Mahendra v. M/s. Mehta Mohanlal Mathurdas — 1987 DIGILAW 124 (GUJ)

D. H. SHUKLA, J. ( 1 ) JUDGEMENT :- The Appellant, Mahendra Mohanlal Mistry, inhabitant of Godhra (District Panchmahals) was the defendant in a suit, bearing Special Civil Suit No. 45 of 1977, filed in the Court of the learned 2nd Joint Civil Judge (Senior Division), Godhra by the respondent, M/s. Mehta Mohanlal Mathurdas, a Partnership firm through its Partners, (1) Ramanlal Mohanlal Mehta, and (2) Sankalchand Mohanlal Mehta, having died through Rameshchandra Sankalchand Mehta, both of Godhra (District Panchamahals), for the purposes of getting possession of the suit property, bearing City Survey No. 437, situate in the City of Godhra, and for recovering a sum of Rs. 6750/-, being the arrears of rent for a period of three years prior to the date of the suit. The learned trial Judge. by his judgement and order dated 31st December, 1981 declared that the respondents were entitled to recover a sum of Rs. 10,000/- on the mortgage amount, as the principal amount, and Rs. 1,800/- for interest on the said amount and further passed a decree that on the payment of the aforesaid amount of Rs. 11,800/- (inclusive of interest), the respondents shall bring into the Court all the documents in his possession or power relating to the mortgaged property and all such documents shall be delivered over to the appellant or to such person as he appoints, and the respondents shall, if so required, reconvey or retransfer the said property free from the said mortgage, and clear of and from all encumbrances created by the respondents or any person claiming under them or any person under whom they claim and free from all liabilities whatsoever arising from the mortgage or the suit. The trial Judge further ordered and decreed that in default of payment as aforesaid, the respondents may pray for a final decree that the appellant shall thereafter stand absolutely debarred and foreclosed of and from all rights to redeem the mortgaged property, described in the Schedule annexed thereto and shall, if so required, deliver up to the respondents quiet and peaceable possession of the said property, and that the parties shall be at liberty to move the Court from time to time as they may have occasion, for appropriate directions. He further directed the appellant to pay the costs of the suit to the respondents and directed that a preliminary decree be drawn accordingly. He further directed the appellant to pay the costs of the suit to the respondents and directed that a preliminary decree be drawn accordingly. ( 2 ) THE appellant, having been dissatisfied and aggrieved by the aforesaid judgement and order, has filed the present appeal. ( 3 ) THE facts leading to the present appeal may shortly be stated as under : the respondent No. 1 is a partnership firm registered under the Indian Partnership Act and deals in Shroff business, i. e. to say, it deals in money lending transactions. The appellant had entered into an agreement of mortgage of an immoveable property, admeasuring 74. 06 sq. yards out of a private plot bearing plot No. 26, along with a superstructure built upon the said land. The mortgage is stated to be a mortgage with conditional sale in favour of the respondent firm for a sum of Rs. 15,000/ -. The agreement of mortgage was entered into on 20-3-1969 and it was a registered document. It is to be found at Exh. 76. Despite an averment to the contrary in the mortgage deed, possession of the suit property remained with the appellant. It was provided in the mortgage deed specifically that the mortgage was in the nature of a mortgage by conditional sale and that if the mortgage debt was discharged within one year of the mortgage-deed, the property would stand redeemed from the mortgage and that if within the same period of one year from the mortgage deed, the mortgage-debt was not discharged, the appellant would not have a right to redeem the property and that the property would stand automatically sold to the respondents. The respondents averred in the plaint that subsequent to the entering into the transaction of mortgage, the appellant had agreed to pay Rs. 187-50 ps. per month by way of rent of the suit property. They further averred that the appellant had paid a cheque of Rs. 15,000 dated 1-8-1973 towards the rent and after giving a credit of the same, the respondents were entitled to recover a sum of Rs. 7187-50 ps. , but they were not claiming the same amount as the same had become barred by limitations. In other words the respondents. They further averred that the appellant had paid a cheque of Rs. 15,000 dated 1-8-1973 towards the rent and after giving a credit of the same, the respondents were entitled to recover a sum of Rs. 7187-50 ps. , but they were not claiming the same amount as the same had become barred by limitations. In other words the respondents. claim that on account of an agreement subsequent to the mortgage-deed entered into by and between the parties, they were entitled to recover rent alias mesne profits from 20-3-1969 to 19-8-1974, which came to Rs. 12,187-50 ps. towards which amount the appellant had paid Rs. 5,000/- by a cheque dated 1-8-1973, and giving a credit of that amount, the respondents were still entitled to recover the balance amount of Rs. 787-50 ps. , but they did not press the amount in the suit, since it had become barred by limitations. Consequently, they have claimed a sum of Rs. 6750/- being the arrears of rent alias mesne profits for a period of three years prior to the filing of the suit. ( 4 ) THE respondents further claimed possession of the mortgaged property on the basis of the title to the property. ( 5 ) THE respondents further averred that the appellant had gone to them on 1-8-1973 telling that he wanted to show the document of mortgage to some other person and tendered a cheque of Rs. 15,000/- dated 1-8-1973 to them. The appellant also got an endorsement of Sankalchand on the said document that by tender of the same cheque, the mortgage-debt was discharged and that the possession of the property was reconveyed to the appellant. It is, however, averred by the respondent that the same cheque was not realised when tendered for payment in the