SHANKAR SAKHARAM KENJALE (DIED) Vs. NARAYAN KRISHNA GADE
LAWS(SC)-2020-4-16
SUPREME COURT OF INDIA (FROM: BOMBAY)
Decided on April 17,2020

Shankar Sakharam Kenjale (Died) Appellant
VERSUS
Narayan Krishna Gade Respondents




JUDGEMENT

MOHAN M.SHANTANAGOUDAR, J. - (1.)The instant appeal arises out of the judgment dated 08.06.2009 passed by the High Court of Judicature at Bombay in Second Appeal No. 439 of 1987. Vide the impugned judgment, the High Court set aside the findings of the Trial Court and the First Appellate Court and directed the Trial Court to draw a preliminary decree of redemption of mortgage in favour of the Respondents herein.
(2.)The factual background to this appeal is as follows:
2.1 The land in question was Paragana watan property/Inam land (hereinafter 'suit land'). Such watan properties and watans were governed by the provisions of the Bombay Hereditary Offices Act, 1874 (hereinafter Watan Act'). Smt. Laxmibai, wife of one Bhawani Raje Ghadge, was the watandar of the suit land. She had inducted one Mr. Ramchandra (successor of the Respondents herein) as a permanent Mirashi tenant of the land. Such tenancy was hereditary in nature.

2.2 On 14.05.1947, the said Ramchandra (hereinafter 'Mirashi tenant - mortgagor') executed a mortgage deed in favour of one Shankar Sakharam Kenjale (hereinafter 'mortgagee') mortgaging the suit land with a condition of sale for an amount of Rs. 900/- advanced by Shankar Kenjale for the purpose of Ramchandra's household and personal sundry expenses. Per the terms of this deed, a period of ten years was envisaged for the repayment of the mortgage money and the mortgagee was placed in possession of the suit land.

2.3 Meanwhile, the Bombay Paragana and Kulkarni Watans (Abolition) Act, 1950 (hereinafter 'the Abolition Act') came into force with effect from 25.01.1951 with a view to abolish Paragana and Kulkarni watans and to make provision for the performance of functions of some of these offices. Under this Act, Paragana and Kulkarni watans were abolished and watan lands were resumed to the Government, subject to Section 4. It is needless to observe that the suit land, being watan property, was also resumed to the Government subject to Section 4, which empowered the holder of the watan to seek re-grant of the land upon payment of the requisite occupancy price within prescribed period.

2.4 Notably, the original watandar did not seek re-grant of the suit land. However, relying on a Government Resolution dated 17.05.1956 (not placed on record) permitting persons in actual possession of the watan lands to seek re-grant, the mortgagee (successor of the Appellants herein) paid the requisite occupancy price and obtained a re-grant of the suit land in his favour in the year 1960.

2.5 The Respondents herein (successors of the mortgagor) then filed a suit for redemption of mortgage against Shankar Sakharam Kenjale (mortgagee) in Regular Civil Suit No. 190 of 1978 before the Civil Judge, Junior Division, Vaduj. It was contended that they had requested the mortgagee to accept the mortgage money and reconvey the land, but he had failed to do so. Vide judgment dated 09.12.1983, this suit was dismissed. It was observed that the deed dated 14.05.1947 was in the nature of a mortgage by conditional sale and not an outright sale. Further, it was found that with the coming into force of the Abolition Act and the failure of the original watandar and the Mirashi tenant - mortgagor to secure a re-grant of the suit land, the said land stood resumed to the Government and the relationship of mortgagor-mortgagee between the parties ceased to exist. In light of this, it was held that the mortgagor's right of redemption had also extinguished and the subsequent re-grant in favour of the mortgagee could not be seen as one on behalf of the mortgagor so as to pass on the benefits of the same to him.

2.6 The Respondents herein then preferred an appeal before the District Judge, Satara in Civil Appeal No. 25 of 1984. On 24.03.1987, this appeal was dismissed. The District Court reiterated the reasoning of the Trial Court that by virtue of the failure of the watandar and the Mirashi tenant - mortgagor to obtain a re-grant of the suit land in their favour, the said land had been resumed to the Government under the Abolition Act, thereby ending the mortgagor-mortgagee relationship between the parties. Thus, in light of the subsequent re-grant made to the mortgagee, it was found that the Mirashi tenant - mortgagor's right to redeem shall be deemed to have been extinguished.

2.7 Aggrieved, the Respondents filed a second appeal before the High Court of Judicature at Bombay in Second Appeal No. 439 of 1987. Vide the impugned judgment, the concurrent conclusions of the Trial Court and the First Appellate Court were set aside and the suit for redemption was decreed. This was done on the basis that but for the mortgage, the mortgagee would not have been in possession of the suit land and could not have obtained the re-grant order in his favour. Given that such re-grant was premised on the underlying mortgagor-mortgagee relationship, it was held that the benefit obtained by the mortgagee by virtue of such re-grant must accrue to the Mirashi tenant - mortgagor. In this respect, reliance was placed on Section 90 of the Indian Trusts Act, 1882 as well as the decisions of this Court in Jayasingh Dnyanu Mhoprekar and Another vs. Krishna Babaji Patil and Another, (1985) 4 SCC 162, and Namdev Shripati Nale vs. Bapu Ganapati Jagtap and Another, (1997) 5 SCC 185. It is against this judgment that the Appellants have come in appeal before this Court.

(3.)Heard the Counsel for the parties.
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