Saturday, 18 April 2020

Whether mortgagee is under obligation to hand over any advantage he has received from mortgage to mortgagor?

 It is well-settled that the right of redemption under a
mortgage deed can come to an end or be extinguished only by a
process known to law, i.e., either by way of a contract between the
parties to such effect, by a merger, or by a statutory provision that
debars the mortgagor from redeeming the mortgage. In other
words, a mortgagee who has entered into possession of the
mortgaged property will have to give up such possession when a
suit for redemption is filed, unless he is able to establish that the
right of redemption has come to an end as per law. This emanates
from the legal principle applicable to all mortgages – “Once a
mortgage, always a mortgage”.
15. In the present case, it is clear that none of the
aforementioned conditions in which the right of redemption comes
to an end exist with respect to the mortgage deed dated
14.05.1947. As regards the impact of the re-grant on such right of
redemption, it must be noted that such re-grant in favour of the
mortgagee could not have been made but for the fact that he was
in actual possession of the property by virtue of his position as a
possessory mortgagee. There is no doubt that had the Mirashi
tenant––mortgagor applied for a re-grant, the suit land would have
certainly been granted in his favour, as the rights of permanent
tenants in watan lands were allowed to subsist even after the
coming into force of the Abolition Act. Thus, in our considered
opinion, the re-grant to the Appellants’ predecessor based on
actual possession as mortgagee cannot be divorced from the
existence of the underlying mortgagor-mortgagee relationship
between the parties. Therefore, any benefit accruing to the

mortgagee must necessarily ensue to the Mirashi tenant––
mortgagor.
16. In this regard, it is apposite to note Section 90 of the
Indian Trusts Act, 1882, which reads as under:
“Section 90. Advantage gained by qualified owner.—
Where a tenant for life, co-owner, mortgagee or other
qualified owner of any property, by availing himself of
his position as such, gains an advantage in derogation
of the rights of the other persons interested in the
property, or where any such owner, as representing all
persons interested in such property, gains any
advantage, he must hold, for the benefit of all persons
so interested, the advantage so gained, but subject to
repayment by such persons of their due share of the
expenses properly incurred, and to an indemnity by the
same persons against liabilities properly contracted, in
gaining such advantage.”
A bare reading of this provision indicates that if a
mortgagee, by availing himself of his position as a mortgagee, gains
an advantage which would be in derogation of the right of the
mortgagor, he must hold such advantage for the benefit of the
mortgagor.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4594 OF 2010

SHANKAR SAKHARAM KENJALE  Vs  NARAYAN KRISHNA GADE 

MOHAN M. SHANTANAGOUDAR, J.

Dated: April 17, 2020

1. The instant appeal arises out of the judgment dated
08.06.2009 passed by the High Court of Judicature at Bombay in
Second Appeal No. 439 of 1987. Vide the impugned judgment, the
High Court set aside the findings of the Trial Court and the First
Appellate Court and directed the Trial Court to draw a preliminary
decree of redemption of mortgage in favour of the Respondents
herein.
2. The factual background to this appeal is as follows:
2.1 The land in question was Paragana watan property/Inam
land (hereinafter ‘suit land’). Such watan properties and watans

were governed by the provisions of the Bombay Hereditary Offices
Act, 1874 (hereinafter ‘Watan Act’). Smt. Laxmibai, wife of one
Bhawani Raje Ghadge, was the watandar of the suit land. She had
inducted one Mr. Ramchandra (successor of the Respondents
herein) as a permanent Mirashi tenant of the land. Such tenancy
was hereditary in nature.
2.2 On 14.05.1947, the said Ramchandra (hereinafter
‘Mirashi tenant—mortgagor’) executed a mortgage deed in favour of
one Shankar Sakharam Kenjale (hereinafter ‘mortgagee’)
mortgaging the suit land with a condition of sale for an amount of
Rs. 900/- advanced by Shankar Kenjale for the purpose of
Ramchandra’s household and personal sundry expenses. Per the
terms of this deed, a period of ten years was envisaged for the
repayment of the mortgage money and the mortgagee was placed
in possession of the suit land.
2.3 Meanwhile, the Bombay Paragana and Kulkarni Watans
(Abolition) Act, 1950 (hereinafter ‘the Abolition Act’) came into force
with effect from 25.01.1951 with a view to abolish Paragana and
Kulkarni watans and to make provision for the performance of
functions of some of these offices. Under this Act, Paragana and
Kulkarni watans were abolished and watan lands were resumed to