Bank and that therefore the mortgage subsisted. The respondent thereafter served a notice dated 25-7-1977, which was received by the appellant on 2-7-1977, but it was not replied. Hence, the suit. ( 6 ) THE appellant resisted the suit by filing a written statement. Exh. 13. It is contended that the respondents have filed a false suit with a view to extracting money second time. The respondent thereafter served a notice dated 25-7-1977, which was received by the appellant on 2-7-1977, but it was not replied. Hence, the suit. ( 6 ) THE appellant resisted the suit by filing a written statement. Exh. 13. It is contended that the respondents have filed a false suit with a view to extracting money second time. It was contended that the mortgage-liability was already satisfied, and having accepted the discharge of the mortgage liability, the respondents have returned the documents with an endorsement regarding the receipt of full payment, on revenue stamp on 1-8-1973 It is contended that the appellant had not received the consideration as stated in the mortgage deed, but that there was a previous debt of Rs. 9,000/- outstanding and including in that amount the future interest, the consideration of Rs. 15,000/- was made up in the document. It is contended that the respondents do not become the owners of the property by stipulation in the document that if the amount is not paid within one year the appellant will have no right of redemption left to him. It is also denied that he had agreed to pay Rs. 187-50 ps. per month as damages or by way of rent at the rate of 15 per cent per annum on Rs. 15,000/ -. It is further denied that a cheque of Rs. 5,000/- dated 1-8-1973 was paid towards Rs. 12,187-50 ps. which are alleged to be arrears from 20-3-1969 to 19-1-1984. It is also denied that the respondents have let off their claim for the balance of Rs. 7187-50 ps. as time-barred. On the other hand, it is the case of the appellant that a cheque of Rs. 5,000/- dated 1-8-1973 was paid towards Rs. 15,000/- being the mortgage amount and that the respondents have falsely stated that the same payment of Rs. 5,000/- was paid towards mesne profits alias rent of the suit property. It is further denied by the appellant that he had gone to the respondent-firm on 1-8-1973 and had told them that he wanted to show mortgage documents to some other person and got executed the endorsement of the full payment of the mortgage liability. It is averred that the said cheque of Rs. 15,000/- dated 1-8-1973 was paid as he was in urgent need for his firm named Mistry and Co. It is averred that the said cheque of Rs. 15,000/- dated 1-8-1973 was paid as he was in urgent need for his firm named Mistry and Co. , and that the said cheque was given on 11-7-1973, but it was a postdated cheque bearing dated 1-8-1973. The said cheque was given to the respondents on the understanding that the respondents were to pay the amount in cash to the appellant. At the time when the cheque was handed over to the respondents, appellant was told that the respondents would think over whether they will pay the amount of the said cheque or not in a day or two. Since no amount was paid by the respondents, the cheque was not to be tendered for payment and it was so done in breach of faith. Since the appellant remained sick for a very long period, he did not take any action for the recovery of the cheque from the respondent. It is the case of the appellant that the respondents have no right to recover Rs. 6750/- from 20-8-1974 as claimed, since there was no such agreement to pay the mesne profits. It is his further say that he has already discharged the mortgage liability of Rs. 15,000/- by paying Rs. 5500/- on 11-7-1973 by encashing a cheque drawn payable to self and by further paying on the same date a sum of Rs. 4500/- in cash. Adding to this amount a sum of Rs. 5,000/- which he had given to the respondent by a cheque dated 1-8-1973, there was a complete discharge of the mortgage debt. The appellant claimed a sum of Rs. 3,000/- by way of compensatory costs. ( 7 ) ON behalf of the respondents, Ramanlal Mohanlal examined himself at Exh. 25. The respondents further examined one Mahmad Jabar Gulamali Dosani, Manager, Bank of Baroda, Gandhi Chowk Branch at Godhra to prove certain cheques. His deposition is at Exh. 37. The oral evidence on behalf of the respondents is confined only to these two witnesses. ( 8 ) ON behalf of the appellant, the appellant examined himself and his deposition is at Exh. 40. ( 9 ) THE learned trial Judge framed issues at Exh. 16. His deposition is at Exh. 37. The oral evidence on behalf of the respondents is confined only to these two witnesses. ( 8 ) ON behalf of the appellant, the appellant examined himself and his deposition is at Exh. 40. ( 9 ) THE learned trial Judge framed issues at Exh. 16. ( 10 ) I do not propose to reproduce the contents of the oral evidence produced by the rival sides here, but I shall refer to it, as and when and to the extent it is found relevant. ( 11 ) IT is an admitted factual position that the appellant had executed a document for Rs. 15,000/- on 20-9-1969. As noted above, the original document is produced by the appellant and it is to be found at Exh. 26. With the consent of the respondent, the document of mortgage was exhibited, excepting the endorsement alleged to have been made by Mehta Sankalchand Mohanlal for the discharge of the liability by receipt of an amount of Rs. 15,000/ -. It is also to be noted that the respondent has admitted that although the document of mortgage is in the form of a conditional sale, it is in fact and in law a transaction of mortgage. It is also beyond doubt chat the respondent has not filed a suit for foreclosure on the strength of the said document of mortgage and that the suit is filed for the recovery of the possession of the suit property and alleged arrears of rent during the subsistence of the mortgage. ( 12 ) BEFORE I proceed to discuss legal questions which emerge from the facts, it is necessary to clear the factual controversies between the parties. It is the case of the respondents, as noted above, that after the mortgage agreement was entered into, there was an oral agreement that since the appellant