In mortgage suits for recovery, the limitation period is twelve years, not three, as clarified in this case, overriding claims of earlier judgments.

JUDGMENT :

RMT. TEEKAA RAMAN, J.

For the sake of convenience, the parties are referred to as per their ranking in the suit.

2. The unsuccessful plaintiff is the appellant herein.

3. The plaintiff, who is a Mutual Benefit Fund Company, filed the suit against the defendant, who is a borrower, under Order VII Rule 1 read with Order XXXIV Rule 4 of the Code of Civil Procedure, namely, mortgage suit, for foreclosure of the loan availed by the defendant.

4. The plaint proceeds on the basis that the defendant borrowed loan by executing two simple mortgage deeds, dated 09.05.1994 and 02.06.1994, for a sum of Rs.1,50,000/- and Rs.40,000/- respectively at the rate of 18% interest per annum and mortgaged the property situated at Door No.6, Venkatarama Iyer Street, Chennai-79 and the loan amount was to be repaid by taking two recurring deposits bearing Nos.507 and 513. The term of repayment of the loan amount is 80 months i.e., till 02.02.2001.

5. According to the plaintiff, as per Clause 6(vi) of the mortgage deeds, the plaintiff is empowered to sell the mortgaged property either by privately or by public auction, without the intervention of the Court, as per Section 69 of the Transfer of Property Act, 1882.

6. As per Clause 6(ii), the defendant agreed not to alienate the mortgaged property, without the written permission of the plaintiff. 7. As per Clause 6(viii), the plaintiff was empowered to file a suit or initiate other proceedings for recovery of the amount due to the plaintiff and for sale of the mortgaged property through Court and for other reliefs.

8. Further, according to the plaintiff, the defendant paid only a sum of Rs.1,52,192/- towards the abovesaid mortgage and on repeated demand notices, the defendant failed to discharge her liability and hence, she became a chronic defaulter, thereby the plaintiff brought the mortgaged property to sale by a public auction as per the auction notice dated 24.08.1999.

9. At that stage, the defendant filed a suit for redemption in O.S.No.6408 of 1999, on the file of the XVI Assistant City Civil Court, Chennai, with a false account, as if the total outstanding due was only Rs.38,000/-, and after filing of the said suit, the defendant had paid a sum of Rs.72,800/- as per the conditional order dated 12.02.2001, passed by the Court directing her to pay a sum of Rs.75,000/- on or before 27.02.2001.

10. After elaborate enquiry and trial conducted in the said suit i.e. O.S.No.6408 of 1999, a decree was passed on 12.09.2005, dismissing the above suit for redemption, wherein it was observed that the defendant herein is liable to pay a sum of Rs.7,40,518/- after giving credit to all the payments made by her before and after filing the said suit.

11. In such circumstances, the plaintiff passed a resolution in the Board Meeting held on 26.02.2006 to claim only principal and interest waiving onerous service charges. After deducting the onerous service charge, the plaintiff restricted their claim to a sum of Rs.5,14,048/- with further interest till the date of recovery.

12. The defendant filed her written statement stating that the suit in O.S.No.6408 of 1999 filed by her for redemption was dismissed and based on the findings rendered therein, the present suit has been filed by the plaintiff. Since it is a money suit, after three years, the suit is barred by limitation.

13. Before the Trial Court, the authorized agent of the plaintiff was exa