the Government, subject to Section 4. It is needless to observe that
the suit land, being watan property, was also resumed to the
Government subject to Section 4, which empowered the holder of
the watan to seek re-grant of the land upon payment of the
requisite occupancy price within prescribed period.
2.4 Notably, the original watandar did not seek re-grant of the
suit land. However, relying on a Government Resolution dated
17.05.1956 (not placed on record) permitting persons in actual
possession of the watan lands to seek re-grant, the mortgagee
(successor of the Appellants herein) paid the requisite occupancy
price and obtained a re-grant of the suit land in his favour in the
year 1960.
2.5 The Respondents herein (successors of the mortgagor)
then filed a suit for redemption of mortgage against Shankar
Sakharam Kenjale (mortgagee) in Regular Civil Suit No. 190 of
1978 before the Civil Judge, Junior Division, Vaduj. It was
contended that they had requested the mortgagee to accept the
mortgage money and reconvey the land, but he had failed to do so.
Vide judgment dated 09.12.1983, this suit was dismissed. It was
observed that the deed dated 14.05.1947 was in the nature of a
mortgage by conditional sale and not an outright sale. Further, it

was found that with the coming into force of the Abolition Act and
the failure of the original watandar and the Mirashi tenant––
mortgagor to secure a re-grant of the suit land, the said land stood
resumed to the Government and the relationship of mortgagormortgagee
between the parties ceased to exist. In light of this, it
was held that the mortgagor’s right of redemption had also
extinguished and the subsequent re-grant in favour of the
mortgagee could not be seen as one on behalf of the mortgagor so
as to pass on the benefits of the same to him.
2.6 The Respondents herein then preferred an appeal before
the District Judge, Satara in Civil Appeal No. 25 of 1984. On
24.03.1987, this appeal was dismissed. The District Court
reiterated the reasoning of the Trial Court that by virtue of the
failure of the watandar and the Mirashi tenant—mortgagor to
obtain a re-grant of the suit land in their favour, the said land had
been resumed to the Government under the Abolition Act, thereby
ending the mortgagor-mortgagee relationship between the parties.
Thus, in light of the subsequent re-grant made to the mortgagee, it
was found that the Mirashi tenant––mortgagor’s right to redeem
shall be deemed to have been extinguished.

2.7 Aggrieved, the Respondents filed a second appeal before
the High Court of Judicature at Bombay in Second Appeal No. 439
of 1987. Vide the impugned judgment, the concurrent conclusions
of the Trial Court and the First Appellate Court were set aside and
the suit for redemption was decreed. This was done on the basis
that but for the mortgage, the mortgagee would not have been in
possession of the suit land and could not have obtained the
re-grant order in his favour. Given that such re-grant was premised
on the underlying mortgagor-mortgagee relationship, it was held
that the benefit obtained by the mortgagee by virtue of such
re-grant must accrue to the Mirashi tenant––mortgagor. In this
respect, reliance was placed on Section 90 of the Indian Trusts Act,
1882 as well as the decisions of this Court in Jayasingh Dnyanu
Mhoprekar and Another v. Krishna Babaji Patil and Another,
(1985) 4 SCC 162, and Namdev Shripati Nale v. Bapu Ganapati
Jagtap and Another, (1997) 5 SCC 185. It is against this
judgment that the Appellants have come in appeal before this
Court.
3. Heard the Counsel for the parties.
4. Learned Counsel for the Appellants relied on the decisions
of this Court in Collector of South Satara and Another v.