had retained possession of the suit property despite an averment to the contrary in the mortgage deed, the appellant was to pay to the respondents at the rate of Rs. 187-50 ps. per month as the mesne profits in lieu of rent of the suit property. The respondents witness Ramanlal Mohanlal has deposed that such an agreement was orally entered into between the parties. It is also the case of the respondents, and deposed to by Ramanlal Mohanlal, that the appellant did pay a sum of Rs. 187-50 ps. per month as the mesne profits in lieu of rent of the suit property. The respondents witness Ramanlal Mohanlal has deposed that such an agreement was orally entered into between the parties. It is also the case of the respondents, and deposed to by Ramanlal Mohanlal, that the appellant did pay a sum of Rs. 5,000/- by way of a cheque dated 1-8-1973 towards the arrears of rent. Ramanlal Mohanlal has stated in his examination that three years arrears of rent is claimed at the rate of Rs. 187-50 ps. per month. The trial Judge had disbelieved this story of the respondents, and in my view rightly. (I) It is clear and beyond doubt that there is no agreement between the parties in the document of mortgage regarding payment of interest. Therefore, there could be no agreement for the payment of rent in lieu of interest. (II) All that can be said for the respondents is that although the possession of the property was to be handed over to the respondents, the appellant retained the possession and therefore an agreement of rent was entered into between the parties. However, it must be noted that if there was an agreement of this nature subsequent to the document of mortgage, the respondents would have insisted upon a written agreement for the payment of rent. There is no written agreement for the payment of rent. (III) Although it is alleged by the respondents that the appellant had paid a cheque of Rs. 5,000/- dated 1-8-1973 towards the arrears of rent, there is no documentary evidence in support of such an allegation. The respondents have failed to produce their books of accounts to show that the same cheque of Rs. 5,000/- was credited in the rent account of the appellant. It is admitted by the witness Ramanlal that in their books of accounts, no rent, account of the appellant is maintained. The respondents being Shroffs, they would not have failed to maintain a rent account, if such an agreement as alleged had in fact been entered into between the parties. (IV) It is admitted by the respondents witness, Ramanlal that although under the alleged oral agreement the respondents were entitled to recover rent from the date of the mortgage, i. e. to say from 20-3-1969, no demand for rent was made for a period between 1969 to 1973. (IV) It is admitted by the respondents witness, Ramanlal that although under the alleged oral agreement the respondents were entitled to recover rent from the date of the mortgage, i. e. to say from 20-3-1969, no demand for rent was made for a period between 1969 to 1973. Ramanlal has admitted that although he has made an oral demand for the payment of rent, he could not give the date on which he had made such a demand. He has also admitted that although the appellant was in arrears of rent for a period of four years, he had not served a notice of demand on him. ( 13 ) THE conduct of the respondents, therefore, leads me to believe that the trial Judge was right in holding that the respondents have failed to prove their case to this extent. He has, therefore, rightly rejected the respondents claim of Rs. 6750/- by giving a negative finding on issues Nos. 3 and 4. ( 14 ) THE trial Judge has held that this claim is nothing but a claim by way of interest calculated at the rate of 15 per cent per annum, which the respondents are not entitled to recover, since there is no stipulation in the document of mortgage for the payment of interest. He has, however, allowed interest to the respondents at the rate of 6 per cent per annum instead of 15% as claimed. In my view, the trial Judge has erred, if he has allowed 6% interest, or for that matter any interest prior to the date of the suit. In the document of mortgage, there is no stipulation of interest. The trial Judge had disbelieved, and rightly so, the alleged oral agreement to pay rent alias mesne profits calculated at the rate of 15%. In view of this factual position, the respondent is not entitled to any interest whatever prior to the date of the suit. It is a different matter that if he succeeds in the suit, the Court will have discretion to allow interest at such rate as the Court deems reasonable to be paid on the principal adjudged from the date of the suit till the date of the decree and for a period subsequent to the date of decree till the realisation of decretal amount. ( 15 ) THE suit claim of Rs. ( 15 ) THE suit claim of Rs. 6750/- is, therefore, rightly rejected by the trial Court. ( 16 ) IT may be noted that there are no cross objections, nor cross appeal filed by the respondents. ( 17 ) THE second factual controversy which I may clear at this stage is regarding the alleged claim of the appellant regarding the discharge of the mortgage liability. ( 18 ) IT is claimed by the appellant that the payment of Rs. 5000/- by a cheque dated 1-8-1973 was not towards the arrears of rent, but it was towards the payment of the principal. It is not in dispute that the same cheque was realised and the respondents have received Rs. 5,000/ -. The witness for the appellant, Mahendra Mistry, has stated in his evidence that he had paid a cheque of Rs. 5,000/- towards the mortgage liability on 1-8-1973. This part of the appellants story is accepted by the trial Judge, and he has allowed payment of Rs. 5,000/- to reduce the mortgage liability of Rs. 15,000/ -. So far, I do not think that there is much difficulty. ( 19 ) FOR the discharge of the remaining liability, the story of the appellant is rejected by the trial Judge, and that decision of the trial Judge is also correct. According to the appellants witness, Mahendra Mistry, he had given a cheque of Rs. 5,000/- to the respondent on 11-7-1973 which was dated 1-8-1973, and that cheque was realised later. On the same date, i. e. 11-7-1973, he had