Back
SUPREME COURT OF INDIA
HEMANT GUPTA, A.S. BOPANNA, JJ.
Narayan Deorao Javle (Deceased) Through Lrs. - Appellant
Versus
Krishna & Ors. - Respondents
Civil Appeal No. 4726 of 2021 (Arising out of SLP (Civil) No. 13575 of 2015)
Decided On : 17-08-2021
(A) Transfer of Property Act, 1882 – Sections 60 and 91 – Civil Procedure Code, 1908 – Order XXXIV Rule 1 – Redemption of mortgage – Equity of redemption means a right to redeem property based upon equitable principles – Right of redemption recognised under the Act is a statutory and legal right which cannot be extinguished – Plaintiff having stepped into shoes of mortgagor in respect of land purchased by him has right to redeem land mortgaged – Equity of redemption is a right which is subsidiary to right of ownership – Such right is not over and above right of ownership purchased by plaintiff – Expression equity of redemption is a convenient maxim but an owner, who has stepped into shoes of mortgagor, after the purchase from mortgagor but before filing a suit for foreclosure is entitled to redeem property in terms of Section 60 of Act – Findings recorded by High Court that appellant is bound by decree passed in suit for foreclosure is not tenable because appellant was not impleaded as a party, though mandated under Section 91 of Act and Order XXXIV Rule 1 of Code – Subsequent conduct of mortgagee who has taken possession from appellant also corroborates fact that mortgagee was aware of factum of sale and possession of appellant but still have chosen not to implead him as a necessary party – Right conferred by Section 60 of Act does not stand extinguished by decree of Court which is to be binding and had to be passed in presence of necessary parties and should not be collusive – Decree passed in suit for foreclosure is a decree which is void and non-est – Decree passed at back of transferee mortgagor prior to filing of suit for foreclosure cannot be said to be a valid decree – Decree of foreclosure passed in suit filed by mortgagee will not extinguish right of mortgagor to redeem land in view of fact that he was not impleaded as a party in suit though he has purchased part of mortgaged property by virtue of registered sale deed – Judgment of High Court set aside and that of First Appellate Court restored. (Paras 13, 15, 16, 19, 23, 27, 28, 30 and 31)
(B) Civil Procedure Code, 1908 – Order XXI Rules 101 and 103 read with Section 11 Explanation VII – Stay of execution – An application for stay of execution does not have any trapping of a decree as is contained in Order XXI Rules 101 & 103 of Code – Only effect of filing of an application for stay of execution would be that appellant can be said to be aware of fact that there is a decree for foreclosure passed against him which has not been stayed by virtue of order of Court – There is no determination of claim as is contemplated in terms of Order XXI Rule 97 or Rule 99 of Code having force of decree – Declining of stay of execution will not operate as res judicata only because Section 11 Explanation VII of Code is applicable to execution as well. (Paras 21 and 22)
Facts of the case:
Plaintiff is in appeal aggrieved against the judgment of High Court of Judicature at Bombay dated 21.1.2015 whereby suit for redemption of mortgage land was dismissed, setting aside judgment of the First Appellate Court and restoring that of Trial Court.
Findings of Court:
The appellant is given three months’ time to deposit the mortgage amount and when the amount is deposited, he shall be entitled to seek restoration of possession which was taken from him in execution of a decree of foreclosure. The Executing Court shall ensure that the delivery of possession be given to the appellant in an expeditious manner.
Result : Appeal allowed.
JUDGMENT :
HEMANT GUPTA, J.
1. The plaintiff is in appeal aggrieved against the judgment of the High Court of Judicature at Bombay dated 21.1.2015 whereby the suit for redemption of mortgage land was dismissed, setting aside the judgment of the First Appellate Court and restoring that of the Trial Court.
2. Brief facts leading to the present appeal are that defendant Nos. 1 and 2 were owners of the land comprising in Survey Nos. 67/3 and 65/1 in Village Veni, Taluka Lonar. The said defendants mortgaged the land in favour of defendant No. 3 on 30.4.1954 (Ex.81) to secure a sum of Rs.700/-. Defendant Nos. 1 and 2 sold the mortgaged land comprising in Survey No. 67/3 admeasuring 1 acre 32 gunthas to the plaintiff vide registered sale deed for consideration of Rs.1000/-. Thus, the plaintiff stepped in the shoes of the mortgagor on account of the sale transaction.
3. The original mortgagee (defendant No. 3) filed a Regular Civil Suit No. 237 of 1965 for recovery of mortgage amount of Rs.700/-along with the interest accrued against the original mortgagors (defendant Nos. 1 and 2). The plaintiff was not impleaded as a party in the said suit, though the sale in his favour was before the filing of the suit. A preliminary decree was drawn based on a compromise whereby the defendant Nos. 1 and 2 agreed to pay the mortgage amount on or before 27.3.1967. Since defendant Nos. 1 and 2 failed to pay the said amount, the preliminary decree was converted into a final decree on 4.6.1969 which led to foreclosing the rights of the mortgagor to redeem the property. In execution of such decree, the mortgagee had taken possession from the plaintiff, the present appellant on 5.12.1980. It is thereafter the plaintiff filed Regular Civil Suit No. 7 of 1984 against the original mortgagors and the mortgagee seeking redemption of the mortgaged property.
4. The Trial Court though dismissed the suit but returned a finding that the suit is within the period of limitation as the statutory period of redemption is of 30 years. The suit was filed on 23.1.1984 though the period of 30 years was to expire on 30.4.1984. It was also held that the plaintiff has purchased the property and not the equity of redemption. It was also held that the plaintiff filed an application before the Executing Court for a stay on the execution of the decree. However, such an order (Ex.124) will not operate as res judicata as the application was only to stay the execution and the appeal against the said order was dismissed (Ex.90). In respect of Issue No. 7(A), the Court held that the partial redemption is permissible in view of the judgment of the High Court reported as Bank of Poona v. Navrajasthan Cooperative Housing Society Ltd., AIR 1968 BOM 106, since the plaintiff has not purchased the equity of redemption, therefore, the plaintiff is not entitled to redeem part of the property though plaintiff was ready to pay the entire mortgage amount. Since the right of redemption and the right of foreclosure are coextensive, therefore, no sooner than a decree for foreclosure is passed, the right to redeem extinguishes.
5. In appeal, the First Appellate Court held that the revenue record shows that the plaintiff was in possession of the suit land after the sale deed was executed in his favour on 18.5.1964. The plaintiff is an attesting witness to the mortgage deed (Ex.81) but that will only lead to an inference that the title of the plaintiff is subject to the rights of defendant No.3 as mortgagee in respect of land purchased by him. He is, thus, a mortgagor within the meaning of Section 59A of the Transfer of Property Act, 1882,2[For short, the ‘Act’]. Therefore, in terms of Section 60 of the Act, he had a right to redeem the property provided it is not extinguished by the act of the parties or by decree of the Court. Examining as to whether the decree of foreclosure has extinguished the right of redemption available to the plaintiff, for that reliance was placed upon the judgment of the learned H
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