Laxman Mahadev Deshpande and Others, (1964) 2 SCR 48, and
Malikarjunappa Basavalingappa Mamle Desai v.
Siddalingappa & Others, (1973) 3 SCC 180, to argue that once
the Abolition Act came into force, the suit land vested with the
Government and after its re-grant to the mortgagee, he became the
absolute owner of the land and all rights of the Mirashi tenant––
mortgagor, including the right to redemption, came to an end.
5. Per contra, learned counsel for the Respondents relied on
Section 90 of the Indian Trust Act, 1882 as well as the decisions of
this Court in Jayasingh Dnyanu Mhoprekar (supra) and Namdev
Shripati Nale (supra) to contend that the benefit obtained by the
mortgagee by virtue of the re-grant must accrue to the Mirashi
tenant––mortgagor. He also drew our attention to the proviso to
Section 3 of the Abolition Act coupled with certain provisions of the
Watan Act to argue that the rights of Ramchandra as a Mirashi
tenant survived the resumption of land to the Government under
the Abolition Act, and therefore his rights as a mortgagor (including
the right to redemption) also continued to survive despite the
re-grant in favour of the mortgagee.

6. Upon perusing the record and hearing the arguments
advanced by the parties, we find that the central issue arising for
our consideration in this appeal is as follows:
Whether the permanent Mirashi tenant—mortgagor’s
(Respondents) right of redemption ceased to exist by virtue of the
resumption of the suit land under the Abolition Act and its
subsequent re-grant in favour of the mortgagee (Appellants)?
7. As mentioned supra, it is not disputed that Ramchandra
was a permanent Mirashi tenant of the watandar of the suit land.
Admittedly, such lease was subsisting as on 25.01.1951, i.e., the
day on which the Abolition Act came into force.
8. At this juncture, it may be relevant to note certain
provisions of the Abolition Act as well as the Watan Act:
“Section 3. Abolition of certain watans together with
the right to office and incidents.—With effect from
and on the appointed day, notwithstanding anything
contained in any law, usage, settlement, grant, sanad
or order—
(1) all Parganas and Kulkarni watans shall be deemed
to have been abolished;
(2) all rights to hold office and any liability to render
service appertaining to the said watans are hereby
extinguished;
(3) subject to the provisions of Section 4, all watan land
is hereby resumed and shall be deemed to be subject to
the payment of land revenue under the provisions of the

Code and the rules made thereunder as if it were an
unalienated land:
Provided that such resumption shall not affect the
validity of any alienation of such watan land made in
accordance with the provisions of Section 5 of the Watan
Act or the rights of an alienee thereof or any person
claiming under or through him;
(4) all incidents appertaining to the said watans are
hereby extinguished.”
(emphasis supplied)
Additionally, Section 5 of the Watan Act is notable:
“Section 5. Prohibition of alienation of watan and
watan rights.—(1) Without the sanction of [the [State]
Government], [or in the case of a mortgage, charge,
alienation, or lease of not more than thirty years, of the
Commissioner] it shall not be competent-
(a) to a watandar to mortgage, charge, alienate or
lease, for a period beyond the term of his natural life,
any watan, or any part thereof, or any interest therein,
to or for the benefit of any person who is not a watandar
of the same watan;
(b) to a representative watandar to mortgage, charge,
lease or alienate any right with which he is invested, as
such, under this Act.
(2) In the case of any watan in respect of which a service
commutation settlement has been effected, either under
section 15 or before that section came into force, clause
(a) of this section shall apply to such watan, unless the
right of alienating the watan without the sanction of [the
[State] Government] is conferred upon the watandars by
the terms of such settlement or has been acquired by
them under the said terms.
It is also relevant to note Section 8 of the Abolition Act:

