Professional Documents
Culture Documents
Hipkins r Amery, 47
Hirachand v Kashiriath, 39
^ Slngli, 3, 4, 796, 8J
820, 822, 829, 835, 836, 837, 841, 843
Hirday Narain v Jugat Prosad, 1111
Hirendra v Hari Mohan, 13, 1001, 10
Hlrendra v Noyea, 561
it 39 I
I ol>
Hunter, 160
B, B. MITRA
. Act IV of 1882
TWELFTH EDITION
By'
c,
1971
S. Bmu
4.00
Rs. 45.00
$ 10.00
ruEtisnto BV b. c. de for eastern law house private ltd., 54 ganesh chunder avenue,
f <I,CL'rTA 13 AND PRINTED BV B. N. DEV FOR THE EASTERN TYPE FOUNDRY & ORIENTAL
PRINTING
WORKS private LTD., 18 BRIND.ABAN BVSACK STREET, CALCUTTA 5 i D, DUTTA FOR AHUNIMA
PRl.Tt;;c WORKS, 61 SLMU STREET, CALCUTTA 6; AND P. SINHA ROY FOR KALI PRESS,
6/ SITARAM GHOSH STREET, CALCUHA 9
PREFACE
The present edition was long overdue. The interval between the present
and the immediately preceding edition is more than 15 years. Many
important cases on the Transfer of Property Act have in the meantime
.been decided by the Supreme Court as well as by the High Courts of the
different States,' I have spared no pains to incorporate all the Important
cases decided since the publication of the previous edition in 1955.
In order that the length of the book may not increase, some of the
old cases that have lost their importance with the passage of time have
been omitted. With the same object in view lengthy extracts from
the report of the Select Committee relating to the amendments made
by the Act of 1929 have been deleted and extensive quotations from judg-
ments have been abridged. Unnecessary details in expounding the principles
laid down in the cases mentioned in the book have been omitted wherever
possible. In short, all-out eiSbrts have been made to curtail the volume
without sacrificing the substance.
In incorporating new cases attempt has been made to state the principles
with reference to the facts of those cases. Salient facts have been stated
in the briefest possible manner so that one may know in what context
a particular principle has been laid down. A bare statement of the principle
without reference to the facts is very often misleading. If the salient facts
are stated before stating the principle, a practising lawyer can at once
know to what extent the principle is applicable to the case he is arguing
before the Court.
All the recent decisions of the Supreme Court bn the various provisions
of the Transfer of Property Act have been carefully noted. As to the
recent cases decided by the High Courts of the different States of India
only those cases have been incorporated as have laid down important
principles, not covered by the decisions of the Supreme Court.
i have resisted the temptation of indicating what the law should be,
because I think that the primary duty of a court of law as well as of a practising
lawyer is to apply the law as it is without speculating what the law should be.
I hope that the present edition of the book will prove as useful to the
legal profession aslits earlier editions.
Calcutta , A. C. S.
1 January 1971
CONTENTS
Preface
Table OF Cases
PREAMBLE
CHAPTER I
Preliminary
Section
1. Short title
Commencement...
Extent
2. Repeal of Acts
Immovable property
Instrument ...
Attested
Registered ...
Actionable claim
Notice _ *
Act of Parties
M. Rl against
s -
rnmm *
II
5.
6 .
7.
8 .
9.
10 .
11
9-10
10
17
17
17
17
17
17
17
18
49
51
58
96
100
II5
118
127
133
135
136
143
146
148
150
152
158
158
160
160
161
163
On
^ C0MENT5
31. Condition that transfer shall cease to have effect in case specified
uncertain event happens or does not happen
CHAPTER III
[ 7 ]
165
167
169
171
171
172
173
173
174
175
184
189
192
197
205
212
233
234
-248 ,
254
256
257
258
263
264
267
285
328
370
389
389
389
415
463
467
[ S ] TRANSFER OF PROPERTY ACt
CHAPTER IV
58.
mortgage-money
Simple mortgage
to mortgagor
Priority
80. [Omitted],
maxium is expressed
470
470
471
471
471
471
472
541
562
563
564
614
615
615
622
627
627
632
637
638
645
649
652
672
674
691
699
702
706
707
714
720
720
721
743
746
755
758
758
764
CONIENTS [ 9 ]
Deposit in Court
Redemption
92. Subrogation
97. [Repealed]
Anomalous Mortgages
99. [Repealed] .
Charges
100. Charges
CHAPTER V
CHAPTER VI
Of Exchanges
782
782
796
803
803
815
843
845
846
849
849
850
853
853
874
884
885
887
888
888
912
939
953
953
954
990
994
994
994
997 '
1020
1025
1028
1033
1035
1037
1046
1051
1055
1057
1058
[2 I
CHAPTER vn
Of Gifts
CHAPTER VIII
The Schedule
APPENDIX
Index
... 1058
... 1059
... 1066
... 1077
... 1078
... 1078
... 1084
... 1084
... 1086
... 1088
... 1092
... 1103
... 1103
... 1104
... 1106
... 1107
... 1108
... 1108
... 1109
... 111 !
... 1115
... 1116
... 1121
table oe cases
[ 12 j TPANSrXP. or PROPrRTV
V Oovlnda N'air. SS7
Al. !':IIs V Mp.hr.nmad, 574
A!-!';H.i V ;tamtnali, 4SS
Al.!!!t!r. V :.M MuFlIm, 3015
ANJ'j!!-! V Rndulla, 5S1
Af.-!u!lah V AtjmacJ, 255, 201
Af.'!iin.i!i V Bhlchulr, 328
Atj'IulJah V lEmall. 350
Atifhilhh V Tonenbaum, 414
Ab'bir Hatif v Chcttyar Firm, 253
Abbnciiarl v Ramchanrtrayya. 10S3
AWialnanclan v Pashpa*. 105
Abalt V Abott 30
Adlb;7n'v^'5
SSTS S'
AhS S
Ahmed Ho.ssain V
Ahamad Husain v m?
