Mathai Thomas v. Yohanan Kunjamma — 1971 DIGILAW 91 (KER)

JUDGMENT V.R. Krishna Iyer, J. 1. The first two second appeals are filed against the decrees and judgments in A.S. No.41 of 1967 and A.S. No.35 of 1967 respectively. The first appeals themselves were carried by the plaintiff and the defendant against the same decree in a suit for redemption of Ext. A transaction of 1113. Twice the matter came up to this Court. Ultimately in S.A. No. 1102 of 1961 the High Court set aside the decrees of the courts below and remanded the case for fresh disposal with a direction to go into the question as to whether the defendant was a tenant entitled to protection under the Kerala Land Reforms Act. The Trial Court granted a decree for possession holding that the defendant was not a tenant, but directed payment of a huge sum by way of value of improvements. The defendant challenged the decree for possession in A.S. No. 35 of 1967 while the plaintiff challenged the quantum of the value of improvements awarded in A.S. No.41 of 1967. However, the lower appellate court held the defendant to be a tenant entitled to fixity of terrace and dismissed the suit. In consequence, the question of the value of improvements was not gone into. 2. Before me, the main point pressed by counsel on both sides turned on the construction of Ext. A, counsel for the plaintiff contending that the transaction was an Otti mortgage while counsel for the defendant would have it that his client was either an Ottikuzhikanamdar or a kuzhikanomdar and was entitled to immunity from eviction. Thus, the short but important point is as to the nature of Ext. A. 3. At this stage 1 may mention that in S.A. No. 391 of 1969 another document very similar to the one that falls for interpretation in the other two appeals, has to be construed. It is Ext. A in O.S. No.728 of 1124 while the sister document which has to be interpreted in S.A. Nos. 345 and 460 of 1969 is Ext. A in O.S. 136 of 1123. Both the documents were executed by the same illom and at about the same time and under similar circumstances. Ext. It is Ext. A in O.S. No.728 of 1124 while the sister document which has to be interpreted in S.A. Nos. 345 and 460 of 1969 is Ext. A in O.S. 136 of 1123. Both the documents were executed by the same illom and at about the same time and under similar circumstances. Ext. A in both the suits and the rights created thereunder will have to be investigated and the correctness of the finding by the Subordinate Judge that the transferee in each case is a tenant entitled to fixity of tenure will have to be tested in the light of the elaborate arguments addressed before me. 4. The name given to the transaction by the parties is not conclusive but has a bearing and Ext. A is called a 'aoolcaocooroo' in both cases. To that extent, it supports the plaintiff. The other provisions have also to be read before the total effect can be ascertained. Right in the beginning I may refer to a recent ruling in a p case which went up from this Court to the Supreme Court where their Lordships had to consider the essential tests to tell off a mortgage from a kanom, which is a species of tenancy. "The first and foremost element to be found for a lease is whether there is the intrinsic intention in the deed for enjoyment of the property by the transferee in lieu of rent or perquisites" observed the Supreme Court in the decision reported in 1971 KLT 163 . Mr. Justice Ray, speaking for the Court, emphasised the principal features of a mortgage, in contra-distinction to a kanom, thus: "The dominant features of a mortgage transaction on the other hand would be the ascertainment of the ratio of the value of land to the amount advanced. If the ratio of the amount advanced bears a substantial proportion to the value of the property transferred it would be a strong piece of intention and circumstance to indicate loan and a mortgage. A provision entitling the transferee to ask for a return of money by sale of the property would be a very important feature to indicate that the transaction is a loan and a mortgage and not a lease. The absence of such a provision, however, would not totally repel the transaction to be a mortgage. A provision entitling the transferee to ask for a return of money by sale of the property would be a very important feature to indicate that the transaction is a loan and a mortgage and not a lease. The absence of such a provision, however, would not totally repel the transaction to be a mortgage. The execution of counterpart is some times a common feature in the case of possessory mortgage though the existence of a counterpart by itself will not be conclusive of the question." 5. Counsel for the appellant argued that in both these cases the amount secured by the transaction was substantially more than half the value of the property and relied upon Ex. B whereunder the plaintiff purchased the property for a sum of Rs. 2900/- subject to the two mortgage amounts covered by Ext. A in each of the cases, namely Rs.500/- and Rs.1375/-. I must say that at the time the transactions were entered into, probably the amounts secured bore a substantial proportion to the value of the property transferred, although there are no materials conclusively to come to a conclusion on this aspect. This circumstances may indicate that Ext. A1 is perhaps a mortgage and not a kanom. Again, counsel for the appellant read Exs. A and B to bring out that the transferor-illom had executed hypothecation bonds and could not discharge the loans and Ext. A