{"id":80486,"date":"2008-04-09T00:00:00","date_gmt":"2008-04-08T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/m-r-satwaji-rao-d-by-l-rs-vs-b-shama-rao-dead-by-l-rs-ors-on-9-april-2008"},"modified":"2015-04-23T22:57:42","modified_gmt":"2015-04-23T17:27:42","slug":"m-r-satwaji-rao-d-by-l-rs-vs-b-shama-rao-dead-by-l-rs-ors-on-9-april-2008","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/m-r-satwaji-rao-d-by-l-rs-vs-b-shama-rao-dead-by-l-rs-ors-on-9-april-2008","title":{"rendered":"M.R. Satwaji Rao (D) By L.Rs vs B. Shama Rao (Dead) By L.Rs. & Ors on 9 April, 2008"},"content":{"rendered":"
Supreme Court of India<\/div>\n
M.R. Satwaji Rao (D) By L.Rs vs B. Shama Rao (Dead) By L.Rs. & Ors on 9 April, 2008<\/div>\n
Author: P Sathasivam<\/div>\n
Bench: Dr. Arijit Pasayat, P. Sathasivam<\/div>\n
           CASE NO.:\nAppeal (civil)  319 of 2002\n\nPETITIONER:\nM.R. Satwaji Rao (D) by L.Rs.\n\nRESPONDENT:\nB. Shama Rao (Dead) by L.Rs. & Ors\n\nDATE OF JUDGMENT: 09\/04\/2008\n\nBENCH:\nDr. Arijit Pasayat & P. Sathasivam\n\nJUDGMENT:\n<\/pre>\n
JUDGMENT<\/p>\n
REPORTABLE<\/p>\n
CIVIL APPEAL NO. 319 OF 2002<\/p>\n
P. Sathasivam, J.\n<\/p>\n
1)\tThis appeal is directed against the final judgment dated
\n11.12.1998 of the High Court of Karnataka at Bangalore in
\nR.F. A. No. 465 of 1990 by which the High Court allowed the
\nfirst appeal filed by the respondents herein.\n<\/p>\n
2) \tThe facts, in a nutshell, are as under:\n<\/p>\n
The legal representatives of defendant No.2 are the appellants
\nin this appeal.  On 19.2.1948, the plaintiffs’ predecessor
\nexecuted a usufructory mortgage in favour of the appellants
\nherein for a sum of Rs.10,000\/-.  The terms of the said
\nmortgage deed were that the mortgagee shall remain in
\npossession of the mortgaged property without paying rent and
\nthat the mortgage amount of Rs.10,000\/- shall carry no
\ninterest.  The period of redemption was five years from the date
\nof mortgage.  However, the mortgagers continued in possession
\nof the mortgaged property as tenants of the mortgagee on a
\nmonthly rent of Rs.97.50.  As the mortgagors failed to pay the
\nrent, on 19.5.1952, the mortgagee filed suit being O.S. No.
\n120\/51-52 on the file of the Ist Munsif, Bangalore for arrears
\nof rent.  The said suit was decreed.  In pursuance of the said
\ndecree, the mortgagee (2nd defendant) filed Execution Petition
\nNo. 1002\/51-52 and the property was put on auction sale by
\nthe executing Court.  Mortgagee being the highest bidder
\npurchased the schedule property in court auction.  Sale was
\nconfirmed.  The respondents\/mortgagors neither objected for
\nthe sale nor confirmed the sale or taken any steps to set aside
\nthe sale over three decades.  On 18.2.1983, the
\nplaintiffs\/respondents, after nearly three decades, filed a suit
\nbeing O.S. No. 632 of 1983 on the file of the III Addl. City Civil
\nJudge, Bangalore for a decree of redemption of the mortgage of
\nthe suit schedule property sold in public auction as long back
\nas on 11.9.1952.  The Civil Judge, after considering both oral
\nand documentary evidence, dismissed the suit with costs on
\n31.7.1990.  Aggrieved by the said order, the plaintiffs filed
\nR.F.A. No. 465 of 1990 before the High Court.  The High Court
\nallowed the appeal decreeing the suit for redemption.  Against
\nthe impugned judgment of the High Court, the defendants filed
