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1923 Supreme(Mad) 18

IN THE HIGH COURT OF MARAS
Wallace
S. Parthasarathy Aiyar
Versus
M. Subbaroya Gramany And Anr.
Decided On : 17 January, 1923

The central legal point established in the judgment is the recognition of the plaintiff as a bona fide mortgagee for value without notice, entitling him to possession of the property.

Headnote:

Mortgage - Property Dispute - Transfer of Property Act, Section 3 - Succession Act, Section 187 - The court discussed the validity of the mortgage and sale transactions, the rights of the mortgagee, and the impact of the Succession Act on the case.

Fact of the Case:

The plaintiff, a mortgagee, sought possession of a property claimed by the defendant. The court found that the plaintiff was a bona fide mortgagee for value without notice and entitled to possession.

Finding of the Court:

The court found in favor of the plaintiff, holding that the defendant's resistance to the claim for ejectment was not valid, and the plaintiff was entitled to possession as a mortgagee for value without notice.

Issues: Validity of mortgage and sale transactions, rights of the mortgagee, impact of the Succession Act on the case.

Ratio Decidendi: The court held that the plaintiff was a bona fide mortgagee for value without notice, and the defendant's resistance to the claim for ejectment was not valid.

Final Decision: Judgment was entered for the plaintiff for possession and for an enquiry into mesne profits.

JUDGMENT

Walter Salis Schwabe, K.C., C.J.

1. One Jambulinga owned two adjoining houses in Mylapore. He purported to mortgage them to one Subbusami who was a brother of the husband of Meenakshi, Jainbulingas daughter. He then died and left a Will appointing his widow Mylathammal executrix and giving her power to sell his property for the purpose of paying debts and to enjoy what was left during her life, and bequeathing after her death what was left to Meenakshi. Probate has never been taken out of the Will. Some-years later, the widow purported to sell the property to Rajagopal her brother for Rs. 1,000. The documents of title were handed over to him, the sale deed was registered and in the presence of the Registrar a thousand rupees were handed over by Rajagopal to the widow. Subbusami joined in that sale by acknowledging the discharge of his mortgage which was for a larger amount, the sale deed providing that the sale was for the purpose of discharging that mortgage. Many years afterwards, Rajagopal purported to sell the property to Subbaroya Gramany for Rs. 4,000 and he, with the assistance of Rajagopal, mortgaged the premises to the plaintiff for Rs. 2,000, it being stated that Rs. 2,000 was required for the purpose of providing part of the purchase money. This suit has been brought by this mortgagee to obtain possession of the premises. Meenakshi who has been forborne time in occupation of part of one of the two houses resists the claim for ejectment alleging that the property is hers.

2. The learned Judge, who tried the case, has held that defendant Meenakshi has made out her case. He holds that all the transactions relating to this property from the time of the mortgage to Subbusami down to the sale to Subbaraya Gramany and including that sale, were benami transactions and mere shams. He holds too that the plaintiff is in no better position than Rajagopal or Subbaraya Gramany, because he is not a bona fide mortgagee for value without notice.

3. I agree with the findings of fact of the learned Judge except on two material points. I agree that the original mortgage to Subbusami by Jambulinga himself was not a real transaction. I agree that the sale by Rajagopal to Subbaraya Gramany was not a real transaction. I am prepared also to accept his view of the character and credibility of Rajagopal that he was an impecunious and unscrupulous person. But I do not agree with the inference that he has drawn from the facts put before him in relation to the sale by Mylathammal, the widow. Nor do I agree that on the facts as found by him, the plaintiff is not a bona fide mortgagee for value. No rational explanation has been offered to the Court as to why Mylathammal should have gone through the form of selling the property to her brother Rajagopal. It is suggested that she did so either, so that, Rajagopal might be trustee for Meenakshi, her daughter, and after her own death, protect the property for the benefit of the daughter against her husband; or as an alternative, that she went through a form of a real sale in order to frighten her son-in-law and make him more careful in the future in his conduct towards her and her daughter. The first of these alternatives seems to me to be incredible, for one cannot believe that the mother would hand over her property to her brother in trust after her death for her daughter in the form of an absolute conveyance without informing her daughter of the fact, and it is admitted that the daughter was never told anything about it. In doing so, she would leave her daughter at the mercy of her uncle and if the uncle died, she would leave her without evidence to attempt to recover her inheritance from the uncles heirs. The other alternative seems to me to be equally incredible. Because, in order to have the desired salutary effect upon the conduct of the son-in-law, he would have to be told of the sale, that there was a real sale, and one would have thought that he would ascertain at once that it was not a













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