Headnote:(i) Code of Civil Procedure, 1908-Section 100-Second Appeal-Appreciation of evidence on issue of question of fact-Unsustainable-Suit for redemption by purchaser-Vendors allegedly heir s of mortgagor-Trial Court and first appellate Court on appreciation of evidence giving concurrent finding that plaintiff did not prove that vendors were heirs of mortgagor-Further finding suit was barred by limitation-High Court reappreciating evidence and holding that vendors were heirs of mortgagor and suit not barred by limitation-High Court committed error not only in law but also on facts-High Courts judgment set aside. (Paras 16 & 17)
       (ii) Limitation Act, 1963-Article 134-Suit for redemption-In case mortgagee sold property-Suit must be filed within 12 years when mortgagor comes to know of transfer-Plaintiff must aver and prove suit is within 12 years of his knowledge-Date of registration of transfer would be deemed knowledge-No burden or duty on defendant to prove knowledge on part of plaintiff-Burden would shift to defendant to prove his case-Bona fide of purchaser not material-All that is required is a purchase for valuable consideration.
       A Suit for redemption of mortgage could be filed within 60 years. But if the mortgagee had created an interest in excess of the right enjoyed by him then to recover possession against the third party the Suit had to be filed within 12 years of the transfer becoming known to the Plaintiff. The rational in cutting down the period of 60 years to 12 years is clear. The 60 years period is granted as a mortgagee always remains a mortgagee and thus the rights remain the same. However when an interest in excess of the interest of the mortgagee is created then the third party is not claiming under the mortgagee. The position of such a person could not be worse than that of a rank trespasser who was in open and hostile possession. As the title of the rank trespasser would get perfected by adverse possession on expiry of 12 years so also the title of such transferee would get perfected after 12 years. The period of 12 years has to run from the date of knowledge by the Plaintiff of such transfer. It is always for the party who files the suit to show that the Suit is within time. Thus in cases where the suit is filed beyond the period of 12 years, the Plaintiff would have to aver and then prove that the Suit is within 12 years of his/her knowledge. In the absence of any averment or proof, to show that the suit is within time, it is the Plaintiff who would fail. Whenever a document is registered the date of registration becomes the date of deemed knowledge. In other cases where a fact could be discovered by due diligence then deemed knowledge would be attributed to the Plaintiff because a party cannot be allowed to extend period of limitation by merely claiming that he had no knowledge. (Para 20)
       It is entirely erroneous to hold that Article 134 would not apply to a transaction of mortgage where an interest in excess of the right of the mortgagee has been created. (Para 23)
       In Article 134 the Legislature has purposely omitted the words "bona-fide". All that is required is a purchaser for valuable consideration. (Para 24)
       In the instant case in evidence there is no deposition that the predecessors in title were not aware of these transactions. The mortgagee i.e. Hanuman and the purchasers i.e. Ram Charan Teli and Ramraj and Lakshman were put in possession of the property sold to them. There was no attempt to hide these transactions. The moment that the respective person i.e. Hanuman, then Ram Charan Teli and then Ramraj and Lakshman took possession the predecessors were put to notice that some right had been created in favour of a third party. With a little diligence and minimal enquiry it could have been found out what that right was. The fact that there is no evidence that the predecessors in title were not aware clearly establishes that they were aware. The suit is only filed on 6th December 1960. On this date it is clearly time barred. The High Court has seriously erred in forgetting that it was for the Plaintiff to aver and to prove that her predecessors had no knowledge of this sale or its nature. There is no such averment or proof. The High Court is itself commenting on the fact that it has not been able to find any evidence that the predecessors had knowledge. What the High Court forgets is that in para 4 of the plaint a reference is made to this sale. Thus the 1st Respondent and her predecessors had knowledge of this sale. It was for them to aver and prove that their knowledge was within 12 years of the suit. It was for them to aver and prove that they had no knowledge of the nature of this transaction. Even after repeated questions from Court the learned counsel for the Respondent could not show to us any averment or proof that this knowledge was within 12 years of the suit. Also to be remembered that Lakhan purchased from Ram Charan Teli on 20th December, 1954. How did the High Court expect him to depose about knowledge of plaintiff predecessors about the transaction of 26th October, 1942. To be remembered that Ram Charan Teli was put in possession of the property and started staying there with his family. It is impossible to believe that the predecessors would not know that a stranger had started residing there. A simple enquiry would disclose under what rights he was staying there. Advisably there is no averment that the predecessors were not aware of this transaction or its nature and advisably nobody stepped into the witness box to state that they were not so aware. There was no burden or duty on the Defendants to prove knowledge on part of the Plaintiff. It is only after, and if, the Plaintiff first averred and then proved that the suit was within 12 years of the date they gained knowledge of the transaction that the burden will have shifted on the Defendant to show that the Plaintiff claims is false. In the absence of any such averment and proof the plaintiff must fail. No question arose of the Defendants having to show that the Plaintiff or her predecessors had knowledge. By wrongly casting the burden on the Defendant and by ignoring the fact that the Plaintiff had neither averred nor proved that her predecessor did not have knowledge of the transaction prior to 12 years of the filing of the suit, the High Court has seriously erred in law. (Paras 22 & 24)

Judgement Key Points

Key Points: - The suit for redemption can be governed by 60 years, but if interest in excess of the mortgagee's right is created, the suit against third parties must be filed within 12 years of the transfer becoming known to the plaintiff. (!) (!) (!) - Article 134 applies to such transactions involving transfers by mortgagee for valuable consideration, omitting bona-fide; deemed knowledge upon registration dates; burden on plaintiff to prove timely filing and knowledge. (!) (!) (!) - High Court erred in re-appreciating facts and considering documents to prove heirs of Lakshamania; proper standard is that predecessors' relationship is a question of fact and must be proven; mere documentary statements without witnesses are insufficient. (!) (!) (!) - The Supreme Court set aside the High Court ruling, holding limitations issues against the Respondent, including time-bar for transfers (1942, 1948) and knowledge dated from registration or due diligence. (!) (!) (!) - The appellate court held that sale transfers created interests in excess of the mortgagee and thus limited their effect under Article 134; the appeal allowed and suit dismissed. (!) (!)