Ahmad
Ahmad Khan , 28
Ahmaduddin v ^2
Ahmaduila v
Ahmadulla v Salar
Ahmad Wali Khln
Ahmed v Gani 420 249
AhmI Air^:
V Pradip AmraSnif'^"
Ahmedbhoy V VuZsl
TABLE OF CASES [ 13 J
[ 14 ] TRANSFER OF PROPERTV
Co.
Amir
UlO
Amir Hussain v
555
^malu ypSmmSS
V BibarmTS '
^ritlal T Chintaman 289
^aal V Kantiial. 290
^ith^al V PoM^^
922,
713, 782,
Anandram
731
V Osimuddin, 925
^antmal v Lain, 1038
Ananfam Veeraiu .
360 ^ Venkayya,
Anantha Ivor vT
Ananthan Pat y S-
Ananthayya v 573
fi,;
1112 V Omademull,
V DebabraiZ Vmi
' 246
TABLE OF CASES [ 15 ]
[ 16 ] TRANSFER OF PROPERTY
Kapoor, 897
TABLE OF CASES
[ 17 ]
Balajl y Dajiba, 14
Balajl y Ganesh, 251
Balaji y Gangamma, 6, 26, 654
Balajl y Gopal, 934
Balaji y Misriial, 402
Balaji y Ramchandra, 1042
Bala Krishna y Apurba Krishna, 643
Balappa y Chandabasappa, 193, 195
Bala Prasad y Ajodhya Prasad, 76
Balararai y Duyyuru Joya Singh, 906,
907
[ 8 ]
transfer of property
TABLE OF CASES [ 19 ]
[ 20 ]
TRANSFER OF PROPERTY
^ Chunder 67
Bhabotarinl y Pearyiai, m
y Ujagar. 298
Bhagwan v Billeshar, 69
Bhagwan v Murari, 92
Bhagn'an y Ujagar, 29
651
Steui,? ^ '
Ramchandra, 1029
^ 11^' 785
y Gorakh, 29
Bhagwat y Bamasis, 5H
SSI! ^ '^'5oblnd. 904
bSS s. 242
^ Hannman, 901
Bhagwaty y jagdam 62
Bhagwat Dayal v nlV. n
Bhagwat Narain
TABLE 6F cases
[ 21 ]
[22]
TRANSFER OF PROPERTY
^ ^ Jainandon Prosad,
335, 342, 344
^ Dash, 410
u s.rss, Co,
^ G^adhar, 238
is
|ltalTS0l,W,I5r
11 , 14 Seshayya,
BhnarazvPapaya^Jos
^ Abdul, 422
^ 179
Mo Caoaj ''
^^yithloko.23
BoH^ 30
ng V sfr^nSrir
TABLE OF CASES
[ 23 1
Bun^vari v Ramjee, 43
Burdett v Spilsbury, 24, 553
Burjorii v Dhanbai, 339, 362, .364
Burke V OConnor, 726
Burma Shell, S94
[ 24 ]
transfer of proferty
Carieton v Leigbton, 61
CarpeDter v Deen, 48S
Cave V Cave, 49
Cavendish v Dacre, 179
Cengalvaraj'a Chettiar v Nataraja
Chettiar, 1004
316
TABLE OF CASES
V2S ]
997, 013
TRANSFER OF PROPERTY
[ 26 ]
Churaman v Balli, 20 4i 42
Churamoni v Rajendra
Church r Bishop:
" , SI,.,
Clam
Cla'Sl '
^ Gandv, 170
ciimie V 3Q '
SS!8S TOW
' Motora
Commissioner of ^
/S^riSr^'-^^-SmtShayamo
Commissioner of WeSr
Csw. 202 'vealth-Tai v Gayatrl
Commissioner Of Wealth f
Sn Ashok Kumar jarat v
TABLE OF CASES
5. 673, 674
Dabu T Jamadar, 25
Dagadu V Vanjl, 34
.[ 27 ]
128 1
transfer of property
KCl ^
, eWntoZ.^
I Nilkanthrao. 656
TABLE OF CASES
[ 29 ]
280, 283
633
276,
Diayadarn v Arigapudi. 79
Digambar v Harendra, 789, 801, 849
Dlgambari v Dhankumari, 199, 200. 202
Digambarrao t Rangrao, 288
Digambar Narain v Comm of Trust
Division, 1041
Dlgamber v Hari, 73
Dilairar Singh v Balakiram, 465
Dildar v Saddip. 616
Dlldop V Shnkrullah, 59 i, 631
Dillon V Parker, 177, 180, 182, 183
Din Dayal v Gurusaran, 465
Din Mohammad v Walait Be^ra, 366
Dina r Nathu, 43, 762
Dlnahandbu v W C Banerjee, 124
Dinabandhu v Gopi Nath, 906
Dinabandbu v Lokanadhasami, 988
Dinamoyee v Banbeharl, 560
Dinanath v Janakl, 908, 950, 996
Dina Nath v Luchtni Narain, 610, 611
Dinanath v Manbadhl, 410
Dinanath v Eamnral, 591
Dina Singh v Jamal Singh, 923
Dlncndra v Chandra Klshore, 12
Dinendra v Union of India, 897
Dinendranath v Tarak Chandra, 14
Dinkar Rai v Ayub, 427. 461
Dinkarrao v Narayan, 411, 414
DInobandbu v Jogmaya, 877, 882
Dlnonatb v Auluckmoni, 408
Dino Nath v Lachmi Narayan, 843
Dinoitath V Pratap, 72
Dino Nath v Shama Blbi, 301
Dio Chand v Imam Din, 62
Dip Narain r Har Singh, 843
Dip Narain Singh v Kanai Lai Goswami,
952
TRANSFER OF PROPERTY
I 30 ]
Pulari V Vallabbdas, 91
Durgadut v Rameshyrar, 77
Durgayya y Anantha, 660
Durgesh Nandini y Bhowanipur Bank-
ing Corporation, 92
Mohta,
[ 31 ]
Ellis V Torrington, 79
Emperor y Cbimanlal, 7
Fadu y Gour, 21
Fagpineswari v Dhum Lai, 914, 921
Fahmidunnissa v Hiralal, 396
Faiyaz Husain v Nilkanth, 118
Faiyazunnissa v Bajrang, 969
Faiz Ali v Harkuar, 339
Faiz Hussain v Prag Narain, 287, 300
Fakhir Jahan Begam v Abdul Ghani, 130,
218
I 32 ]
transfer of property
Fazal V Jiwan, 29
Fisher t Dixon, 30
Fisher v Kamala, 93
Flower V Sadler, 92
TABLE OF CASES
[ 33 ]
Gerlmal v Raghunath, 81 -
134 ]
TRANSFER OF PROPERTY
999
6 .
