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2001 DIGILAW 161 (KER)

Pallathumpadikkal Rayankutty v. Saidalavi

2001-03-14

D.SREEDEVI

body2001
JUDGMENT :- This appeal is directed against the decree and judgment in A.S. No. 59/86 of the Sub Court, Tirur, which was filed against the decree and judgment in O.S. No. 184/83 of the Munsiff's Court, Tirur. Defendants 2 to 4 are the appellants. During the pendency of this appeal the first appellant passed away and his legal representatives are recorded as appellants 2 and 3 as per order dated 28-10-1999. 2. The plaintiffs filed the above suit for redemption of mortgage in respect of the plaint schedule property. The plaint property originally belonged to Saidalikutty, the father of plaintiffs 1 to 6 and the husband of 7th plaintiff as set apart to his share in the family partition in 1949. Saidalikutty mortgaged the property in favour of the 1st defendant. The mortgagor was allowed to take the income and to adjust the same towards interest on the amount borrowed. Saidalikutty died and his right devolved on his legal representatives who are plaintiffs 1 to 7. The 1st defendant assigned his right in favour of the 2nd defendant. He has effected improvements in the property. On the allegation that the 2nd defendant is willing to surrender the property the plaintiffs filed the suit. 3. D2, D3 and D4 filed written statement contending that the transaction is not a mortgage but a lease. According to them, the property was a waste land at the time of mortgage. The entrustment of property was not as a security for the loan, but for effecting improvements. Saidalikutty was in affluent circumstances and hence there was no necessity to borrow money and the first defendant was not in a position to lend money. The transaction is not a tenancy and as such the defendants are entitled to fixity of tenure. The second defendant executed a gift deed in favour of defendants 3 and 4. They purchased jenm right from the Land Tribunal. Hence, they pray for the dismissal of the suit. 4. The trial Court, after framing four issues, referred Issue No. 2, namely "whether defendants 3 and 4 are entitled to fixity of tenure?", to the Land Tribunal for adjudication. The Land Tribunal, after taking evidence, held that the transaction is a tenancy and not a mortgage. Accepting the said finding, the trial Court dismissed the suit. Aggrieved by the said decree and judgment, the plaintiffs filed A.S. 59/86 before the Sub Court, Tirur. The Land Tribunal, after taking evidence, held that the transaction is a tenancy and not a mortgage. Accepting the said finding, the trial Court dismissed the suit. Aggrieved by the said decree and judgment, the plaintiffs filed A.S. 59/86 before the Sub Court, Tirur. The learned Sub-Judge allowed the appeal setting aside the decree and judgment of the trial Court and passed a preliminary decree for redemption and redemption price was fixed at Rs. 4752.36. Aggrieved by the said decree and judgment defendants 2 to 4 filed this appeal. 5. Heard both sides. 6. Learned counsel for the appellants challenged the decree and judgment of the Court below on various grounds. He would submit that the First Appellate Court erred in thinking that Ext.A1 transaction is a usufructuary mortgage and the Court below ought to have found that it is a lease. He has also submitted that the Court below erred in thinking that the payment mentioned in the document is not the consideration for enjoyment of the property and Rs. 25/- mentioned in the document is other consideration within the meaning of Section 2(57) of the Kerala Land Reforms Act and under Section 12 of the Kerala Land Reforms Act parties are free to adduce evidence to establish the real nature of the transaction regardless of the recitals in and nomenclature of the document. 7. The questions of law involved in this case for interference by this Court are as follows : (a) Has not the lower appellate Court erred substantially in law in purporting to hold that Ext.A1 document evidence a mortgage and not a lease? (b) Has not the lower appellate Court erred in law in not even considering whether the appellants are not entitled to fixity of tenure under the Kerala Land Reforms Act as deemed tenants, in any view? (c) Has not the lower appellate Court erred in law in reversing the finding of the Land Tribunal in the referred case, when the finding on tenancy in independent proceedings under the Kerala Land Reforms Act which have become final and no appeal have been filed therefrom? 8. The first question to be looked into is whether Ext.A1 transaction between the parties is a mortgage or a lease. Ext.A1 is dated 1-5-1956. It was executed by Saidalikutty in favour of Narayanan Ezhuthachan, the first defendant. The nomenclature of the document is 'Kaivasapanayadharam'. 