\nthe present appeal by way of special leave.\n<\/p>\n
3)\tHeard Mr. S.B. Sanyal, learned senior counsel appearing
\nfor the appellants, Mr. P. Vishwanath Shetty, learned senior
\ncounsel for the contesting respondent Nos. 1(i) to (vii) and 7
\nand Mr. R.P. Wadhwani, learned counsel appearing for
\nrespondent Nos. 2,3,5,6,8 & 9.\n<\/p>\n
4)\tMr. Sanyal, learned senior counsel for the appellants
\nmainly contended that the money decree (O.S.No 120\/51-52)
\nobtained is an independent one and not connected with the
\nmortgage claim and in execution of the money decree the
\nproperty was sold on 11.09.1952, the relationship of
\nmortgagor and mortgagee is not subsisting, in such
\ncircumstances, Order XXXIV Rule 14 CPC is not applicable
\nand the trial Court rightly dismissed the suit, however, the
\nHigh Court committed an error in granting preliminary decree
\nfor redemption as if the original mortgage subsists.  According
\nto him, the application of Order XXXIV Rule 14 CPC is wholly
\nillegal and setting aside the sale of 1951-52 is inequitable
\nespecially in view of the fact that there was no objection from
\nthe respondents for sale or confirmation of the sale and of the
\nfact that they have not taken any steps to set aside the sale for
\nover three decades.  On the other hand, Mr. Vishwanath
\nShetty, learned senior counsel for the contesting respondents
\nsubmitted that O.S. No 120\/51-52 brought by the appellants
\nwas very much for seeking satisfaction of the claims patently
\narising under the mortgage of the suit schedule property and
\nthe same not being a suit for sale instituted in enforcement of
\nthe mortgage in question clearly comes under the pale of the
\nbar under Order XXXIV Rule 14 CPC. He further submitted
\nthat their purchase in the circumstances amounts to a mere
\ntrust and they cannot be allowed to exploit the adversity of the
\nappellants.  He further pointed out that the property in
\nquestion is worth of Rs. 100 lacs and for non-payment of rent
\nof just less than Rs.1,200\/-, the sale took place and was
\npurchased by the mortgagee.  Finally according to him, even
\non equity, the appellants are not entitled to any relief.\n<\/p>\n
5)\tBefore adverting to necessary provisions, it is useful to
\nrefer certain factual details.  It is seen that the deceased
\nsecond defendant had taken the suit property under
\npossessary mortgage dated 19.02.1948 on payment of
\nRs.10,000\/- for a period of five years from the plaintiffs.
\nHowever, the plaintiffs\/mortgagors continued in possession as
\ntenants on monthly rent of Rs.97.50.  As the plaintiffs\/
\nmortgagors failed to pay rents, O.S. No.120\/51-52 was filed
\nfor recovery of Rs.1,225\/- towards arrears of rent.  The suit
\nwas decreed and the property was put in auction in execution
\nNo. 1002\/51-52 and the mortgagee\/second defendant
\npurchased the schedule property in court auction on
\n11.09.1952.  The sale was confirmed under Order XXI Rule 92
\nCPC.  The second defendant became the absolute owner of the
\nschedule property.  It is the claim of the mortgagee that the
\nsale held on 11.09.1952 was the sale of the right of plaintiffs
\nin the mortgaged property in question which came to be
\npurchased by him\/second defendant, the said sale having
\nbecome final, there was no right of redemption subsisting on
\nthe date of confirmation of sale as mortgage came to an end.
