Dalip Singh vs The Financial Commissioner and Secretary To Government Punjab, Chandigarh and Others

Mahajan, J.—This is a petition under Articles 226 and 227 of the Constitution and is directed against the order of the Financial Commissioner, dated the 27th of August, 1963, reversing in revision the order of the Commissioner which affirmed the order of the Collector, Mansa.

The facts are that the land in dispute was mortgaged by Bhajan Singh, its owner, in favour of Mal Singh. Bhajan Singh later on sold the land to respondents Nos. 3 to 7 (Harnek Singh and others). It may be mentioned that the mortgagee settled the present petitioner (who is his son-in-law) on the mortgaged land. At the time of redemption by respondents Nos. 3 to 7 after the sale in their favour of the equity of redemption the petitioner was in possession of the land and he was ejected in pursuance of the redemption decree. The petitioner thereafter brought the present application before the Collector u/s 43 of the Pepsu Tenancy and Agricultural Lands Act, 1955 (Act No. 13 of 1955) for restoration of the possession on the ground that he was tenant under Bhajan Singh from the year 1950. He did not plead the alternative case that even if he was not inducted by Bhajan Singh he was still entitled to possession because he was inducted on the land by the mortgagee and even if the mortgage had come to an end he would still be the tenant of the mortgagor. It may be mentioned that the Collector as well as the Commissioner decided in his favour on the basis that he being the tenant of the mortgagee was entitled to the restoration of possession. The case set up by the petitioner that he was tenant of Bhajan Singh from 1950 was found by both these authorities against him. On a revision filed by the transferees from the mortgagor, i.e., respondents Nos. 3 to 7, the Financial Commissioner held that the tenant of the mortgagee could not be held to be the tenant of the mortgagor after redemption in as much on redemption the tenancy created by the mortgagee came to an end. It is this decision of the Financial Commissioner which is being questioned in the present petition.

The first contention of the learned counsel for the petitioner is that the mortgagee''s tenant ipso facto becomes the tenant of the mortgagor. This contention is not wholly correct. It was held by their Lordships of the Supreme Court in Mahabir Gope and Others Vs. Harbans Narain Singh and Others, as follows :

The general rule is that a person cannot by transfer or otherwise confer a better title on another than he himself has. A mortgagee can not, therefore, create an interest in the mortgaged property which will enure beyond the termination of his interest as mortgagee. Further the mortgagee, who takes possession of the mortgaged property, must manage it as a person of ordinary prudence would manage it if it were his own; and he must not commit any act which is destructive or permanently injurious to the property. It follows that he may grant leases not extending beyond the period of the mortgage; any leases granted by him must come to an end at redemption. A mortgagee cannot during the subsistence of the mortgage act in a manner detrimental to the mortgagor''s interests such as by giving a lease which may enable the tenant to acquire permanent or occupancy rights in the land, thereby defeating the mortgagor''s right to ''khas'' possession; it would be an act which would fall within the provisions of section 76, sub-clause (e) of the Transfer of Property Act.

A permissible settlement by a mortgagee in possession with a tenant in the course of prudent management and the springing up of rights in the tenant conferred or created by statute based on the "nature of the land and possession for the requisite period is a different matter altogether. It is an exception to the general rule. In such a case the tenant cannot be ejected by the mortgagor even after the redemption of the mortgage. He may become an occupancy raiyat some cases and a non-occupancy raiyat in other cases. But the settlement of the tenant by the mortgagee must have been a bona fide one.

This exception will not apply in a case where the terms of the mortgage prohibit the mortgagee from making any settlement of tenants on the land either expressly or by necessary implication. Where, for example, all the zamindari rights are given to the mortgagee, it may be possible to infer on the prefer construction of the document that he can settle lands with the tenants in the ordinary course of the management and the tenants might acquire certain rights in the land in their capacity as tenants.

The general rule is that the tenancy created by a mortgagee would come to an end with the redemption of the mortgage and the exception to the rule which is stated by their Lordships of the Supreme Court has to be proved by the person who after redemption still maintains that he is the tenant of the land and his tenancy has not come to an end with the redemption of the mortgage. This exception was neither pleaded nor proved in the present case before the relevant authorities and, therefore, no advantage can be taken by the petitioner on the basis of this exception.

The second contention advanced by the learned counsel for the petitioner was that by reason of the definition ''landowner'' in section 2(f) of the Pepsu Tenancy and Agricultural Lands Act, 1955, the petitioner ipso facto becomes the tenant of the mortgagor. It is no doubt true that a mortgagee is to be deemed to be a landowner for the purposes of the Act, but then the ''tenant'' has been defined in section 2(k) of the Act as follows :

''Tenant'' has the meaning assigned to it in the Punjab Tenancy Act, 1887 (Punjab Act 16 of 1887), but does not include a person-

(i) who holds a right of occupancy, or

(ii) who is relative of the tenant within the meaning of sub-clause (ii) of clause (g).

This definition will be incomplete without setting out the definition of the word ''tenant'' in the Punjab Tenancy Act. That definition is to be found in section 4(5) and is in these terms-

''Tenant'' means a person who holds land under another person, and is, or but for a special contract would be, liable to pay rent for the that land to that other person; but it does not include-

(a) an inferior landowner, or

(b) a mortgagee of the rights of a landowner, or

(c) a person to whom a holding has been transferred, or an estate or holding has been let in farm, under the Punjab Land Revenue Act, 1887 (Act No. 17 of 1887), for the recovery of an arrear of land revenue or of a sum recoverable as such an arrear, or

(d) a person who takes from the Government a lease of unoccupied land for the purpose of subletting it.

The crux of the definition is that the person who claims to be a tenant must be holding land under another person and is liable to pay rent for that land to that other person. In the present case the petitioner was neither holding land under the mortgagor nor was liable to pay rent to the mortgagor. That being so he cannot be held to be a tenant under the mortgagor. Therefore, no error can be said to have been committed by the Financial Commissioner in coming to the decision to which he came.

For the reasons given above this petition fails and is dismissed with costs.