Glrijanandan y Hanumandas,
Glrljanand r Sallajanand, 84
Glrjesh v Data Din, 147
Glrjojl y Kesharrao, 725
5}^^ Narain y Mt Makbunnessa,
GobardhanyRaghublr.SOl
iiuosciu .
IS' '
Broadcasting Corpn,
Gooroodas y issur Chui
Gooroo Das y Sarat, 1 ';
V Chandian
1044
965
TABLE OF CASES
Gopal T Bank of Madras, 345
Gopal T Oesai, 516
Gopal V Gangaram, 490
Gopal T Lachnil, 262
Gopal T Lakshmikanta, 91
Gopal T Parsotam, 474, 495
Gopal T Sheokumar, 367
Gopal T Sliriniwas. 1013
Gopal T Ttaakur, 44
Gopal Chandra t Bhutnath, 1049
Gopal Chunder v Herumbo Chunder, 882
Gopaldas v Municipality Hyderabad, 896
Gopal Devi v Ghulam Fatima, 749, 817
Gopal doss Dwarkadoss Family Trust
Estate V Michalswaml Filial, 1004
Gopal Jayvant v Shrlnlvas, 1036
Gopal EMshna v Samnath, 103
Gopal Fandey v Farsotam Das, 61, 52, 95.
Gopal Ram r Dhakeswar, 1013, 1018
Gopal Satan v Sita Devi, 1060
Gopala T Arasappa, 226
Gopala T Juvappa, 903, 907
Gapala v Ramaswatnl, 81
Gopala T Swaminathayyan, 761
Gopala Dasu v Rami, 248
Gopala Krishna v Gopala Krishna, 1100,
1104
[ 35 ]
Gourinath v Madhumanl, 89
transfer of PROPERXy
I 36 ]
Gurumurthappa v Chirkmunisamappa,
991 .
TABLE OF CASES
[ 37 ]
TRANSFER OF PROPERTY
138 ] ,
644
jr - . transfer of
t 40- 1
, 882 . .
^ ^ J^charanlal, 321
sJS, 9 ^" Ltd T B S Mantosh,
Indramani v Surendra, ^7
519
Bengal, 136
TABLE OF CASES [ 41 ]
t'42 ]
transfer of psopertv
505
- vuouuo, WVVf
Peerbhoy. 696,
Jesa Ram v Ghulaman, 217
TABLE OF CASES
I 43 ]
Jhangaldas v Chetumal, 34
Jharia Water Board v Jagadamba Iioan
Co, 620-
Jolland y Stainbridge, 37
Jones y Arthur, 589, 799
Jones y Mills, 1015
Jones y Ogle, 188
Jones y Ryde, 1058
Jones y Smith, 40, 45
Jones y Westcomb, 168
Joseph Pyke & Son Ltd y Kedarnath, 34
JoShua y Alliance Banlc of Simla, 39,
43, 51, 330
TRANSFER OF PROPERTY
144 ]
m 106 ,
TABLE OF CASES
[ 45 ]
[ 46 ]
transfer of property
377, 379
Kara v Pandia, 319
Karunakar v Mahakuren, 386
Karumanchi V Karnmanchl, 1006, 1012
Karuppan v Ponnarasn, 250
Karuppiah v Hari How, 446
Karusing v Narasimha, 62, 304
Kasamma A v Bramuramba P, 813
ICashi T Kailash, 72
405
TABLE OF CASES
[ 47 ]
Kettlewal v Watson, 48
Keyaka v Yaddatil, 84
Khasim v Carllet, 86
Khatar Minstrl v SadmddI, 1014
Khater t Gropal, 1038
Khatija v Ismail, 1062
Khatu Bibi V Madhnram, 49, 406
Khatun Fatima v Shlb Singh, 229
Bhawaja Muhammad Khan t Muham-
mad Ibrahim, 229 ...