8. The first question to be looked into is whether Ext.A1 transaction between the parties is a mortgage or a lease. Ext.A1 is dated 1-5-1956. It was executed by Saidalikutty in favour of Narayanan Ezhuthachan, the first defendant. The nomenclature of the document is 'Kaivasapanayadharam'. The consideration for the mortgage is Rs. 25/-. Saidalikutty's tharavad had obtained a kanam right in respect of the plaint schedule property and later as per the partition of the year 1949 the plaint schedule item was allotted to Saidalikutty. The first defendant was directed to pay 'pattam'. The property was surrendered to the first defendant. The first defendant was also directed to enjoy the property by taking the yield which will be adjusted towards the interest on the amount. The term of mortgage was fixed at one year. It is also provided that after one year he is liable to surrender the property on receipt of the mortgage money and also the value of improvements effected by him. There is also direction for sale of the mortgaged property in case the property is not surrendered on receipt of the redemption price. 9. Section 58 of the Transfer of Property Act defines mortgage as follows : "A mortgage is the transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability". 10. According to the respondent, this mortgage is a usufructurary mortgage as the mortgagor surrendered possession of the mortgaged property to the mortgagee. He was authorised to retain such possession until the payment of the mortgage money and to receive the profits accruing from the property in lieu of interest. In the light of Section 58 Clause (d) of the Transfer of Property Act, it is submitted for the respondents that the transaction has the ingredients of usufructuary mortgage. 11. The learned counsel for the appellants invited my attention to Section 12 of the Kerala Land Reforms Act and submitted that he should be given an opportunity to prove the real nature of the transaction. The first defendant or the mortgagor alone can prove the real nature of transaction. The first defendant is now no more. 11. The learned counsel for the appellants invited my attention to Section 12 of the Kerala Land Reforms Act and submitted that he should be given an opportunity to prove the real nature of the transaction. The first defendant or the mortgagor alone can prove the real nature of transaction. The first defendant is now no more. It is submitted that at the time of mortgage the mortgagor was not in need of money as he has obtained 8 items of properties under Ext.B1 including the plaint schedule item and hence he was in affluent circumstances. To prove the income from these properties, there is no evidence. Hence, the mere possession of 8 items of properties does not mean that the mortgagor was getting good income from the properties and that he was not in need of money. 12. Another argument advanced by the appellants is that the amount of mortgage shown in the mortgage deed is disproportionate to the value of property. Regarding the value of property there is no reliable evidence on record. Moreover, it is seen from Ext.B1 that the value of 8 items is only Rs. 100/-. Therefore, the argument that the consideration is disproportionate to the value of property also has no merit. Even if it is assumed that the mortgage amount is disproportionate to the value of property, that will not make the transaction a lease. This Court in the decision reported in Kunhiparan v. Venkiteswara Naicken, 1967 KLT 646 : (AIR 1968 Ker 38) (FB) held that the real test is whether the transfer was intended by the parties for the enjoyment of the property by the transferees or whether it was intended solely to secure the amount advanced by him. 13. The document is styled as a usufructuary mortgage. Possession of the property was surrendered to the mortgagee. Rs. 25/- was paid by way of loan. The mortgagee was asked to take the yield from the property and adjust the same towards interest. That itself shows that the property was not a barren land. The term of mortgage is only for one year. The mortgagee was directed to surrender possession on receipt of mortgage money and value of improvements, if any, effected. All these lead me to a conclusion that the transaction is a mortgage and as such it is liable to be redeemed. The term of mortgage is only for one year. The mortgagee was directed to surrender possession on receipt of mortgage money and value of improvements, if any, effected. All these lead me to a conclusion that the transaction is a mortgage and as such it is liable to be redeemed. I went through the judgment of the learned Sub-Judge. I do not find any reason to upset the said findings and to set aside the decree and judgment. All the questions of law are answered in favour of the respondent and against the appellant. In the result, this appeal is dismissed. Appeal dismissed.