RSA No.1834 of 1985 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH RSA No.1834 of 1985 Date of Decision: 08.04.2010 Smt.Rehmani ..Appellant Vs. Bhoorji & Ors. ..Respondents CORAM: HON'BLE MR.JUSTICE VINOD K.SHARMA Present: Mr.M.L.Sarin, Sr.Advocate, with Mr.Kabir Sarin & Ms.Alka Sarin, Advocates, for the appellant. Mr.Sudhir Aggarwal, Advocate, for the respondents. --- 1. Whether Reporters of Local Newspapers may be allowed to see the judgment? 2. To be referred to the Reporters or not? 3. Whether the judgment should be reported in Digest? --- Vinod K.Sharma,J. This is plaintiff's appeal against the judgment and decree dated RSA No.1834 of 1985 2 13.3.1985 passed by the learned courts below, vide which suit for possession by way of redemption of agricultural land situated in village Azizabad, Tehsil Palwal, District Gurgaon, was dismissed. Plaintiff/appellant filed a suit on the pleadings that he was owner/mortgagor of agricultural land bearing Khewat No. 337 Khatauni No.410, Rect. No.26, Killa No.14/1 (3-0), 17/2 (5-10), 18/1 (5-10), Khatoni No.411, Rect. No.26 Killa No.22/2 (5-7), 23(8-0) 15/1 (3-13), total measuring 40 kanals Punhana Tehsil Ferozepur Jhirka, District Gurgaon and defendant No.1 was the mortgagee of the said agricultural land. The suit land bears the following particulars of the mortgage:- (a) Date of mortgage-1. Mutation No.759 for Rs.500/- which was decided on 18.5.52. (2) Mutation No.760 for Rs.500/- (3) Mutation No.836 for Rs.400/- decided on 25.3.85. (b) Names of mortgagor and mortgagee Shri Hassan Khan mortgagor and Sh.Kanhiya Lal defendant No.1 mortgagee. (c) Sums secured Rs.500+500 Rs.400/- i.e. 1400/-, respectively. (d) Rate of interest the mortgage is with possession and the interest was equal to the produce of the land. (e) Property subject of mortgage is detailed in para No.1 of the plaint. Interest payable in view of the stipulation in the mortgage deed, was equivalent to the produce of the land. Plaintiff/appellant purchased the suit land from the owner Rassan Khan son of Salem Khan, share holder, in RSA No.1834 of 1985 3 possession of the suit land and accordingly, became successor-in-interest of the mortgagor. It was pleaded by the plaintiff that the suit land could be redeemed at any time on payment of mortgage amount. It was claimed that the plaintiff was, therefore, entitled to possession of the suit land on payment of mortgage amount of Rs.1400/- (Rupees one thousand and four hundred only). Defendants No.2 and 3 were said to be the sons of defendant No.1. Defendants No.2 and 3 were also said to be inducted as tenants by mortgagee and therefore, were liable to vacate the land on redemption. Suit was contested by the defendants by taking preliminary objections; that the suit was not within the time; plaintiff had no locus standi to file the suit and that the particulars of the land mortgaged were not given as per provisions of the Code of Civil Procedure (for short the Code) and the Rules and Orders of the High Court, therefore, plaint was liable to be rejected. Suit was said to be not properly valued for the purposes of court fee and jurisdiction. Defendant No.1 claimed to have acquired the occupancy rights in the suit land. Suit was also said to be barred by principles of res judicata. Defendants claimed that they were cultivating the suit land since their predecessors-in-interest were tenants at will for the last more than 80 years. They denied having been inducted as tenants by defendant No.1. Additional plea was taken that if it is proved that the suit land was under mortgage with defendants as alleged, in that case, plaintiff was not entitled to have actual physical possession of the suit land as the defendants were cultivating suit land under the predecessors-in-interest of RSA No.1834 of 1985 4 the plaintiff for the last more than 80 years as tenants at will and therefore, after the redemption, the tenancy rights of defendant No.1 revived and the plaintiff can claim only symbolic possession on payment of mortgage money. Defendants No.2 and 3 denied their relationship and also pleaded that they were not sub-tenants. In the replication, averments made in the written statement were denied and the facts pleaded in the plaint were reiterated. On the pleadings of the parties learned trial court framed the following issues. 1. Whether the plaintiff is the mortgagor of agricultural land detailed in para No.1 of the plaint? 2. Whether the plaintiff is entitled to redeem the suit property? If so, to what amount? 3. Whether the suit is not within time? 4. Whether the plaint is liable to be rejected as alleged? 5. Whether the suit is not properly valued for the purposes of court fee and jurisdiction? 6. Whether defendant No.1 acquired occupancy rights? 7. Whether the suit is barred by res judicata? 8. Whether the defendants are entitled to remain in possession over the suit properly even after the redemption of the suit property as tenant? 