1971 Supreme(P&H) 126
PUNJAB & HARYANA HIGH COURT
D.K.Mahajan, J.
Hari Singh
Versus
Chand Singh
Second Appeal No. 173 of 1961,
Decided On : JULY 29, 1971
The purchase of the equity of redemption by a mortgagee merges the mortgage in their favor, and there is no subsisting mortgage that can be redeemed by a subsequent mortgagee.
Headnote:
REDEMPTION OF MORTGAGED LANDS ACT, 1938 - SECTION 101 OF THE TRANSFER OF PROPERTY ACT, 1882 - PURCHASE OF EQUITY OF REDEMPTION BY MORTGAGEE - EFFECT - MERGER OF MORTGAGE - VALIDITY OF REDEMPTION ORDER - PARTIAL REDEMPTION.
Fact of the Case:
Plaintiffs, mortgagees of two parcels of land, purchased the equity of redemption from the mortgagor's widow. Defendant No. 1, a subsequent mortgagee, applied to the Collector for redemption of the previous mortgage in favor of the plaintiffs. The Collector ordered redemption, and defendant No. 1 took possession of the land. Plaintiffs filed a suit for possession, claiming that the redemption order was illegal as there was no subsisting mortgage.
Finding of the Court:
The court held that the purchase of the equity of redemption by the plaintiffs merged the mortgage in their favor, and there was no subsisting mortgage that could be redeemed by defendant No. 1. The court also held that Section 101 of the Transfer of Property Act, 1882, which allows a mortgagee to purchase the equity of redemption without causing the mortgage to merge, did not apply in this case as the plaintiffs did not intend to keep the mortgage alive.
Issues: 1. Whether the order of the Collector for redemption was valid in view of the plaintiffs' claim that the mortgage in their favor no longer subsisted. 2. Whether there could be a claim for partial redemption.
Ratio Decidendi: 1. Section 101 of the Transfer of Property Act, 1882, allows a mortgagee to purchase the equity of redemption without causing the mortgage to merge, but this does not mean that the mortgagee is obliged to do so. 2. In this case, the plaintiffs did not intend to keep the mortgage alive, and the purchase of the equity of redemption merged the mortgage in their favor. 3. As a result, there was no subsisting mortgage that could be redeemed by defendant No. 1, and the Collector's order for redemption was illegal.
Final Decision: The court allowed the appeal, set aside the judgments and decrees of the lower courts, and decreed the plaintiffs' suit for possession of the land.
1. In order to arrive at a correct decision in this second appeal, it is necessary to set out the facts not only in detail but also with precision. In the decisions of the courts below there is considerable confusion of thinking both on the question of law as well as on the questions of fact. To say the least I have derived a very little assistance from the decisions rendered by the courts below.
2. Naraina was the owner of the land with which we are concerned. He mortgaged a parcel of this land (hereinafter referred to as the first parcel) to Hari Singh, Chand Singh and Kaka Singh sons of Bhola Singh on 23-12-1984 which will be equal to 1927 A. D. In the year 1928 A. D. he created a further charge on this very land in favour of the mortgagees. He again mortgaged another parcel of the land (hereinafter referred to as the second parcel of land) to Teku and Harnama. Teku sold his mortgagee rights in the second parcel of land to the extent of 1/2 to Hari Singh, Chand Singh and Kaka Singh. Naraina then died. He was succeeded to by Roor Singh. On the death of Roor Singh, his widow Smt. Bhagwan Kaur created a fresh mortgage on the said two parcels of land, along with some other land in favour of Chand Singh, Mukhtiar Singh and Nihal Singh sons of Sadha Singh. The mortgagees of the first parcel of land are the plaintiffs and the mortgagees from Smt. Bhagwan Kaur (hereinafter described as defendant No. 1) are the parties to the present litigation.
3. It is also alleged that Smt.Bhagwan Kaur relinquished her right of redemption in favour of her daughter but the lower appellate Court found that there was, in fact, no valid relinquishment. This matter does not require any further consideration.
4. Defendant No. 1 applied to the Collector under the Redemption of Mortgaged Lands Act for redemption of the previous mortgage in favour of the plaintiffs. During the pendency of the application Smt. Bhagwan Kaur sold the equity of redemption and whatever land she had obtained from Naraina to the plaintiffs. The plaintiffs in the application for redemption before the Collector urged that the same was not maintainable because they were no longer the mortgagees of the land. They had become the owners of the equity of redemption and the mortgage had merged into it. This connection was overruled. An order for redemption was passed in favour of defendant No. 1. In consequence of that order defendant No. 1 took possession of the land.
5. This led to the present suit by the plaintiffs for possession of the land on the ground that the order of redemption passed by the Collector was illegal in as much as there was no subsisting mortgage, which could be redeemed. The suit was contested by defendant No. 1. A large number of issues were framed on the pleadings of the parties and they are set out below:-
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1. Whether the defendants have taken possession of the disputed land in execution of the order of Collector, Sangrur dated 22-1-1959?
2. If issue No. 1 is proved whether the suit in the present form is maintainable?
3. Whether the order of the Collector dated 22-1-1959 whereby he ordered the redemption of the disputed land is illegal and as such is not binding on the plaintiffs?
4. Whether Khasra numbers mentioned in paras Nos. 4 and 5 of the plaint have been wrongly described?
5. Whether Bhagwan Kaur mortgaged the disputed land with defendant No. 1 for a period of five years? If so what is its effect?
6. Whether Bhagwan Kaur was not the owner of the disputed land when the same was mortgaged by her in favour of defendant No. 1?
7. Whether land measuring 11 Bighas and 16 biswas described in para No. 5 of the plaint was sold by one Teku in favour of the plaintiff? If so what is its effect?
8. Whether Bhagwan Kaur on 14-7-1958 sold the disputed land along with some other land to the plaintiff and Karnail Singh defendant No. 2? If so what is its effect?
9. Whether the suit is properly valued for purposes of court-fee?
10. Whether the plaint has not been