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1941 Supreme(Cal) 17
CALCUTTA HIGH COURT
Sheikh Akbar Ali & Ors. - Appellant
Versus
Sheikh Mafijuddin of Islampur - Respondent
Decided On : 06-06-1941
The Provincial Legislature has the authority to regulate rights of transferor and transferee in agricultural land mortgages, and its legislation can be valid even if it contradicts existing Indian law.
Headnote:
mortgage - recovery of possession - 26G(5), Ben. Ten. Act - 62, 68, T.P. Act, and Section 37, Contract Act
Fact of the Case:
The mortgagor sought recovery of possession of the mortgaged property under 26G(5), Ben. Ten. Act, due to the expiry of 15 years from the date of the registration of the bond. The mortgagee did not contest, and an ex parte order was made. The legality of Section 26G, Ben. Ten. Act, in relation to existing Indian law was challenged.
Finding of the Court:
The court analyzed the conflict between Section 26G, Ben. Ten. Act, and Sections 62 and 68, T.P. Act, and Section 37, Contract Act. It concluded that the Provincial Legislature had the power to regulate rights of transferor and transferee in agricultural land mortgages, and the section was valid despite contradicting existing Indian law.
Issues: The key issue was the validity of Section 26G, Ben. Ten. Act, in relation to existing Indian law, specifically Sections 62 and 68, T.P. Act, and Section 37, Contract Act.
Ratio Decidendi: The court held that the Provincial Legislature had the authority to regulate agricultural land mortgages, and the section was valid. It clarified the applicability of Section 68(1)(a), T.P. Act, to different types of mortgages and emphasized the distinction between pure usufructuary mortgages and mixed mortgages.
Final Decision: The court discharged the rule, allowing the mortgagor's prayer for recovery of possession, and granted costs to the mortgagor.
ORDER
1. This rule is directed against an order dated 18th May 1940 made by the Munsif of Dubrajpur in a proceeding commenced by the opposite party u/s 26G(5), Ben. Ten. Act. In July 1922 the opposite party executed a usufructuary mortgage bond in favour of the father of the petitioners to secure an advance of Rs. 100 only received from the latter. The terms of the mortgage bond were, that the mortgagee would enjoy the usufruct of the land in lieu of interest, and that the mortgagor would take back the property on payment of the principal sum in the month of Baisakh 1332 B S. or in the beginning of any other subsequent year; and the mortgagee would go on enjoying the mortgaged properties till the money was paid. There was a further stipulation in the mortgage bond which stood as follows:
Be it further known, that if there arises any hindrance, or disturbance or you are dispossessed from the land described below, till the principal amount is fully realized; in such event I and my heirs shall be liable to you and your heirs for interest on the said principal at the rate of Re. 1-8-0 per cent. per month from the date of such disturbance, and on failure to pay the same, you shall be entitled to realize the amount from my other properties moveable and immovable, and to that neither I, nor my heirs, shall be entitled to raise any objection.
2. In 1940, the mortgagor presented an application to the Munsif at Dubrajpur u/s 26G(5), Ben. Ten. Act, for recovery of possession of the mortgaged property, on the ground that more than 15 years had elapsed from the date of the registration of the bond. The mortgagee did not appear or contest the proceeding and an ex parte order was made by the Munsif on 18th May 1940, allowing the prayer of the mortgagor opposite party. It is against this order that the present rule has been obtained. The only point that has been raised by Mr. Das who appears in support of the rule is that no legal claim could be founded on Section 26G, Ben. Ten. Act, which as an enactment of the Provincial Legislature, is void u/s 107(1), Government of India Act, 1935, on account of its being repugnant to the provisions of existing Indian law. What is said is, that Section 26G, Ben. Ten. Act, conflicts with the provisions of existing Indian law which are contained in Sections 62 and 68, T.P. Act, and Section 37, Contract Act, and as the matter relates to contracts which is entry No. 10 in the concurrent list, and no assent of the Governor-General has been obtained u/s 107(2), Government of India Act, the section is void u/s 107(1) of the Act. The point is one of considerable public importance and requires careful consideration.
3. A mortgage, as defined in Section 58, T.P. Act, is a transfer of an interest in specific immovable property for securing the payment of money or money's worth. There are two elements involved in a mortgage. In the first place there is a conveyance of some interest in land, and in the second place there is a debt to secure the payment of which the conveyance is made. Transfer or alienation of agricultural land is a Provincial subject coming under Item 21 of the Provincial list, and all contracts relating to agricultural lands are also excluded from Item 10 of the concurrent list 3. If the mortgage relates to agricultural lands, it is not disputed that it is within the competence of the Provincial Legislature to make laws which would regulate the rights of the transferor and transferee with regard to the property which is the subject-matter of the mortgage. Section 62, T.P. Act, provides, that in the case of a usufructuary mortgage the mortgagor has the right to recover possession of the mortgaged property when the debt is satisfied out of the rents and profits of the property, or in cases where the mortgagee has taken the profits in lieu of interest only, or, in part payment of the mortgage money, when the term if any prescribed for payment has expired and the balance of the mortgage money is paid or ten
