Decided on December 02,1953



Satyanakayana Rao, J. - (1.) This appeal is by the plaintiffs against the decision of the learned Subordinate Judge of Palghat, dismissing their application, I. A. No. 560 of 1949, for scaling down the debt in O. Section No. 53 of 1945.
(2.) On 14-7-1933 an usufructuary mortgage was executed by the Tavazhi of the plaintiffs, which was a branch of Manavaahi tarwad, for a sum of Rs. 16000, in favour of the first defendant in the suit, who is the first respondent in this appeal. The mortgage itself seems to be in renewal of certain earlier debts, the details of which are not relevant for this appeal. Contemporaneously with the mortgage there was a lease back of the mortgage property to the mortgagors for a rent of Rs. 1150 per year. A 3/5th share in the equity of redemption on the hypotheca eventually devolved on the 2nd defendant, who is no other than the daughter of the first defendant. On 11-9-1936 the mortgagors surrendered possession of the properties to the first defendant, the mortgagee, and the mortgagee continued in possession of the properties by the date of the suit, O. Section No. 53 of 1945. That suit was instituted for partition and separate possession of the plaintiff's 2/5th share in the plaint schedule properties, and the second defendant, who owned the undivided 3/5th share, was impleaded as a party. The properties in the tayazhi, other than those which comprised in the suit, were divided earlier, and the suit was, therefore, confined to the property covered by the usufructuary mortgage deed Of 1933. With a view to have the debt due to the first defendant ascertained and determined, she was also impleaded as a party to the action. Various defences were raised to the action, and one of the issues in the suit covered the dispute between the parties concerning the correct amount due to the first defendant on account of the mortgage and the lease back. The first defendant also claimed in the action that she was entitled to the value of the improvements, and an issue on that question was also raised in the suit. The plaintiffs claimed in the suit also a relief under the Madras Agriculturists Relief Act, Act 4 of 1938. The issues in which the first defendant was interested, namely, issues 6 and 7, were also considered by the trial Judge, and findings were recorded on those issues. The correct amount due to the first defendant was determined to be Rs. 16000, the principal of the mortgage, as also the arrears of rent as found under issue 6 and interest thereon was calculated at 10 per cent. As the first defendant failed to establish that she was entitled to any value of the improvements, the issue relating to that was found against the first defendant. During the course of the trial of the suit, the first defendant agreed and endorsed on the plaint that she was willing to allow partial redemption of the plaintiffs' 2/5th share of the mortgage property when they sought to redeem the same. She also agreed to the apportioning of the liability due under the mortgage of the lease back as determined by the court in the ratio of 2/5th to be borne by the plaintiffs and 3/5th by the second defendant. The second defendant, who was a party to the action, did not object to the arrangement to which the first defendant was a party, under which the liability under the mortgage and the lease back was split up in the proportions stated above and which also allowed the plaintiffs to redeem their 2/5th share on payment of the proportionate amount due to the first defendant. In pursuance of this arrangement and the findings recorded by the court, a preliminary decree was passed In the suit on 18-3-1947. Two clauses of this decree are relevant for the decision of this appeal. They are clauses 2 and 3 of the decree. Clause 2 of the decree is as follows: "That the plaintiffs are liable to pay the first defendant 2 out of 5 shares of the mortgage amount of Rs. 16000 due to her towards the principal as well as 2 out of 5 shares in the arrears of rent which were specified ...... the second defendant being liable to pay the balance of 3 out of 6 shares to the first defendant as calculated above." Clause 3 is "that as agreed to by the first defendant after division of the properties by metes and bounds the plaintiffs be at liberty to redeem their 2/5th share on payment of the proportionate amount of the mortgage and arrears of rent due to the first defendant as shown above." On 17-4-1947 an application was filed for passing a final decree in the suit. While these proceedings were pending, on 4-10-1947, the second defendant, as evidenced by Ex. B. 1, ozhimuri, or release deed, as it is called -- purported to pay the full mortgage amount to the first defendant, who is her mother, and redeem the entire mortgage and obtain possession of the properties from the first defendant. On 7-4-1949 the application, I. A. No. 560 of 1949, for scaling down the debt under Sections 8, 9, 9-A and 17-a of the Madras Agriculturists Relief Act, as amended by the Act of 1948, was filed by the plaintiffs. The learned Subordinate Judge passed a final decree in the suit on 18-4-1949 without disposing of the application, I. A. No. 560 of 1949, but providing under the final decree that, if it was found ultimately that the mortgage amount and arrears of rent are liable to be scaled down, then the plaintiffs should pay 2/5th of the reduced mortgage amount and the arrears of rent. Afterwards the application for scaling down the decree debt was taken up for consideration by the learned Subordinate Judge and he dismissed the application on 17-9-1949 on the ground that the mortgage was protected under Sub-section 8 of 3. 9-A of the Madras Agriculturists Relief Act, which section was introduced by the amending Act of 1948. Hence this appeal.
(3.) Under Section 9-A, Sub-section 8, protection is given to a co-mortgagor redeeming the usufructuary mortgage, if the redemption was of the entire mortgage made during the period between 30-9-1937 and 30-6-1948. The subsection runs as follows : "Where the equity of redemption in the property subject to the usufructuary mortgage belonged to, or devolved on, two or more persons and any of them or any person claiming under any one of them has, during the period referred to in Sub-section (7), Clause (ii) (a), redeemed the entire mortgage nothing contained in this section shall affect the rights or the reliefs to which the person redeeming the mortgage might be entitled to under any other law for the time being in force as against the other persons aforesaid." (The explanation Is omitted as not being relevant). The point for determination is whether at the moment when the second defendant paid the mortgage amount under B. 1 on 4-10-1947, she was a co-mortgagor in respect of the usufructuary mortgage entitled to redeem the entirety of the mortgage. A contention was raised before the learned Subordinate Judge, that B. 1 was a nominal transaction entered into at a time when the bill to amend the Madras Agriculturists Relief Act, which ultimately became the Act of 1948, was under consideration of the Select Committee, and that it was brought into existence with a view to defeat the provisions of the Act, which would enable the plaintiffs to have the debts scaled down. But the findings of the learned Subordinate Judge, based on the evidence of the husband of the first defendant, who was a member of the Legislative Assembly, is against the plaintiffs. Notwithstanding the attack levelled against that finding by the learned counsel for the appellants we are not convinced that the finding of the learned Subordinate Judge regarding Ex. B. 1 is erroneous. We therefore proceed on the footing that the transaction under Ex. B. 1 was a real transaction and not a nominal one.;

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