in each case was only a mode of arranging for discharging the prior loans by granting otties. From this circumstance counsel wanted me to hold that the amount referred to in Ext. A was a loan , and the transaction, therefore, a mortgage. Yet another contention which was pressed by him before me was that the very name given to the transaction in the document implied a right of sale, which is a feature more in consonance with a mortgage than with a kanom. Although there was no express recital in the deeds conferring a right of sale, the very use of the word 'otti' was sufficient in this behalf. Counsel drew my attention to the rulings reported in 1961 KLT 809 , 1966 KLT 619 and 1968 ) KLT 11 to persuade me to the conclusion that when a transaction is described as an otti a right of sale is read into it in the Travancore area. Counsel drew my attention to the rulings reported in 1961 KLT 809 , 1966 KLT 619 and 1968 ) KLT 11 to persuade me to the conclusion that when a transaction is described as an otti a right of sale is read into it in the Travancore area. If so, parties must have intended to create a mortgage by executing Ext. A. There is some force in this argument also. Indeed, these various elements only help the court to ascertain whether the primary object of the transaction was to secure a loan or to provide for the enjoyment of the land by the transferee. In fact, a Full Bench decision of this Court in 1967 KLT 78 also considered a similar question in great detail and indicated the correct approach to be made. Both the rulings emphasise that the enjoyment element is suggestive of a lease and the security element as suggestive of a mortgage. Both the rulings have indicated the importance of the terms of each transaction and the nomenclature of the deed being not decisive. Some of the factors F referred to by the Supreme Court have been elaborately discussed by Raman Nayar J. (as he then was) in the Full Bench ruling. I may refer in this context to yet another decision reported in 1970 KLT 469 where also a kindred question came up for consideration before a Division Bench of this Court. After stating that "the question to be decided is whether the document is intended to create security for P the money taken by the transferor or whether the intention was to allow the transferees to enjoy the properties" the learned Judges excerpted from the Full Bench ruling I have already referred to, the following paragraph: "................. a transaction can be a composite transaction embodying both a mortgage and a lease. If it is at least in part a lease, no matter how small a part, the person holding under it would be a tenant entitled to fixity under S.13 so that redemption of the part which is a mortgage, no matter how predominant a part, would not entitle the mortgagor to obtain possession which is what a plaintiff suing for redemption normally wants. Therefore, the proper question to be asked in such cases is whether the transaction is, to any extent, a lease. Therefore, the proper question to be asked in such cases is whether the transaction is, to any extent, a lease. If it is, then by reason of the fixity given by S.13 of the Act the transferor cannot recover possession even if the transaction be at the same time a mortgage which he is entitled to redeem. The question could not be whether the transaction is predominantly a lease or predominantly a mortgage but whether it is a lease at all." 6. However, the learned Judges also emphasised one aspect which may have relevancy to the present case. "The provisions we have pointed out already - provisions for planting cocanut and jack trees and pepper vines, digging a well, constructing a new house, etc. clearly indicate that the intention of the parties to the document was the enjoyment of the properties by the transferees. If so, the transaction is a tenancy and S.13 of the Act confers fixity of tenure on the transferees." 7. With this legal background one has to study the provisions of Ext. A. It is proper to mention at this stage that the Kerala Land Reforms Act, 1963, has been amended extensively since the rendering of the decision reported in 1967 KLT 78 , widening the definition of 'tenant' as it were and bringing into its sweep otti-kuzhikanoms also. The decision of this Court in C.M.A. No.52 of 1966 dated 25-1-1967 (not reported yet) was pressed before me as having a bearing on the construction of Ext. A. However, subsequent to this decision the definition of 'ottikuzhikanom' has been added and there have been other changes in the statute which strongly suggest that transactions which were regarded as mere mortgages have now been transformed into tenancies under the amended Act. I do not think that in view of these statutory alterations the decision in CMA. No.52 of 1966 can have the force counsel for the appellant thought it has. 8. S. 2(57)id) includes an ottikuzhikanom among the categories of tenure protected by the statute. S.2(39)A defines 'ottikuzhikanom' as a transfer for consideration by a person to another of any land other than nilam for the enjoyment of that land and for the purpose of making improvements thereon, but excludes mortgages within the meaning of the Transfer of Property Act, 1882. S. 2(57)id) includes an ottikuzhikanom among the categories of tenure protected by the statute. S.2(39)A defines 'ottikuzhikanom' as a transfer for consideration by a person to another of any land other than nilam for the enjoyment of that land and for the purpose of making improvements thereon, but