RSA No. 97 of 2003 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH RSA No.97 of 2003 Decided on : 05-05-2009 Om Parkash and others ....Appellants VERSUS Roshan Lal and others ....Respondents CORAM:- HON'BLE MR. JUSTICE MAHESH GROVER Present:- Mr. Vikram Singh, Advocate for the appellants. Mr. N.C.Kinra, Advocate for the respondent nos. 42 to 44. MAHESH GROVER, J This is defendants' second appeal directed against the judgments of the learned Trial Court dated 3.6.1999 and that of the learned First Appellate Court dated 3.4.2002. The plaintiffs-respondents filed a suit for declaration pleading that they may be declared as owners in possession of the suit property which was mortgaged by one Tek Chand alongwith possession with Kishna Ram, Parma Ram, Hovna Ram, Khilanda Ram on 22.6.1917 for a consideration of Rs. 25,000/- and it was agreed that mortgagees were to enjoy the usufruct of the mortgaged property in lieu of the interest on the amount of mortgage. Kishna Ram died leaving behind Jasoda Bai, Pyari Bai, Asi Bai as legal heirs. Thereafter, Smt. Pyari Bai also died leaving behind Partap Atma, Ishwar sons and Radha daughter. Asi Bai has also died leaving behind Chander Vati, Kaushalya and Asa Nan as legal heirs. Khilanda Ram has also died leaving behind Takan Dass, Roshan Dass, Ram Lal, Om Parkash, RSA No. 97 of 2003 2 Chetni Bai, Durga Wati, Laj Wanti, Kaushalya. Similarly, Parma Ram has also died leaving behind Roshan Lal and Vir Bhan as his legal heir. Vir Bhan is survived by Tulsi Bai, Inder Sain, Surinder, Vishan Devi, Vimal Devi. It was pleaded that since the land had not been redeemed, the rights of the defendants stood extinguished by efflux of time. It was further pleaded that this mortgage had been created prior to the partition and after partition the land which was described in the plaint was allotted to them in lieu of the land which was left behind in Pakistan including the land qua the mortgaged land. During the consolidation proceedings, in lieu of the land allotted, the land which was detailed in para no.7 of the plaint was allotted to the successors-in-interest of the original mortgagees and mortgagors. Thereafter, Manohar Lal and Jawahar Lal sons of Tek Chand brought a civil suit against Kishna Ram and others seeking redemption of the mortgaged property which was dismissed on 21.8.1971. Kishna Ram and other plaintiffs had denied right of redemption and asserted that they have become owners of the mortgaged property by lapse of time. Thereafter, adverse possession of the plaintiffs was continuous and to the knowledge of the defendants and in view of these circumstances, defendants have no right to redeem the mortgage. The defendants-appellants contested the suit and pleaded that the mortgage did not come to an end because of the efflux of time. The land still being recorded in the revenue record as under mortgage and therefore, the question of adverse possession does not arise. Both the parties went to trial on the following issues:- 1. Whether Tek Chand son of Tula Ram mortgaged with RSA No. 97 of 2003 3 possession the suit land, alleged?OPP. 2. Whether the plaintiffs have become owners of the land, fully detailed and described in para no.4 of the plaint, as averred?OPP. 3. Whether the plaintiffs are entitled to the relief of injunction, as prayed for?OPP. 4. Whether the suit is not maintainable in the present form?OPD. 5. Whether the plaintiffs have no locus standi to file the present suit?OPD. 6. Whether the suit is barred by time?OPD. 7. Whether the plaintiffs have no cause of action to file the present suit?OPD. 8. Whether the suit is not properly valued for the purpose of court fees and jurisdiction?OPD. 9. Whether the plaintiffs are estopped by their own act and conduct to file the present suit?OPD. 10.Whether the suit is bad for non-joinder of necessary parties?OPD. 11.Relief. Both the Courts decreed the suit of the plaintiffs and held that since the land had been mortgaged in the year 1917 and the suit was brought in the year 1981 after lapse of 70 years it is barred by limitation and the suit having been not brought within the statutory period of 30 years which has to be taken from 1917, the land could not be redeemed. This has resulted in the filing of the present regular second appeal. RSA No. 97 of 2003 4 It has been contended by the learned counsel for the appellants that the findings recorded by both the Courts below are incorrect and that the matter is now squarely covered by the judgment rendered by the Full Bench in 'Ram Kishan and others V. Sheo Ram and others' 2008(1) PLR 1. The aforesaid contention of the learned counsel for the appellants could not be rebutted by the learned counsel for the respondents. In Ram Kishan's case (supra), Full Bench has observed as under:- “31. After considering the aforesaid judgments, we respectfully agree that the view of the Full Bench of this Court in Lachhman Singh's case (supra) and that of Patna High Court in Jadubans Sahai's case (supra). The provisions of Section 60, 62 and 67 of the Transfer of Property Act are not applicable within the jurisdiction of this Court. Therefore, these provisions are required to be interpreted keeping in view the principles of equity and good conscious. Since the mortgage is essentially and basically a conveyance in law or an assignment of chattels as a security for the payment of debt or for discharge of some other obligation for which it is given, the security must, therefore, be redeemable, on the payment or discharge of such debt or