IN THE HIGH COURT OF KERALAATERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN THURSDAY, THE 17TH DAYOF JULY 2014/26TH ASHADHA, 1936 WP(C).No. 16108 of 2010 (K) PETITIONER : - RAJAMMA, W/O.CHANDRAN, AGED 57 YEARS, THUPPAICHIRAYIL HOUSE, AMICHAKARI MURI, CHAMBAKULAM VILLAGE, KUTTANADU TALUK. BY ADVS.SRI.K.S.HARIHARAPUTHRAN SRI.M.D.SASIKUMAR SRI.GEORGE MATHEW SRI.DIPU JAMES RESPONDENTS : - 1. KERALA STATE HOUSING BOARD, THIRUVANANTHAPURAM, REPRESENTED BY ITS SECRETARY. 2. THE DEPUTY COLLECTOR AND CHIEF REEVENUE OFFICER, KERALA STATE HOUSING BOARD, THIRUVANANTHAPURAM. R1,2 BY ADV.POOVAPPALLY M.RAMACHANDRAN NAIR,SC.KSHB R1,R2 BY ADV.SRI.GEORGE BOBAN, SC, K.S.H.B. R1,2 BY ADV.SRI.A.JAYASANKAR, SC KSHB, TVM THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 17-07-2014, THE COURT ON THE SAME DAYDELIVERED THE FOLLOWING: WP(C).No. 16108 of 2010 (K) APPENDIX PETITIONER'S EXHIBITS : EXHIBIT P1 : TRUE COPY OF MORTGAGE DEED No. 397 DATED03.03.1993. EXHIBIT P2 : TRUE COPY OF LETTER DATED 04.11.93. EXHIBIT P3 : TRUE COPY OF THE FIRE POLICY ISSUED BY THE KERALA STATE INSURANCE DEPARTMENT DATED 04.04.1994. EXHIBIT P4 : TRUE COPY OF THE NOTICE DATED 25.03.2010. RESPONDENTS' ANNEXURES : ANNEXURE I : TRUE COPY OF THE SUMMARY DUES ON LOAN ACCOUNT IN ONE TIME SETTLEMENT. TRUE COPY P.A.TO JUDGE DMR/- K. VINOD CHANDRAN,J. W.P (c) No. 16108 of 2010 Dated this the 17th day of July, 2014 JUDGMENT
The petitioner's contentions are two fold, in so far as the challenge against the recovery proceedings, as projected in the writ petition. Both of limitation, one being that the cause of action of the Board having arisen when a default was committed and the period of limitation running from that date. The other of the recovery in any event being barred even going by the mortgage created. One of the issues on limitation is raised on the ground that the loan itself was availed by execution of a deed of mortgage on 03.03.1993, evidenced as Exhibit P1, and hence the recovery proceedings initiated after 12 years would be barred under the Limitation Act, 1963. Even going by Exhibit P1, the total period of the loan within which repayments were be effected, was 14 years from the initial grant of loan. Hence, the petitioner's repayment period ends only in 2007. The said ground of limitation hence has no legs to stand.
2. The next ground raised is with respect to clause 18 of the agreement, which entitles the respondent Board to foreclose the loan, on default committed of two consecutive instalments or on breach of any of the conditions in the agreement and proceed for possession of the property without even approaching a court of law. The contention seems to be that, the respondent Board having not invoked such provision, and not proceeded for recovery, after the default had gone beyond the two consecutive instalments as indicated in clause 18, the limitation has to run from that date.
3. Definitely, the mortgagee would be entitled to proceed in accordance with the said clause in the agreement, if the mortgagee chooses to do so. But, merely for reason of not invoking the said clause, it cannot be said that the mortgagee is interdicted for all time from proceeding, for recovery of the loan amounts.
4. The learned counsel for the respondent Board places reliance on a decision reported in Abdul Rahman and others v. Sheo Dayal and another [AIR 1934 Allahabad 152], which followed a Privy Council Decision in Lasa Din v. Mt. Gulab Kunwar and others [AIR 1932 Privy Council 207]. The issue raised in the aforesaid case was quite contrary to what is raised here. The mortgagor, therein was proceeded against on default in payment of interest, as provided in the mortgage deed. On default having occurred for an unbroken period of six months, the mortgagee filed a suit for recovery of the whole amount. The defence taken was that there had been no breach of covenant and the plaintiff had no right to sue, especially since there was no notice of the mortgagee intending to exercise his option. It was contended that, the default in payment of interest, did not make the mortgage money due, and that the mortgagee could not have proceeded against the mortgagor without a notice, in the event of which only the mortgagee would be deemed to have exercised his option to proceed against the property. Following the decision of the Privy Council in Lasa Din (supra); it was held so:
"But their Lordships have not laid down that the mortgagee who has such an option is not entitled to maintain a suit unless and until before such suit he does some act indicating that he is going to exercise his option and informs the mortgagor of such an exercise. It has been merely laid down that the option to sue in case of default is for the benefit of the mortgagee exclusively, and if he does not choose to exercise it, time does not begin to run against him.
x x x x x x x x x We are unable to hold that without previous notice or without the doing of some other act to the knowledge of the mortgagors a suit by the mortgagee is not maintainable when a default is made."
5. The ancillary issue considered was whether on such default clause being available; limitation would run from such time as the mortgagee gets the right to sue based on such a default. Abdul Rahman (supra) specifically noticed that in Lasa Din (supra), the view taken by the two Full Benches earlier was overruled. The earlier view that the mortgagee has to sue on a default being committed by the mortgagor and otherwise the period of limitation would run from such default was overruled. The Court noticed the difference between the words "payable" and "due" and found that money would become due under Article 132 of the Limitation Act only when the mortgagee can sue for his money and the mortgagor also, is enabled to redeem the mortgaged property. It was held that otherwise the mortgagor would also get a right to redeem the mortgaged property on his own default and that would lead to an impossible result. Hence, the mortgagee alone is given an option, on a default being committed to sue immediately or wait for the full period as per the deed. The proposition laid down by the Privy Council as noticed by the Allahabad High Court in the aforesaid decision does not at all help the Writ Petitioner, but negatives his contention. The ground of limitation raised on the fact that the mortgagee did not, immediately on default, file a suit or seek recovery does not hence stand against the mortgagee invoking recovery after the period of the loan, but, within the limitation period; running from the expiry of the loan period.
6. The Writ Petition hence is devoid of merit. However, considering the impecunious circumstances, the petitioner shall be granted 12 monthly instalments to satisfy the entire arrears starting from 23.08.2014 and followed up on the 23rd of every succeeding month. The respondent Board shall on production of the certified copy of this judgment issue a statement of accounts with the total arrears due as on 15.08.2014. Monthly instalments as directed above shall be in accordance with such statement of accounts and after satisfaction of the instalments, the respondent Board shall be entitled to make a further demand for future interest from 15.08.2014, which shall be satisfied on the 23rd of the next succeeding month. If the amounts are satisfied as directed herein, by deposit made to the first respondent Board, the revenue recovery proceedings shall stand closed. No further demand shall be raised against the petitioner.
Writ Petition is disposed of.
K. VINOD CHANDRAN JUDGE DMR/-