also drawn a cheque payable to self on Bank of Baroda Limited for a sum of Rs. 5501/ -. On receiving that amount in cash, he had handed over the same to Ramanlal Mohanlal at the Appellants office. The trial Judge has not believed the story of the payment of Rs. 5500/- as alleged. The trial Judge has believed that the same cheque of Rs. 5501/- was encashed on 11-7-1973, but he has not accepted the story of the payment of that amount to the respondent. The trial Judge has not accepted this story because there is no evidence that the sum of Rs. 5501/- was paid to Ramanlal Mohanlal. Admittedly, no receipt was obtained by the appellant from Ramanlal Mohanlal, nor was even a note or some writing maintained to evidence the same payment. The trial Judge has not accepted this story because there is no evidence that the sum of Rs. 5501/- was paid to Ramanlal Mohanlal. Admittedly, no receipt was obtained by the appellant from Ramanlal Mohanlal, nor was even a note or some writing maintained to evidence the same payment. The trial Judge has rightly held that such a conduct on the part of the appellant, who too was a businessman, is highly improbable and unacceptable. ( 20 ) SIMILARLY, it is the contention of the appellant that on the same day, i. e. 11-7-1973, he had paid Rs. 4500/- to Ramanlal Mohanlal from the cash which was available at the appellants office. For the payment of this amount also, there is no documentary evidence to support the say of the appellant. There is no documentary evidence to show that the appellant did have cash on hand from which he could pay Rs. 4500/ -. There is no documentary evidence in the nature of a receipt from Ramanlal Mohanlal for the payment of the amount. The appellants witness has stated that he does not keep the books of accounts, but this is no reason to believe that he had paid such a large sum as that of Rs. 4500/- in cash without obtaining receipt from Ramanlal Mohanlal. If the total transaction is looked at according to the appellant, he had paid a sum of Rs. 10,000/- in cash to Ramanlal Mohanlal and it is an improbable story that he paid this amount without taking receipt for the payment of the same amount. . ( 21 ) MR. S. K. Zaveri, the learned Advocate for the appellant, persisted in his submission that the trial Court should have accepted the endorsement on the back of the counterfoils of the cheque. The content of the counterfoil would be no evidence against the respondent. In order to bind the respondent, the appellant could have, and considering the normal way of life, would have obtained a receipt of payment in cash. It would also be expected of him that he had maintained the books of accounts and even if it is accepted that he does not maintain books of accounts, he would have kept such documentary proof of payment which would satisfy the conscience of the Court. I, therefore, hold that the trial Judge has rightly disbelieved the alleged payment of Rs. I, therefore, hold that the trial Judge has rightly disbelieved the alleged payment of Rs. 10,000/- in cash on 11-7-1973 by the appellant to the respondent. If this payment is disbelieved, it must consequently be held that the mortgage liability is not discharged and that the document of the mortgage subsists. ( 22 ) THE third factual controversy between the parties is in connection with the endorsement of discharge on the mortgage deed itself. The say of the respondent in the plaint is that the appellant had approached them on 1-8-1973 and told them that he may be returned the mortgage document as he wanted to show it to some person and had tendered to them a cheque of Rs. 15,000/- dated 1-8-1973 for the discharge of the mortgage amount. On receipt of the cheque as stated in the plaint, an endorsement about the receipt of the cheque was made on the document of mortgage and the document was entrusted to the appellant. However, when the cheque was presented for payment, the cheque bounced and thus the mortgage liability remained undischarged. According to the respondent, that is how the mortgage is subsisting. The trial Judge has accepted this story of the respondent. He had observed in the course of his judgement at paragraph 10, "so the say of the plaintiff in this regard is more probable and acceptable instead of the say of the defendant that it was signed for full settlement of document Ex. 41 as averred by him. " The appellant has denied this allegation of the respondent. According to him, he had requested the respondent to advance a sum of Rs. 15,000/- on 11-7-1973, on the strength of a post-dated cheque of Rs. 15,000/- dated 1-8-1973. He had handed over the cheque to the respondent. The respondent had told him that he would consider the matter whether a further amount of Rs. 15,000/- should be advanced to him or not. Before finally paying the amount, however, the cheque was tendered for payment and therefore it was dishonoured. ( 23 ) ON a close scrutiny of evidence on both the sides, it appears that neither of the theories advanced by the rival parties is satisfactory. 15,000/- should be advanced to him or not. Before finally paying the amount, however, the cheque was tendered for payment and therefore it was dishonoured. ( 23 ) ON a close scrutiny of evidence on both the sides, it appears that neither of the theories advanced by the rival parties is satisfactory. ( 24 ) SO far as the allegation of the respondent is concerned, it suffers from the following defects :- (1) In the plaint, it is stated, vide paragraph 7, that the appellant paid a cheque of Rs. 15,000/- dated 1-8-1973. On 1-8-1973 itself the respondent had made an endorsement on the document of mortgage that the same cheque was received, and then the same document was handed over to the appellant, whereas in his evidence Ramanlal Mohanlal has stated vide paragraph 3, that when the appellant had given a cheque of Rs. 15,000/- on 1-8-1973 his brother, Sankalchand Mohanlal Mehta, had placed his signature on a stamp on the document of mortgage and had returned that document to the appellant. He has categorically stated that the endorsement was concocted later and that no endorsement existed on the document at the time when the signature was placed upon it on a revenue