Effect on right of mortgagee.

The third defendant, who is one of the legal representatives of the original mortgagor is the appellant. The first respondent as assignee of the suit mortgage, dated 9th September, 1937, sued on it and asked for sale of a part of the hypotheca in default of payment. Most of the alienees of parts of the hypo-theca have been impleaded as defendants in addition to the legal representatives of the original mortgagor who died in about 1942. Various defences were raised of which the substantial one was whether the properties mentioned in the plaint B schedule were liable for the mortgage amount and whether the suit was not barred under the provisions of the Madras Act XXVI of 1948. Among the other minor questions were whether the plaint B schedule properties formed part of the mortgage and whether the debtors were not entitled to the benefits of the Madras Act IV of 1938. On all these questions, the 1st respondent succeeded.

The mortgage was by one S.K. Muhammed Aliar Marakayar for repayment of a sum of Rs. 15,000 on a number of items of properties of which Perayur village was one which was admittedly an undertenure estate in the zamindari of Ramanatha puram. The entirety of the village being the subject-matter of the mortgage, there is no doubt that the pannai lands therein also would form part of the hypotheca. On the other question as to the applicability of the Madras Act IV of 1938, no argu-ents have been addressed to us. We also think that the Court below on that question came to the correct conclusion. The matter in controversy thus turned only on whether the pannai lands in the Perayur village could be proceeded against in execution of the mortgage decree.

The zamin of Ramanathapuram was notified and taken over under the provisions of Act XXVI of 1948, with effect from 9th September, 1949 and the notification included the undertenure estate. The contention for the mortgagor before the Court below was that the effect of the notification under section 3(b) of the Act was that the undertenure village in its entirety on and from the date of the notification stood transferred to and Vested in the State Government free of all encumbrances so that the rights of the mortgagee could only be worked out as provided by the Act land against the compensation awarded to the landlholder in respect of the under-tenure estate. On the other hand, what was urged for the mortgagee was that compensation was paid by the Government only for the melvaram interest of the landholder and as, for the pannai lands, the landholder was entitled to get a ryotwari patta, there was only a change of tenure and no transference of ownership and that, therefore, execution could be levied against the pannai lands. The Court below relied on the terms of section 59 (1) (b) and allowed execution.

The same contention is reiterated by the appellant before us but on slightly different reasoning. It is said that as a result of the notification, the title of the landholder to the entirety of the undertenure estate was extinguished as such including the pannai lands and that having regard to the scheme of the Act, the remedy of the mortgagee whose rights cease as against the Government and against the interest of he landholder in the quondam estate is entirely confined to the compensation paid or to be paid to the landholder under the Act. If the landholder is entitled to a ryotwari patta for pannai lands and is granted one, that is a conferment on him under the provisions of the Act and is a new right. The bar under section 59 is comprehensive so as to preclude the mortgagee from proceeding against the property for which the landholder has obtained, a ryotwari patta even on the principle of substituted security. This argument is countered for the first respondent on the ground that the effect of the notification is a qualified one so far as ryoti or pannai lands are concerned, that in respect of such lands, patta granted to the landholder is related to his p