“Section 8. Application of Bombay Tenancy and
Agricultural Lands Act, 1948.–––
If any watan land has been lawfully leased and such
lease is subsisting on the appointed day, the provisions
of the Bombay Tenancy and Agricultural Lands Act,
1948, shall apply to the said lease and the rights and
liabilities of the holder of such land and his tenant or
tenants shall, subject to the provisions of this Act, be
governed by the provisions of the said Act.
Explanation.- For the purposes of this section the
expression ‘land’ shall have the same meaning as is
assigned to it in the Bombay Tenancy and Agricultural
Lands Act, 1948.”
From a reading of the proviso to Section 3(3) of the
Abolition Act, it is clear that the resumption of watan land to the
Government under the Abolition Act does not affect the rights of
an alienee of the watandar or his representative of such land under
the Watan Act or that of any person claiming through or under
him. Further, in respect of watan land that has been lawfully
leased and wherein the lease is subsisting on the day appointed
for the coming into force of the Abolition Act, Section 8 of the
Abolition Act accords primacy to the Bombay Tenancy and
Agricultural Lands Act, 1948 (hereinafter ‘Bombay Tenancy Act’) in
governing the rights and liabilities of the holder of such land and
his tenant(s).

9. In light of this, when we turn to the facts of the present
case, we find that the rights of Ramchandra, who was a lawful
permanent Mirashi tenant, survive resumption of the suit land to
the Government by virtue of the proviso to Section 3(3) as well as
Section 8 of the Abolition Act. This is because the tenancy created
in favour of the Mirashi tenant subsisted as on the day on which
the Abolition Act came into force, thereby implying that his tenancy
rights were protected and continued to be governed by the Bombay
Tenancy Act despite the introduction of the Abolition Act. This is
well-aligned with the general primacy accorded to tenancy laws
over other legislations, as is also reflected in Section 8 of the
Abolition Act. Thus, it is amply clear that the rights of permanent
tenants over watan lands were intended to subsist even after the
coming into force of the Abolition Act.
10. At this juncture, it may be useful to note certain other
provisions of the Abolition Act, which are as follows:
“Section 4. Holder of watan land to be occupant.—
(1) A watan land resumed under the provisions of this
Act shall subject to the provisions of Section 4-A, be
regranted to the holder of the watan to which it
appertained, on payment of the occupancy price equal
to twelve times of the amount of the full assessment of
such land within five years from the date of the coming
into force of this Act and the holder shall be deemed to
be an occupant within the meaning of the Code in

respect of such land and shall primarily be liable to pay
land revenue to the State Government in accordance
with the provisions of the Code and the rules made
thereunder; all the provisions of the Code and rules
relating to unalienated land shall, subject to the
provisions of this Act, apply to the said land:
Provided that in respect of the watan land which has
not been assigned towards the emoluments of the
officiator, occupancy price equal to six times of the
amount of the full assessment of such land shall be paid
by the holder of the land for its regrant:
Provided further that if the holder fails to pay the
occupancy price within the period of five years as
provided in this section, he shall be deemed to be
unauthorisedly occupying the land and shall be liable
to be summarily ejected in accordance with the
provisions of the Code.
(2) The occupancy of the land regranted under subsection
(1) shall not be transferable or partible by metes
and bounds without the previous sanction of the
Collector and except on payment of such amount as the
State Government may by general or special order
determine.
(3) Nothing in sub-sections (1) and (2) shall apply to any
land—
(a) the commutation settlement in respect of which
provides expressly that the land appertaining to the
watan shall be alienable without the sanction of the
State Government; or
(b) which has been validly alienated with the sanction
of the State Government under Section 5 of the
Watan Act.
Explanation.—For the purposes of this section the
expression ‘holder’ shall include—