stamp. There is thus evident contradiction about the existence of the endorsement between the plaint and the evidence of the plaintiffs witness. (2) In the plaint, it is stated that the appellant wanted the document of mortgage back on the ground that he wanted to show the document to some other person. It is ununderstandable why was that excuse to show the document to a third person necessary, if he was to discharge the mortgage liability by the payment through the cheque. It is pertinent to note that Ramanlal Mohanlal has stated in his evidence that the appellant had seen him at his residence and had told him that the appellant was making the arrangement for the payment of the mortgage amount. There is no mention in his evidence that he wanted the document back as he wanted to show it to some person. In his cross-examination, he has admitted that when the cheque was given to them, they had understood that the same cheque was given to discharge the liability. This discrepancy also creates a doubt about a theory put forth by the respondent. In his cross-examination, he has admitted that when the cheque was given to them, they had understood that the same cheque was given to discharge the liability. This discrepancy also creates a doubt about a theory put forth by the respondent. (3) It is not possible to believe that an experienced Shroff like Sankalchand Mohanlal would put his signature on the document of mortgage, which would operate as a blank signature. What was the purpose in putting up the signature, if there was no writing whatever ? (4) He had also to admit in his cross examination that he has no documentary evidence to show that he had received a cheque of Rs. 15,000/- on 1-8-1973. The respondents are Shroffs and if the cheque was received on 1-8-1973, they could have proved the receipt by producing their books of accounts because they must have credited that cheque in the Rojmel. (5) He had also to admit in his cross examination that although the appellant had defrauded them by taking the document on a false ruse that he wanted to show the document to some third person by giving a cheque which was dishonoured, no notice was given to the appellant, nor was any other legal step taken for such a fraud committed by the appellant. No notice was served to take the document hack from the appellant, and even the suit was filed on a copy of the document of mortgage. Even the suit was not filed till August of 1977, although the cheque was dishonoured in 1977. ( 25 ) FOR these reasons, I am unable to accept the finding of the trial Judge in accepting the respondents theory, vide paragraph 10 of his judgement. ( 26 ) I might as well observe that on this point, the theory of the appellant is also not swallowable. According to him, all these transactions happened on 11-7-1973. On 11-7-1973, he paid a cheque of Rs. 5,000/- which was realised. He had also drawn a cheque of Rs. 5501/- payable to self and by encashing that cheque he had paid the amount, without taking a receipt thereof from the respondent. He had also paid Rs. 4500/- in cash to the respondent, without taking a receipt for that amount also. He had also given on that day a cheque of Rs. He had also drawn a cheque of Rs. 5501/- payable to self and by encashing that cheque he had paid the amount, without taking a receipt thereof from the respondent. He had also paid Rs. 4500/- in cash to the respondent, without taking a receipt for that amount also. He had also given on that day a cheque of Rs. 1500/- for the rent of the office premises, and he had also given a cheque of Rs. 15,000/- dated 1-8-1973 since he wanted a further amount from the respondent. This is an intermingled story. For the reasons stated above, I have disbelieved, as the trial Judge had done, payment of Rs. 5501/- and Rs. 4500/- in cash to the respondent. It is not possible to disentangle the whole story and believe a part of it. There is one more snag in the appellants version. ( 27 ) THERE appears infirmities in the versions of the rival sides, and it is difficult to accept either of them without having doubts in mind. However, this controversy would have lose significance only if the story of the appellant was believed because in that case the mortgage liability would have stood discharged and the mortgage agreement would not have remained a subsisting agreement. Since the story of the appellant regarding the discharge of the mortgage liability by payment of a cheque of Rs. 5,000/- and by payment of remaining amount in cash is not believed, the consideration of the mortgage document remains undischarged and therefore the mortgage transaction must be considered as a subsisting transaction at the time when the suit was filed. ( 28 ) THE fourth controversy arises out of the appellants say that the mortgage deed was executed towards the old dues of Rs. 9,000/- with interest, but the trial Judge has disbelieved this allegation of the appellant, in the absence of documentary evidence. If the appellant had not maintained books of accounts, he could have at least called upon the respondent to produce their books of accounts to prove his case, but that is also not done. The trial Judge has rightly therefore answered issue No. 5, namely, whether defendant proves that mortgage deed was executed towards dues of his amount of Rs. 9000/- with interest, in the negative. ( 29 ) MR. The trial Judge has rightly therefore answered issue No. 5, namely, whether defendant proves that mortgage deed was executed towards dues of his amount of Rs. 9000/- with interest, in the negative. ( 29 ) MR. S. K. Zaveri, the learned Advocate for the Respondent, first based his argument on the endorsement made on the mortgage deed and submitted that mortgage did not subsist as the mortgage liability was discharged. This argument cannot be accepted, in view of the fact that the payment of the mortgage consideration as alleged by the appellant is disbelieved by the trial Judge as well as by me, for the reasons stated above. He has relied upon the ruling reported in AIR 1963 SC 1041 for the proposition that when the mortgage money is paid by the mortgagor to the mortgagee, there does not remain any debt from the mortgagor to the mortgagee, and