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2006 DIGILAW 3225 (MAD)

V. Janarthanan v. Alemelu Animal

2006-11-24

A.KULASEKARAN

body2006
Judgment : A. KULASEKARAN, J. The defendant in O. S. No. 819 of 1995 and the plaintiff in O.S. No. 2732 of 1990 is one and the same, who is the appellant in these second appeals. 2. Since these second appeals arose out of the common judgment and decree of the lower appellate Court and the appellant and the respondent in these second appeals are also one and the same, they are disposed of by this common judgment by consent of the learned counsel on either side. 3. The appellant herein, in both the second appeals, filed the suit in O.S. No. 2732 of 1990 before the 2nd Additional District Munsif Court, Coimbatore, seeking for a decree and judgment, directing the respondent herein, to receive the sum of Rs. 5,000/-due to her, under the usufructuary mortgage dated 16.2.1971 from the appellant herein, and to issue receipt therefor, entering into full satisfaction of the said mortgage and to put appellant herein in vacant possession of the suit property and the said suit was decreed as prayed for. The respondent herein, also filed the suit in O. S. No. 819 of 1987 before the District Munsif Court, Coimbatore, for injunction, restraining the appellant herein, from interfering with her possession of the suit property, which was dismissed. As against the judgment and decree of the trial Court made in O. S. No. 2732 of 1990 and O. S. No. 819 of 1987, the respondent herein filed appeals in A. S. Nos. 47 of 1995 and 53 of 1995 before the 2nd Additional District Judge, Coimbatore, which were allowed by the common judgment and decree dated 23.12.1994. Aggrieved by the same, these second appeals have been filed. 4. The facts, which resulted in filing of these second appeals, are as follows: The appellant is the owner of the land to an extent of 2.63 acres comprised in Ka. Sa. No. 200 of Pannimadai Village,Coimbatore Taluk. The appellant and the respondent herein entered into agreement, Exhibit A-1, which is called as usufructuary mortgage by the appellant thereby a sum of Rs. 5,000/- was paid by the respondent to the appellant herein, who delivered the suit property to her for a period of five years. It was agreed by the appellant herein, that he would repay the said sum of Rs. 5,000/- was paid by the respondent to the appellant herein, who delivered the suit property to her for a period of five years. It was agreed by the appellant herein, that he would repay the said sum of Rs. 5,000/- after the expiry of said period of five years and in the event of repaying the said sum of Rs. 5,000/-, the respondent herein should hand over vacant possession of the suit property to the appellant herein. On the very same day, i.e., on 16.2.1971, Exhibit B-4, varthaman letter, dated 16.2.1971 was also entered into between them, which was an arrangement of the lease between them and the adjustment of the yearly rent of Rs. 1,200/-towards interest payable on the said sum of Rs. 5,000/- received by the appellant herein. After expiry of five years, the appellant herein, said to have approached the respondent herein, for delivery of vacant possession of the suit property, which was not acceded by her and hence, the appellant herein has filed a petition in O. A. No. 221 of 1979, Exhibit A-2 before the Revenue Court for eviction, which was dismissed by order dated 24.3.1987. Exhibit A-1 did not disclose any landlord and tenancy relationship since it is stated that the appellant herein was entitled to recover possession only after the repayment of Rs. 5,000/-was made and the Revenue Court had no jurisdiction to try the issue. Hence, the suit in O. S. No. 2732 of 1990 for eviction against the respondent herein on receipt of Rs. 5,000/-has been filed. The respondent also filed the suit in O.S. No. 819 of 1987 against the appellant herein restraining him from interfering with her possession of the suit property. The trial Court decreed O.S. No. 2732 of 1090 and dismissed O.S. No. 819 of 1987 and the appeal filed by the respondent herein were allowed by the lower appellate Court. Hence, these second appeals have been filed. 5. Before the trial Court, the respondent marked Exhibits A-1 to A-10 and examined the respondent herein as P.W.1 and one Duraisamy as P. W. 2 and the appellant herein marked Exhibits B-1 to B-7 and examined the appellant herein as D. W. 1. 6. Hence, these second appeals have been filed. 5. Before the trial Court, the respondent marked Exhibits A-1 to A-10 and examined the respondent herein as P.W.1 and one Duraisamy as P. W. 2 and the appellant herein marked Exhibits B-1 to B-7 and examined the appellant herein as D. W. 1. 6. The trial Court, considering both the oral and documentary evidence, particularly relying on Exhibits A-1 and B-4, came to the conclusion that Exhibit A-1 is the usufructuary mortgage, on which basis only, the possession of the suit property was delivered by the appellant herein to the respondent. The trial Court also considered the oral evidence of P. W. 1 and 2, who have deposed that the appellant herein was in possession of half of the suit property, well, and coconut trees and suit was filed by them only by way of abundant caution, hence, there was no evidence the respondent interfered in his possession and decreed the suit in O. S. No. 2732 of 1990 as prayed for and dismissed the suit in O.S. No. 819 of 1987 filed by the respondent for bare injunction. 