\nIn this way, it was contended that the suit which was filed for
\nredemption of the schedule property is mis-conceived and not
\nmaintainable in law.  It was also claimed that the property
\nonce mortgaged was sold in court auction and consequently
\nthe property never subsists as a mortgaged property.  It was
\nalso argued that the auction sale is not void, but voidable
\nunless the mortgagor avoids such a sale by taking recourse to
\nlegal proceedings in the absence of which he will not be
\nentitled to exercise his right of redemption as there is no such
\nright exist.  It was also pointed out that though it was open to
\nthe plaintiffs to take such steps as was necessary to prevent
\nthe sale being held or to institute such proceeding as was
\nnecessary to get the sale set aside, the plaintiffs failed to avail
\nthe remedy available to them in law within the time available
\nunder the Limitation Act and thus allowed the sale to become
\nfinal.  Therefore, the plaintiffs waived their rights.  Though the
\ntrial Court dismissed the suit and rejected the claim of
\nredemption of the mortgaged property, the appellate
\nCourt\/High Court on appreciation of oral and documentary
\nevidence and on the basis of relevant provisions, namely, Civil
\nProcedure Code, Transfer of Property Act and Indian Trusts
\nAct granted preliminary decree for redemption which is now
\nchallenged in this appeal.\n<\/p>\n
6)\tChapter IV of the Transfer of Property Act, 1882 refers
\nvarious kinds of mortgage of immoveable property.  Section 58
\ndefines that mortgage is the transfer of an interest in specific
\nimmoveable property for the purpose of securing the payment
\nof money advanced or to be advanced by way of loan, an
\nexisting or future debt, or the performance of an engagement
\nwhich may give rise to a pecuniary liability.  The transferor is
\ncalled a mortgagor, the transferee a mortgagee; the principal
\nmoney and interest of which payment is secured for the time
\nbeing are called the mortgage-money, and the instrument by
\nwhich the transfer is effected is called a mortgage-deed.  In the
\ncase on hand, it is not in dispute the mortgage in question is a
\nusufructuary mortgage which is defined in sub-section (d) of
\nSection 58 as under:\n<\/p>\n
“(d) Usufructuary mortgage.- Where the mortgagor delivers
\npossession or expressly or by implication binds himself to
\ndeliver possession of the mortgaged property to the
\nmortgagee, and authorizes him to retain such possession
\nuntil payment of the mortgage-money, and to receive the
\nrents and profits accruing from the property or any part of
\nsuch rents and profits and to appropriate the same in lieu of
\ninterest, or in payment of the mortgage-money, or partly in
\nlieu of interest  or partly in payment of the mortgage-money,
\nthe transaction is called an usufructuary mortgage and the
\nmortgagee an usufructuary mortgagee.”\n<\/p>\n
Section 60 refers to ‘right of mortgagor to redeem’ which reads
\nthus:\n<\/p>\n
“Section 60 – Right of mortgagor to redeem.- At any time
\nafter the principal money has become due, the mortgagor
\nhas a right, on payment or tender, at a proper time and
\nplace, of the mortgage-money, to require the mortgagee (a) to
\ndeliver to the mortgagor the mortgage-deed and all
\ndocuments relating to the mortgaged property which are in
\nthe possession or power of the mortgagee, (b) where the
\nmortgagee is in possession of the mortgaged property, to
\ndeliver possession thereof to the mortgagor, and (c) at the
\ncost of the mortgagor either to re-transfer the mortgaged
\nproperty to him or to such third person as he may direct, or
\nto execute and (where the mortgage has been effected by a
\nregistered instrument) to have registered an acknowledgment
\nin writing that any right in derogation of his interest
\ntransferred to the mortgagee has been extinguished :
\nProvided that the right conferred by this section has
\nnot been extinguished by act of the parties or by decree of a
\nCourt.\n<\/p>\n
The right conferred by this section is called a right to
\nredeem and a suit to enforce it is called a suit for
\nredemption.\n<\/p>\n
Nothing in this section shall be deemed to render
\ninvalid any provision to the effect that, if the time fixed for
\npayment of the principal money has been allowed to pass or
\nno such time has been fixed, the mortgagee shall be entitled
\nto reasonable notice before payment or tender of such
\nmoney.”\n<\/p>\n
Order XXXIV CPC speaks about suits relating to mortgages of
\nimmoveable property.  Among the other provisions, we are
\nconcerned about Order XXXIV Rule 14 CPC which reads as
\nunder:-\n<\/p>\n
“14. Suit for sale necessary for bringing mortgaged
\nproperty to sale.- (1) Where a mortgagee has obtained a
\ndecree for the payment of money in satisfaction of a claim
\narising under the mortgage, he shall not be entitled to bring
\nthe mortgaged property to sale otherwise than by instituting
\na suit for sale in enforcement of the mortgage, and he may
\ninstitute such suit notwithstanding anything contained in
\nOrder II, Rule 2.”\n<\/p>\n
It is useful to refer Section 90 of the Indian Trusts Act, 1882
\nwhich reads as under:-\n<\/p>\n
“Section 90 – Advantage gained by qualified owner.-
\nWhere a tenant for life, co-owner, mortgagee or other
\nqualified owner of any property, by availing himself of his
\nposition as such, gains an advantage in derogation of the
\nrights of the other persons interested in the property, or
\nwhere any such owner, as representing all persons
\ninterested in such property, gains any advantage, he must
\nhold, for the benefit of all persons so interested, the
\nadvantage so gained, but subject to repayment by such
\npersons of their due share of the expenses properly incurred,
\nand to an indemnity by the same persons against liabilities
\nproperly contracted, in gaining such advantage.