therefore, the mortgage can no longer continue after the mortgage money has been paid. This authority cannot help the appellant, inasmuch as the alleged repayment of mortgage consideration is not believed. ( 30 ) MR. Zaveris second submission has force in it. Mr. Zaveri submitted that assuming that the version of repayment of mortgage consideration is disbelieved, in that case even the respondents version stating the circumstances in which the document of mortgage was returned to the appellant, is unacceptable. It is difficult to swallow Mr. Zaveris submission, that the respondent has returned the original document of mortgage with a blank signature on a revenue stamp, without receipt of the consideration for the mortgage transaction. In that eventuality i. e. to say when the versions of the rival sides are found unbelievable, there still remains a question of presumption under Section 114 of the Indian Evidence Act read with illustration (i ). The effect is that the Court may presume the existence of any fact which he thinks likely to have happened regarding the whole conduct. It is true that the versions given by both the sides are not free from doubt. So far as the making of the endorsement is concerned, it does not satisfactorily become clear as to under what circumstances was the endorsement made on the document. This is so all the more because the theory of the repayment of the mortgage consideration as advanced by the appellant is disbelieved. So far as the making of the endorsement is concerned, it does not satisfactorily become clear as to under what circumstances was the endorsement made on the document. This is so all the more because the theory of the repayment of the mortgage consideration as advanced by the appellant is disbelieved. In such circumstances, I find force in the argument of Mr. Zaveri that a presumption under Section 114 of the Indian Evidence Act arises. It is pertinent to note that the respondents have not produced their books of accounts to prove several important facts involved in the transaction. In the first place, the respondents have not proved their books of accounts to prove the consideration of the mortgage as stated in the mortgage deed. As per the mortgage deed, Rs. 12,501/- was an outstanding liability of the appellant. This liability could not should have been proved by the production of the books of accounts. The further consideration of Rs. 2499/- was an amount which was paid in cash to the appellant at the time of the transaction. This fact is also not proved by the production of books of accounts. It may be that since the appellant had produced the mortgage deed from his own custody, it was exhibited and therefore the proof of consideration was not required to be independently proved. But at least the respondents should have proved that a payment of Rs. 5,000/- was made to them towards an arrear of rent as alleged by them. This fact is also not proved by the production of books of accounts. The respondents also could have proved the receipt of a cheque. The respondents, for the reasons best known to them, have refrained from producing their books of accounts. If the respondents had produced their books of accounts, there would not have remained any suspicion about their conduct. If the respondents theory of the circumstances in which a cheque of Rs. 15,000/- which was subsequently dishonoured was given to them is disbelieved there is no other evidence on record to rebut the presumption and to explain how the original document of mortgage was parted with by them in favour of the appellant. Mr. Zaveris submission is that if the respondents have failed to rebut the presumption, the suit of the respondents must be dismissed. ( 31 ) IN support of his submission, Mr. Mr. Zaveris submission is that if the respondents have failed to rebut the presumption, the suit of the respondents must be dismissed. ( 31 ) IN support of his submission, Mr. Zaveri has put heavy reliance on a Privy Council judgement in the case of Muhammad Mehdi Hasan Khan v. Madir Das, ILR 34 All 511. The head-notes run as under :"in a suit for money due on a mortgage bond, the plaintiff produced only a copy of the document, alleging in his plaint that it had been lost. The defendant admitted its execution, but alleged that the debt had been discharged; and in support of his allegation he produced the original document containing the endorsement of the mortgagee through her agent of payment of the debt. The Subordinate Judge, relying on Section 114 of the Evidence Act, put the onus on the plaintiff, who, to account for the possession of the bond by the defendant, set up a case supported by witnesses which both courts below held to be false. The Subordinate Judge dismissed the suit. The Judges of the Judicial Commissioners Court disbelieved the evidence on both sides, set aside the presumption under Section 114 of the Evidence Act, and endeavoured to make out a case for the plaintiff based on a theory of their own. Held (reversing that decision) that the first court was right in holding that the production by the defendant of the bond with the endorsement of payment cast on the plaintiff the burden of proving that the debt was still outstanding and that the appellate court should not have disregarded the presumption under Section 114 in favour of a "possibility based on surmise, suspicion, though a ground for scrutiny, could not be made the foundation of a decision. "their Lordships of the Privy Council, concluding their judgement, observed as under :"their Lordships cannot help considering this mode of treating a case where two distinct and conflicting sets of facts are opposed to each other as unsatisfactory. The plaintiff came into court with a definite story to account for the possession of the document by the defendant. The learned Judges agree with the first court in holding that story to be false, and yet they proceed to build up a case for the plaintiff on what they call a "possibility". The plaintiff came into court with a definite story to account for the possession of the document by the defendant. The learned Judges agree with the first court in holding that story to be false, and yet they proceed to build up a case for