7. The lower appellate Court, considering the oral and documentary evidence, allowed the appeals filed by the respondent herein, on the ground that Exhibits A-1 and B-4 came into existence on the very same day; that on a combined reading of Exhibits A-1 and B-4, it would be known that there was a lease arrangement between the appellant and the respondent; that the appellant filed O.P. No. 221 of 1979 before the Revenue Court, wherein he called himself as a landlord arraying the respondent as tenant; that even in the earlier suit in O.S. No. 772 of 1972 filed by the appellant herein for permanent injunction against the respondent, he stated that the respondent was only a tenant; that in view of the fact that the appellant himself claimed the relationship of lessor/lessee, not as usufructuary mortgagor, he was not entitled to seek eviction on the ground of usufructuary mortgage. 8. 8. The learned counsel for the appellant has submitted that where the question to be decided is as to whether the transaction is a lease or mortgage, the only guiding rule that can be extracted from the case on the subject is that the intention of the parties which must be looked into as laid down by the Apex Court in the case of Ramdhan Puri v. Bankey Biha Saran and Others Ramdhan Puri v. Bankey Biha Saran and Others Ramdhan Puri v. Bankey Biha Saran and Others AIR 1958 SC 941 ; that the trial Court considering the said legal position rightly decreed the suit filed by the appellant in O.S. No. 2732 of 1990 and dismissed the suit filed by the respondent O.S. No. 819 of 1987; that Exhibit A-1 in clear terms speaks that the transaction is only an usufructuary mortgage and while so, the decision of the lower appellate Court that it is a lease is untenable in law since the respondent failed to deliver possession of the suit property after the expiry of five years as stipulated in Exhibit A-1; that the appellant herein has filed a petition in O. P. No. 221 of 1979 before the Revenue Court and the said O.P. was dismissed on the ground that it has no jurisdiction; that therefore, the appellant filed the suit for recovery of possession; that Exhibit B-4 also supports the case of the appellant that Exhibit A-1 is only a usufructuary mortgage; that the respondent, without paying any amount, has been in possession and enjoyment of the suit property to an extent of 2.63 acres ever since 1971; that the findings of the lower appellate Court that Exhibit A-1 is a lease transaction is contrary to Sections 58 and 105 of the Transfer of Property Act and also the judgment rendered by the Apex Court in the case of Ramdhan Puri v. Bankey Biha Saran and Others Ramdhan Puri v. Bankey Biha Saran and Others Ramdhan Puri v. Bankey Biha Saran and Others (supra) and prayed for setting aside the judgment and decree of the lower appellate Court, wherein it was held as under: “ 5. From the aforesaid summary of the recitals in the document, the following facts emerge: (1) The executant owed large sums of money to the other party; (2) Interest @ ½ per cent per month was agreed to be paid on the sum of Rs. 29,496/- i.e. on the entire consideration excluding that amount which was advanced by the thikadars to the executant; (3) The manner of discharging the debt was prescribed in the document, namely, that during the subsistence of the thikdari interest, the other party would receive the rent from the thikadars and appropriate Rs. 1,769-12-0 on account of interest and pay a sum of Rs. 435-4-0 as rent to the executant and that after the expiry of the thikadari interest, the other party would take physical possession of the land and appropriate the produce towards interest and pay only a sum of Rs. 435-4-0 as rent to the executant; (4) On the expiry of 15 years’ period or after the extended period, the executant would pay the entire principal amount to the other party; (5) 8 annas share in the mauza was specifically given as security for the amount payable by the executant. Under the document, there was a relationship of creditor and debtor between the parties and the property was given as security for the payment of the amount advanced with interest. Though the document is described as a cowle, the parties, who have had earlier transactions, must be deemed to have known the nature of the transaction they were entering into. In clear and express terms, the nature of the transaction has been stated in more than one place. The executant, requested the other party in respect of the advance amount and interest, to get executed by him a usufructuary mortgage deed bearing a lower rate of interest in respect of the 8 annas share. After mentioning the various terms, the executant stated the intention of the parties in the following terms: “In security of the payment of the peshgi money with or without interest mentioned in this ijara, I, the executant, have mortgaged, hypothecated, encumbered and made liable the ijara property.” 9. The learnedcounsel for the respondent has submitted that in Exhibit A-1 lease deed, the quantum of yearly rent agreed at Rs. The learnedcounsel for the respondent has submitted that in Exhibit A-1 lease deed, the quantum of yearly rent agreed at Rs. 1200/- is mentioned, however, the said amount was agreed to be adjusted towards the interest; that based on the said tenancy agreement, the case was filed by the appellant herein before the Revenue Court and also O. S. No. 772 of 1972; that in view of the fact that the respondent was treated as tenant all along, the present suit filed under the pretext of usufructuary mortgage is untenable in law and prayed for dismissal of these second appeals. 10. This Court carefully considered the arguments of the learned counsel on either side and perused the material records placed. 