obligation. That is the view of the Hon'ble Supreme Court in Pomal Kanji Govindji's case (supra) wherein it has also been held that poverty should not be unduly permitted to curtail one's right to borrow money. Since at one point of time the mortgagor for one or the other reason RSA No. 97 of 2003 5 mortgaged his property to avail financial assistance on account of necessities of life, the mortgagor's right cannot be permitted to be defeated only on account of passage of time. The interpretation sought to be raised by the mortgagees is to defeat the right of mortgagor and is wholly inequitable and unjust. The mortgagee remains in possession of the mortgaged property; enjoys the usufruct thereof and, therefore, not to lose anything by returning the security on receipt of mortgage debt. Section 60 of the Act is general in nature applicable to all kinds of mortgagees including usufructuary mortgage which is evident from clause (b) of Section 60 of the Act, where the mortgagee in possession of the mortgaged property is required to deliver possession to the mortgagor. But Section 62 of the Act is a special provision dealing only with the rights of usufructuary mortgagor. In terms of clause (a) of Section 62 of the Act. The suit is for possession after the mortgage comes to an end by self redeeming process as the mortgagee is authorised to pay himself the mortgage money from the rents and profits of the property. The mortgagee has to look to the rents and profits only to repay himself and when his entire charge is so liquidated he must re-deliver possession of the mortgaged property to the mortgagor. However, in terms of clause (b) of Section 62 of the Act, the right of the mortgagor will arise only after rents and profits derived by the mortgagee out of the usufruct of the mortgaged property are adjusted towards the interest or the principal and on mortgagor paying RSA No. 97 of 2003 6 the balance in the manner prescribed. In such mortgages, rents and profits are to be set off against interest and the mortgagee is entitled to retain possession until such time as the mortgagor chooses to redeem on payment of the principal sum secured. Such right for possession will accrue after the mortgage money is paid off. 32. The limitation of 30 years under Article 61(a) begins to run "when the right to redeem or the possession accrues". The right to redemption or recover possession accrues to the mortgagor on payment of sum secured in case of usufructuary mortgage, where rents and profits are to be set off against interest on the mortgage debt, on payment or tender to the mortgagee, the mortgage money or balance thereof or deposit in the court. The right to seek foreclosure is co- extensive with the right to seek redemption. Since right to seek redemption accrue only on payment of the mortgage money or the balance thereof after adjustment of rents and profits from the interest thereof, therefore, right of foreclosure will not accrue to the mortgagee till such time the mortgagee remains in possession of the mortgaged security and is appropriating usufruct of the mortgaged land towards the interest on the mortgaged debt. Thus, the period of redemption or possession would not start till such time usufruct of the land and the profits are being adjusted towards interest on the mortgage amount. In view of the said interpretation, the principle that once a mortgage, always a mortgage and, therefore, always redeemable RSA No. 97 of 2003 7 would be applicable. 33.The argument that after the expiry of period of limitation to sue for foreclosure, the mortgagees have a right to seek declaration in respect of their title over the suit property is not correct. From the aforesaid discussion, it is apparent that the mortgage cannot be extinguished by any unilateral act of the mortgagee. Since the mortgage cannot be unilaterally terminated, therefore, the declaration claimed is nothing but a suit for foreclosure. It is equally well settled that it is not title of the suit, which determines the nature of the suit. The nature of the suit is required to be determined by reading all the averments in the plaint. Such declaration cannot be claimed by an usufructuary mortgagee. Thus, we prefer to follow the dictum of law laid down by the larger Bench in Seth Ganga Dhar's case (supra) as well as judgments of Hon'ble Supreme Court in Jayasingh Dnyanu Mhoprekar's case(supra), Pomal Kanji Govindji's case (supra), Panchanan Sharma's case (supra) and Harbans's case (supra), in preference to the judgments relied upon by the mortgagees in Prabhakaran's case (supra) and Sampuran Singh's case (supra). 34. Therefore, we answer the questions framed to hold that in case of usufructuary mortgage, where no time limit is fixed to seek redemption, the right to seek redemption would not arise on the date of mortgage but will arise on the date when the mortgagor pays or tenders to the mortgagee or deposits in Court, the mortgage money or the balance thereof. RSA No. 97 of 2003 8 Thus, it is held that once a mortgage always a mortgage and is always redeemable.” Noticing the aforesaid observations and also noticing the fact that the controversy is squarely covered by the aforesaid judgment, the appeal which raises following question of law:- “Whether any time limit is prescribed for redeeming the usufructuary mortgage” is answered on the basis of the aforesaid Full Bench judgement. The appeal is allowed and the judgments and decree of the Courts below are hereby set aside. May 05 , 2009 (Mahesh Grover) rekha Judge