Khemchand t Hemandas, 61
Khemcband V Mallo, 480, 554, 658, 870,
Khem Ghand V Mul Cband, 317
Khemchand Dayaljl & Co r Moha-
madbbal Chandbhal, 911
Khetrabasi Farida v Chaturbhuj Farida,
254
Kfsandas y Dhondu, 90
Kisan janu y Pr.iyagbai, 811
KIshan Chand y Eamsukh Das, 761
Kishanjl y Motllal, 741
KIshan Lai y Ganga Ram, 496, 693, 857,
872
transfer of property
I 48 ]
Krishnamachariar v Annongarachariar,
chariar, 239
Krishnamma y Mall, 397
Krishnamma y Suranna, 46, 408, 543
Krishnammal y Krishna, 702
^Ishnamurthy v Satappa, 825
Krtehna Muthu y Kumaraswamiya, 7
&i8hnan y Krishna, 912
Krlshnan v Paraohan, 14
Krlshnan v Velayu. 1097
Krishna Nair y Kundu Nalr, 1057
TABLE OF CASES . [ 49 ]
[71
TRANSFER OF PROPERTY
[ 50 ]
TABLE OF CASES
[ 51 ]
TRANSFER OF
property
I 52 ]
M M R M Chettiar Firm v S R M S L
Firm, 418, 462
Ma Mo V Ma Kun, 546
Ma Mya v Annamalai, 387, 405
Ma Myal v Ma Nyan, 539
Ma Nyo v Mg Hla, 793
Ma Pwa-T K P s A R P Firm, 710
Ma Me, 686, 690
Ma Ihin ? M ^ 1067
1073
676
154
226, 228
Madam Pillai v Badrakali, 117, 394, 395,
1053
TABLE OF CASES
t 5S J
i 54 i
transfer of PROPERtV
Duty, 10G9
TAfitE dF cases
Manjunath y Shankar, 73
Manjural Haque y Mewajan Bibi, 382
Manks y Whitely, 877
Mankuar y Jasodha, 90
Man Mohan y Bidhu Bhusan, 78
Manmatha y Anath, 95
Manmotba v Balai, 976
Manmatha r Hedait All, 34, 80
Manmatha y Nalinaksha, 976, 977
Mamnatha y Peary Mohan; 1044
Manmatha v Sarat, 790
Manmatha y Sheikh Hedait, 83
Manmohan y Lower Ganges & Co, 480
Manmohan Das y Bahauddin, 866
Manmohan Das y Blshun Das, 988 -
Mannalal Serowgie y Iswari Prasad Jain,
1020
transfer of
PROPERTV
I 56 1
Mathura v ,^.1 gg 7
9'S
Maung
Maung
Maung
Maung
Maung
Maung
Maung
Maung
Mating
Mg Po
Maung
rr.n
Das, 28
947, 951
tAllLE OF CASES
( 57 )
Md Shabbar v Hamath, 71
Md Shall V District Magistrate, 2
Md Shakur Khan v Shahjahan, 228
Md Sharif v Abdullah, 587
Md Sharif v Waqf Banam-i-Kliuda, 973,
1007
[81
TRANSFER OF PROPERTY
[ 58 I
533, 539,
Mohan Devi v .
665 Mehdi,
Bismillah, 340
Mohamed Musa v Joganund, 949
Mohammad Ali y Kanai Lai, 269
Mohammad Yusuff y Jashodha, 498 499
Mohammad Abdul Jaii? t, ^
Mohammad Abdullah v nr ^
Yasin, 8 Mohammad
SSSsS .s,
Wstributing Co 40?'^''
TABLE OF cases
t 59 ]
Mt Balo y Mt Parbati, 90
Mt Banti v Mandu, 209
Mt Barti Kuer y Brahmachari Singh,
599
TRANSFER OF PROPfiRfV
[ 60 ]
Mt Hardei v Bhagwan, 63
Mt Har Kaur v Udham Singh, 626
Mt Hedayat-ul-Nissa v Jalabul-din, 331
Mt Hiran 7 Mt Sohan, 63
Mt Imlianzunnissa r Abdur Qasim, 641
Mt Indrani v Mabaraj, 854, 857, 873
Mt Ishra t Nawbat, 422
Mt Jaidevi v Sripal Singb, 840
Mt JalesMvar v Sbeonarayan, 518
Mt Jasodar v Mt Sukurmani, 29, 219, 228
Mt Jileba t Mt Parmesra, 377
Mt Jio V Mt Rukuram, 255
Mt Jogi V Smt Raikumar, 202
Mt Jugesrf v Aftab Chand, 583
Mt Kanwal v Babu Lai, 338, 522
Mt Kawtikabai v Bacbraj, 864, 867
Mt Komal v Gur Charan, 217
Mt Kulsum V Sbiam Sundar, 1090, 1091
Mt Laebmina v Mt Makfula, 891
Mt Mangala v Mahadeo, 485
Ml Mathura Devi v Mohan Lai, 563
Mt Mohammadi v Kashi, 804
Mt Murtazs v Dildar Alt, 159, 263
Mt Mushrafi v Kundan Lai, 557
Mt Nasiban v Md Sayeed, 373, 380, 947
Mt Nathibai v Wailaji, 404, 838
Mt Natho V Sltal Prasad Sahu, 932
Mt Parbati v Gopal Das, 543
Mt ^ 1^'^rka Prasad 2
Mt Shi?Stt KuS^'^
128
Si.a
240
687, 591
Muniappa v SS? US
Mumcipal L 650
MuniSS 70 .
TABLE OF CASES
[ 61 ]
Muralidhar v Rupendra, 79
Muranjani v Labhai', 65
Murarl v Samiuddin, 657
Murarllal v Devkaran, 676
Murarilal Kuti v Narayan Lai, 55
Murat V Phefcu, 862
Murli T Sheo Dat, 763,- 776, 779
Murlidhar v Mulchand, 76
Murlidhar v Parmanand, 268, 271, 273
Murlidhar v Parsharam, 13
Murlidhar v Tara Dye, 381, 385, 898,
918, 1026
Iff
transfer
OF PROPERTY
t 62 1
N S & C Firm v Attauddln, 337
NahawLp v Lokenath, 2^
Nahanehand v Modi, 23
vl
TABLE OF CASES
I i
Narasimma v Annntlia, 84
Naraslngarayiidii v Ankincedn. 439
Narasingorji v Panagsntl, 55. S3
Naraslnporjl v Partlins.'iratlil, 500
Narasingorji v R.aja Panaganthl. 452
Narasingh v RadhakanL 1082
Nnrnsingh v Ram Narain, 901
Narasingha v Achhalbar, 587
Narasingh v Prolhadman, 22
Narslngh Prasad v Rupan Singh, 684
Naratmal v Mohanlal, 1005
I 64 ]
transfer of property
SMS'S',
SLSvrsf-S'.'
Haridas, 15,
TABLE OF CASES
[ 65 ]
[ 66 ]
transfer of property
1095. 1097
Sitaram Agamvala,
TABLE OF CASES
[ 67 ]
Parker, 153
transfer of property
Penry 7 Brown, 32
Fetch V Tutin, 56
Pethu V ICandswami, 78
SS 5 ^ 216
Phn]p*T 225 ,
^ Hamaman, 605
Phul Chand v Akbar Tar Khan.
