- (1.) THIS appeal has been filed against the concurrent decrees of the lower courts whereby the suit of the plaintiff-respondent for redemption of mortgage and delivery of possession was decreed. The suit of the plaintiff-respondent is based on the deed (Ex. P. 1), whereby the land in question was handed over to the defendants-appellants for a period of 10 years to meet the debt of Rs. 2000/- which the plaintiff- respondent, had incurred with the stipulation that the defendant Janvedsingh will cultivate the land for 10 years and will also pay the rent due to the landlord. For a period of 10 years, the plaintiff will have no connection with the land and the debt will be deemed to have been extinguished after the expiry of this period at the rate of Rs. 200/- per year.
(2.) THE defendants-appellant denied the suit and claimed that the fields had been subject to them and not mortgaged as alleged by the plaintiff-respondent. It was, further contended that they had acquired khatedar rights under Sec. 19 of the Rajasthantenancy Act and the plaintiff respondent had no locus standi to evict them. THE entire question then turns on the construction of the document executed at the time of the transfer of the land. While the plaintiff-respondent alleges that it was a mortgage deed, the defendants contend that it was a lease deed. As stated above, both the lower courts came to the conclusion that it was a mortgage deed. Hence the suit was decreed in favour of the plaintiff-respondent. It contended on behalf of the appellants that the document is styled as the Patta and does not fulfil the requirements of the mortgage deed. A mortgage deed must fulfil three conditions. Firstly, it should indicate that the property has been transferred as a security for a debt. Secondly, it should mention the rate of interest. Thirdly, it should make a mention of the right of redemption. It is, further, argued that under the then obtaining Dholpur Laws, the plaintiff had no right to create the mortgage. It is also contended that the stamp duty affixed on me deed is not in accordance with the requirements of the mortgage deed. It is, furtner, urged that the lower courts have ignored the evidence produced by the defendants and that issue No. 1 whether the defendants have acquired khatedari rights and the suit cannot proceed has not been properly adjudicated For these reasons, it is contended that the lower courts have manifestly fallen into an error of law and their judgments are not maintainable. On the other hand, it is contended on behalf of the plaintiff-respondent that the interpretation of the deed executed at the time of the transfer of the land would depend upon the intention of the parties as well as the construction of the document. It is urged that the land was transferred in lieu of the debt which had been incurred by the plaintiff respondent. Therefore, the mere mention of the word 'patta' would not take away from the character of the document which is to all intent and purposes a mortgage deed. A mortgage, as defined in Sec. 58 (a) of the transfer of Property Act, is the transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability. It is contended that the transaction falls within the four corners of the above definition. Further it conforms to the definition of usufructuary mortgage in which the mortgagor delivers possession of the mortgaged property to the mortgagee and authorises him to retain such possession until payment of the mortgage money, and to receive the rents profits accruing from the property in lieu of interest or in payment of the mortgage money. As regards the non-maintainability of the suit on the ground that the mortgage was void, it is argued on the strength of Sheo Bux vs. Bhuriya (1958 RRD 92) that even if a mortgage is void, the mortgagor is entitled to redeem the property, where the mortgagee has been in possession for more than 12 years, as in that case there comes into existence a legally operative mortgage and the mortgagee acquires by prescription the rights of a mortgagee. As stated above, the entire case hinges upon the construction of the deed which was executed between the parties at the time of the transfer of the land. According to the learned counsel for the appellants, it was a lease deed. In support of contention, he has cited a number of authorities. A reference has been made to Smt. Kawal Patti vs. Ram Jokhan Upadhya (AIR 1956 All. 150 ). In this case a debtor had taken a loan of Rs. 500/- from his creditor on the foot of a pronote and subsequently put the creditor into possesion of his Khudkasht fields under an oral agreement between the parties to the effect that the creditor should continue in possession till the debt is liquidated. It was held that the transaction did not amount to a 'mortgage' within the meaning oi. that term under the Transfer of Property Act. A perusal of this case shows that one of the reasons why this transaction was not deemed to be a mortgage was that it did not fulfil the provisions of sec. 59 of the Transfer of Property Act under which where the principal money secured is Rs. 100/- or upwards, a mortgage can be effected only by a registered instrument signed by the mortgagor and attested by atleast two witnesses. Under the circumstances, we do not think this reference can be of much avail to the appellants. Similarly, the rule laid down in Jageshur Singh vs. Alakh Narain Singh (AIR 1939 Patna 265) also cannot help them. In this case, a settled raiyat had executed a "zarpeshgi" lease in favour of the landlord in a period by 3 years. The recital in the document indicated that the object of the executants in leadig the land was not for the purpose of securing the repayment of the advance of Peshgi money but to acquire more Karta land in the village as the lands which they had were insufficient for their maintenance. The document did not mention that the lands were pledged as a security for the repayment of the advance nor did it contain any provision for the repayment of the debt. It was, therefore, held that the document read as a whole amounted to a lease for cultivating purposes and