AKELLA JAGANNADHAM S/O VENKANNA Vs. VENUTHURUPALLI NARASIMHAM

JUDGEMENT

(1.) This appeal has been preferred by defendants 1 to 13 who represent the mortgagees under a usufructuary mortgage executed on 11 November 1893. The mortgagors now represented by respondents l to 3 brought the suit for redemption of the mortgage. The mortgage was for a sum of Rs. 625 and the document provided that the sum should carry interest at the rate of Re. 0-10-8 per cent. per month. At this rate which is equivalent to 8 per cent. per annum the annual interest on the mortgage money amounted to Rs. 60. The document recites that a fixed rent of Rs. 50 per year was settled in respect of the lands some of which had been cultivated and were in the occupation of tenants, the others being waste lands and then proceeds as follows: Therefore, towards the interest due on the aforesaid sum principal you shall enjoy the said lands for a period of 60 years, that is, from the current year Vijaya (1893) to the end of the recurring Vijaya year, viz, 1953, by way of leasing out the said lands etc., and enjoying as you like the usufruct therein. After the expiry of the stipulated period, that is, after the end of 60 years, on our paying to you at the commencement of Mosham of any year, the principal amount, you shall immediately deliver possession of the lands and the document to us. As the profit or loss in respect of the lease etc, relating to the lands is only yours, you shall raise extensive cultivation in the said lands and enjoy the same. You shall not be entitled to claim (any amount) towards the repairs executed by you in respect of the said lands after the expiry of the stipulated period. Even if we should offer to pay to you the principal amount within the stipulated period you are not bound to receive the same but shall enjoy the said lands as you like. The other provisions of the deed are not material for the purpose of this appeal. Notwithstanding that the period stipulated in the deed has not yet expired, respondents 1 to 3 claim to redeem the properties on the ground that under the Madras Agriculturists Relief Act the whole debt must be deemed to have been discharged by the mortgagee receiving the profits from the land at the rate of Rs. 50 per year and that therefore the mortgagee was bound to deliver back possession of the lands.

(2.) The suit was resisted mainly on three grounds : first, that the Act was not applicable to the debt in question as the mortgage debt had been assigned to defendants 12 and 13 who were widows of the mortgagee's family entitled to maintenance as against the members of the family and that therefore the debt was exempted under Section 4 (h) of the Act; secondly, that even if the Act was applicable, the debt was not liable to be scaled down under the provisions thereof as the receipt of the profits by the mortgagees under the terms of the deed could not be regarded as payments by the mortgagors within the meaning of Section 8 (2) of the Act; and thirdly, that even if such receipts could be regarded as payments and the debt must be deemed to have been discharged, the provision that the mortgagees should continue in possession of the properties for a fixed period of 60 years would disentitle the mortgagors to claim possession of the properties before the expiry of that period and that the suit was accordingly premature.

(3.) The trial Court dismissed the suit upholding the second of these contentions, namely that there were no payments within the meaning of Section 8 (2) of the Act. It also accepted another contention raised by the defendants, namely, that the debt was not payable at the commencement of the Act because the time for payment had not yet arrived under the terms of the bond. As this Court has held that the word "payable" in Section 7 means only recoverable" and that it would be sufficient for the purposes of the Act if the liability had been incurred at the commencement thereof, this contention was not pressed in this Court. The trial Court negatived the contention regarding the assignment of the debt to defendants 12 and 13, holding that the assignment was not valid because the mortgagors were not consenting parties to it. In the result it dismissed the suit. On appeal by respondents 1 to 3 herein, the learned Subordinate Judge while agreeing with the trial Court as regards the alleged assignment of the debt to defendants 12 and 13, differed on the question of the liability of the debt to be scaled down under the provisions of the Act. He held that the bond having provided for a rate of interest, the exemption under Section 10 (2) (i) of the Act did not apply and that the receipt by the mortgagees of the rents and profits of the property were payments by the debtors within the meaning of Section 8 (2) of the Act. On that footing as admittedly more than Rs. 2000 had been received by the mortgagee's family, he held that the debt must be deemed to have been discharged and that therefore respondents 1 to 3 herein were entitled to redeem. He accordingly remanded the suit to the trial Court for disposal after determining sundry other issues raised in the case which were left undetermined by that Court.