TABLE OF CASES
PBul Chand v Lakkliu, 1061, 1068, 1082
Phulwanti T Janesbar, 66
Piercy, 566
Poothakka v Annamalai, 33
[ 69.3
Powri V Shiva, 81
Prabhakar v Pandurang, 739
Prabhu v Chatter, 44
Prabhu v Ramdeo, 724
Pbabhu Dayal v Baban Lai, 872
Prabhulal v Godawari Bai, 673
Prabhu Narain v RamraTi, 207
Prabhu Ram v Kameshwar, 775
Prabodh Kfimar v Dantmara Tea Co, 372
Praduman Kumar v Virendra, 1032
Pradyaman v Mabadeo, 811
Prafulla v -Jogendi-a, 130
Prafulla v Nandalal, 918
Prafulla v Soaru, 626
Prag V Mohanlal, 625
Prag Dat v Chote Singh, 69
Prag Dutt V Hari Bahadur, 502
Pragi Lall v Pateh Chand, 79
Prag Narain v Kadir Bakhsh, 1032, 1017
Prahlad v Maganlal. 22
Prahaladrai v Commissioners for the
Port of Calcutta, 917, 937
Prakash v Birendra, 49
Prakash v Hasan Banu, 717
Praltash Vati v Maya Devi, 1066
Pramadanath v Srigobind, 902
Pramatha v Champa, 905
Pramatha v Janaki, 619, 819, 878
Pramatha v Pradumna, 58
Pramatha v Sashi Bhusan, 106, 289
Pramatha Nath v Prabulla Chandra,
1008
Pramila v Jogeshar, 95
Pranballav v Bhagahan, 613
Pranballav Saha v Sm Tulsibala Dassi,
90
(TRANSFER OF PROPERTY
t 76]
STS
Pt^'SS^T^^ ^ Sivasankara, 45
Puddipeddf^ LaStaa^^^"*
^ Hanganayake^r2;r^ v Godi
Pndarikaksha V c?. f
Pnndarikakshudu
^ Chand, 1005
^ Nath, 1023
uran Singh v Kesar Singh, 583
^iMawalkam H J S Ld v KudL Mn
Purbi V Hardeo, 765. 774
Purmandas, 987
Purna v Gobinda, 601
77, 235
Purnend?"v Simt
Sr
Puthenpuray?, ^003
Pathumadammarv
TABLE OF cases
Puttananjamma v P M Channabasavanna,
680
[ 71 ]
TRANSFER OF PROPERTY
[72J
'' Dattatrava
Shankar Mote, 45. 311, 872
Paijal T Irhhan, 298
Paikishorl v Debendranath, 129
Pal Kumar v Abani Kumar. 68
Pai Jlolian V Comilla Union Bank, 683
Raimoni v Mathoora, 950
l7?8,r " 6.
oai
SGS ^ Setrucherla,
p's,.
1048 Y Ayyapareddi,
Siai 581
Rajani Kante v 33
...
I 73 ]
[ 10 ]
[ 74 ]
transfr of property
^niathan v Da'wint
Ramanathan v Ranranft?'^''
RamarayanimraiT^x?";^^
Ramasami y
Ramasami y ^^5
^^asarni y 1107
Ramasami y 809
^ l^lmi. 246
922 f Mt C Gulabokuer.
Jagannadham, 2J8
Rarnam y Komarappr424
y Kotajya. 5
Ram Badan
Sbaran S09
67, 246
Rambhadrachar y qht,-
haj T jjani
tAiLE OF CASES
pain Bliarosey v Bhag^va^dl^, 62, 238'
Kam Bharose v Rameshwar, 1059, 1065
Ram Bharose v Rampal, 307
Ram Bharose v Rampal, 307
Rambhat v Lakshman, 320
Ram Bilas V Lachmi, 882
Ram Birich v Clihakauri, 636
Ram Brich Narain v Ambika Prosad, 631
Rambriksh Prasad v Shyamsunder Pra-
sad, 207
t 75 j.
[76 3
TRANSFEll OF PROFERTY
Kameswar v if
Ramesa-ar t Bamnali, 76
Ramf-shwar v Riknali, id .
Rameshar t Subbakaran, 66
581 .
Singh, 8 V.
doo
ooy, 50
9?r' ^ 379.
[ 77 ]
transfer of property
I 78 ]
91
^ ''58
.[ 79 ]
I 80 ]
TRANSFER OF PROPERTY
S bS 8S0
Sailabala r TapSer^SJr
Saiyed Ahmad t
^55 zmb, ,
isulfioar t '^2
SsSha^,, 33
Ssiharam - ^ 8lo
s Ohms,,. 3_
Sakharam t SusMlabal, 28
Sakharam t Tukaram, 319
Sakharam v Vishram, 23
Sakharampant r Lothi, 922
Sakliaram Shet v Amtb a, 710
Sakhawant v Gajadhar, 659
Sakhisona v Gourhari, 999
Sakhiuddin v Sonaulla, 21, 747
Sahubai v Eknatb, 324
Sakuthalammal v Chandrasekhar Hpa
diar, 1034
1058
S3ni^l]X2(2QpQ| V T^fartK" *
Samavva V 859
Sambaudam
Naidu, 466
y Ramaswami
865
Sami kSl't
Prabhaii
and Wood-
Samuel v
fleers TTmi
Sandon r
Cninarasami, loO
TABLE' OB CASBS
1^1]
- 702-
461 . '
Sarju T Ramsarn, 98
[ 1 ]
I 82 ]
TRANSFER OF PROPERTY
^ Chandra, 936
Satyadeva v Trlbenl, 94
Satyakrlpal v Goplklshore 77i
Sa^jn Kumar v Satya 'Kripal, 117,
^ Suryanarayana, 722
Satyanarayana v Venkatapam sof
Satyesh v JuinT.
