BHARAT RAMANUJ DAS MAHANTA Vs. ISHAN CHANDRA HALDAR

JUDGEMENT

(1.) This is an appeal by the plaintiff in a suit for redemption of an usufruatuary mortgage, dated the 11th July 1881. On the 28th August 1884, the enquiry of redemption was sold in execution of a money-decree against the mortgagor, and was purchased by the mortagagee. On the 11th May 1907, the plaintiff took a conveyance of the equity of redemption from the heirs of the mortgagor, and on the 19th May 1913, instituted this suit for recovery of possession upon redemption. The Courts below have dismissed the suit, on the ground that the plaintiff, by his purchase, has not acquired title to the equity of redemption and cannot claim to redeem the mortgage. The plaintiff-appellant has controverted this view and has argued that the mortgagee, by his purchase of the equity of redemption on the 20th August 1884, did not acquire an irredeemable title but became a trustee for the benefit of the mortgagor and might be called upon to submit to redemption. In support of this view, reliance has been placed upon the decision in Erasappa Mudaliar v. Commercial and Land Mortgage Bank 23 M. 377 : 10 M.L.J. 91 : 8 Ind. Dec. (N.S.) 665 and Pancham Lal Chowdhury v. Kishun Pershad Misser 6 Ind. Cas. 47 : 14 C.W.N. 579 : 12 C.L.J. 574.

(2.) The first of these cases apparently assists the contention of the appellant but we are unable to accept as well founded the rule of law enunciated therein. We cannot affirm the proposition that whenever a mortgagee purchases the equity of redemption at a sale held in execution of a money-decree obtained by a stranger against the mortgagor, the mortgagee holds the equity of redemption as trustees for the mortgagor and for his benefit. Neither principle nor authority supports this comprehensive proposition, which has, indeed, been expressly repudiated in the cases of Sesha Ayyar v. Krishna Ayyangar 24 M. 96, Kuttan Nayar v. Krishnan Mussad 12 M.L.J. 390 and Ikkotha v. Chakkiamma 27 M. 428. We are further of opinion that the broad rule formulated on behalf of the appellant is contrary to the decision of the Judicial Committee in Raja Kishendatt Datt Ram v. Mumtaz Ali Khan 6 I.A. 145 : 5 C. 198 : 5 C.L.R. 213 : 4 Sar. P.C.J. 17 : 3 Suth. P.C.J. 637 : Rafique & Jackson s P.C. No. 58 : 3 Ind. Jur. 426 : 3 Shome L.R. 1 : 2 Ind. Dec. (N.S.) 737 (P.C), where the judgment of Knight Bruce, L.J., in Shaw v. Bunny (1865) 33 Beav. 494 : 2 De G.J. & S. 468 : 139 R.R. 1901 : 46 E.R. 456 : 34 L.J.Ch. 257 : 11 L.T. 465 : 11 Jur. (N.S.) 99 : 13 W.R. 374 was quoted with approval. The question raised before the Judicial Committee was whether, when a landed estate has been twice mortgaged by the owner, so that there are several distinct mortgages not connected with each other, one first, the other second, and the first mortgagee having a power of sale duly exercises it, the second mortgagee becoming the purchaser, such a state of things prevents him from acquiring by means of the purchase that absolute and irredeemable title against the mortgagor which a stranger making the purchase would have acquired. The question thus formulated was answered in favour of the purchaser, and it was ruled that, in the absence of special circumstances to show that the second mortgagee had availed himself of the position as a mortgagee to procure some facility or advantage leading to the purchase or connected with it, he is precisely in the same position as a stranger purchaser. See also kirkwood v. Thompson (1865) 2 H. & M. 392 : 44 L.J.Ch. 305 : 11 Jur. (N.S.) 385 : 12 L.T. (N.S.) 446 : 144 R.R. 189 : 71 E.R. 515 affirmed 2 De G.J. & S. 613 : 34 L.J. Ch. 501 : 12 L.T. (N.S.) 811. This view is in accord also with the decision of the Judicial Committee in Khiarajmal v. Daim 32 C. 296 : 9 C.W.N. 201 : 2 A.L.J. 71 : 7 Bom. L.R. 1 : 1 C.L.J. 584 : 32 I.A. 23 : 8 Sar. P.C.J. 734 (P.C.). That case is not an authority for the proposition that a mortgagee is under a disability to purchase the equity of redemption brought to sale at the instance of a stranger decree-holder, although the position might be different if the mortgagee himself acquired the equity of redemption at an execution sale held at his instance in contravention of the rule enunciated in Section 99 of the Transfer of Property Act.

(3.) As regards the judgment in Pancham Lal Chowdhury v. Krishnan Pershad Misser 6 Ind. Cas. 47 : 14 C.W.N. 579 : 12 C.L.J. 574, we are not unmindful of the dictum it contains, namely, that as an established proposition of law, the purchase of the equity of redemption constitutes the mortgagee the trustee for the mortgagor. This observation, however, must be limited to the circumstances of the particular case then before the Court, namely, the case of a purchase by the mortgagee in contravention of the provisions of Section 99 of the Transfer of Property Act.