\nIllustrations\n<\/p>\n
(a) A, the tenant for life of leasehold properly, renews the
\nlease in his own name and for his own benefit. A holds the
\nrenewed lease for the benefit of all those interested in the old
\nlease.\n<\/p>\n
(b) A village belongs to a Hindu family. A, one of its
\nmembers, pays Nazrana to Government and thereby
\nprocures his name to be entered as the inamdar of the
\nvillage. A holds the village for the benefit of himself and the
\nother members.\n<\/p>\n
(c) A mortgages land to B, who enters into possession. B
\nallows the Government revenue to fall into arrear with a view
\nto the land being put up for sale and his becoming himself
\nthe purchaser of it. The land is accordingly sold to B. Subject
\nto the repayment of the amount due on the mortgage and of
\nhis expenses property incurred as mortgagee, B holds the
\nland for the benefit of A.\n<\/p>\n
A perusal of the various clauses in the mortgage deed dated
\n19.02.1948, second mortgage dated 12.12.1948, pleadings in
\nO.S. No. 120\/51-52 filed for arrears of rent which was decreed
\non 19.05.1952, order passed in E.P.No. 1002\/51-52 dated
\n11.09.1952 as well as pleadings in O.S. No.632\/1983 on the
\nfile of third Additional City Civil Judge, Bangalore filed for
\nredemption of mortgage and the reasoning of the High Court in
\nRFA No. 465\/1990 dated 11.12.1998 which is impugned in
\nthis appeal clearly support the stand taken by the contesting
\nrespondents\/plaintiffs.  Though learned senior counsel for the
\nappellants contended that the claim and the decree in
\nO.S.No.120\/51-52 has nothing to do with the mortgage dated
\n19.02.1948 or 12.12.1948, a perusal of all the details referred
\nto above leads to an irresistible conclusion that the decree in
\nfavour of the appellant mortgagee in O.S. No. 120\/51-52 was
\nnot an independent money decree against respondents but
\nmerely for satisfaction of the rents accrued on the mortgaged
\nproperty, leased back to the respondents on 19.02.1948 itself
\nup to 12.12.1948 and thereafter which was secured by a
\nsecond mortgage deed dated 12.12.1948 executed by the
\nrespondents in favour of the appellants.  We have already
\nreferred to Rule 14 of Order XXXIV CPC which prohibits the
\nmortgagee to bring the mortgaged property to sell otherwise
\nthan by instituting a suit for sale in enforcement of the
\nmortgage.  Admittedly, the said suit by the mortgagee was not
\nin terms of Rule 14 of Order XXXIV.  Therefore, bringing the
\nmortgaged property for sale by the appellants in execution of
\nthe decree passed in O.S. No. 120\/51-52 and purchasing the
\nsame by the appellants in public auction is clearly barred
\nunder Order XXXIV Rule 14 CPC.  It is useful to point out that
\nD.W.1 has specifically stated in her examination that though
\nthe suit schedule property was mortgaged by the respondents
\nwith the appellants by way of possessory mortgage deed dated
\n19.02.1948, the respondents never parted with the possession
\nthereafter, as the appellants chose simultaneously on
\n19.02.1948 to let the respondents continue in possession as
\ntenants on a monthly rental of Rs.97.50.  The High Court has
\nalso referred to the fact that on 12.12.1948 a second mortgage
\ndeed for Rs.3,000\/- was executed in favour of the appellants
\nby the respondents towards arrears of rent for the period from
\n19.02.1948 to 12.12.1948. In those circumstances, we agree
\nwith the conclusion of the High Court that in O.S. No. 120\/51-
\n52 brought by the appellant was very much for seeking