(i) all persons who on the appointed day are the
watandars of the same watan to which the land
appertained, and
(ii) in the case of a watan the commutation settlement
in respect of which permits the transfer of the land
appertaining thereto, a person in whom the ownership
of such land for the time being vests.”
The above provisions indicate that, with the coming into
force of the Abolition Act, watans were abolished and all watan
lands vested absolutely with the Government, subject to Section 4.
Under Section 4(1), ‘holders’ of the watans were allowed to pay a
certain occupancy price within five years from the date of coming
into force of the Act and obtain a re-grant of the land. However,
according to the second proviso to Section 4(1) of the Abolition Act,
if the holder failed to pay such occupancy price within the five-year
period, he would be deemed to be in unauthorised occupation of
the land and would be liable to be summarily ejected in accordance
with the Bombay Land Revenue Code, 1879.
11. Notably, as mentioned supra, the watandar in the instant
case did not exercise her right to seek re-grant of the land under
Section 4(1) of the Abolition Act. It seems, the State Government
passed orders in G.R.R.D. No. PKA-1056-IV-L dated May 3, 1957
and G.R.R.D. No. 2760-III-48820-L dated November 23, 1960 to
grant the lands in favour of persons who were in actual possession.

By virtue of the aforesaid orders, wherever the holder or watandar
had failed to pay the occupancy price as required by Section 4(1)
of the Act before the prescribed period, the lands in question be
granted in favour of permanent Mirashi tenants who were in actual
possession of lands. But the Mirashi tenant in this matter, namely,
Ramchandra did not apply for re-grant pursuant to the said orders.
On the other hand, the mortgagee applied for re-grant, though he
was not a permanent Mirashi tenant.
12. By an order dated 23.11.1960, the mortgagee
(represented by the Appellants herein) obtained a re-grant of the
suit land upon paying the requisite occupancy price. It is claimed
that this was done on the basis of a Government Resolution dated
17.05.1956 permitting persons in actual possession of the watan
lands to seek re-grant. Notably, this Government Resolution dated
17.05.1956 has not been placed on record and nor has it been
considered by the three Courts. We hasten to note that the effect
of the Government Orders dated 03.05.1957 and 23.11.1960,
mentioned supra, was considered by this Court in para 5 of the
judgment in Jayasingh Dnyanu Mhoprekar (supra). But the
Government Resolution dated 17.05.1956 is not considered by this
Court earlier. Be that as it may, it is not in dispute that a re-grant

order was made in favour of the Appellants’ predecessor and has
not been questioned subsequently. Thus, proceeding on the basis
that the Government Resolution dated 17.05.1956 existed and the
re-grant was made in favour of the mortgagee, we find that the
central question to be considered here is the effect of such re-grant
on the rights of the Mirashi tenant––mortgagor.
13. In our considered opinion, the failure on the part of the
mortgagor to pay the occupancy price and seek a re-grant is not
fatal to his rights as a Mirashi tenant as the tenancy in his favour
continued to subsist despite the introduction of the Abolition Act,
as detailed in our discussion above. Consequently, the mortgage
executed by him also survived the resumption of the suit land
under the Abolition Act, and it cannot be said that the relationship
of mortgagor-mortgagee between the parties ceased to exist by
virtue of such Act.
14. It is well-settled that the right of redemption under a
mortgage deed can come to an end or be extinguished only by a
process known to law, i.e., either by way of a contract between the
parties to such effect, by a merger, or by a statutory provision that
debars the mortgagor from redeeming the mortgage. In other
words, a mortgagee who has entered into possession of the
mortgaged property will have to give up such possession when a
suit for redemption is filed, unless he is able to establish that the
right of redemption has come to an end as per law. This emanates
from the legal principle applicable to all mortgages – “Once a
mortgage, always a mortgage”.
15. In the present case, it is clear that none of the
aforementioned conditions in which the right of redemption comes
to an end exist with respect to the mortgage deed dated
14.05.1947. As regards the impact of the re-grant on such right of
redemption, it must be noted that such re-grant in favour of the
mortgagee could not have been made but for the fact that he was
in actual possession of the property by virtue of his position as a
possessory mortgagee. There is no doubt that had the Mirashi
tenant––mortgagor applied for a re-grant, the suit land would have
certainly been granted in his favour, as the rights of permanent
tenants in watan lands were allowed to subsist even after the
coming into force of the Abolition Act. Thus, in our considered
opinion, the re-grant to the Appellants’ predecessor based on
actual possession as mortgagee cannot be divorced from the
existence of the underlying mortgagor-mortgagee relationship
between the parties. Therefore, any benefit accruing to the