excludes mortgages within the meaning of the Transfer of Property Act, 1882. The key note of this group of definitions relating to various types of tenancy is the object of the transaction being for enjoyment. Even as the Full Bench decision in 1967 KLT 78 has explained a document may represent a composite transaction or a transaction may be in part a lease and in part a mortgage. In all such cases, if any part of the transaction, or any one of the transactions telescoped into one document is found to partake of the characteristics of a lease, then the protection of a fixity conferred by the statute on tenants is attracted. In short, the scope of my enquiry is considerably narrowed down to finding out whether Ext. A is a composite transaction including a lease or is in part at least a lease, the litmus test itself being whether the transaction contemplates, in any part thereof, the enjoyment of the property by the transferee as one of the principal objects. 9. Counsel for the respondent when confronted with the Supreme Court decision raised two points in answer. For one thing, he argued that the learned Judges were concerned in that case only with the question as to whether the transaction was a mortgage or a kanom. His client could claim fixity of tenure under S.13 of the Kerala Land Reforms Act, 1963 even if she were not a kanomdar provided he was able to make out that she came within the definition of 'tenant' given in S.2(57) of the Act. She could be a tenant if she were an ottikuzhikanomdar as defined in S.2(39)A or if she were a kuzhikanomdar as defined in S.2(28). Secondly, he stated that the Supreme Court was not concerned with the amended statute which had widened the categories entitled to protection. She could be a tenant if she were an ottikuzhikanomdar as defined in S.2(39)A or if she were a kuzhikanomdar as defined in S.2(28). Secondly, he stated that the Supreme Court was not concerned with the amended statute which had widened the categories entitled to protection. After having heard both sides and after having carefully gone through the decision of the Supreme Court in 1971 KLT 163 I am satisfied that there is much to be said in favour of the view that the present transaction is more a mortgage than a kanom, notwithstanding the flavour of a tenure some of its clauses possess as I will presently show. There is no payment of michavaram provided in Ext. A since the Supreme Court has taken the view that payment of land revenue and other dues to the State as per a direction contained in the deed, particularly when no payment is stipulated to be made to the grantor or when the payment is not directed to be made out of anything which is due or payable to the grantor, cannot be considered as a payment of rent or michavaram to the grantor. Therefore, the respondent's position is perilous if he can claim fixity only by proving that he is a kanomdar. That is why counsel for the respondent in both the oases have chosen to invoke the applicability of S.2(28) and S.2(39) A. It must be clearly noticed that the Supreme Court did not have occasion to consider the scope of these species of tenancy, and reliance upon the , ruling in 1971 KLT 163 may not be very helpful when considering these claims of the respondents. Nevertheless, no person can come under any one of the categories of tenancy covered by the Land Reforms Act, 1963 if the transaction whereunder he holds is not one for the purpose of enjoyment of the land. It may be that there are other purposes also, but it is essential that the objects must include, not casually nor incidentally but clearly and deliberately, the right to enjoy the land transferred. 10. It is useful to extract the relevant portions of Ext. A in the two oases. Since the terms are substantially similar I shall extract relevant portions from one of them only. xxx xxx xxx It is plain that there is a loan secured by Ext. 10. It is useful to extract the relevant portions of Ext. A in the two oases. Since the terms are substantially similar I shall extract relevant portions from one of them only. xxx xxx xxx It is plain that there is a loan secured by Ext. A. It may perhaps be that there is an implied right of sale gatherable from the use of the expression 'otti'. Ext. A is equally emphatic that parties intended that the transferee should enjoy the land. Indeed, as counsel for the respondent rightly stressed, the recitals read as if the transferee is obligated to planting improvements on the land even by cutting mango trees if need be to dig a well, to construct buildings and to repair the boundary walls. The language is unmistakable that one of the purposes of the transaction was the planting of fruit bearing trees and pepper vines and to enjoy the land. This circumstance alone is sufficient, according to the respondent, to make him a kuzhikanomdar. For, by definition a kuzhikanom means a transfer of garden lands or of other lands with all or any of the trees standing thereon or without such trees "for the purpose of planting trees or pepper vines or both thereon, and for the enjoyment of the trees transferred, if any", Given a transfer by one to another of garden lands or of other lands - and in this case such a transfer is manifest - and given further as a purpose of the transfer the planting of trees or of pepper vines and the enjoyment of the trees - and in the present case this ingredient is amply satisfied -a kuzhikanom emerges. 