\nsatisfaction of claims arising under the suit schedule property
\nand the same not being on a suit for sale instituted in
\nenforcement of the mortgage in question, the same is barred
\nunder Order XXXIV Rule 14 CPC.  Further, we are satisfied
\nthat all the relevant materials have been specifically pleaded in
\nthe plaint in O.S. No. 632 of 1983 on the file of third
\nAdditional City Civil Judge, Bangalore.\n<\/p>\n
7)\tWe have already referred to Section 90 of the Indian
\nTrusts Act.  Illustration (c) of Section 90 is applicable to the
\ncase on hand.  The purchase by the mortgagee in the
\ncircumstances narrated above amounts to a mere trust and
\neither himself or his legal representatives cannot be allowed to
\nexploit the adversity of the appellants.\n<\/p>\n
8)\tIn view of the factual scenario, though learned senior
\ncounsel for the appellants relied on decisions of various High
\nCourts, we are of the view that there is no need to refer the
\nsame.\n<\/p>\n
9)\tIn Mritunjoy Pani and Another vs. Narmanda Bala
\nSasmal and Another,<\/a> [1962] 1 SCR 290, the legal position as
\nto right of redemption in a usufructuary mortgage and Section
\n90 of the Indian Trusts Act have been clearly explained.  The
\nfollowing discussion and conclusion are relevant:
\n“The following three conditions shall be satisfied before s. 90
\nof the Indian Trusts Act can be applied to a case : (1) the
\nmortgagee shall avail himself of his position as mortgagee;
\n(2) he shall gain an advantage; and (3) the gaining should be
\nin derogation of the right of the other persons interested in
\nthe property. The section, read with illustration (c), clearly
\nlays down that where an obligation is cast on the mortgagee
\nand in breach of the said obligation he purchases the
\nproperty for himself, he stands in a fiduciary relationship in
\nrespect of the property so purchased for the benefit of the
\nowner of the property. This is only another illustration of the
\nwell settled principle that a trustee ought not to be permitted
\nto make a profit out of the trust. The same principle is
\ncomprised in the latin maxim commodum ex injuria sua nemo
\nhabere debet, that is, convenience cannot accrue to a party
\nfrom his own wrong. To put it in other words, no one can be
\nallowed to benefit from his own wrongful act. This Court had
\noccasion to deal with a similar problem in Sidhakamal
\nNayan v. Bira Naik A.I.R.<\/a> 1954 S.C. 336. There, as here, a
\nmortgagee in possession of a tenant’s interest purchased the
\nsaid interest in execution of a decree for arrears of rent
\nobtained by the landlord. It was contended there, as it is
\ncontended here, that the defendant, being a mortgagee in
\npossession, was bound to pay the rent and so cannot take
\nadvantage of his own default and deprive the mortgagors of
\ntheir interest. Bose, J., speaking for the Court, observed at
\np. 337 thus:\n<\/p>\n
“The position, in our opinion, is very clear and in the
\nabsence of any special statutory provision to the
\ncontrary is governed by s. 90, Trusts Act. The
\ndefendant is a mortgagee and, apart from special
\nstatutes, the only way in which a mortgage can be
\nterminated as between the parties to it is by the act of
\nthe parties themselves, by merger or by an order of the
\nCourt. The maxim “once a mortgage always a
\nmortgage” applies. Therefore, when the defendant
\nentered upon possession he was there as a mortgagee
\nand being a mortgagee the plaintiffs have a right to
\nredeem unless there is either a contract between the
\nparties or a merger or a special statute to debar them.”