the plaintiff on what they call a "possibility". As already observed, the defendant did not rest his case merely on the legal presumption which arose from the possession of the document; he produced positive testimony which received corroboration from that presumption, and he proved facts which made his statement probable. The learned Judges having disbelieved the evidence on both sides, have set aside the presumption under Section 114 of the Evidence Act, which only embodies the ordinary rule of law, by a possibility based on surmises. Now, it is a settled principle that suspicion, though a ground for scrutiny, cannot be made the foundation of a decision, and that is exactly what appears to have happened in this case. "with reference to the conflicting views of the two courts in India regarding the question of onus, in view of the presumption under Section 114 of the Indian Evidence Act their Lordships are of opinion that the Subordinate Judge was right in holding that the production by the defendant of the bond with the endorsement of payment cast on the plaintiff the burden of establishing the affirmative proportion that the debt was still outstanding in other words, of showing that the bond came in defendants possession by dishonest means and that the signatures to the endorsement were either forgeries or unauthorised. " (Emphasis supplied.) for the similar proposition, he has also relied upon the ruling reported in AIR 1942 Pat 315. ( 32 ) HOWEVER, it is not on this legal position alone that I am inclined to dismiss the suit of the defendants. The reasons given by the trial Judge for not accepting the respondents claim of Rs. 6750/- has been discussed by me above. I need not repeat the discussion. It will suffice to say here that the respondents are not found entitled to recover a sum of Rs. 6750/- for the arrears of rent for three years prior to the institution of the suit. ( 33 ) HE cannot claim this amount by way of interest as well, since the deed of mortgage Contained no stipulation about the payment of interest. 6750/- for the arrears of rent for three years prior to the institution of the suit. ( 33 ) HE cannot claim this amount by way of interest as well, since the deed of mortgage Contained no stipulation about the payment of interest. The respondents are not entitled to claim even the interest at the rate of 6% per annum as awarded by the trial Judge, because there is no stipulation to pay interest in the document of mortgage. The suit, therefore, is required to be dismissed, so far as the prayer at paragraph 10 (2) of the plaint is concerned. ( 34 ) THE next is the claim of the respondents to recover the actual physical possession of the suit property from the appellants. In that regard, it is stated in the plaint, vide paragraph 6 that the possession of the property was claimed on the strength of title to the suit property arising out of a mortgage which was in the nature of a conditional sale. This relief also cannot be granted to the respondents, as they have not filed a suit for and obtained a decree for foreclosure. The trial Judge has reproduced a quotation from the Commentaries on the Transfer of Properties Act by J. P. Singal, which I need not reproduce here. The only remedy to which the respondents would have been entitled to under Section 67 of the Transfer of Property Act is to have a right to obtain from the Court a decree that the mortgagor shall be absolutely barred to redeem the property. In a mortgage by conditional sale, the mortgage works itself out into a sale or the conditional sale becomes absolute. The mortgagee is, therefore, not entitled under this Section to an order for sale, but his remedy is foreclosure. (Transfer of Property Act, Mulla, 6th Edition, page 474 ). In other words, the remedy of the respondents would have been only to claim a decree of foreclosure. The respondents could have based their relief for the recovery of the possession of the suit property on title only after they had obtained a decree for foreclosure. The respondents have not claimed a relief of foreclosure, and this position was candidly admitted by Mr. M. J. Thakore, the learned Advocate for the Respondents. The trial Judge has approved of the argument advanced before him by Mr. The respondents have not claimed a relief of foreclosure, and this position was candidly admitted by Mr. M. J. Thakore, the learned Advocate for the Respondents. The trial Judge has approved of the argument advanced before him by Mr. K. A. Parikh, the learned Advocate for the defendant, that if the mortgage was in existence, the respondents, i. e. the original plaintiffs, cannot become the full owner and they do not get the title of ownership to the suit property till a decree of foreclosure was obtained. Still, however, the trial Judge has granted a relief of a preliminary decree based on equities, as he found them. He was evidently not entitled to do so, and has exceeded the jurisdiction in granting a preliminary decree to the respondents. The suit of the respondents to the extent that they claim possession of the suit property on the basis of the title to the property cannot, for the aforesaid reasons, be entertained, and the suit is required to be dismissed for this relief also. ( 35 ) IT is true that the trial Judge has found that a balance of Rs. 10,000/- was outstanding towards the principal sum of the mortgage debt. It appears that his conclusion is well based to that extent. However, the respondents are not entitled to a personal decree against the appellant because that remedy is not kept open in the mortgage deed. Section 68 (1) deals with the right of a mortgagee to sue for the mortgage money, but the case of the respondents is not covered by it, nor have the respondents claimed in the suit a personal remedy against the appellant for the recovery of the principal mortgage amount. There is no case, therefore, for considering whether in this suit a personal decree for Rs. 10,000/- can be granted against the appellant. The trial Judge has disallowed the appellants claim of Rs. 3,000/- by way of compensatory costs and that view is quite correct. ( 36 ) HAVING considered the suit of the respondents from diverse angles, I have reached