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1950 DIGILAW 109 (KER)

Ouseph v. Krishna Iyer

1950-11-16

GANGADHARA MENON, GOVINDA PILLAI

body1950
Judgment :- 1. The decree holder is the appellant. He had failed the suit to recover possession of the plaint property which the defendants were holding under Ext. A. The plaintiff stated that it evidenced a redeemable mortgage whereas the 4th defendant's contention was that it was an irredeemable Kanom and that the plaintiff was not entitled to recover possession of the property. The defendant's contentions were overruled by the trial, appellate and the Second appellate Courts and the decision of the High Court was reported in 1949 T.L.R. 139. That was passed on 25.1.1949. Before the plaintiff could take out execution and recover possession of the property there was then the Holding Stay Act XXI of 1124 which stayed execution of decrees for a period of six months from 19.3.1949 if the decree was for recovery of possession based on pattom, Otti, Panayam with possession and Kanom. This expired on 24.9.1949 when the Ordinance II of 1125 was promulgated. This ordinance prohibited execution of decrees involving lease-hold interest. On the assumption that this Ordinance would not apply to the decree in question the decree-holder applied to execute the decree for possession. The 4th defendant on notice objected to the same on the ground that Ordinance II of 1125 was a bar to the execution. The execution court dismissed the objection and ordered delivery of possession. Possession was accordingly given on 6.10.1949 to the decree-holder. The 4th defendant filed an appeal against this order on 11.10.1949. While the appeal was pending the period prescribed in Ordinance II of 1125 had expired and in its place act VIII of 1950 was passed on 5.4.1950 with retrospective effect from 25.3.1950. The appellate Court held that Ordinance II of 1125 would not apply to the decree in question, but it was of opinion that Act VIII of 1950 which came into force while the appeal was pending would be a bar to the execution and so the order of the execution court was set aside and the appeal allowed. It is against this that the decree-holder has filed this appeal. The judgment-debtor-4th defendant has objected to the findings that Ordinance II of 1125 would not apply to this decree. 2. Act XXI of 1124 had stayed execution of all decrees based on Pattom, Otti, Panayam with possession and Kanom other than those covered by the Jenmi-Kudiyan Act. It is against this that the decree-holder has filed this appeal. The judgment-debtor-4th defendant has objected to the findings that Ordinance II of 1125 would not apply to this decree. 2. Act XXI of 1124 had stayed execution of all decrees based on Pattom, Otti, Panayam with possession and Kanom other than those covered by the Jenmi-Kudiyan Act. Ottis and Panayam with possession are definitely excluded in Ordinance II of 1125 and Act VIII of 1950. Ordinance II of 1125 and Act VIII 1950 related only to a holding which was defined to mean any immovable property held under a single transaction by which a lease-hold right in the property was created and possession of the property was transferred by one person in favour of another. Evidently therefore it was only leases and documents that had the characteristics of lease alone were intended to be governed by these later enactments. If the transaction in question was not a lease-hold right but only a mortgage or otti then the question of the applicability of Ordinance II of 1125 or Act VIII of 1950 would not arise for consideration at all. These enactments do not define lease and so the accepted definition of the same as laid down in the Transfer of Property Act would be the proper guide in such matters. A lease of immovable property is defined to be a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee who accepts the transfer on such terms. (Vide S. 105 of the Transfer of Property Act, Vol. III, 3rd Edn.1950 of A.I.R. Series.) S.58 Cl.(d) of the same Act (Vol. (Vide S. 105 of the Transfer of Property Act, Vol. III, 3rd Edn.1950 of A.I.R. Series.) S.58 Cl.