B.V. SUNDARARAJA IYER AND ORS. Vs. KANAKARAJ

JUDGEMENT

(1.) THIS appeal at the instance of the mortgagors is directed against the judgment of Mack, J., in C.M.A. No. 502 of 1951, which arose out of proceedings instituted by the appellants for a declaration of the amount due under an usufructuary mortgage after applying the provisions of Section 9 -A of Madras Act IV of 1938. The father of the appellants 1 and 3 had executed an usufructuary mortgage on 25th April, 1924, for Rs. 7,499 in favour of one Mohideen Meeraganni Rowther. After he death of the mortgagee his heirs transferred on 13th August, 1935, their rights, under the mortgage, to one Alagannan Chettiar for a consideration Rs. 5,500. The representatives of the assignee -mortgagee and the respondent who claimed rights to the mortgage were impleaded as parties and it was claimed that only a sum of Rs. 917 would be due in respect of the usufructuary mortgage. The representatives of Alagannan Chettiar disclaimed all interest in the mortgage stating' that the mortgage along with certain other out -standings had been assigned to the respondent on 1st January, 1938, in partial satisfaction of a large sum due to him. The case for the respondent was that Alagannan Chettiar who obtained the assignment of the mortgage from the original mortgagee did so on behalf of a firm in which he and his brother Suppan Chettiar were partners, that the respondent's father who was a divided brother of Alagannan Chettiar had deposited large sums of money in the firm and after his death the respondent became entitled to the monies so deposited, that the firm fell on evil days and it had to be wound up, and that in the course of winding up the respondent was given on 1st January, 1938, several items of assets one of which was the mortgage right which; belonged to the firm in satisfaction of his claim. The consideration attributable to the assignment was Rs. 5,500 -13 -9. That -assignment was oral but the respondent claimed that as he entered into possession of the mortgaged properties immediately he had perfected his title as an assignee of the mortgage by adverse possession and that he would be entitled to a sum of Rs. 5,500 -13 -9 on the basis of the proviso to Section 9A(10)(ii)(b) of the Act. The learned Subordinate Judge held that as the assignment was not effected by a registered instrument, as required by Section 54 of the Transfer of Property Act, the respondent could not be deemed to be an assignee even though he might have acquired the mortgagee's right by adverse possession and that Section 9 -A(10)(ii)(b) would not apply. He granted a declaration that the amount due under the mortgage was Rs. 917.

(2.) THE respondent appealed to this Court against that order and Mack, J., allowed, the appeal, holding that on an equitable construction of Section 9 -A, there should be no distinction between an assignee of an usufructuary mortgage by virtue of a registered instrument and a person who acquired title to the mortgagee's right by adverse possession. The learned Judge further held that the respondent was entitled to' protection under Section 53 -A of the Transfer of Property Act and, therefore, the debt was not liable to be scaled down. In this view the learned Judge dismissed the appellants' application for scaling down the mortgage debt without even giving a declaration in conformity with the admitted case of the respondent that he would be entitled to Rs. 5,500 -13 -9. The appellants have filed this appeal under Clause 15 of the Letters Patent against the judgment of Mack, J.

(3.) AS the benefit of the section is granted only to a transferee it is necessary that there should be a valid transfer. An instrument of mortgage of immovable properties is itself an interest in immovable property and if its value is more than Rs. 100 it could be effected only by a registered document. Vide Elumalai Chetti v. Balakrishna Mudaly : AIR1922Mad344 . In the absence of such an instrument a mere oral assignment of the mortgage right, as in the present case, cannot invest in the respondent the rights of the transferee of the mortgage. We do not agree with the learned Judge that Section 53 -A of the Transfer of Property Act would enable the respondent to claim the benefit as a transferee. For one thing there was no contract to transfer the mortgage right in writing signed by the transferors. Even if the conditions for the applicability of Section 53 -A are deemed to be satisfied, the doctrine of part performance embodied in the section does not operate to effect a transfer of title, which under the provisions of Section 54 can be effectuated only by a registered instrument. In Probodh Kumar Das v. Dantamara Tea & Co. Ltd. ., Lord Macmillan observed: