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2016 Supreme(P&H) 690

IN THE HIGH COURT OF PUNJAB AND HARYANA
Before
The Hon’ble Mr. Justice Surinder Gupta
RSA No. 376 of 1988 (O&M)
Dharam Kaur & Ors.
v.
Mohinder Singh & Ors.
{Decided on 21/04/2016}

Advocates:
For the Appellants:Mr. S.K. Garg Narwana, Senior Advocate with Mr. Naveen Gupta, Advocate.
For the Respondents:Ms. Alka Sarin, Advocate.

Headnote:(A) Transfer of Property Act, 1882, S.58--Usufructuary Mortgage--Determination of--

       (i) Posession of mortgage land was delivered to mortgagee;

       (ii) As per terms recorded in mutation that rent/profit from the land shall be treated as equal to interest of mortgage money and no remedy by sale or fore closure was allowed.

       (iii) Mortgage in question can be termed as usufructuary mortgage and there is no limitation for its redemption.

       (iv) Claim of plaintiff that they have become owner of land due to lapse of period of limitation for seeking redemption of its mortgage is not maintainable. (Para 21)

       (B) Transfer of Property Act, 1882, S.58--Usufructuary Mortgage--Payment of Principal and Interest--It is not one of the requirements in order to create a usufructuary mortgage that the rent/profit from the mortgage property should be utilized towards both i.e. payment of interest and for payment of mortgage money. (Para 20)

       Section 58 (d) of the Act of 1882 requires that rent and profit accruing from the mortgage property are agreed to be appropriated either in lieu of interest, or in payment of mortgage money--The word used here is ‘or’ and not ‘and’ so as to support the plea raised by learned counsel for the respondents that rent and profit of the mortgage property should have been agreed to be appropriated in lieu of interest and mortgage money. (Para 20)

       (C) Transfer of Property Act, 1882, S.58--Usufructuary Mortgage--An usufructuary mortgagee is not entitled to file a suit for declaration that he has become an owner merely on expiry of 30 years from the date of mortgage and there is no time limit to seek redemption of usufructuary mortgage. (Para 22)

       (D) Transfer of Property Act, 1882, S.58--Usufructuary Mortgage--Definition of--When the mortgagor has delivered possession of the mortgage-property to the mortgagee and authorized him to retain such possession until payment of the mortgage money, and to receive the rent/profit accruing from the property and to appropriate the same in lieu of (i) interest; or (ii) payment of mortgage money; or (iii) partly in lieu of interest or partly in payment of mortgage money, the transaction is called an usufructuary mortgage. (Para 13)

       

JUDGMENT

Mr. Surinder Gupta, J.: - This is second appeal against judgment and decree passed by then Sub Judge, Ist Class, Jhajjar, whereby suit filed by plaintiffs Mohinder Singh and others (now respondents in this appeal) was decreed for declaration that they have become “owner of land in dispute due to lapse of period of limitation for seeking redemption of its mortgage”. First appeal filed by defendants was dismissed by Additional District Judge, Rohtak.

2. Case of plaintiffs, in brief, is that Chhailu son of Kurdiya resident of village Silana (predecessor-in-interest of appellants) mortgaged suit land to Khem Chand son of Teku, predecessor-in-interest of plaintiff-respondents and a mutation in this regard bearing No. 528 dated 28.06.1899 was sanctioned. The land was got redeemed and after lapse of 30 years, plaintiffs have become owners of suit land by foreclosure.

3. Defendants-appellants denied possession of plaintiffs over suit land and their plea that they have become its owner by lapse of time.

4. Pleadings of parties led to framing of the issues as follows:-

(i) Whether plaintiffs who were earlier mortgagees in possession, became its owner by lapse of time of the land in suit? OPP

(ii) Whether the suit is not maintainable in the present form? OPD

(iii) Whether the plaintiffs have no locus standi to file the present suit? OPD

(iv) Whether the plaintiffs are estopped by their own act and conduct from filing the suit? OPD

(v) Relief.

5. Learned Sub Judge, Ist Class, Jhajjar recorded finding on issue no. 1 that under Article 61 (A) of the Limitation Act, 1963 (later referred to as ‘the Act of 1963’) the right to seek redemption has stood extinguished, as such, plaintiffs have become owners of suit land. The plea raised by defendantsappellants that mortgage was a usufructuary mortgage, as such, there is no period of limitation to seek its redemption was discarded.

6. Regarding possession over suit land, it was conceded during arguments by counsel for defendants-appellants before learned Sub Judge, Ist Class that defendants are in its possession as mortgagees.

7. Ist Appellate Court affirmed finding of learned Sub Judge, Ist Class with the observations that land is under possession of plaintiffs but discarded the plea raised by defendants that mortgage is a usufructuary mortgage.

8. Learned counsel for appellants has argued that both the Courts below have recorded findings against law that the mortgage in favour of plaintiffs was not an usufructuary mortgage. It was an oral mortgage accompanied with delivery of possession as alleged by plaintiffs in para 2 of the plaint. As per mutation No. 528 dated 28.06.1899, rent/profit of the land shall be treated as equal to interest. As per definition of usufructuary mortgage under Section 58 (d) of the Transfer of Property Act, 1882 (later referred to as ‘the Act of 1882’), mortgage falls under the category of usufructuary mortgage. The plea raised by defendants-appellants that they are in possession of suit land was given up before learned Sub Judge, Ist Class, as such, plaintiffs-respondents cannot take any benefit of that plea. In the event of plea of defendants that they are in possession of suit is accepted, the suit is not maintainable as plaintiffs have not sought possession of suit land. In this regard reliance has been placed on the observations of this Court in the case of Devi Lal vs. Shokaran and another, [2011(1) Law Herald (P&H) 549] : 2011 (2) PLR 787.

9. Learned counsel for plaintiffs-respondents has argued that the mortgage in this case was oral mortgage, which was legal and valid mortgage. This mortgage cannot be termed as usufructuary mortgage on two counts. Firstly, as per plea raised by defendants they are in possession of suit land and this means that they do not admit the delivery of possession to mortgagees; and secondly, as per term of mortgage mentioned in mutation, rent/profit of the land was to be utilized towards interest of mortgaged land, but to draw i














































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