11. Going by the definition in S.2(28) it is clear that Ext. A creates a kuzhikanom tenancy. But counsel for the appellant wanted to counter this inference by two submissions. He would say that Ext. A is essentially a transfer by way of security for a loan and the making of improvements and the enjoyment of the land are peripheral and not relating to the core. May be, that Ext. A was occasioned by the need to secure a loan. But it is not correct to state that the purpose of the transaction was also not for enjoyment of the land and for planting fruit bearing trees and pepper vines. May be, that Ext. A was occasioned by the need to secure a loan. But it is not correct to state that the purpose of the transaction was also not for enjoyment of the land and for planting fruit bearing trees and pepper vines. A transaction may have more than one purpose and may be composite in nature as the Full Bench ruling in 1967 KLT 78 has elaborated. As Mr. Justice Raghavan in 1970 KLT 469 pointed out, a transaction may be for the enjoyment of the property by the transferee. If so, it creates a tenancy and S.13 of the Act confers fixity of tenure on the transferee, even if the same transaction may also create a mortgage. His Lordship, for instance, observes in that case "We may however add that the indemnity clause on which reliance was placed by Joseph J. may indicate that the transaction was intended to be a mortgage too. In tenancy documents such a provision might be out of place. Still, even if we construe the document as a composite one embodying a mortgage and a lease, however small that lease part be, even then the transferees cannot be evicted. That was what the Full Bench laid down'." I must follow this guide line drawn by the Division Bench and hold that in the present case a kuzhikanom has been created by Ext. A 12. Counsel for the appellant strenuously argued that a kuzhikanom tenancy is ordinarily for a period of 12 years and even where the term of the lease is not specified, courts have implied into such "improvement leases" a period of 12 years. Counsel's argument is that Ext. A deliberately specifies a period of 10 years in one case and 11 years in the other case, thus departing purposefully from the customary period of 12 years so as to emphasise the intention of the parties not to create a kuzhikanom lease. I am not very much impressed with this argument. Moreover, we have to go by the definitions contained in the statute and cannot import into them customary notions and concepts derived from judicial decisions. The whole object of the Kerala Land Reforms Act will be frustrated and its benignant purpose defeated if we read down the definitions of the various species of tenancies or limit their application by relying on pre-conceived notions, even though sanctified by decisions of courts. The whole object of the Kerala Land Reforms Act will be frustrated and its benignant purpose defeated if we read down the definitions of the various species of tenancies or limit their application by relying on pre-conceived notions, even though sanctified by decisions of courts. A break with the past legal ideas of land tenure is writ large in the new legislation. S.2(26) does not insist, as an essential ingredient of a kuzhikanom, the specification of a period of 12 years for enjoyment. Such elements as have been mentioned therein are satisfied in the present case and that is enough. 13. Counsel for the respondents also attempted to bring their case within G the new definition incorporated by the amending Act 35 of 1969, namely, S.2(39)A and they submitted Ext. A created an ottikuzhikanom. Here again, if we go by the definition, Ext. A is a transfer for consideration and its object is the enjoyment of the land so transferred and the making of improvements thereon. I see no reason why the respondent cannot seek the protection of S.2(39) A read with S.2(57) and S.13 of the Act. There is a slightly intriguing feature in the definition which I must notice. Ottikuzhikanom shall not include a mortgage within the meaning of the Transfer of Property Act, 1882" and counsel for the appellant says that Ext. A undoubtedly is a mortgage within the meaning of the Transfer of Property Act, 1882 and therefore cannot create an ottikuzhimkanom. There is an apparent attractiveness in this argument. But I am satisfied that, in this context, what is meant is that if the transfer is only a mortgage as defined in the Transfer of Property Act, 1882 and not one which has other equally important features which are not integral to a mortgage, such as the purpose of making improvements and the enjoyment of the land, then, and then alone, the protection of ottikuzhikanom cannot be availed of. In the present case Ext. A may be a mortgage. But it is much more, since emphatically the purpose of making improvements on the land and enjoyment of the land are included in the transaction. Consequently, Ext. A can be rightly called an ottikuzhikanom. However, I need not finally pronounce on this aspect of the case because I am satisfied that Ext. A creates a kuzhikanom. But it is much more, since emphatically the purpose of making improvements on the land and enjoyment of the land are included in the transaction. Consequently, Ext. A can be rightly called an ottikuzhikanom. However, I need not finally pronounce on this aspect of the case because I am satisfied that Ext. A creates a kuzhikanom. The appellants are therefore confronted by the plea of fixity of tenure and the armour of S.13 of the Act is invulnerable, the right of redemption conferred by the Transfer of Property Act notwithstanding.