered Gift Deed dated 5.6.1975.To prove this fact, the plaintiff has also produced the oral evidence of his sister at Exh. 59. This witness made attestation in the Gift Deed vide Exh. 60. I have carefully gone through the said Gift Deed. It appears from this Gift Deed that the plaintiff became an exclusive owner of the suit property from 5.6.1975 and his name was also entered into the City Survey Register. At the time of the said Gift Deed, the brother of the plaintiff had also given actual possession of the first floor as well as the constructive possession of the ground floor to the plaintiff. Section 208 of the Mohammedan Law provides gift how made'. The three conditions which are necessary for a valid gift under the Mohammedan Law are the following:
(1) Manifestation of the wish to give on the part of the donor.
(2) Acceptance of the donee, either expressly or impliedly, and (3) Taking of possession of the subject matter of the gift by the donee, either actually or constructive.
It should, however, be noted that while the delivery of possession is an essential condition for the validity of the gift, it is not necessary that in every case, there should be a physical delivery of possession. Possession the delivery of which would complete the gift, may be either actual or constructive. Section 209 of the Mohammedan Law indicates that possession how delivered. In this section, it has been very specifically mentioned that where the property is in possession of the mortgagee and the donor cannot make a physical delivery of possession and for that reason the gift would not be invalidated. If the donor does all that he can do to effect a transfer of ownership of a gift of the equity of redemption would be valid. Hence under these circumstances, the learned trial Judge has rightly considered that the gift deed vide Exh. 60 executed in favour of the plaintiff is valid in Mohammedan Law and on the basis of this gift deed, the Plaintiff became an exclusive owner of the said property bearing City Survey No. 4317 and the other family members of the deceased Isufali have no right, title and interest over the same and the suit is not bad for non joinder of necessary parties.
17. So far as the question of tenants' rights remain in abeyance during the term of mortgage and the parties revert to their former position of redemption is concerned, there is a specific contention of the appellants that there was no surrender of tenancy right and there was merger of the interest of the mortgagees and the tenants.
18. Ordinarily, the doctrine of the merger applies to extinotion of mortgage security. This occurs by the merger of a lower in a higher security and by the merger of a lesser estate in a greater estate. Where the capacity in which a person in possession of the mortgagee's rights is something quite different from the capacity in which he is in possession of the equity of redemption. 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 lesser is 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.
Section 111 of the Transfer of Property Act in clauses (e) and (f) deal with surrender, and in clause (d) with merger. Clause (d) states that lease in moveable properties determines in case the interest of the leasee or the lessor in the whole of the property becomes vested at the same time in one person in the same right. When a lease hold and a reversion coincide, there is a merger of a lessor estate in the greater. The lease hold is the lessor estate for it is carved out of the estate of the owner which is the reversion. The lesser estate is merged in the greater. The lease determines and merges in the reversion. If the lessor purchasers the lessee's interest, the lease is extinguished as the same man cannot be at the same time both landlord and tenant. The interests of the lessor and of the lessee must be in the whole of the property, otherwise, there is no merger. A surrender under clause (e) and (f) of section 111 of the Transfer of Property Act, is an yielding up of the term of lessee's interest to him who has the immediate reversion of the lessor's interest. It takes effect 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 the 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. Relinquishment of possession operates as an implied surrender. There must be a taking of possession not necessarily a physical taking but some thing amounting to virtual taking of possession. Whether this has occurred is a question of fact. In our present case, the plaintiff has very specifically submitted in his evidence that Gift Deed vide Exh. 60, the defendants tenants surrendered the tenancy rights and became mortgagees of the suit property.
19. As against this, by producing oral evidence,t he defendants have not satisfied the Court that the intention of the parties was not to surrender their tenancy rights or the tenancy rights to be kept in abeyance during the terms of mortgage. On the contrary, as per the terms of the mortgage deed, there was no doubt that the landlord tenant relationship had ceased to exist after the relationship of mortgagor and mortgagees came into existence and the mortgage bond had not specifically provided that the landlord tenant relationship would be restored after the redemption of the mortgage.
20. No particular form of words is essential to make a valid surrender. A surrender may be oral. A surrender may be express although delivery of possession is necessary for surrender. Relinquishment 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.
21. So far as the period of redemption is concerned, the mortgagor had fixed eight years period in the mortgage deed vide Exh. 49 from the date of the execution of the mortgage deed i.e. 3.2.69 Assuming that there is no term fixed for redemption, of mortgaged property which means that it was open to mortgagor to redeem the mortgage at any time that is to say even within a very short time.