9. Relief. RSA No.1834 of 1985 5 Learned trial court took up issues No.1 and 2 together and held that the plaintiff was mortgagor of agricultural land detailed in Para No.1 of the plaint. It was held that the plaintiff was entitled to redeem suit property on payment of Rs.1400/- (Rupees one thousand and four hundred only). On issue No.3, it was held that according to law of Limitation Act 1963, mortgage could be redeemed within the 30 years from the date, when right to redeem or recover possession accrued. The learned trial court held that mutation of mortgage showed that it was sanctioned on 18.5.1982 and therefore, the suit was held to be within time. Issues No.4 and 5 were decided in favour of the plaintiff as the defendants did not press these issue. Issues No.6 and 8 were also decided against the defendants and in favour of the plaintiff, as the defendants failed to produce any evidence in proof thereof. However, on issue No.7, learned trial court held that the suit was barred by principles of res judicata, as Suit No.175 of 17.3.1975, between same parties, regarding the suit land, was dismissed on 12.10.1976. Copies of order Ex. D4 and decree sheet Ex.D5, were relied upon to support the plea of res judicata as the learned trial court was pleased to hold that the decision under Order 17, Rule 3 of the Code, in previous suit of the representative character was a decision which fell within the scope of Section 11 of the Code. In view of the finding on issue No.7, suit filed by the plaintiff/appellant was dismissed. RSA No.1834 of 1985 6 Plaintiff/appellant preferred an appeal against the judgment and decree passed by the learned trial court. Learned lower appellate court affirmed the findings of the learned trial court holding that the suit which is dismissed under Order 17, Rule 3 of the Code, is to be treated to be a judgment which would operate as res judicata. Finding on issue No.7 was affirmed and appeal was dismissed. Mr.M.L.Sarin, learned senior counsel appearing on behalf of the appellant contended, that the following substantial question of law arises for consideration in this appeal. 1. Whether the second suit for redemption of land could be held to be barred by principles of res judicata in the absence of express bar in the previous suit on the plaintiff, of his right to redeem. In support of the substantial question of law, learned senior counsel contended, that the decree passed in redemption suit, cannot operate as res judicata unless it extinguishes the right to redeem. The contention of learned senior counsel was, that while dismissing the previous suit under Order 17, Rule 3 of the Code, right to redeem did not stand extinguished. In support of this contention learned senior counsel placed reliance on the judgment of Privy Council in the case of Raghunath Singh & Ors. Vs. Mt.Hansraj Kunwar & Ors. AIR 1934 Privy Council 205, wherein the question, that when no payment was made under the old decree and suit was dismissed, could the right of mortgagor to RSA No.1834 of 1985 7 redeem the mortgage be extinguished? The question was answered as under -: “ The important question for their Lordships' consideration is third point, the answer to which depends in their view, upon a correct appreciation of the joint effect of the relevant sections of the Transfer of Property Act 1882, and the form of the old decree. It is to be noted that at the relevant date (1896) the rights of the mortgagor were governed by the Act as originally enacted: the sections hereafter cited or referred to are those of the original enactment. Further it is to be observed that the rights of a mortgagor in that part of India from which this appeal comes are regulated by the provisions of the Act. It is impossible to say (as may be said under English law) that the dismissal of a redemption action operates as a foreclosure, unless the justification of that statement is to be found in the language of the Act. The relevant sections of the Act are Ss. 60-92 and 93. S. 60 in terms confers upon a mortgagor a right to redeem at any time after the principal money has become payable. This right however is limited by a proviso which runs thus : Provided that the right conferred by this section has not been extinguished by act of the parties or by order of a Court. There is here no question of extinguishment by act of the parties. The right must therefore still exist, unless it has been RSA No.1834 of 1985 8 extinguished by order of a Court. Ss. 92 and 93 indicate how such an order can be obtained. S. 92 provides for the decree to be passed by the Court in a suit for redemption if the plaintiff succeeds. The decree is to order an account of what will be due to the defendant on the date fixed for redemption or is to declare the amount so due at the date of the decree. Further, it is to order that upon the plaintiff paying to the defendant or into Court the amount so due on a day to be fixed by the Court the defendant shall (inter alia) if necessary put the plaintiff into possession of the mortgaged property. Finally, the decree is to order: That if such payment is not made on or before the day to be fixed by the Court, the plaintiff shall (unless the mortgage be simple or usufructuary) be absolutely debarred of all right to redeem the property, or (unless the mortgage be by conditional sale) that the property be sold. Section 92 thus enacts what should be the form and contents of a redemption decree: but