Decided on March 24,1955

Dattajirao Appellant
Prahladdas Respondents


Dixit, J. - (1.) THIS is a Defendant's appeal in a suit for the taking of accounts of a mortgage with possession and for the recovery of Rs. 2,060 -1 -6, the surplus amount said to have been paid by the mortgagor to the Defendant mortgagee. The case of the Plaintiff Prahlad Das was that one Raghuwar Dayal mortgaged with possession with the Defendant Krishnarao Patankar two houses belonging to him for the total consideration of Rs. 10,000, that subsequently Raghuwar dayal sold the property to the Plaintiff for Rs. 28,000, that thereafter the Plaintiff served the Defendant with a notice to explain the accounts of the mortgage and to restore the possession of the properly to him after receiving such amount as may be found due from him after the taking of accounts; that the Defendant without rendering any accounts demanded from the Plaintiff Rs. 13,049 -8 -0 for the redemption of the property; that the Plaintiff first objected to the payment of this amount saying that it was high and not due under the mortgage but ultimately paid under protest the amount demanded by the mortgagee and obtained possession of the property after giving a receipt to the Defendant -mortgagee. The Plaintiff further averred that on 29th January 1943 he gave a notice to the Defendant stating that in the amount of Rs. 13,049 -8 -0 demanded by him i.e., the mortgagee and paid to him, an amount of Rs. 2,049 -8 -0 over and above the amount really due under the mortgage had been included and calling upon the Defendant to pay this amount together with interest therein. The Defendant failed to pay this amount to the Plaintiff. He, therefore, instituted a suit out of which this appeal arises. The Defendant admitted the mortgage as also the receipt of Rs. 13,049 -8 -0 form the Plaintiff. He however, pleaded that the Plaintiff forcibly took possession of the property and that the Plaintiff could only sue for redemption of the property and that his suit for the taking of accounts which was not maintainable. The city Sub -Judge of Lashkar, who tried the suit dismissed it on the ground that the suit was not maintainable. In appeal the learned District Judge if Gwalior held that the Plaintiff's suit was maintainable and remanded it for trial to the original Court. When the matter came up in 'Civil Second Appeal No. 154 of Samvat 2003' before this Court, my learned brother Abdul Hakim Khan J., allowing the appeal, directed the Court of District Judge to determine on merits the appeal preferred to him. He also expressed the opinion that if the Plaintiff had redeemed the property and obtained possession thereof, then his suit for accounts was maintainable. The learned District judge accordingly decided the appeal on merits. He found that the Plaintiff redeemed the property and obtained possession of it after paying Rs. 13,049 -8 -0 to the Defendant -mortgagee and that the Plaintiff was entitled to ask the Defendant to render accounts of the mortgage transaction. Accordingly he passed a preliminary decree for the taking of accounts. The Defendant has now appealed to this Court from this preliminary decree.
(2.) MR . Motilal Gupta first submitted that the Plaintiff had not been able to prove that he had redeemed the property and that there was no registered document to prove the redemption. There is no substance in this contention. The evidence on record clearly shows that the Defendant -Appellant after obtaining from the Plaintiff Rs. 13,049 -8 -0 the amount demanded by him as due under the mortgage, gave back the possession of the property to the Plaintiff and took from him a receipt. The payment of the money and the restoration of the possession are, in my opinion, sufficient evidence of redemption of the mortgage. The redemption of a mortgage can be evidenced by the fact of the payment of the mortgage amount, other facts, and the conduct of the parties. A registered deed is not necessary for the redemption of a mortgage. Learned Counsel referred me to - 'Kashinath Bhaskar v. Bhaskar Vishveshwar' : AIR 1952 SC 153 (A), as an authority for the proposition that the Plaintiff could not, in the absence of a registered deed of redemption, prove the facts that he had redeemed the property. The Supreme Court's decision does not lay down any such proposition. In that case the difference between a receipt evidencing the payment of mortgage money and a release was considered and it was pointed out that: a receipt is not the payment, nor does the document in such a case serve to extinguish the mortgage or limit the liability. It is the payment of the money which does that and the receipt does on more than evidence the fact. Not so a release. The extinguishment or diminution of a liability is in that event effected by the agreement itself and not by something external to it. If the agreement is oral, it is hit by proviso to Section 92, Evidence Act, for it 'rescinds' or 'modifies' the contract of mortgage. If it is in writing, it is hit by Section 17(1)(b), Registration Act, for in that case the writing itself 'limits' or 'extinguishes' the liability under die mortgage. It was further observed by the Supreme Court that when the mortgagor pays money due on the mortgage, in whole or in part, he is carrying out the terms of the bond and is not making any alteration in it, and even though the fact of payment may limit or extinguish the mortgagee's interest that is only because the bond is working, itself out by the force of its own terms and not by reason of some new agreement which seeks to modify it or limit or extinguish the interest which it creates. It is plain from these observations that what the Supreme Court held was that an agreement whether called a release or a remission, which effects an alteration in the mortgage contract and by the force of its terms limits, or extinguishes the liability under the mortgage, requires to be in writing and registered. There is nothing in the Supreme Court's decision to suggest that there must be a registered deed for the redemption of a mortgage and the redemption cannot be proved by the fact of payment of the mortgage amount and other circumstances. In my view the learned District Judge was right in holding on the evidence on record that the Plaintiff obtained possession of the property after redeeming it.
(3.) IT was next contended that the Plaintiff had not alleged in the plaint that he had paid to the Defendant the amount, which he was now seeking to recover, through some mistake or fraud and that in the absence of any such averment his suit was not maintainable. This contention also is devoid of any force. The mortgagor's right to demand accounts of die profits received by die mortgagee in possession and to recover from the mortgagee any surplus left in his hand after the satisfaction of the mortgage amount is a right arising from and connected with his right to redeem or recover possession of the property and tire liability of the mortgagee to account of the profits received by him. The right to recover surplus amount in the hands of the mortgagee is not a right founded on mistake or fraud. The point whether the mortgagor can, after receiving possession of the property and paying under protest the amount demanded by the mortgagee sue to receiver surplus amount from the mortgagee is concluded by the decision of my learned brother Khan J., in 'Civil Second Appeal No. 154 of Samvat 2003'. The Appellant cannot canvass the pointg again in this appeal. I may however, add that what my learned brother held is in accord with the decision in -'Raj Raghubar Singh v. Bikramajit Singh', AIR 1915 Oudh 63 (B), where it has been held that where redemption has been effected on payment under protest of the money demanded by mortgagee and there is nothing to indicate that any adjustment of accounts had been made, then a suit for surplus profit is maintainable.;

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