VENKU SHETTITHI (DEAD) Vs. TRAMACHANDRAYYA

JUDGEMENT

(1.) I agree. I am unable to regard the omission of the words " in good faith" which appeared in the corresponding articles of the Limitation Acts of 1859 and 1871, as being without any significance, so as to throw the onus on a purchaser of the full interest from a mortgagee to prove that he acted in good faith before he can plead limitation. The same Art. 134 governs both properties conveyed in trust and properties mortgaged when they have been transferred afterwards for valuable consideration. In the case of trust property the Privy Council has decided in Subbaiya Pandaram V/s. Muhammad Mustapha Marcayar (1923) ILR 46 M 751 : 45 MLJ 588 (PC) that a purchaser for valuable consideration with notice of the trust can under Art. 134 plead 12 years adverse possession as a defence to a suit brought by the trustee. I see no reason to suppose that trusts were intended to be put in a worse position than mortgagors as regards recovery of alienated property. The only distinction between the position of a purchaser from a mortgagee and a purchaser from a trustee is that a mortgagee as such has the mortgage interest, which is assignable, in the property, whereas a trustee as such has no transferrable interest. This distinction is pointed out in Subbaiya Pandaram V/s. Muhammad Mustapha Marcayar (1916) 32 MLJ 85 but nevertheless it was held in that case that a transferee of trust property need not prove good faith before taking advantage of Art. 134, and the decision was confirmed by the Privy Council in Subbaiya Pandaram V/s. Muhammad Mustapha Marcayar (1923) ILR 46 M 751 : 45 MLJ 588 (PC) My judgment in Kannuswami Tanjirayan V/s. Muthuswami Pillai (1917) MWN 5 was quoted with approval in Muthaya Shetti V/s. Kanthappa Shetti (1917) 34 MLJ 431 and we have not been shown any reason for doubting its correctness beyond a footnote at page 516 of Rustomji's commentary on the Law of Limitation (3 Edition). The view of the majority of the Full Bench which decided Seeti Kutti V/s. Kunhi Pathumma (1917) ILR 40 M 1040 : 33 MLJ 320 (FB) that Art. 134 does not apply to cases where the transferee from a mortgagee does not get possession of the property will not help the appellants before us who are out of possession and ask for delivery of possession. In every case where Art. 134 is set up as a defence by a transferee from a mortgagee it is material to see what interest the mortgagee purported to transfer to him vide Rego V/s. Abbn Bean (1897) ILR 21 M 151 and Muthaya Shetti Vs. Kanthappa Shetti (1917) 34 MLJ 431. Veerabhadra Tevan V/s. Veerappa Tevan (1912) 15 IC 609 and Baluswami Aiyar V/s. Venkatasami Naicker (1916) 32 MLJ 24. Ex. II, dated July 16, 1878, purports to be an absolute sale of the properties in A schedule and not a mere assignment of a mortgage interest in them. I think that both seller and purchaser must have honestly believed that the entire interest of the owner was being transferred by this document, seeing that if Ex. I, dated January 12, 1872, were to be treated as a sale with an option for re-purchase after 4 years and before 6 years, the date for re-purchase had passed and the property had become vested entirely in the purchaser on January 12, 1878. The present suit was rightly found by the Subordinate Judge to be time-barred and the appeal must be dismissed with costs. Ramesam, J.

(2.) This appeal arises out of a suit for redemption of a mortgage. The plaintiff's predecessors in title, namely one Parameshwari Hengsu and others mortgaged such of the properties as are comprised in Schedule A and the properties in Schedule A-1 to one Manjunatha Naika by Ex. I, dated the 12 January, 1872, for Rs. 14,000. The mortgagee conveyed the properties in Schedule A by Ex. II, dated the 16 July, 1878, to one Venkappa, the ancestor of the defendants and the defendants obtained them for their share at a family partition. The mortgagors assigned the equity of redemption in the mortgaged properties by Ex. B, dated the 12 September, 1906, to one Booba Shetti, from whom it devolved on the plaintiffs under the Aliyasanthana Law. We are not now concerned with the properties in Schedule A-1 as to which the interest of the mortgagee also has come to the plaintiffs hands by various transactions. The Subordinate Judge dismissed the suit. In appeal the claim for the properties in Schedule A-2 has not been pressed and no reference need be made to them and we are only concerned with the properties in Schedule A. Two points have been argued by the learned vakil for the appellants- (1) Whether Ex. I is a mortgage by conditional sale or a sale with an agreement for re-purchase? (2) Assuming it is a mortgage, whether the suit is barred by limitation under Art. 134 of the Limitation Act ?

(3.) In the view I take of the second question, I think it is unnecessary to discuss the first. For purposes of discussion I will assume in favour of the appellant that Ex. I ought to be construed only as a mortgage by conditional sale. The question now is whether the properties having been sold by Ex. II, Art. 134 of the Limitation Act does not apply.