it enacts nothing more, if that section had been followed, the order decree would have in terms ordered that in default of payment on or before 15th November 1896 the plaintiff should be absolutely debarred of all rights to redeem the property. The Act, however by S. 93 provides a further opportunity for the defendant to obtain this relief. It provides (inter alia) that if payment is not made the RSA No.1834 of 1985 9 defendant may (unless the mortgage is simple or usufructuary) apply to the Court for an order that the plaintiff and all persons claiming through or under him be debarred absolutely of all right to redeem; and that if he so applies the Court shall pass an order that the plaintiff and all persons claiming through or under him be absolutely debarred of all right to redeem the mortgaged property. The section further enacts: On the passing of any order under this section the plaintiff's right to redeem and the security shall, as regards the property affected by the order, both be extinguished. The old decree for some unexplained reason departed from the form required by the Act. It simply provided that in case of default by the plaintiff in payment “his case will stand dismissed.” It was contended by the appellant that these words read in the light of S. 92 were to be construed as meaning that that plaintiff was to be debarred of all right to redeem, and that the order decree accordingly was an order of a Court extinguishing the right to redeem within the meaning of the proviso to S. 60. Their Lordships are of opinion that unless constrained by authority they ought not so to hold. The right to redeem is a right conferred upon the mortgagor by enactment, of which he can only be deprived by means and in manner enacted for that purpose, and strictly complied with. In the present case the only basis for the claim that the with to redeem RSA No.1834 of 1985 10 has been extinguished is S. 60; but in their Lordships' view the old decree cannot properly be construed as doing that which it does not purport to do, viz., as extinguishing the right to redeem.” Reliance was also placed on the judgment of Federal Court in the case of Thota China Subba Rao and Ors. Vs. Mattapalli Raju and Ors. AIR (37) 1950 Federal Court 1, wherein the Federal Court was pleased to lay down as under -: “12 In our opinion, the view of the Madras High Court is incorrect. We prefer the view taken by the Bombay High Court on this point. The right of redemption is an incident of a subsisting mortgage and it subsists so long as the mortgage itself subsists. As held by the Privy Council in Raghunath Singh's case, 61 I.A. 362: (AIR (21) 1934 P.C.205) the right of redemption can be extinguished as provided in S. 60, T.P. Act, and when it is alleged to have been extinguished by a decree, the decree should run strictly in accordance with the form prescribed for the purpose. Unless the equity of redemption is so extinguished, a second suit for redemption by the mortgagor, if filed within the period of limitation, is not therefore, barred. The Board expressly held that if the appellants failed to establish that the old decree extinguished the right to redeem, there was no ground for saying that the old decree operated as RSA No.1834 of 1985 11 res judicata and the Courts were prevented from trying the second suit under Section 11, Civil P. C. They therefore, held that the right to redeem was not extinguished by the procedural provisions contained in the Civil Procedure Code. 13. It was next argued on behalf of the respondents that although the right to redeem may not be extinguished the remedy was barred. In support of that contention, the learned counsel relied on the words of O. 23, R. 1 Civil Procedure Code. In our opinion, the High Court did not properly appreciate the effect of the termination of the former suit of 1929. When that suit reached hearing on 9th November 1932, the Subordinate Judge wrote a judgment in which, after reciting that the suit in forma pauperis to redeem the three mortgages was filed and for issues were raised, he stated as follows: “the plaintiff has been examined and a number of documents have been marked and suit stands posed to this day for arguments. But today plaintiff's vakil reports that he got intimation not to proceed with the case and filed the letter which he got from his client. This is not a case of withdrawal of a suit but an abandonment of it. Suit is dismissed with costs. Plaintiff shall pay the court fees to Government”. The letter from the mortgagor to the vakil is not on the record, but the terms thereof are not material as they will contain only the instructions of a lay client to his pleader. The record shows RSA No.1834 of 1985 12 that the Court was informed that the plaintiff was not proceeding with the case. The Court interpreted it as a case not of withdrawal but of abandonment and “dismissed the suit with costs.” The circumstances under which that litigation ended show that the case did not fall under the provisions of O. 23, R. 1 at all. There was not question of a formal defect, or withdrawal of a suit, or abandonment of a part of the claim. Order 23 R. 1 does not provide for a Court's order dismissing the suit. Order 9, R. 8 Civil Procedure Code is more properly applicable to the facts. The question then is whether a fresh suit fro redemption is barred under the provisions of O. 9, R. 9, Civil Procedure Code. The material part of that rule runs as follows: “O.9, R. 9.