KAMLAKAR AND COMPANY Vs. GULAMSHAFI IMAMBHAI MUSALMAN

JUDGEMENT

(1.) These two appeals raise at least one question in common and that is why they have been placed together. In appeal No. 1041 of 1958, the point arises in execution proceedings and in appeal No. 1162 of 1958 it arises in a suit proper. In both these cases, the mortgagors obtained redemption decrees against their mortgagees. The mortgagees had before the filing of the suit created monthly tenancies in respect of the mortgaged premises. After the decrees were obtained, the tenants of the mortgagees claimed protection under the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947. In appeal No. 1041 of 1958, the mortgagor sought to execute the decree against the tenants also on the ground that once the decree was passed in his favour against the mortgagee, the tenants of the mortgagee were bound by the decree and, therefore, he was entitled to obtain physical possession of the properties. In Appeal No. 1162 of 1958, an order for symbolical possession was passed in favour of the mortgagor in execution proceedings under which he obtained symbolical possession. Thereafter he filed the suit, out of which the present appeal arises, for possession against the tenants on the ground that they were trespassers and were not entitled to the protection of the Rent Act.

(2.) The first question, therefore, that arises in both the appeals is, whether or not a monthly tenant of the mortgagee inducted before the date of the suit can claim protection of the Rent Act, 1947. It is contended on behalf of the tenants that under Section 76(a) of the Transfer of Property Act, a mortgagee in possession is entitled to manage the property as a person of ordinary prudence would manage it as if it were his own. It is argued that in view of this provision the mortgagee would be entitled to create monthly tenancies in respect of the properties in disputed and if that is so, on redemption the mortgagor is bound by the creation of such tenancies.

(3.) Mr. Kotwal relies on two cases which support his contention. These cases are Chinnappa Thevan v. Pazhaniappa Pillai, AIR 1916 Mad 911 and Hardei v. Wahid Khan, AIR 1954 All 16. We will first examine the question on principle apart from authority. It is undoubtedly true that a mortgagee has got the right of making prudent management of a property that has come into his possession. That right must necessarily be co-terminus with his right to continue as a mortgagee and it must come to an end as soon as his right to continue in possession ends. If during that period the mortgagee creates any leases as any other ordinary prudent persons would do in respect of his own property, the mortgagor cannot make any grievance whatsoever. From this, the further proposition, that if the original lease or grant was within the power of the mortgagee, then it would continue even after the redemption and would bind the mortgagor does not necessarily follow. Much would depend upon the nature of the interest created by the mortgagee. In respect of leases the rights of the parties are governed by the special provisions in the Transfer of Property Act. Section 111 (c) provides that a lease of immovable property determines when the interest of the lessor in the property terminates on, or his power to dispose of the same extends only to, the happening of any event by the happening of such event. This section in clear and unmistakable terms lays down that once the authority of the lessor to lease the property ends, the lease also necessarily terminates. This section must apply to all powers and authorities derived either from the Transfer of Property Act or from any other law. The mortgagee's rights cannot be any higher than that of any other lessor whose rights are limited in point of time by the very nature of the relationship between the lessor and the owner. If once this position is reached, the Court must hold that the mortgagor is entitled to get possession of the property unless there is some provision in law which creates an exception to this doctrine. This conclusion is supported by the decision of the Supreme Court in the case of Mahabir Gope v. Harbans Narain, AIR 1952 SC 205. In paragraph 6 of their judgment, their Lordships observe:--