Savannuthu v
Marthandan, 507
Bhageerathi
982
f Chimanlal. 907
^2^ Dattatraya. 48
Digambar, 950
Secretary
bS. ^ ^-^arala of
cSesL^\u^ Affairs
890, 895
SSma VeST'"
Seethalakshmi 79
Seetharama v w
SeetharamammJ 883
TABLE OF CASES
Seetliaramanujacharyulu t Venkata-
subbamma, 312, 313
Seetharamaraja v Bayanna, 1083
Seeti KuttI v KunM Pathumma, B73
Selkh Bikala v Sbeikh All, 299
Sendatilaka v Sangili, 185
Sengava t Perumal, 760, 761
Sengayyani y Baan, 940
Sequerira v Mrs Nadershayr, 521
Serajuddin Md v State of Orissa, 1011
Serajul Haque v Dwliendra Mohan, 4
Seramot r Samad All, 403, 404
Serandaya Pillai v Sankaralingam
Filial, 117, 388
Sesah r Exishna, 781
Seshappa v Chandayya, 71, 76, 77
Se^hayya v Lakshmlnarasimha, 625
Seshayya v Hajah of Plttapur, 1048 '
Sesha Ayyar r Krishna, 761, 765
Sesha Iyer v Srinivasa Ayyar, 757
Seth Bansiram v Naga Aj^ar, 669, 670
Seth Chhaganlal Madhavil v Bal
Memunabal Amadmlya, 859
Seth Chlttor v Sbib Lai. 868
Seth Dooly Chand y Hameshwar Singh,
733
[ 83 ]
transfer of property
iraS ^elhwant, 5^
KarOInv^kalP^sad^
chankar Lai v Babu Ham, aa/
Ul T on Bl. m.
399
,helkh Bhukhah V
ShS!Nuroo y Seth
Sheikh Sonaulla .v Troyln^o, 921
Sheikh Yuauf v Joytish,- 924, 1017, 1036
Shekari Varma v Mangalam, 535
Shenbhagavadiammal v Mupidathi Am-
mal, 62, 89
SheoaJ v Gajodhar, 821
Sheobachan v Madho. Saran, 862
Sheobux Singh v Paras Ram, 930..
Sheodan v Ramesh, 778 . . . ,
437'
TABtE.OF CASES
776, 791
78 '
transfer of FROFERTV
FInsb, 70G
Find*' V SIndc. 21
FInp.a! v B.ajt Hao, 76
Slncamancnl Ramappa v Amllineni
IMddahka, 312
Sirajuddln v Ml Rahlman, 29
Slrbadh Ral v RapluinaUi, 258, 259
Sirlj V MusJiar, 155, 1090
Slrw.irln v Balyu, 1079
Sister Ixulse t Jattndra Nath Mondal
517
bSi
Sitarambhat v Sitaram, 73
SilaramiaK v Kanakaiah, 1056
.Sitaramma v Ankaiah, 912
Sitla V Samiuddin, 273, 279
Sitla Bus V Mahabii-, 1110
Sitla Sahai v Dhiim SingR, 596, 745
Situl V Laclimi, 501
Siva Chidamhara v KamatcM, 742
Sivagangai Ammal r Jagadambal, 867
Sivajnanam v Mathevaa, 1046
Sivakaml v Gopala, 581, 665, 680
Sivanandan v Tribiavendas Vendravan,
974
TABLE OF CASES
:[ 87 ]
654
383
, transfer of property
[ 88 ]
370
Stat3 of U P V
lOSl
Shamsundar Ramciaran,
C Mackerich, 385,
695
985
664,
184,
Subbuah
772
Govlnd Reddl,
156
V Subramanlam, 153,
V Ethlrajulu, 664
V Klradadasan, 1105
V Lutebman, 661
. . 'itABtE 6 f cases i 8$ ]
Sultan T Nanu, 89
744
[ 12 ]
Suridrabal-vi'Hamabai, 28
Sundrabal v Shivnarayan, 193
Sundrabai r Shlvanarayana, 202
Sunitibala' y Dhara Sundari, 99, 607, 672
Sunkayally y Slngaraju, 998
Suppan y Rangan, 676, 788, 791, 801
Suptd & Remembrancer of Legal Affahs
y Bbagirath, 110, 430
Sura Lakshmiah v Kothandaramma, 201
Suraj BalH' y Ramdular 622
Suraj Bali v Rang Bahadur; 667
Suraj Chandra v' Behari Lai, 655, 666,
aOOl
[ 90 ]
transfer op property
^ Nandan, 207
'tvffooT ''
. 29;
&L *
'tABl Of CASg
li 1
Thiagaraja V Ramastrami, 792
Tblagarajaswaml t Kamalappa Thevar,
980
Thoma Y Qovindakurup, 79
Thomas v Evans, 590
Thomas v Hanuman Prasad, 437
Thomas y Howell, 163, 171
Thomas Pillay v Mathnraman, 340
Thomcos Bank v Mathew, 488
Thommen Varkey y Govindan Nair, 613
Thoppai Y Venkatarama, 772, 779
Throne v Cann, 877
Thorpe v Holdsworth, 751 '
TRANSFER OF FROPERTY
t 92 ]
Treasurer v Tyabjl,-976
Tretanath v Alodhya Prasad, 663
Trlbhuban v Sankar, 409
Tribhuban las v Smith, 177. 183
Tribhuvandas v -Tattanll, -344
Trichinopoly Vartaga Sangam Ltd y
Shanmughasundaram, 322
Triguna v liadh-anini. 183
'' 'Commissioner,
444, 446
J^aram v '^01-
21'! ^ PmbaI,.4B7
Tulsi Ram v
TPP.n NuibiS,
n/ -i2. '973
TABLE OF CASES
[ 93 ]
V Satyanarayanaraju v J Hanuma-
yamma, 994
609 . :
^ 922
656
Manlclca
504
1107
, transfer of property
{ 94 ]
Veera Eaghava v
Vceraraghavalu v Suryanarayana,
Veeraawami Mandirl v i
Mudallar. 834
Veeraswamy t Ibramsa, 688
Veeravunni Saji T Koyammu,
Veerayamma v Venkamroa,
231, 305
446
628
Vengannan v Ramaswami, 537
Vengopala v *Thirunavalikarasu,
896
541
Venkatachalan v Sethuram, 97
Venkatachari v Karruppan, 834
Venkatachariar v Rangaswami
1019
1015,
Venkatarayanim v Venkate. B 90
Venkata Setteyya r Mull Bal, 710, 712
venkatashlah v Venlcatnkrlahnlali, 613 ,
731
Venkatasubbamma
1063, 1081
V Narayanaswami,
TABLE OF CASES
[ 95 ]
I 96 ]
transfer of property
677. 843
Waman v Balaji, 72
770
Wilkinson. 1061
William V Sorrell, 44
Withered v Withered, 67
Wrexham, 814
Watkins v Watkins, 76
^nr>n '
Farid-ud-Dln. 334
Zahana y Par/iaieshri, 69
TABLE OF CASES
'[ 97 ]
The
ted as follows :
1. History of the Act : ^The kernel of the Bill which became the
Transfer of Property Act was a draft prepared in England by the Indian
Law Commission, which was sent out to India in 1870, with instructions
to take the necessary steps for passing it into law. It was heterogeneous,
ill-defined and ill-drawn. The sections on powers, for instance, were
unnecessary. No mortgagee was to take possession of the mortgaged land, no
mortgagee was to foreclose. Not only the English but all the Indian forms
of mortgages were ignored. The then Law-Member of the Governor-
General's Council felt that the amount of simplicity gained would not
justify the amount of disturbance created.