(1) Where a suit is wholly or partly dismissed under rule 8, the plaintiff shall be precluded from bringing a fresh suit is respect of the same cause of Action.” It will be noticed that the words used in the Rule are “of the same cause of Action”. The question therefore is whether the first suit, which was dismissed under O.9, R.8, was based on the same cause of action as the suit from which the present appeal arises. As pointed out by the Judicial Committee of the Privy Council in Raghunath Singh's case, 61 I. A. 362 : (A.I.R. (21) 1934 P. C. 205) the issues in the two suits for redemption are quite different. The questions are : (i) whether the plaintiff RSA No.1834 of 1985 13 (mortgagor) had the right to redeem when he filed the second suit, and (ii) what amount he was now liable to pay to redeem? The Board held in that case that the trial of these issues was not barred under Section 11, Civil Procedure Code. It follows therefore that if the right of redemption is not extinguished, provisions like O.9, R.9 or O.23, R. 1, will not debar the mortgagor from filing a second suit because, as in a partition suit, the cause of action in a redemption suit is a recurring one. The cause of action in each successive action, until the right of redemption is extinguished or a suit for redemption is time barred, is a different one.” Hon'ble Supreme Court in the case of Mhadagonda Ramgonda Patil & Ors. Vs. Shripal Balwant Rainade & Ors. (1988) 3 SCC 298 followed the law referred to above, and held that the contention on behalf of the appellants, that as a final decree was passed in the earlier redemption suit and there was a merger of the mortgage-debt in the decretal-debt and the second suit for redemption is barred, was without any substance and thus, rejected. Again in Achaldas Durgaji Oswal (dead) Vs. Ramvilas Gangabisan Heda (dead) through LRS & Ors. (2003) 3 SCC 814, it was again reiterated by Hon'ble Supreme Court that even despite expiry of the time for deposit of the mortgaged money in terms of the preliminary decree, a second suit for redemption is maintainable. RSA No.1834 of 1985 14 Mr.Sudhir Aggarwal, learned counsel appearing on behalf of the respondents, on the other hand, has supported the impugned judgment and decree and contended that once previous suit filed by the plaintiff/ appellant for redemption was dismissed under Order 17, Rule 3 of the Code, which was a judgment inter se between the parties, the provisions on Section 11 of the Code were rightly applied to dismiss the suit. On consideration, I find force in the contentions raised by the learned counsel for the appellant. It is now well settled law, that in the absence of extinguishment of right of redemption, second suit for redemption is not barred, and is not hit by principles of res judicata. Admittedly, in the previous suit right of redemption was not extinguished by passing a specific order and in the form prescribed under the Code, therefore, it could not be said that the suit was barred by principles of res judicata. Substantial question of law raised, therefore, is answered in favour of the appellant. Consequently the finding of the learned courts below on issue No.7, is reversed and it is held that the suit is not barred by principles of res judicata. The appeal is allowed and the suit filed by the plaintiff for redemption on payment of Rs.1400/- (Rupees one thousand and four hundred only) is decreed, and it is ordered that plaintiff shall pay the mortgage amount in the trial court on 30.8.2010 or on the later date upto which the time for payment may be extended by the learned court, and on RSA No.1834 of 1985 15 receipt of the payment, the defendants shall place before the court, all the documents in their possession or power relating to the mortgaged property mentioned in the plaint, and all such documents shall be delivered to the plaintiff or such other persons as he appoints, and the defendants shall reconvey the suit property to the plaintiff through the said mortgage, and clear of all encumbrances which might have been created by the defendants or any person claiming under them, or any person under whom they claim, and from all liabilities, whatsoever, arising from the mortgage or from this suit, and deliver to the plaintiff quite and peaceful possession of the property. It is further ordered, that in default of payment as aforesaid, the plaintiff and any other persons claiming through or under him be, and they shall hereby be absolutely debarred and foreclosed of, from all rights of redemption of the suit property. In case of deposit, the defendants shall deliver to the plaintiff quite and peaceful possession of the mortgaged property. The whole of liability of the plaintiff upto date, arising from the said mortgage mentioned in the plaint shall stand discharged and extinguished. Preliminary decree be drawn accordingly. Appeal allowed. No costs. (Vinod K.Sharma) 8.04.2010 Judge rp