the conclusion that the final order passed by the trial Judge is required to be reversed, quashed and set aside. ( 37 ) MR. 3,000/- by way of compensatory costs and that view is quite correct. ( 36 ) HAVING considered the suit of the respondents from diverse angles, I have reached the conclusion that the final order passed by the trial Judge is required to be reversed, quashed and set aside. ( 37 ) MR. M. J. Thakore, the learned Advocate for the respondents, tenaciously advanced a submission that the respondents are entitled to file a suit to recover possession of the suit property, even during the subsistence of the mortgage. Mr. Thakores submission is that if the document of mortgage is properly construed, it would be found that it is not a pure mortgage by conditional sale, but it is an anomalous mortgage. Under the mortgage agreement, the appellant was required to hand over possession of the suit property and he also entered into an agreement for a conditional sale. The document is, therefore, of the nature of an anomalous mortgage. Mr. Thakores submission is that under an anomalous mortgage, it is open to the mortgagee to file a suit to obtain possession from the mortgagor, even during the subsistence of mortgage. In support of his submission, he cited several judgements. They are as under : ilr 57 Bom 593, (1884) ILR 10 Cal 68, AIR 1942 Oudh 172, AIR 1950 Ajmer 59, AIR 1967 Mysore 41, AIR 1921 Bombay 28, AIR 1961 Guj 129 and AIR 1966 Guj 59 . However, I do not enter into the discussion of this proposition of Mr. Thakore because it is not the case of the respondents that they are claiming possession of the suit property under the terms of the mortgage agreement. It is specifically averred, vide paragraph 6 of the plaint, that they are claiming possession of the suit property on the basis of the title to the suit property derived under a mortgage. which is of the nature of a mortgage with conditional sale. It is not at all claimed by them at any stage of the suit that the mortgage was an anomalous mortgage and that therefore under anomalous mortgage they were entitled to recover the suit property while the mortgage was subsisting. The cause of action as pleaded by the respondent is distinctly different from the proposition canvassed before me by Mr. Thakore. The cause of action as pleaded by the respondent is distinctly different from the proposition canvassed before me by Mr. Thakore. The possession on the basis of title cannot be claimed by the mortgagee-respondents till they obtain a decree for foreclosure. No decree for possession, therefore, subsisting the mortgage can be granted on a plea advanced by Mr. Thakore. ( 38 ) IF a decree for possession was based upon their right to do under the mortgage deed and if it was pleased that as the mortgage was an anomalous mortgage, a decree for possession of the suit property could be claimed during the subsistence of the mortgage, the suit of the respondents would have taken a different colour. It would have given an opportunity to the appellant to plead that the appellant was allowed to retain possession by the respondents by a waiver or they would have also pleaded that the mortgage agreement was in fact a document entered into to secure the outstanding amount and that it was not intended to be acted upon. In fact, Mr. Jhaveri did raise an argument before me that the mortgage was not intended to be acted upon and that it was just a device contrived by the respondents to secure an outstanding amount. Mr. Jhaveri submitted that it is not otherwise understandable that the respondent did not take any step to recover the possession of the suit property from 1969 to middle of 1977. If the possession of the suit property was to be handed over to the respondents as stated in the mortgage deed, they would not have permitted the appellant to retain possession for such a long time. The mortgage agreement contains no stipulation for payment of interest and therefore the respondents could have realised interest only by utilising possession of the suit property. The respondents are dealing in money-lending transaction. It is not possible to believe that on the one hand they did not introduce any stipulation for payment of interest in the mortgage deed, and, on the other hand, did not take any step to recover possession of the suit property, the utility of which would have compensated them towards interest. Mr. Jhaveri also submitted that it is an admitted position that the respondents paid them a sum of Rs. 5000/- by a cheque dated 1-8-1973. The respondents have claimed that it was by way of rent. Mr. Jhaveri also submitted that it is an admitted position that the respondents paid them a sum of Rs. 5000/- by a cheque dated 1-8-1973. The respondents have claimed that it was by way of rent. This theory is unbelievable for various reasons which I have discussed above. Mr. Jhaveri submitted that the strongest reason amongst them is that the respondents would not have allowed their claim for arrears of rent to become barred by limitation. The respondents have not explained as to how they have credited the cheque of Rs. 5000/- by producing their books of accounts. There are strong reasons, therefore, to believe that the mortgage was entered into to secure an, outstanding liability of the appellant to the respondents and that there was some arrangement to pay interest dehors the mortgage agreement and that the term about the delivery of possession of the suit property was not intended to be acted upon. A failure to claim a relief for foreclosure does not appear to be through oversight. The factual circumstances involved in this case are so dubious that it is difficult to reach an emphatic affirmation of any of the rival versions. I, however, decide this appeal on the basis of the above discussion, and on a legal position, which emerges from the discussion. The above discussion leads me to the conclusion that the appeal must be allowed, and the respondents suit must be dismissed. ( 39 ) IN the result, the First Appeal is allowed, and the suit of the respondents is dismissed the respondents shall bear their own costs, and shall also bear the costs of the appellant all throughout. Appeal allowed. .