not a mortgage and the advance made was by way of premium and not a loan. The learned counsel for the appellants has further, cited Gulab Chand Prasad vs. Ram Kumar (AIR 1941 Patna 296 ). In this case, the mortgagee had obtained a lease of the mortgaged house from the mortgagor and advanced a certain sum to the mortgagor for repairing and reconstructing the house. This advance was to be set off against the rent payable at a certain rate by the mortgagee for the house for a fixed term on the expiry of which if the mortgagee wished to continue to occupy the premises, a higher rate of rent was payable. The mortgagee was held to be in possession as a tenant and not as a mortgagee. The present case is clearly distin-guishable from the above case. Another authority cited by him is Bhika vs. Sheikh Amir (1923 Nagpur 60 ). Although the recital of the deed referred to in this authority runs almost parallel to the recital of the deed in the present case, it also bears the stipulation that the land shall remain in the possession of the transferee without any interruption after the stipulated period of 15 years. It goes on to say that after the stipulated period of 15 years, the transferee may (continue to) cultivate the said land himself or get it cultivated and the land shall continue in his possession and in that all his heirs in accordance with this stipulation neither the transferee nor his heirs could remove the land from his possession. This document was held to be a lease for obvious reasons. The learned counsel for the appellants has also cited Chitikala Peda Yerranna vs. Chitikala Somanna (AIR 1935 Mad. 320 ). In this case a document called a Khandagutta Cowle recited that the land had been mortgaged to defendant 1 for a period of 33 years and reference was made to "discharging the aforesaid debt The sum was to carry no interest and was to be extinguished by a cist or rent of Rs. 21/- per annum which for the 33 years would amount to this figure. It was held that the document in question was only a lease for a fixed premium and not a mortgage. A perusal of this case shows that their Lordships came to this conclusion firstly because the document was entitled Khandagutta Cowle which ordinarily denotes a lease and not a mortgage and secondly, because the document made a reference to the payment of rent of Rs. 21/- per annum. Although they found that the transaction in that case resembled in most respects the one considered by a Full Bench of Madras High Court in 21 Mad. 358 (1) wherein it was held that the document was a usufructuary mortgage and not a lease yet they held the document in this case to be a lease because in one important respect there was a difference, namely that the rents and profits in the other document were to go in satisfaction not only of the principal amount but of the interest thereon which showed that the money advanced was regarded as a debt. No doubt the case before us is almost of the same nature as AIR 1935 Mad. 320. The document is styled as a Patta and there is a mention of the discharging of the debt and there is no mention of the satisfaction of interest, yet it is distinguishable in one respect. It bears no reference to the payment of rent as in the Madras case. Moreover, in the case before us, there is an implied prevision for the redemption of the lands after the expiry of the stipulated period. This authority also, therefore, cannot be of much avail to the appellants in our view. The other authority cited is Konjeti Kotayya vs. Konjeti Annapurnamma (AIR 32 1945 Mad. 189 ). In this case, the debtor was indebted to the creditor in the sum of Rs. 400/ -. He was not able to repay the amount, but in satisfaction of the debt he granted to the creditor the right to occupy and enjoy certain land for a period of 20 years. It was held that the interest created was not a mortgage but a lease, the consideration for the lease being the Rs. 400/- which the debtor owned to the creditor and the appeal was dealt with on this basis. It is, however, relevant to note that their Lordships went on to observe in the same sentence that the same considerations would appear to rise even if the document constituted a mortgage and not a lease. Apparently, in this case their Lordships were not primarily called upon to determine the nature of the document and the ratio decidendi in this case was whether the Hindu Women's Rights to Property Act (1937 as amended in 1938) regulated succession to a lease (or mortgage of agricultural land ). The next authority cited by the counsel for the appellants is Krishnan Padma Nabhan vs. K. Krishna Pillai (AIR 1957 Travancore Cochin 239 ). It was held in this case that in the case of a lease with premium, the premium is the price paid or promised in consideration of the demise. But if the indebtedness continues despite the grant of the lease then the transaction is in effect a mortgage. Once there is a debt with the security of land for repayment then the arrangement is a mortgage, by whatever name it is called. Where, however, a lease does not intend to create the relationship of debtor and creditor and reserves no right of redemption to the lessor, but simply asks the lessee to quit the land without any payment on the part of the lessor at the expiry of the term of the lease, it is a lease, but not a mortgage. But where the amount which formed the consideration under a deed was charged on the property and was repayable at the time of redemption and also bore interest, it was a definite indication of a usufructuary mortgage and not a lease with premium. No doubt, the document in the case before us, to some extent, partakes of the nature of the lease as defined in this authority, and could be called, on the face of it, to be a Zarpeshgi lease, but in view of the next authority also cited by the learned counsel for the appellants, in the case of Dunga vs. Maharam (1957 RRD 20), we have no hesitation in holding that it cannot be called a Zarpeshgi lease and was, in fact, the foundation of the usufructuary mortgage. In that case, the learned Members who examined the document found that according to the document