Raghunath Singh and Another vs Kishanlal (dead) L.R. Ramratan

Rampal Singh, J.—Aggrieved by the Judgment and decree passed by the Additional Judge to the Court of District Judge. Vidisha, in Civil Appeal No. 141-A of 1971 dated 6th March 1972, the appellant-defendants have preferred this appeal,

The respondent-plaintiff filed a suit in the Court of Additional Civil Judge Class II, Basoda, for possession and mean profits, against the appellant-defendants with the averment that he was the Bhunuswarni of survey Nos. 7 and 59 measuring 8 bigha and 2 biswa of village Banwa, which he mortgaged with the defendants for Rs. 600/-only for a period of five years. After the stipulated period of five years, the plaintiff wanted to redeem the mortgage to which the defendants refused.

The appellants/defendants repelled the case of the plaintiff, contested the suit and pleaded that in Samvat 2020 the plaintiff executed a ''Patta'' (Ext. D /1) for a period of five years. The defendants further pleaded that they have acquired the rights of a Bhumiswami by operation of law and cannot be ejected from their lawful possession.

The trial Court after framing the issues and recording the evidence of the parties, dismissed the suit of the plaintiff and answered the issues thus ;

the plaintiff did not mortgage the suit land with the defendants for Rs 600/- on 15-3-1964. On the contrary, it was given to defendants on a lease of five years on 22-2-1964 ;

The defendants, thus, have acquired the rights of an occupancy tenant of the suit land.

The plaintiff challenged in these findings in the first appeal in the first appellate Court, and that Court reversed these findings. It is the defendants who now challenge the judgment and decree of the first appellate Court under Sec. 100 of the Code of Civil Procedure. The first appellate Court in the impugned judgment held that exhibit D/1, filed and relied upon by the defendants, was not admissible in evidence, because it was a lease for a period of five years and cannot be read in evidence even for collateral purposes. The first appellate Court, thus, decreed the suit for redemption and upheld the plea of mortgage

Shri K N. Gupta, learned counsel for the appellants, contended that (i) Ext D 1, is not a lease because it is not signed by both the parties; (ii) even it, Ext. D/l, is considered to be a lease, then by virtue of section 117 of the Transfer of Property Act it is not required to be registered; (iii) even if it is required to be registered, it can be read in evidence for ascertaining the nature of possession, that is, for collateral purposes, and (iv) an oral mortgage is not permissible in law, when the valuation of the mortgage, is Rs. 600/-by virtue of the provisions of section 59 of the Transfer of Property Act.

Shri Arun Mishra, learned counsel for the respondent, fairly conceded that section 17 of the Indian Registration Act excluded the operation of section 117 of the Transfer of Property Act. He has further repelled the contentions of Shri Gupta and added that the finding that it is a mortgage is a finding of fact by the first appellate Court, because this finding is solidly based opinion the fact that the nature of possession of the defendants recorded in the annual village papers is that they are in possession as mortgagees,

The first appellate Court has reversed the judgment and decree passed by the trial Court on the ground that Ext. D/l, on the basis of which the defendants claim to be the tenants of the suit land for five years, in view of the law laid down in the case of Smt. Dhana Bai Vs. Smt. Kewara Bai and Others, . A division Bench Judgment of this Court, is not admissible in evidence The first appellate Court, has further held, unlike the trial Court, that Ext. D/l cannot be read in evidence even for collateral purposes, i. e. for looking to the nature of possession. In Smt Dhana Bai''s case (supra). It was held that rent not from year to year or for a term exceeding one year requires registration u/s 17(1)(d) of the Registration Act, as it is a lease within the meaning of section 107 of the Transfer of property Act. It was further held that a document compulsorily registerable, if unregistered, is inadmissible in evidence of a transaction affecting immoveable property. It was further observed that collateral purpose is that which is by the side of or distinct from the main purpose. A term of a deed of lease being one of its main purpose, it could not be termed a collateral purpose within the meaning of proviso to section 49 of the Registration Act.

Daromulal was in direct conflict with Smt. Dhana Bai (supra). Hence a reference was made by a Single Bench, and a Full Bench considered the ratio of Smt. Dhana Bai and the ratio of Daromulal (supra) in Sardar Amar Singh and Another Vs. Smt. Surinder Kaur, . The case of Smt. Dhana Bai was elaborated in Sardar Amar Singh''s case (supra) and it was held that the unregistered lease deed was admissible to show the nature and character of defendant''s possession as a lease, and from the nature of possession and other circumstances, the status of defendant as tenant could be established. In this Full Bench decision it was further held :

The expression ''collateral purpose'' is very vague one and the court roust decided in each case whether the purpose for which it is sought to use the unregistered document is really a collateral one or is to establish directly the title to immoveable property sought to be conveyed by the document. Collateral purpose is that which is by the side of or distinct from the main purpose. In the case of an unregistered lease the nature and character of the possession of party, or the relationship of landlord and tenant are purposes which are by the side of or distinct from the main purpose of the lease.