22. Similar question cropped up for consideration before the Honourable Supreme Court in the case of Shah Mathurdas Maganlal and Company, appellants vs. Nagappa Shankarappa Malaga and others, respondents, AIR 1976 SC 1565.In this case, the Honourable Supreme Court has observed that in the case in question, delivery of possession was immediately followed by a redelivery of possession of the appellant as mortgagee. The mortgage deed establishes beyond doubt that the effect of the deed was inconsistent with the continuance or subsistence of the lease. On the redemption of mortgage, the respondent had a right to recover the possession, both on the terms of the mortgage deed and under section 62 of the Transfer of Properties Act.
The Honourable Supreme Court has also taken the similar view in the case of Gambanji Appalswamy Naidu and others appellants vs. Dehera Venkatramanayya Patre, respondent, AIR 1984 Supreme Court, 1728.
Lower appellate Court has also considered both decision of apex court as relied upon by both parties. No particular form of words is essential to form valid surrender of tenancy rights. Surrendering of tenancy right may be oral or may be express although delivery of possession is necessary for surrender. Relinquishment of possession operates as an implied surrender. There must be a taking of possession not necessarily a physical taking but some thing amounting to virtual taking of possession. Whether this has occurred is a question of fact. In our present case, plaintiff has very specifically submitted in his evidence that vide Gift Deed Exh. 60, the defendants tenants have surrendered tenancy rights and became mortgagees of suit property. The mortgage deed establishes beyond doubt that effect of deed was inconsistent with continuance or subsistence of lease. On redemption of mortgage, respondent had a right to recover possession, both on terms of mortgage deed and under section 62 of Transfer of Properties Act.
I have considered submissions made by learned advocate Mr. RN Shah for appellants and learned advocate Mr. SM Shah for other side. I have also perused judgment and decree passed by trial court as well as judgment and order passed by lower appellate court. I have also perused records and proceedings received from both courts below. I have also considered substantial question of law which is involved in this appeal as framed by this court on 5th October, 1990, which is as under:
(1) Whether there can be an inference of implied surrender of tenancy at the ground floor portion in view of the recitals made in the mortgage deed Exh. 49 dated 3.2.1967 and the consent decree Exh. 48 passed on 7.2.1967 as contemplated in the judgment reported in 1976 Supreme Court 1565 and 1985 GLH 132?
In light of aforesaid substantial question of law framed and raised by appellant, I have considered reasoning given by lower appellate court after re-appreciating evidence led before trial court that there cannot be a merger of lease and mortgage in respect of same property since neither of them is a higher or lesser estate than the other. Section 111 of the Transfer of Property Act in clauses (e) and (f) deal with surrender, and in clause (d) with merger. Clause
(d) states that lease of immovable properties determines in case interest of leasee or the lessor in the whole of property becomes vested at the same time in one person in the same right. When a lease hold and a reversion coincide, there is a merger of a lessor estate in the greater. The lease hold is lessor estate for it is carved out of estate of owner which is the reversion. The lesser estate is merged in the greater. The lease determines and merges in the reversion. If lessor purchases the lessee's interest, lease is extinguished as same man cannot be at the same time both landlord and tenant. The interests of lessor and of lessee must be in whole of property, otherwise, there is no merger. A surrender under clause
(e) and (f) of section 111 of Transfer of Property Act, is an yielding up of the term of lessee's interest to him who has immediate reversion of lessor's interest. It takes effect like a contract by mutual consent on the lessor's acceptance of act of lessee. The lessee cannot, therefore, surrender unless term is vested in him and surrender must be to a person in whom immediate reversion expectant on term is vested. Implied surrender by operation of law occurs by creation of a new relationship or by relinquishment of possession. If lessee accepts a new lease that in itself is a surrender. Surrender can also be implied from consent of parties or from such facts as relinquishment of possession by lessee and taking over possession by lessor.
Considering aforesaid detailed reasoning given by lower appellate court while confirming judgment and decree passed by trial court, according to my opinion, looking to evidence on record and legal aspects as discussed above, contentions raised by learned advocate Mr.RN Shah before this Court cannot be accepted. According to my opinion, both the Courts below have rightly examined evidence on record and have rightly considered recitals made in mortgage deed Exh. 49 dated 3.2.1967 and also rightly appreciated consent decree Exh. 48 passed on 7th February, 1967 and rightly drawn an inference of an implied surrender of tenancy right of ground floor portion in view of mortgage deed Exh. 49. Therefore, findings given by Courts below cannot be considered to be contrary to record and no interference of this court is required since courts below have not committed any error of facts or law and, therefore, there is no substance in this second appeal. Accordingly, this second appeal is dismissed with no order as to costs. Interim relief, if any, shall stand vacated.
Time to hand over actual possession to original plaintiffs present respondent by present appellants original defendants is extended for a period of three months from date of receiving copy of present judgment and order.
(H.K. Rathod,J.) Vyas Top