the land in question had been mortgaged with possession in lieu of debt. There was no recital to the effect that it was a Zarpeshgi lease or that in consequence of this document, the relationship of landlord and tenant was created. The learned Members held that the document was a mortgage deed. They quoted with approval Mr. Bilgrami in his Commentary on the U. P. Tenancy Act of 1939 as follows - "a Zarpeshgi lease or a lease for consideration is, in form, a lease by the debtor to his creditor on a fixed rent reserved by the lease, which is generally a little over the amount of interest agreed to be paid by the debtor. Under the definition of usufructuary mortgage as given in sec. 58 (d) of the Transfer of Property Act, the mortgagee is authorised to take possession which must be delivered to him until the mortgage money is paid off out of the usufruct of a mortgaged property. Thus there are two outstanding features of a mortgage as distinguished from a Zarpeshgi lease (i) existence of debt and (ii) the right of redemption. If Zarpeshgi lease is, in fact, a security for the mortgage and if (it) reserves the right of redemption, it is a mortgage, otherwise it may be a lease. It is a question of intention and construction. When Zarpeshgi lease contains a provision for redemption it is to be treated as an usufructuary mortgage. ,. . . . . . . ". In this connection, it would be useful to refer to the rule laid down in Ram Dhan Puri vs. Bankey Behari Saran (AIR 1958 S. C. 941 ). It was stated by their Lordships that where the question to be decided by the court is whether the transaction is lease or mortgage, the only guiding rule that can be extracted from the cases on the subject is that the intention of the parties must be looked into and that once you get a debt with security of land for its redemption, then the arrangement is a mortgage by whatever name it is called.
(3.) APPLYING this criterion to the construction of the document in the present case, it must be held that there was a relationship of creditor and debtor between the parties and the property was given as security for the payment of the amount advanced. The gist of the document does not amount to the letting of the land with a rent reserved but a mortgage of the land which was to be redeemed automatically after the expiry of the stipulated period. Under similar conditions in Vijai Singh vs. Karan See (AIR 1957 Raj. 120) where A advanced Rs. 7000/- to B, the terms of the Baraskati deed executed by B in favour of A were that A would be put in possession of three villages for 10 years and would get his money with interest from the usufruct of those villages for that period, it was held that the Baraskati deed was a mortgage. Similarly, in Karka Somulu vs. Reddy Appalanaidu (AIR 1958 Andhra Pradesh 507) where from the recital of the document, it was manifest that there was a debt carrying interest and that there was the relationship of creditor and debtor between the parties and the mode of discharge of the debt was indicated, it was held that the document was a mortgage and not a lease. In order to appreciate the distinction between the mortgage and a lease it will be worthwhile to reproduce the definition of mortgage and lease as given in the Transfer of Property Act. According to sec. 58 (a), a mortgage is the transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability. The transferor is called a mortgagor, the transferee a mortgagee ; the principal money and interest of which payment is secured for the time being are called the mortgage-money, and the instrument (if any) by which the transfer is effected is called a mortgage-deed, and Where the mortgagor deliver? possession (or expressly or by implication binds himself to deliver possession) of the mortgaged property to the mortgagee, and authorises him to retain such possession until payment of the mortgage-money, and to receive the rents and profits accruing from the property (or any part of such rents and profits and to appropriate the same) in lieu of interest, or in payment of the mortgage-money, or partly in payment of the mortgage money, the transaction is called an usufructuary mortgage and the mortgagee an usufructuary mortgagee. (Sec. 58 (d ).) | According to sec. 105, a lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms. The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share service or other thing to be so rendered is called the rent. It will be seen that a mortgage is created for the purpose of securing the payment of money advanced or to be advanced by way of loan or an existing or future debt, while a lease is created in consideration of a price paid or promised. A mortgage, obviously, envisages the relationship of creditor and debtor while a lease revolves round the relationship of a lessor and lessee and it is with this back-ground that the document in the present case has to be construed. It is admitted that the land was transferred in this case in lieu of the debt which the transferor owed to the transferee. As the transferor had no other means of the payment of the debt, he agreed to transfer the land (obviously as a security') and agreed that the transferee will enjoy the usufruct of the land for the 10 following years when the debt will be deemed to have been extinguished. There was no stipulation of the land remaining in the possession of the transferee on lease. There was no indication that this would bring into existence the relationship of lessor and lessee between the parties. In fact, the document indicates that previously some such relationship did exist between the parties but it came to an end with the execution of this document which was obviously executed by way of offering security for the debt which it was not found possible for the transferor to repay otherwise. We now turn to the question whether the mortgage should be ignored on the ground that it was void inasmuch as it did not bear the requisite court fee and it violated the provisions of the Dholpur haws prohibiting the transfer of lands so held by way of a mortgage without the sanction of the revenue authorities. ;