The main legal point established is that a lessee for a term of years is a person having an interest in the property and is a necessary party to a mortgage suit. Additionally, the court clarified that the assignment of leasehold rights entitles the assignee to redeem the mortgage.

Kinkhede—This judgment will also govern Second Appeal No. 71-B of 1925. One Barkya and his brother Khondya owned Survey No. 82 of mouza Asegaon. They both mortgaged it on 8-1 12 to one Satuji. Barkya alone mortgaged his half-share in it to the plaintiff-appellant Pannalal on 15-4-16 with a condition for foreclosure. Barkya made default in payment and Pannalal therefore sued him for foreclosure and obtained a final decree for foreclosure on 11-12-19. Barkya was the sole defendant in the case. A few months before the date of the mortgage suit Barkya and Khondya granted a lease of the entire field for a term of seven years by a registered deed dated 24-6-18, Exhibit D-1, to one Amrit Narayan (D.W.3) and put him in possession of the field. The mortgagee Pannalal did not join the lessee as a party to the mortgage suit. In pursuance of the final decree for foreclosure the plaintiff took formal possession of his mortgagor's share through Court on 11-2-20, Exhibit P-4; the actual possession however remained with the lessee.

2. The prior mortgagee Satuji, who is the father of the present respondent Rajaram entered into a transaction with his mortgagors Barkya and Khondya evidenced by the registered sale deed dated 9-3-22 whereby in consideration of Rs. 2,500 the latter assigned their interest in the property mortgaged to him. Out of the consideration Rs. 1,900 were due on account of the prior mortgage. Rs. 300 were agreed to be paid to the lessee Amrit in full satisfaction of his right of enjoyment of the lease-hold property for the unexpired term of three years (1332 to 1334 Fasli) and the balance Rs. 300 was to be paid in cash. A sum of Rs. 300 was paid to the lessee that very day and. the lessee delivered possession of the property to Satuji. A formal document of the transfer of the leasehold rights which had remained to be executed was actually executed by Amrit in favour of Satuji on 26-6-23, Exhibit D-2.

3. On the strength of the title acquired by Pannalal as a co-occupant be instituted suit No. 310 of 1922 on 18-12-22 against Satuji for pre-emption and possession of Khndya's half-share on the ground that Satuji failed to serve him with a notice as required under S. 206 of the Berar Land Revenue Code, and also claimed possession of Barkya's half-share on the ground that by virtue of the foreclosure Barkya bad no right to transfer the same to Satuji. On 6-6-23 the defendant Satuji filed his written statement asserting that he had a right to retain possession of the field in his capacity of an assignee of the lessee's rights for the unexpired term of the lease and that in the same capacity he had a right to redeem the plaintiff's mortgage inasmuch as the original lessee Amrit was a necessary party to the foreclosure suit, but the plaintiff bad improperly omitted to join him as a party to that suit. The plaintiff contested Satuji's right to redeem and urged that he (Satuji) could not claim to redeem in that suit. Satuji instituted an independent Suit No. 142 of 1923 on 10-7-23 for redemption in the same Court. That suit was stayed till the disposal of Suit No, 310 by agreement of parties.

4. The Court of first instance held that as the present respondent was a prior mortgagee purchaser, and the plaintiff appellant was a subsequent mortgagee who had foreclosed, the latter was not entitled to get back the half share of Barkya without redeeming the prior mortgage, but that ho was entitled to exercise his right of pre-emption in respect of the other share in his capacity of a co-occupant. A decree for pre-emption was accordingly passed to that effect, It was further held that the lessee Amrit should have been joined as a party to the mortgage suit, that the foreclosure decree did not therefore affect his rights as a lessee and could not bind him or the defendant who acquired possessory rights including the lease, but that as the leasehold rights had terminated and in fact were surrendered there was a merger of the leasehold rights