\nThese observations must have been made on the assumption
\nthat it was the duty of the mortgagee to pay the rent and
\nthat he made a default in doing so and brought about the
\nauction sale of the holding which ended in the purchase by
\nhim. The reference to s. 90 of the Indian Trusts Act supports
\nthis assumption.\n<\/p>\n
Xxxx xxx xxxx
\nThe legal position may be stated thus: (1) The governing
\nprinciple is “once a mortgage always a mortgage” till the
\nmortgage is terminated by the act of the parties themselves,
\nby merger or by order of the court. (2) Where a mortgagee
\npurchases the equity of redemption in execution of his
\nmortgage decree with the leave of court or in execution of a
\nmortgage or money decree obtained by a third party, the
\nequity of redemption may be extinguished; and, in that
\nevent, the mortgagor cannot sue for redemption without
\ngetting the sale set aside. (3) Where a mortgagee purchases
\nthe mortgaged property by reason of a default committed by
\nhim the mortgage is not extinguished and the relationship of
\nmortgagor and mortgagee continues to subsist even
\nthereafter, for his purchase of the equity of redemption is
\nonly in trust for the mortgagor.\n<\/p>\n
\tXxxx xxxx xxx
\n The said findings clearly attract the provisions of s. 90
\nof the Indian Trusts Act. In view of the aforesaid principles,
\nthe right to redeem the mortgage is not extinguished and in
\nthe eye of law the purchase in the rent sale must be deemed
\nto have been made in trust for the mortgagor. In the
\npremises, the High Court was right in holding that the suit
\nfor redemption was maintainable.”\n<\/p>\n
10)\tIn Jayasingh Dnyanu Mhoprekar and Another vs.
\nKrishna Babaji Patil and Another,<\/a> (1985) 4 SCC 162, again
\nconsidering similar claim with reference to Section 83 of the
\nTransfer of Property Act and Section 90 of the Indian Trusts
\nAct, this Court held:\n<\/p>\n
“6. The only question which arises for decision in this case
\nis whether by reason of the grant made in favour of the
\ndefendants the right to redeem the mortgage can be treated
\nas having become extinguished. It is well settled that the
\nright of redemption under a mortgage deed can come to an
\nend only in a manner known to law. Such extinguishment of
\nright can take place by a contract between the parties, by a
\nmerger or by a statutory provision which debars the
\nmortgagor from redeeming the mortgage. A mortgagee who
\nhas entered into possession of the mortgaged property under
\na mortgage will have to give up possession of the property
\nwhen the suit for redemption is filed unless he is able to
\nshow that the right of redemption has come to an end or that
\nthe suit is liable to be dismissed on some other valid ground.
\nThis flows from the legal principle which is applicable to all
\nmortgages, namely “Once a mortgage, always a mortgage”…..\n<\/p>\n
9. An analysis of Section 90 of the Indian Trusts Act, 1882
\nset out above shows that if a mortgagee by availing himself of
\nhis position as a mortgagee gains an advantage which would
\nbe in derogation of the right of a mortgagor, he has to hold
\nthe advantage so derived by him for the benefit of the
\nmortgagor. We are of the view that all the conditions
\nmentioned in Section 90 of the Indian Trusts Act, 1882 are
\nsatisfied in this case. The mortgagees i.e. Dnyanu, the father
\nof Defendant 1 and Ananda the second defendant could each
\nget one-fourth share in the total extent of land measuring 22
\nAcres and 13 Gunthas only by availing themselves of their
\nposition as mortgagees. The grant made in their favour is an
\nadvantage traceable to the possession of the land which they
\nobtained under the mortgage and that the said grant is
\ncertainly in derogation of the right of the mortgagors who
\nwere the permanent Mirashi tenants entitled to the grant
\nunder the Government Orders referred to above. The
\ndefendants could not have asserted their right to the grant of
\nthe land when the plaintiffs had deposited the requisite
\noccupancy price well in time. It is seen that the mortgagees
\nobtained the grant in their favour by making an incorrect
\nrepresentation to the Government that they were permanent
\nMirashi tenants although they were only mortgagees. Section
\n90 of the Indian Trusts Act, 1882 clearly casts an obligation
\non a mortgagee to hold the rights acquired by him in the
