The intention of the party in whose hands the rights come together is crucial in determining whether two rights, which coalesce, have merged. The legal position regarding a superior and an inferior right was discussed, emphasizing that both rights will exist separately unless there is a clear intention to merge the inferior in the superior, or it was to the interest of the person, in whom the rights unite, to have merged them.

1. The only question in this case is whether the tenancy right held by the respondent prior to Ex. D1 merged in it, when he took that document on 10th February 1959 The trial court held that there was merger; but the lower appellate court held that there was no merger.

2. Ex. D1 was a mortgage (nadappupanayam) for Rs. 325/-executed by the appellant to the respondent. The document recites that the property was already outstanding with the respondent on a lease; and that the same is put in the possession of the respondent under the mortgage. It recites further that the respondent will appropriate the income of the property towards the interest of the mortgage money; and that he should properly look after the property and pay the Government revenue. The recital continues that the respondent is entitled to be so in possession until the mortgage money is paid; and that at some proper time the mortgagor will satisfy the mortgage money and obtain release of the right.

3. The question whether two rights, which coalesced in the hands of the same person, have merged, the smaller in the larger, the inferior in the superior, is a question of the intention of the party in whose hands the rights come together. If he wants to keep them separate, it can be done; and there cannot be any doubt regarding this proposition. The further question is when the intention is not quite clear, what results. Thus, the first question in this case is whether the respondent intended to keep the rights separate, so that, in case one of them ceased to exist he could take advantage of the other. In other words, did he intend to keep alive his earlier tenancy, so that, when the mortgage was redeemed, he could claim the tenancy? Formerly, it was thought that a mortgage right was a larger or superior right and a tenancy right a smaller or subordinate one, so that, if both the rights united in the same hands, the tenancy right merged in the mortgage right. It is now doubtful, in the light of the Land Reforms Act and the Tenancy Acts, whether a tenancy right is inferior to a mortgage right. It may even be otherwise. At any rate, it is not necessary to decide, the first question in this case, because, if the circumstances prevailing at the time when both the rights came into the hands of the same person indicated that it was in his interest to have kept the two rights separate, it must be presumed that he intended to keep them separate. In the recent ruling of the Supreme Court in Jyotish Thakur v. Tarakant Jha (AIR. 1963 S. C. 605) the Supreme Court has said that while the union of the superior and the subordinate interests will not automatically cause a merger, merger will be held to have taken place if the intention to merge is clear and not otherwise; and that is the absence of any express indication of intention, courts will proceed on the basis that the party had no intention to merge, if it was to his interest not to merge and also if a duty lay on him to keep the interests separate. This is the answer of the Supreme Court to the second question; and the second question alone need be considered in this case.

4. I shall now advert to the circumstances and the wording of Ex. D1 in the light of the above observation of the Supreme Court. In February 1959, when Ex. D1 came to be executed, the circumstances were such that the tenancy right of the respondent was quite a valuable right; and it cannot be thought that it was to his interest to have merged such a valuable right in the mortgage right, which might be redeemed at any moment. It is only reasonable then to presume that in the above circumstances, the respondent could have had no intention to merge the tenancy right, because it was not to his interest to have merged it. The recitals in Ex. D1 also do not indicate any positive intention to merge. Therefore, there could not have been any merger.

5. The decision of Velu Pillai J. in Godasankara Valia Raja v. Tharappan Vareed (1961 K. L. T. 138) has been b