11. S. A. No. 1399 of 2005 was not admitted, but S. A. No. 637 of 2006 was admitted on the following substantial questions of law: • 1. Whether the nomenclature given to a document by the parties is indicative of their intention will override the other words mentioned in the documentse • 2. Whether once a debt is created with security of land for its redemption, such arrangement between the parties can be termed only as mortgage or whether it can be named as some other nature of documentse • 3. Whether the lower appellate Court has considered the oral and documentary evidence and legal possession while reversing the considered judgment of the trial Courte It is needless to mention that the same substantial questions of law are involved in S. A. No. 1399 of 2005 also. 12. The appellant and the respondent herein entered into Exhibit A-1. On perusal of Exhibit A-1, dated 16.2.1971, it is seen that the parties therein referred to it as lease deed. Exhibit B-4, dated 16.2.1971 executed by the appellant in favour of the respondent is referred to as Varthaman Letter, in which the arrangement of lease between the respondent and the appellant and the mode of adjustment of yearly rent of Rs. 1,200/- are also found mentioned. As per Exhibit A-1, after receipt of Rs. 5000/- from the respondent, the appellant herein handed over possession of the suit property. It was agreed between the parties that the period was for five years and that on repayment of Rs. 5000/- by the appellant to the respondent, the respondent should hand over possession of the suit property to the appellant. 5000/- from the respondent, the appellant herein handed over possession of the suit property. It was agreed between the parties that the period was for five years and that on repayment of Rs. 5000/- by the appellant to the respondent, the respondent should hand over possession of the suit property to the appellant. In this case, the yearly rent was fixed at Rs. 1200/-. Admittedly the respondent did not pay any rent, which is admittedly adjusted towards interest. Exhibit B-4, Varthaman Letter came into existence on the day of Exhibit A-1. No doubt, it speaks about the lease between the appellant and the respondent and adjustment of yearly rent of Rs. 1200/- towards the interest payable on the amount of Rs. 5000/- paid by the appellant to the respondent. Exhibit B-4 further supports the contention of the appellant that it is only a usufructuary mortgage and not a lease. In view of the fact that the respondent did not pay any rent and the same was adjusted towards interest for the amount of Rs. 5000/-, gathering the intention of the parties, this Court is of the considered view that the findings arrived at by the trial Court that Exhibit A-1 is a usufructuary mortgage is valid and the same is confirmed. 13. . The lower appellate Court set aside the judgment and decree of the trial Court on the ground that the appellant herein, in earlier proceedings before the Revenue Court, treated the said transaction as a lease and that while so, it is not open to the appellant to take a different stand that it is a usufructuary mortgage, for which it relied upon only the pleadings in the revenue original petition proceedings without noticing the order of dismissal and reason for dismissal on terms of Exhibit A-1 and surrounding circumstances. In this context, it is necessary to refer to the submission made by the learned counsel for the appellant that the Revenue Court refused to grant relief sought for by the appellant on the ground that the transaction was not a lease. The appellant, in his suit, made his claim based on Exhibit A-1. When deciding the right of the parties, the lower appellate Court ought to have taken into consideration of the pleadings, oral and documentary evidence, but it failed. 14. The appellant, in his suit, made his claim based on Exhibit A-1. When deciding the right of the parties, the lower appellate Court ought to have taken into consideration of the pleadings, oral and documentary evidence, but it failed. 14. The first substantial question of law is whether the nomenclature given to a document by the parties is indicative of their intention which will override the other words mentioned in the documents. The second substantial question of law is whether once a debt is created with security of land for its redemption, such arrangement between the parties can be termed only as mortgage or whether it can be named as some other nature of documents. 15. The question is to be decided with reference to the predominant intention of the parties as gathered from the recitals and the precise terms of the documents and the surrounding circumstances, including the conduct of the parties. 16. Now, we look into the recitals of Exhibit A-1, which runs as follows: The above said Tamil version extracted from Exhibit A-1 says that the suit property is without facility of electricity motor for irrigation and the well is to be desilted and also reclaimed (sic) the land, hence, the appellant herein, borrowed from the respondent a sum of Rs. 1,500/- on the date of execution of Exhibit A-1 and the respondent agreed to pay further sum of Rs. 3,500/- at the time of registration of the said Exhibit A-1, thus, a total sum of Rs. 5,000/- is received by the appellant and agreed to instal motor pumpset within a period of seven days facilitating drawing of water from the well for irrigation for suit land and in view of the same, the appellant transferred the property to the respondent. The said recital discloses that Exhibit A-1 is only a mortgage. If it is a lease, transfer of the right to enjoy the property alone be made. The said recitals further disclose that the land was given