PATNA HIGH COURT
Reuben and Narayan JJ.
Bibi Ganshul Fatma
Versus
Badri Singh
Appeal From Appellate Decree No. 626 of 1948 ;
Decided On : NOVEMBER 29, 1951
BIHAR TENANCY ACT - SECTION 171 - MORTGAGE - STATUTORY MORTGAGE - ACCOUNTING - LIABILITY OF MORTGAGEE IN POSSESSION.
Fact of the Case:
Plaintiffs sued for a preliminary decree for rendition of accounts and a declaration that the usufructuary mortgage as well as the statutory mortgage created by the deposit under S. 171 of the Bihar Tenancy Act had been satisfied. The defendants resisted the claim, contending that the plaintiffs were not entitled to possession of the property until they deposited the entire amount which they were liable to pay to the defendants.
Finding of the Court:
The court held that a decree for rendition of accounts should have been passed in this case as there were two mortgages to be satisfied, one being the usufructuary mortgage and the other being the statutory mortgage created by the operation of Sec.171 of the Bihar Tenancy Act. The court further held that a mortgagee in possession is liable to account for the rents and profits of the mortgaged property.
Issues: Whether the plaintiffs were entitled to a preliminary decree for rendition of accounts and a declaration that the usufructuary mortgage as well as the statutory mortgage created by the deposit under S. 171 of the Bihar Tenancy Act had been satisfied.
Ratio Decidendi: The court relied on the provisions of S. 171 of the Bihar Tenancy Act and the decision of the Division Bench of this Court in MUNGE LAL V/s. SAGARMAL, 15 Pat 481, to hold that a statutory mortgage is created by the operation of Sec.171 of the Act and that the rights and liabilities of the mortgagor and the mortgagee will have to be governed by the law which applies to mortgages in general.
Final Decision: The appeal was allowed, the judgment and decree of the lower appellate Court were set aside and it was directed that a preliminary decree for redemption and accounts be passed in favour of the plaintiffs.
Narayan, J.
1. This is a plaintiffs appeal arising out of a suit in which the main prayer was that a preliminary decree for rendition of accounts be passed in favour of the plaintiffs. The facts are these: Plaintiff No. 1 had a holding with an area of 5 bighas 8 kathas 16 dhurs of which the annual rental was Rs. 10-10-6. Out of this holding he gave 2 bighas 1 katha 17 dhurs in usufructuary mortgage to the defendants for a consideration of Rs. 335 by a document which was executed on the 2nd September 1927. Thereafter, the landlord obtained two rent decrees with regard to this holding. one of which was for Rs, 53-9-6 and the other for Rs. 75. The defendants as mortgagees deposited the amounts payable under the decrees and, in accordance with the provisions of S. 171 of the Bihar Tenancy Act, obtained possession of the remaining portion of the holding. The possession of the remaining portion of the holding was delivered to the defendants on the 18-1-1943 and on the 1st of September 1943 the plaintiff No. 1 sold the entire holding to the plaintiffs Nos, 2 & 3.
2. The plaintiffs allegation was that the entire dues of the defendants had been satisfied from the income of the property and that after a proper accounting the plaintiffs would now be entitled to recover Rs. 1387-4-0 from the defendants. The main relief sought, as already pointed out, was a preliminary decree for rendition of accounts and a declaration to the effect that the usufructuary mortgage as well as the statutory mortgage created by the deposit under S. 171 of the Bihar Tenancy Act had been satisfied. It was also prayed that possession of the property be delivered to the plaintiffs Nos. 2 and 3.
3. The claim was resisted by the defendants, and their contention was that the plaintiffs were not entitled to the possession of the property until they deposited the entire amount which they were liable to pay to the defendants. The defendants further alleged that on a proper accounting it is they who would be entitled to get a sum of Rs. 1602-2-9 from the plaintiffs.
4. The Court of first instance dismissed the suit and the Court of appeal below confirmed the decision of the learned Additional Subordinate Judge.
5. The lower appellate Court was of opinion that until the plaintiffs deposited the entire amount of the decree with interest thereon they were not entitled to possession of the holding, and the learned Additional District Judge relied on a decision of this Court in RAM LAL V/s. THAKUR DAS, AIR (25) 1936 Pat 94. In our opinion a decree lor rendition of accounts should have been passed in this case in as much as the settled view appears to be that, whenever there is a deposit under Sec.171 of the Bihar Tenancy Act and the mortgagee making the deposit takes possession on the property, a statutory mortgage is created in his favour.
In fact, therefore, there were two mortgages in this case to be satisfied, one being the usufructuary mortgage and the other being the statutory mort-gage which had been created on account of thej operation of Sec.171 of the Bihar Tenancy Act. As pointed out by a Division Bench of this Court in MUNGE LAL V/s. SAGARMAL, 15 Pat 481, though Sec.171 of the Act provides that the payment of money to save a holding or tenure from sale will create a mortgage by the operation. of the law in favour of the man who pays the money, the rights and liabilities of the mortgagor and the mortgagee will have to be governed by the law which applies to mortgages in general. In RAJES-WAR PRASAD V. RAJANI NATH, 35 Cal W N 678, it was pointed out that when a person makes a payment under Sec.170 of the Bengal Tenancy Act, he is, under Sec.171(1) (c) entitled as a mortgagee to possession of the tenure or holding in respect of which the payment is made and, under Sec.171(2) he has also a further remedy to sue for the enforcement of the statutory mortgage after giving up possession of the tenure or holding concerned, and that, if such a person avails himself
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