Udai Singh and Others vs Bhunesharnath Singh and Others

James, J.—The plaintiffs in 1927 took certain property in usufructuary mortgage from the defendants for Rs. 800. By the terms of their bond, they were as usual entitled to sue for recovery of their mortgage money in the event of disturbance of their possession of the mortgaged property. The suit out of which this appeal arises was instituted for recovery of the mortgage money on the allegation that the plaintiffs had been dispossessed. The trial Court found that this was a simple usufructuary mortgage and that the plaintiffs'' possession had not been disturbed. The suit was therefore dismissed. On appeal the District Judge of Shahabad reversed the decision of the trial Court on two grounds: one ground was that the mortgage of the property itself by way of security for the loan converted the mortgage from a usufructuary mortgage into a combination of simple mortgage and a usufructuary mortgage; while the second ground was that the mortgage contained a covenant to repay. He therefore gave a decree for the principal money of the mortgage but no decree for sale. The mortgagors appeal from that decision. Mr. B.P. Sinha, on behalf of the appellants argues that the mortgage is a mere usufructuary mortgage with no covenant for repayment and no special condition which would take it out of the category of usufructuary mortgage. Mr. Khurshed Husnain on behalf of the respondents cites several cases in which the words used in usufructuary mortgages had been held to imply covenants for repayment, or in which it had been implied from the special terms of the clause hypothecating the property as security that the mortgage was a combination of simple mortgage and usufructuary mortgage. The only question for consideration in this case is whether the mortgage bond with which we have to deal is anything other than a mere usufructuary mortgage. The mortgage bond recites that:

We have given in dakhli rehan from the full moon day of Jeth 1334 Fs. to 133? Fs., and we declare that the said Mahajans should cultivate and get cultivated the said lands and appropriate the produce in lieu of their money. If we fail to pay the principal on the said date, then after the expiry of that date we shall, on making payment of it in Jeth of any year, take back this deed and bring the rehan property into our possession and occupation.

In my judgment the learned District Judge erred in reading into this stipulation for redemption a covenant for repayment of the money advanced. There is nothing here implying a promise to repay the money. The mortgagees are to enjoy possession securely for three years; and stipulations are made that unless, redemption is made on the said date of Jeth 1337 it shall not be made until the subsequent Jeth. There is no promise to pay, express or implied; the option of redemption remains with the mortgagors, but so long as the principal is not paid, the mortgagees will remain in possession. There is a further stipulation that if the mortgagees are dispossessed from the mortgaged property, they may realise the principal in any manner they like, and as security for realisation of the money in that event, the land is mortgaged to the Mahajans. A mortgage is defined in the Transfer of Property Act as a transfer of an interest in specific Immovable property for the purpose of securing the payment of money advanced by way of loan; and that general definition is satisfied by what Mr. Khurshed Husnain styles the hypothecation, clause; while a usufructuary mortgage is a mortgage in which possession of the mortgaged property is delivered to the mortgagee who is to receive the rents and profits in lieu of interest which has happened in this case.

This is a plain usufructuary mortgage of the kind described in Sub-sections (a) and (d) of Section 58, T.P. Act. It is not a combination of a mortgage described in Sub-section (d) and of the simple mortgage described in Sub-section (b); it is an ordinary usufructuary mortgage of the kind described in subs. (d). That being so, the rule in Luchmeshar Singh v. Dookh Mochan Jha (1897) 24 Cal 677 will apply, which was followed by this Court in Babu Kamal Nayan Prasad Sinha and Others Vs. Babu Ram Nayan Prasad Sinha, Raghunandan Prasad and Binda Pathak and Others, . I find nothing in the mortgage with which we are here concerned by which it can be distinguished from Luchmeshar Singh''s mortgage which was the subject of discussion in the decision of the Calcutta High Court to which I have referred. That being so, since the plaintiffs remain in possession of the mortgaged property, they are entitled neither to a money decree nor a decree for sale; and the decision of the Munsif in this suit was correct. The appeal must be allowed, the decree of the lower appellate Court will be set aside and the decree of the Munsif restored. The appellants are entitled to their costs in this Court and in the lower appellate Court.