It, thus, becomes apparent that Ext-D/I, though not admissible in evidence due to its inherent infirmities, though the terms of the alleged lease contained therein cannot be seen, yet from ascertaining the nature of possession of the defendant, it can be looked into. The first appellate Court, therefore, due to misconception refrained from examining the nature of possession of the defendants over the suit land. It will have to be remembered that the Registration Act strikes at documents not at transactions. The Registration Act does not direct as to what transaction should be reduced to writing. The Transfer of Property Act, on the other hand, enacts as to what transactions have to for reduced to writing and registered. The alleged lease (Exf.D/l), in the present case, is said to be for five years The provisions of section 117 of the Transfer of property Act regarding leases of immoveable property do not apply to leases from agricultural purposes, A valid lease from agricultural purposes for a period of five years could be created even orally. The contract of lease (Ext. D/l), according to the finding of fact arrived at by the first appellate Court, has not been relied upon not only on legal grounds but also on the ground that the entries in the annual village papers from the years 1963-64 to 1967-68 (Ex. p/1) show that the defendants are in possession of the suit land as mortgagees and not as tenants. This finding of fact is not only based on Ext. P/1 but also on the evidence of Banshilal (P.W. 2). and Munshilal (P.W. 3). According to the finding of fact recorded by the first appellate Court the suit land was mortgaged by the plaintiff with the defendants for five years, and the defendants were in possession of the suit land as mortgages.

But, was it a valid mortgage. The plaintiff pleaded in paras 2 and 3 of the plaint that the suit land was mortgaged with the defendants with possession and he obtained Rs. 600/-which was needed for a marriage in the family. No document of mortgage has been produced by the plaintiff, but according to his pleading, a document of mortgage was written. The finding of the first appellate Court with regard to the factum of mortgage is not only based upon the entries in the annual village papers made by the Patwari (Ext. P/1) but also on the oral evidence of the plaintiff and his witnesses. This finding is vitiated by the fact that if a mortgage deed was written and not produced, the terms of the contract, which were reduced to writing cannot be said to be proved due to the specific bar created by the provisions of section 91 of the Evidence Act.

Further-more, section 59 of the Transfer of Property Act, which is being reproduced below, created a mandate that mortgage of Rs. 100 or upwards of valuation is compulsorily registerable :

Mortgage when to be by assurance.-Where the principal money secured is one hundred rupees or upwards, a mortgage, other than a mortgage by deposit of title-deeds, can be affected only by a registered instrument signed by the mortgagor and attested by at least two witnesses.

Where the principal money secured is less than one hundred rupees, a mortgage may be effected either by a registered instrument signed and attested as aforesaid, or (except in the case of a simple mortgage) by delivery of the property.

Thus, the requirement of this provision cannot be got over by applying the doctrine of part performance. Consequently, an admission by the mortgagor that the mortgagee was in possession of the property as a mortgagee under an oral mortgage for a consideration of more than one hundred rupees, cannot create a mortgage nor an entry in the revenue record to that effect is sufficient. The principle that ''once a mortgage, always a mortgage, will not be applicable, as there is no mortgage at all. Even where the mortgage is not a valid transaction because of non-compliance with section 59 of the Transfer of property Act, the mortgagee may acquire the status of a mortgagee by prescription. It is for the mortgagee to have a proper and valid mortgage deed executed in his favour. If the mortgage deed is defective due to non-registration and the mortgagee takes possession of the mortgaged property, the principle once a mortgage always a mortgage applies and the mortgagee cannot be permitted to resist the redemption by the mortgagor. But, in this case as no mortgage deed has been produced, and no oral or other evidence in proof of the mortgage deed can be accepted and the defendants have also cot taken the plea of mortgage, the first appellate Court has committed an error in law in passing a decree for redemption in favour of the plaintiff.

Thus, according to the findings of the first appellate Court the possession of the appellants over the suit land was not as sub-tenants and, hence there was no lease in their favour. Consequently, they do not acquire any right of an occupancy tenant over the suit land. The finding of the first appellant Court that the possession of the appellant-defendants was that of a mortgagee is erroneous. There was no valid mortgage and, hence, this finding of the first appellate Court has to be set aside, as no decree for redemption could be passed in favour of the plaintiff.

The relief prayed from a decree of redemption includes a prayer for a decree of possession, but as the factum and finding of mortgage has been set aside, a decree in favour of the plaintiff for possession over the suit land solely on the strength of his title can be passed. The possession of the appellant-defendants over the suit land was not as a lessee, but only as a licensee. The cardinal distention between a lease and a licence is that in a lease there is a transfer of interest in the land, whereas in the case of a licence there is no transfer of interest, although the licensee acquires a right to occupy the land. Therefore, a decree for possession in favour of the respondent-plaintiff can be passed.

The plaintiff has admitted that he obtained an amount of Rs. 600/-from the appellant-defendants. This admission binds him in law and it is equitable that he should pay back this amount to the appellants.

The upshot of the above discussion is that this appeal, with the modifications stated hereinabove, is dismissed. The judgment and decree passed by the first appellate Court stand modified to the extent that the respondent-plaintiff shall get back in his favour possession simpliciter of the suit land and shall be entitled to get vacant possession after the ejectment of the appellant-defendants. But before that he shall deposit an amount of Rs. 600/-to be disbursed to the appellant-defendants. Parties are directed to bear their own casts as incurred throughout.