What is the proper limitation period for a suit for redemption of mortgage where an interest in excess of the mortgagee's right is created?

What is the effect of creating an interest in excess of the mortgagee's right on the applicability of Article 134 of the Limitation Act?

What are the appropriate considerations for determining whether predecessors in title were heirs of Lakshamania for limitation and title questions?

JUDGMENT

S.N. Variava, J.-This Appeal is against an Order dated 13th July 1982 in a Second Appeal No. 2100 of 1973 wherein the High Court has proceeded to appreciate evidence and on questions, purely of fact, overruled concurrent findings of facts by two Courts below. Cross objections have been filed by the 1st Respondent against directions in the impugned Judgment to have ascertained, amongst others, the state of the different parts or portions of the suit property and improvements made therein and their value.

2. Briefly stated the facts are as follows :

On 30th August 1902 Smt. Lakshamania widow of Narayan Sonar mortgaged two houses and twenty trees in favour of Ram Charan Sonar. The mortgage was for a sum of Rs. 499/-. It is claimed by the Appellants that Ram Charan Sonar and his brother Swaroop Sonar were already staying in the suit property with Narayan Sonar. The said Smt. Lakshamania died on 3rd November, 1908.

3. One Smt. Piyari, claiming to be the nearest heir of the husband of Smt. Laxmina, filed Suit No. 328 of 1908 and made a claim to the suit property. This Suit was dismissed on the ground that Smt. Piyari was not an heir of Shri Narayan or of Smt. Lakshamania.

4. One Shri Bharat Sonar, claiming to the heir of Smt. Laxmina, filed Suit No.17 of 1914 making a claim to the suit property. This Suit was also dismissed on the ground that Shri Bharat Sonar was not an heir of Smt. Laxmina. In this Suit Ram Charan Sonar and Swaroop Sonar had averred, in their written statement, that the suit property had come to them under an oral Will by Shri Narayan. Thus as far back as in 1914/1915 Ram Charan Sonar and Swaroop Sonar set up a title adverse to the estate. To be remembered that Swaroop Sonarwas not a mortgagee under the mortgage deed of 1902.

5. On 12th September 1916 Ram Charan Sonar and Swaroop Sonar executed a mortgage in favour of one Hanuman. This mortgage was in respect of one of the houses (which for sake of convenience is called the southern house.) The mortgage was for a fixed period of 10 years. Thus the rights of the mortgagor to redeem within the period of 10 years was being affected. Also, as indicated above, Swaroop Sonar was not a mortgagee. He had already claimed ownership of this property in suit No.17 of 1914. Now he was mortgaging as owner. Thus an interest in excess of the interest of the mortgagee was being created. The mortgagee Hanuman was put in possession of the southern house as a mortgagee.

6. On 26th October, 1942 Ram Charan Sonar sold a part of the other house (which for sake of convenience is called the northern houses) to one Ram Charan Teli. We have seen the sale deed. Ram Charan Saran described the northern house as "my personal property". Thus Ram Charan Sonar sold not as a mortgagee but as an absolute owner. Thus again an interest in excess of the interest of a mortgagee was created. Ram Charan Teli was put in possession of the house sold to him.

7. On 4th December, 1948 Appellant No. 8 (who is the son of Ram Charan Sonar) along with Appellant No. 9 (who is the son of Swaroop Sonar) sold the southern house to Ramraj and Lakshman. The Sale Deed was registered on 15th January, 1949. Ramraj and Lakshman were given a right to redeem the mortgage from Hanuman. The sale was also on the footing that the sellers were owners of the property.

8. On 20th December, 1954 Ram Charan Teli sold the house to Lakhan and Mahavir Kandu. They were put in possession of the house.

9. Ram Raj and Laxman filed Suit No. 85 of 1959 against Hanuman for redemption of the mortgage. In the Suit objections were sought to be taken by some of the predecessors in title of the present Respondent No.1. That Suit was compromised and on the basis of the compromise a decree for redemption was passed against Hanuman and in favour of Ram Raj and Lakshman.

10. By two sale deeds dated 1st March 1960 and 21st March 1960 Sita Ram, Ganesh, Bechni, Rajwanti, Bhoju and Bhuwel, claiming to be the heirs of Smt. Laxmina, sold their equity of re

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2000 Supreme(SC) 1498

What is the proper limitation period for a suit for redemption of mortgage where an interest in excess of the mortgagee's right is created?

What is the effect of creating an interest in excess of the mortgagee's right on the applicability of Article 134 of the Limitation Act?

What are the appropriate considerations for determining whether predecessors in title were heirs of Lakshamania for limitation and title questions?

Cases Referred (7)