2 TRANSFER OF PROPERTY
B.L.J.R. 135.
The amendments made by this Act have come into force from the
1st April 1930.
[For Bill No. 33 of 1927, and the Report of the Special Committee,
see Gazette of India, August 20, 1927, Part V, pp. 89131 ; reprinted
(as Bill No. 6 of 1929) in the Gazette of India, March 9, 1929, Part V,
pp. 3070 ; for the Report of the Select Committee, see Gazette of India,
September 7, 1929, Part V, pp. 111-125 ; for Act XX of 1929, see Gazette
of India, October 12, 1929, Part IV, pp. 3344.]
lA. Amendments whether retrospective : The general principle
as laid down by the Privy Council as to whether an amendment is retros-
pective is as follows : while provisions dealing with matters of procedure
have, in general, retrospective effect, provisions which touch a right in
existence are not to be applied retrospectively in the absence of express
enactment or necessary intendment De/Ai Cloth, etc.. Mills Co. v.
or incurmdbefore sfhdatef
THANSFER OF PROPERTY. 3
The principal ground, upon which it has been held, that the amend-
ments mentioned above are not retrospective, is that where the languap
employed by the Legislature is ambiguous and not clear and explicit,
the Court must not give a construction to the new Act which would take
away vested rights ^see Jagadamba v. Anadi, supra and Srinivasulu v.
Damadaraswami, supra.
On the other hand, the chief reason which has influenced the contrary
view is that sec. 63 of the Amending Act having declared certain sections
to be not restrospective says that the other sections are not retrospei^ve
in a limited sense only, that is, the amendments will not affec^nythmg
already done before 1st April 1930 in any pending proceeding. Therefore,
by implication the Legislature has said that where Acre is no pending
proceeding the sections will have retrospective operation. -
4 TRANSFER OF PROPERTY
More ma.< decMons :-Tl>e following recent canes support tte view
prsmig, AXR 1939 Rang 175, 182 1C 651 : /ngnd Btam v. Rnnnn ^
A T R 1941 Cal 287 (Henderson. J.) ; Rustomji v. Bai Mott, AJ.R. 1940
Bom 90 IL.R.l940 Bom. 50, 41 Bom. L.R. 1310 (Beaumont, Cl. and
Ln I.) ; Gopal v. Abdul Latif, A.LR. 1940 Oudh 97, 15 Luck 175,
(1939) OWN 1045 (Thomas, C.J. & Radha Krishna, J.) ; Mcifigal Sen y.
Kewd Rani. A.LR. 1940 A11.75, 187 I.C. 274 (Bennet & V^ma JJ.) CJmn
Lai V. Laksmi Chand. A.I.R. 1940 All. 237, 1940 A.L.J. 234, I.L.R. 1940
All. 212 (Iqbal Ahmad & Bajpai, IJ.) ; Tika Sao v. Hari Lai, 19 Pat. 752
For the contrary 'view see further hAunna Lai v, Chatan Pnakash,
I.L.R. 1940 All. 79, 1939 A.L.J. 1099, A.I.R. 1940 All. 65 where Bennet
and Varma, ]J. have held that there is nothing in the amendment of sec,
It does not, however, appear that the Full Bench decision in Hira Singh
V. Jai Sitigh. I.LR. 1937 All. 880, 1937 AL.I. 659, A.LR. 1937 All. 588 was
A.LR. 1940 All. 75, 187 LC. 274 the same learned Judges have held that
Haque v. Dwijendra Mohan, A-LR. 1941 Cal. 33, Mr. Justice Biswas seems
V. Anadi Nath, A.I.R. 1938 Pat. 337, 19 P.L.T. 594, 176 LC. 273; but
this latter decision is deemed to have been overruled by the Full Bench
has, however, held that the mere fact that certain sections of the Act are
In Janaki NaHi v. Pramatha Nath, 67 LA. 82, I.L.R. (1940) 1 Cal. 291
p. 306), A,LR. 1940 P.C. 38, their Lordships of the Judicial Committee
have noticed that there are conflicting decisions in India on the above
question, but their Lordships did not find it necessary to express any
opinion thereon. j tr j
a transfer by opera-
TAANsPer of property S
6 TRANSFER OF PROPERTY
[Sec. 1
All. 1 ; and Mohaimnadi Bibi v. Koshi, A.I.R. 1926 All, 725, 96 I.C. 775.
CHAPTER 1
Preliminary
Short title
Commencement
Extent
proSnsfS^elf
Sec. 1]
TJlANSFEit OF PBOPEftrV 7
A.O. 1937 and A.L.O. 1956. The third paragraph was adapted by A.L.O.