(d) of the same Act (Vol. II) defines an usufructuary mortgage thus: "Where the mortgagor delivers possession or expressly or by implication binds himself to deliver possession of the mortgaged property to the mortgagee, and authorizes him to retain such possession until payment of the mortgage-money and to receive the rents and profits accruing from the property or any part of such rents and profits and to appropriate the same in lieu of interest, or in payment of the mortgage-money, or partly in lieu of interest or partly in payment of the mortgage-money, the transaction is called an usufructuary mortgage and the mortgagee an usufructuary mortgagee. Thus the distinction between an usufructuary mortgage and a lease for a premium is apparent from the definition of two tenures. The points of distinction are thus analysed at pages 1695 and 1696 of Vol. III of the A.I.R. Commentaries of the Transfer of Property Act 1950 Edn. (1) A lease for a premium is a transfer of the right to 'enjoy' the property. Under such a lease the usufruct of the property will belong to the lessee till the lease is determined. But under a usufructuary mortgage only the right to 'possession' is transferred to the mortgagee. The usufruct of the property will not 'belong' to the mortgagee. He will have only the right to receive it. He must adjust it towards the mortgage-debt. This is the principle even in cases in which the mortgagees remaining in possession and appropriating the profits of the property for a certain period is to wipe out'ipso facto' the mortgage-debt without his being liable to account for such profits during that period. (2) A usufructuary mortgage connotes a transfer of an interest in the 'fee simple' in the property, though not the entire fee simple or ownership of the property. The interest in immovable property which, according to the definition of a mortgage in S. 58, is transferred to the mortgagee is an interest in the 'fee simple'. But the interest transferred under a lease for a premium is not an interest in the fee simple. It is merely'a right to the enjoyment' of the property. (3) The premium for a lease is a 'price' paid or promised for the lease. But the interest transferred under a lease for a premium is not an interest in the fee simple. It is merely'a right to the enjoyment' of the property. (3) The premium for a lease is a 'price' paid or promised for the lease. But the consideration for a usufructuary mortgage is the advancement of a 'loan'. (4) The transfer of an interest under a usufructuary mortgage is for the purpose of securing repayment of the loan. There is no such object in a lease. It is this difference that is at the root of the difference mentioned in item (1) above." 3. With these points of distinction in view we shall examine the document on the basis of which the decree in the case had been passed. It is true that it is called a "WLeOL• IfMgLiLgU". The defendant advanced the Jenmi fanams 2865-3 chs.12 cash as a loan and of this, a sum of 1500 fanams-1 ch. 0 cash was declared to be a charge on the properties conveyed thereunder. The yield which these properties would fetch was then assessed and interest on the loan advanced was deducted. The balance was agreed to be paid as Michavaram along with other prequisites mentioned therein. He also undertook to take renewal after the expiry of 12 years. There was the balance of 365 fanams-2 chs.12 cash which had not been charged on the property. Those properties were outstanding with another party. To redeem him a decree had already been obtained by the owner. The right of that tenant to the amount advanced as well as to the value of improvements had been purchased in court auction by the owner. The right over the value of improvements was assessed at fanams 365-2 chs.12 cash and assigned over to the 4th defendant. The details thus given would show that this document will not come under the category of a lease and that the 4th defendant was not holding the property under a lease-hold right. The nomenclature of the document as immaterial for the purpose of gathering the intention of parties and the tenure created thereby. The rulings in Thukaram v. Ram Chand (26 Bom. 252), Pada Veeranna v. Somanna (AIR 1935 Mad. 320), Seshayya v. Lakshminarasimha Rao (AIR 1930 Mad. 160), Gulabbhai Ranchedbhai v. Bhagwan Kesur (AIR 1928 Bom. 377) and Hitend a Singh v. Rameshwar Singh (A.I.R. 1931 Pat. The rulings in Thukaram v. Ram Chand (26 Bom. 252), Pada Veeranna v. Somanna (AIR 1935 Mad. 320), Seshayya v. Lakshminarasimha Rao (AIR 1930 Mad. 160), Gulabbhai Ranchedbhai v. Bhagwan Kesur (AIR 1928 Bom. 377) and Hitend a Singh v. Rameshwar Singh (A.I.R. 1931 Pat. 43) are in support of this position. 4. This Court also in disposing of the appeal on the decree had proceeded on the assumption that Ext. A evidenced only a redeemable mortgage. Thus the execution of a decree obtained on a transaction like Ext A is not stayed by the provisions of Ordinance II of 1125 or Act VIII of 1950. It would therefore be unnecessary for us to enter into a discussion as to the applicability of Act VIII of 1950 to a decree which had been satisfied before that Act came into force and also the several other nice questions of law raised at the time of the argument. We would therefore set aside the order passed by the lower appellate Court and restore that of the first court. The appellant will get his costs in all the three courts. Appeal allowed.