as security for repayment of the said amount, hence, Exhibit A-1 has to be treated as mortgage. The said recital discloses that Exhibit A-1 is only a mortgage. If it is a lease, transfer of the right to enjoy the property alone be made. The said recitals further disclose that the land was given as security for repayment of the said amount, hence, Exhibit A-1 has to be treated as mortgage. Now, we look into the decision of the Honourable Supreme Court, reported in Fuzhakkal Kuttappu v. C. Bhargavi and Others Fuzhakkal Kuttappu v. C. Bhargavi and Others Fuzhakkal Kuttappu v. C. Bhargavi and Others AIR 1977 SC 105 : (1997) 1 S.C.C. 17 wherein in paras 6 and 14, it was held thus: “ 6. In construing a document like the one before us, it is always necessary to find the intention of the party executing it. The intention has to be gathered from the recitals and the terms in the entire document and from the surrounding circumstances. How the parties or even their representatives-in-interest treated the deed in question may also be relevant. It is also well settled that the nomenclature given to a document by the scribe or even by the parties is not always conclusive. The word ‘otti’ as such, used in the document is not, therefore of much consequence. 14…..Even so, there is one most essential feature in a mortgage which is absent in a lease, that is, that the property transferred is a security for the repayment of debt in a mortgage, whereas in a lease it is a transfer of a right to enjoy the property….” In Kaveripatnam Subbaraya Setty Annaiah Setty Charities Trust v. S.K. Viswanatha Setty Kaveripatnam Subbaraya Setty Annaiah Setty Charities Trust v. S.K. Viswanatha Setty Kaveripatnam Subbaraya Setty Annaiah Setty Charities Trust v. S.K. Viswanatha Setty (2004) 8 SCC 717 wherein in para 12, it was held thus: “ 12. The guidelines for deciding whether a transaction is a lease or a mortgage contemplate that the name given to the document is not conclusive. The question has to be decided with reference to the predominant intention of the parties as gathered from the recitals and the terms of the documents and the surrounding circumstances including conduct of the parties. In the case of a mortgage, there is a transfer of interest to secure repayment of debt and in the case of a lease, there is a transfer of a right to enjoy the property. In the case of a mortgage, there is a transfer of interest to secure repayment of debt and in the case of a lease, there is a transfer of a right to enjoy the property. (See Mullas Transfer of Property Act, 9th Edn., p. 621). In the case of Puzhakkal Kuttappu v. C. Bhargavi it has been observed that the nomenclature given to a document by the writer or even by the parties is not always conclusive. In construing a document, it is necessary to find out the intention of the parties executing such document. Such intention has to be gathered from the recital, the terms in the document and from surrounding circumstances. When there is a document of a composite character disclosing features of mortgage and lease, the Court will nave to find out the predominant intention of the parties executing the document viewed from the essential aspect of the reality of the transaction.” 17. In view of the above said discussion, the first and second questions of law are answered against the respondents. 18. The thirdsubstantial question of law is whether the lower appellate Court has considered the oral and documentary evidence and legal position while reversing the considered judgment of the trial Court. When the lower appellate Court, while reversing the judgment and decree of the trial Court had ignored and misread important evidence on record and has failed to refer to the important features of the evidence and has also failed to give any reason to rebut the grounds taken and the reasons assigned by the trial Court and has rather failed to take stock of the entire materials on record, that decision is bad. While reversing the judgment of the trial Court, the first appellate Court should consider the evidence and also reasonings of the trial Court and give its own reasons for not agreeing with the findings of the trial Court. While reversing the judgment of the trial Court, the first appellate Court should consider the evidence and also reasonings of the trial Court and give its own reasons for not agreeing with the findings of the trial Court. Applying the above said settled law in this case and also on perusal of the decree and judgment passed by the trial Court as well as the first appellate Court, this Court is of the view that the first appellate Court has failed to discuss Exhibits A-1 and B-4 as well as the evidence of P.W. 1, which was threadbare discussed by the trial Court to arrive at a conclusion that the transaction is usufructuary mortgage, but the first appellate Court has not assigned any valid reasons for not agreeing with the findings of the trial Court, hence, it is not difficult for this Court to hold that the first appellate Court failed to consider the oral and documentary evidence and also the legal positions, which are discussed above, thus, the third substantial question of law is also answered against the respondent. 19. In view of the above said discussions, the judgment and decree of the lower appellate Court is liable to be set aside and the judgment and decree of the trial Court is liable to be restored. 20. In the result, these second appeals are allowed. The judgment and decree of the lower appellate Court is set aside and the judgment and decree of the trial Court is restored. No costs. Consequently, the connected C.M.P. is closed.