\nmortgaged property for the benefit of the mortgagor in such
\ncircumstances as the mortgagee is virtually in a fiduciary
\nposition in respect of the rights so acquired and he cannot
\nbe allowed to make a profit out of the transaction..”\n<\/p>\n
11)\tIn Namdev Shripati Nale vs. Bapu Ganapati Jagtap
\nand Another,<\/a> (1997) 5 SCC 185 in a similar situation this
\nCourt held thus:\n<\/p>\n
“6.   We are of the view that in the totality of the facts
\nand circumstances, the provisions of Section 90 of the
\nIndian Trusts Act are attracted. The first respondent-
\nmortgagee gained an advantage by availing himself of his
\nposition as a possessory mortgagee and obtained the
\nregrant. This he did by committing a wrong. He committed a
\ndefault in not paying the occupancy price within the time
\nlimited by law for and on behalf of the mortgagor. The
\nregrant was obtained in his name by posing himself as a
\ntenant, which was possible only because he was in
\npossession of the land (as a possessory mortgagee). The
\nadvantage so gained by him in derogation of the right of the
\nmortgagor should attract the penal consequences of Section
\n90 of the Indian Trusts Act. We hold that the default
\ncommitted by a possessory mortgagee, in the performance of
\na statutory obligation or a contractual obligation, which
\nentails a sale or forfeiture of right in the property to the
\nmortgagor, will attract the provisions of Section 90 of the
\nIndian Trusts Act. In such cases any benefit obtained by the
\nqualified owner, the mortgagee, will enure to or for the
\nbenefit of the mortgagor. The right to redeem will subsist
\nnotwithstanding any sale or forfeiture of the right of the
\nmortgagor. We are of the view that the law on this point has
\nbeen laid down with admirable clarity by this Court in
\nMritunjoy Pani v. Narmanda Bala Sasmal<\/a> (1962) 1 SCR 290
\nand by K.K. Mathew, J. (as his Lordship then was) in Nabia
\nYathu Ummal v. Mohd. Mytheen. [1963 KLJ 1177].  The said
\ndecisions have our respectful concurrence.\n<\/p>\n
12)\tThough Mr. Sanyal, learned senior counsel heavily relied
\non a decision of three-Judge Bench in Sachidanand Prasad
\nvs. Babu Sheo Prasad Singh,<\/a> [1966] 1 SCR 158, on going
\nthrough the factual scenario, we are satisfied that the same is
\nnot helpful to the stand taken by the appellants.\n<\/p>\n
13)\tThough the mortgagee purchased the mortgaged property
\npursuant to the decree in O.S. No. 120\/51-52, as explained
\nand interpreted the provisions of Order XXXIV Rule 14 CPC
\nand Section 90 of the Indian Trusts Act, in the absence of
\nrecourse to Rule 14 of Order XXXIV, we hold that the
\nrelationship of mortgagor and mortgagee continues to subsist
\neven thereafter, and his purchase is only in trust for the
\nmortgagor.  In view of the same, the right to redeem the
\nmortgage is not extinguished and in the eye of law the
\npurchase of the mortgaged property in pursuance of the
\ndecree for rent arrears must be deemed to have been made in
\ntrust for the mortgagor.  In such circumstances, the High
\nCourt was right in granting preliminary decree for redemption.
\nInsofar as the period of limitation is concerned, article 61 of
\nthe Limitation Act, 1963 applies and for a mortgagor to redeem
\nor recover possession of immoveable property mortgaged; the
\nperiod of limitation provided is 30 years when the right to
\nredeem or to recover possession accrues.  In view of the same,
\nsince the mortgagee purchased the mortgaged property in
\ncourt auction on 11.09.1952 and the suit for redemption of
\nmortgaged property was filed within the time prescribed, the
\nHigh Court cannot be faulted for granting preliminary decree
\nfor redemption.\n<\/p>\n
14)\tIn view of the above discussion and conclusion, the
\nappeal fails and the same is dismissed with no order as to
\ncosts.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India M.R. Satwaji Rao (D) By L.Rs vs B. Shama Rao (Dead) By L.Rs. & Ors on 9 April, 2008 Author: P Sathasivam Bench: Dr. Arijit Pasayat, P. Sathasivam CASE NO.: Appeal (civil) 319 of 2002 PETITIONER: M.R. Satwaji Rao (D) by L.Rs. RESPONDENT: B. Shama Rao (Dead) by L.Rs. & Ors […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-80486","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nM.R. Satwaji Rao (D) By L.Rs vs B. 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