mortgagee must necessarily ensue to the Mirashi tenant––
mortgagor.
16. In this regard, it is apposite to note Section 90 of the
Indian Trusts Act, 1882, which reads as under:
“Section 90. Advantage gained by qualified owner.—
Where a tenant for life, co-owner, mortgagee or other
qualified owner of any property, by availing himself of
his position as such, gains an advantage in derogation
of the rights of the other persons interested in the
property, or where any such owner, as representing all
persons interested in such property, gains any
advantage, he must hold, for the benefit of all persons
so interested, the advantage so gained, but subject to
repayment by such persons of their due share of the
expenses properly incurred, and to an indemnity by the
same persons against liabilities properly contracted, in
gaining such advantage.”
A bare reading of this provision indicates that if a
mortgagee, by availing himself of his position as a mortgagee, gains
an advantage which would be in derogation of the right of the
mortgagor, he must hold such advantage for the benefit of the
mortgagor.
17. In the instant case, we find that the conditions stipulated
under Section 90 of the Indian Trusts Act, 1882 are satisfied. As
mentioned supra, the mortgagee could only obtain the re-grant in
his favour by availing himself of his position as a mortgagee, as

such re-grant is traceable to the possession of the land accorded
to him by virtue of the mortgage deed. Further, the said re-grant
was certainly in derogation of the rights of the mortgagor who was
the permanent Mirashi tenant and thereby protected by virtue of
the subsisting tenancy. The fact that the lessor/Mirashi tenant
Ramachandra did not claim re-grant is not relevant inasmuch the
right of redemption of a mortgagor is not extinguished by virtue of
re-grant in favour of the original defendant inasmuch as the
re-grant was obtained and the property was held by the original
defendant for the benefit of the mortgagors. Re-grant made in
favour of the original defendant is an advantage traceable to the
possession of the suit property obtained by him under the
mortgage and the said re-grant certainly subserves the right of
mortgagor who was a Mirashi tenant in respect of the suit property.
As mentioned earlier, Section 90 of the Indian Trusts Act, 1882
casts a clear obligation on the mortgagee to hold any right acquired
by him in the mortgaged property for the benefit of the mortgagor,
as he is seen to be acting in a fiduciary capacity in respect of such
transactions. Therefore, the advantage derived by the Appellants
(mortgagee) by way of the re-grant must be surrendered to the
benefit of the Respondents (Mirashi tenant––mortgagor), subject to the payment of the expenses incurred by them in securing the
re-grant. This is because the Mirashi tenant—mortgagors’ right to
redeem the mortgage was not extinguished but was protected by
virtue of the Abolition Act as well as under the provisions of the
Bombay Tenancy and Agricultural Lands Act, 1948; in other words,
the tenancy in his favour continued to subsist.
18. This is also supported by the decision of this Court in
Jayasingh Dnyanu Mhoprekar (supra) where in a similar factual
scenario of the mortgagee obtaining a re-grant in derogation of the
right of the mortgagor–Mirashi tenant, this Court held as follows:
“9. ……. It is seen that the mortgagees obtained the
grant in their favour by making an incorrect
representation to the Government that they were
permanent Mirashi tenants although they were only
mortgagees. Section 90 of the Indian Trusts Act, 1882
clearly casts an obligation on a mortgagee to hold the
rights acquired by him in the mortgaged property for the
benefit of the mortgagor in such circumstances as the
mortgagee is virtually in a fiduciary position in respect
of the rights so acquired and he cannot be allowed to
make a profit out of the transaction. The defendants are,
therefore, liable to surrender the advantage they have
derived under the grant in favour of the plaintiffs even
if the order of grant has become final before the Revenue
Authorities, of course, subject to the payment of the
expenses incurred by them in securing the grant. The
decree of the first appellate court accordingly has
directed that Rs 182.41 should be paid by the plaintiffs
to the defendants along with the mortgage money.”

19. In Namdev Shripati Nale (supra), while dealing with the
applicability of Section 90 of the Indian Trusts Act, 1882, this
Court observed as follows:
“6. …....The first respondent-mortgagee failed to comply
with the aforesaid statutory obligation. He committed a
wrong or a default. Whether the default/wrong
committed has as its basis a contractual obligation or a
statutory obligation, makes no difference. He was taken
to be a tenant by the authorities, which enabled him to
get the regrant in his favour. That was only because the
first respondent, as a possessory mortgagee, was in
possession of the property. He took advantage of his
position as a possessory mortgagee. In so doing he
faulted. So, on facts, it is clear that the first respondent
obtained regrant in his favour or obtained an advantage
in his favour, by availing himself of his position as a
mortgagee. In law, the advantage obtained by the first
respondent, the qualified owner, must be held to be for
the benefit of the persons interested — the mortgagorappellant.
We are of the view that in the totality of the
facts and circumstances, the provisions of Section 90 of
the Indian Trusts Act are attracted. The first
respondent-mortgagee gained an advantage by availing
himself of his position as a possessory mortgagee and
obtained the regrant. This he did by committing a
wrong. He committed a default in not paying the
occupancy price within the time limited by law for and
on behalf of the mortgagor. The regrant was obtained in
his name by posing himself as a tenant, which was
possible only because he was in possession of the land
(as a possessory mortgagee). The advantage so gained
by him in derogation of the right of the mortgagor
should attract the penal consequences of Section 90 of

the Indian Trusts Act. We hold that the default
committed by a possessory mortgagee, in the
performance of a statutory obligation or a contractual
obligation, which entails a sale or forfeiture of right in
the property to the mortgagor, will attract the provisions
of Section 90 of the Indian Trusts Act. In such cases any
benefit obtained by the qualified owner, the mortgagee,
will enure to or for the benefit of the mortgagor. The
right to redeem will subsist notwithstanding any sale or
forfeiture of the right of the mortgagor. We are of the
view that the law on this point has been laid down with
admirable clarity by this Court in Mritunjoy
Pani v. Narmanda Bala Sasmal [(1962) 1 SCR 290 : AIR
1961 SC 1353] and by K.K. Mathew, J. (as his Lordship
then was) in Nabia Yathu Ummal v. Mohd.
Mytheen [1963 KLJ 1177 : AIR 1964 Ker 225] . The said
decisions have our respectful concurrence.”
(emphasis supplied)
20. The facts in the case of Collector of South Satara (supra)
and the case of Malikarjunappa Basavalingappa Mamle Desai
(supra) were totally different and these cases were dealing with a
different point. The litigation in these cases was not related to the
rights of a permanent tenant under watandar. So also, the point
involved therein was not related to the effect of the order of re-grant
made in favour of the mortgagee. Therefore, we are of the
considered opinion that the dictum laid down in the
aforementioned judgments is not applicable to the facts of the case
at hand.

21. On other hand, in our considered opinion, the question
involved in the present litigation is squarely covered by the
judgments in Jayasingh Dnyanu Mhoprekar and Namdev
Shripati Nale (supra).
22. In view of the foregoing, we hold that the High Court was
justified in decreeing the suit filed by the Respondents herein and
setting aside the judgments of the Trial Court and the First
Appellate Court. We do not find any reason to interfere with the
impugned judgment. Accordingly, the instant appeal is dismissed.
…..…………................................J.
(MOHAN M. SHANTANAGOUDAR)
.……………………………...............J.
(R. SUBHASH REDDY)
New Delhi;
April 17, 2020

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