1950 and A.L.O. 1956. The Act has been declared in force in Paiitii
Piploda by the Panth Piploda Laws Regulation, 1929. The words terri-
tories to which immediately before the 1st November, 1956 were com-
prised in Part B States or in the States of Bombay, Punjab and Delhi were
substituted by A.L.O., 1956 for the words Part B States".
The Act came into force in Cochin on 1-1-1112 (Coch.). The rights
and liabilities, of the parties to transactions which came into existence
before the Act have to be determined in accordance with the principles
of the common law which governed the transactions in the State prior
to date of commencement of the ActVarahadevaswom v. Umer Sait,
A.I.R. 1951 Tr.-Coch. 17.
The Act has been declared in force in the Pargana of Manpur by the
Manpur Laws Regulation 2 of 1926 and in Panth Piploda by the Panth
Piploda Laws Regulation 1 of 1929.
The Act has been repealed or modified to the extent necessary' to give
effect to the provisions of Madras Act 3 of 1922 in the City of Madras
See s. 13 of Madras Act 3 of 1922.
The Act has been repealed as to Crown grants by the Crown Grants
Act, 15 of 1895.
Sind .'The whole Act was extended with effect from 1st January,
1915 to the Province of Sind See Bombay Rules and Orders, Vo.. II,
p. 194.
Bombatj ilHvs Act has been extended from 1st January 1893 to the
whole of the territories (other than the scheduled disttict^
administration of the Government of Bombay. See Bombay Gazette,
8 TRANSfeR OF PROPERTY
[Sec. i
R p trs.
In a province to which this Act has not been e,xtended the rule
embodied in this Act should be allowed in preference to the English
procedure KodiV Moidin v. Nepean, 26 Cal. 1 (6, 7) (P.C.).
- govern'd by the
arealSeTwkhin
Sec, i]
tRANS^ER OF PROPERTY 9
10 transfer of PROPERty
[Sec. 2
deemeftoTlny\uk^r
10. Claniso . CT ,
. A lease executed i ,b , ^
S^ofSst'Srr A can.
Conr^
Sec. 2]
transfer of property 11
This clause does not apply where the legal relation was constituted
after the Transfer of Property Act came into force. Such a' case will
be governed by the provisions of this Act Ulfat Hossaln v Gvani 36 Cal
802 (806). . .
Although the Transfer of Property Act may not, of its own force,
apply directly to a case of kanom granted prior to this Act, the rules in
this Act, being founded on reason and equity, may properly be applied
to the case Vasudevan v, Valia Ckathu, 24 Mad. 47 (56) (F.B.). The
principle of sec. Ill (g), being a statutory provision in accordance with
justice, equity and good conscience, was applied to a lease executed before
this Act, although the section itself was not applicable to the case and
it was held that the refusal to render specified services did not operate
to create a forfeiture Ma/zara/a of Jeypcn-e v. Rukmini, 42 Mad. 589 (598)
(P.C.). The rules of the T. P. Act may be applied to a mortgage executed
prior to the passing of this Act, in the absence of any rule preventing them
and in conflict with this Act Gopi Lai v. Abdul, 26 A.L.J. 887, A.I.R
1928 All. 381 (383), 116 I.C. 91.
Where a tenancy was created before the commencement of this Act, but
that tenancy came to an end and a new tenancy was thereafter constituted
subsequent to the passing of this Act, the tenant cannot avail himself of
the benefit of this clause and evade the operation of this Act Durga
Nikarini v. Gobordhan, 19 C.W.N. 525 (527, 528), 20 G.L.J. 448, 24 I.C.
183.
r So 2
12 TRANSFER OF PROPERTY
app ^ o'
Act v. Kashi^
a Domini, 32 Cal. 1023, Even
SEC. 2]
TRANSFER OF PROPERTV 13
ing of this Act. Section 111 (d), therefore, cannot be applied to such
tenures XH?7r v. Sarat, A.I.R. 1938 Cal. 128.
Where a mortgage deed was executed before this Act came into
force; the rights or liabilities of the parties to the mortgage or
tlie relief in respect thereof arc saved by sec. 2 {c)~Nami v.
Raman, 16 Mad. 335. The subsequent creation of suits for foreclosure
could not, observed their Lordships of the Judicial Committee, except
by clear enactment, revive the extinct right, and in effect the clear enact-
ment is the other way, for sec. 2, cl. (c) of the Transfer of Properly Act
says that nothing therein shall affect any right or liability arising out of
legal relation constituted before this Act comes into force or any relief
in respect of such liability Srinath v. Khmur Mohan, 16 Cal. 693 (P.C.)
at p. 701.
V. Kishen Sahai, 6 AM. 262 (267) (F.B.). No one has a vested right i?i anj
particular form of procedure Warner v, Murdoch, L,R. 4 Ch. D. 750, at
p. 752 (per James, J.) ; Republic of Costa Rica v. Erlauger, L.R. 3 Ch. 62,
69 (pei' Mellish, L.J.). Clause (c) of sec. 2 preserves the rights of the
parties in respect of mortgages executed before the commencement of this
Act, but after the introduction of this Act the procedure for enforcing
those rights is governed by its provisions Murlidhar v. Parsharam, 23
Bom. 101 (103). It does not follow that because a suitor has a cause of
action, he has also a vested right to enforce it b}' a course of procedure
and practice which was in force when he began his suit. He has only the
right of prosecuting it in the manner prescribed for the time being by or
for the Court in which he sues, and if an Act of Parliament alters that
mode of procedure, he has no other right than to proceed according to the
altered mode ^Maxwells Interpretation of Statutes.
[Sec. 2
H TRANSFER OF PROPERTY
live vdidity T
TRANSFER OF PROPERTY 15
S. 100 is not excluded from the operation of the saving cl, (d)
Nawal Kishore v. Municipal Board, A.I.R. 1943 All. 115 (F.B.). This
clause prevents s. S3 operating in the case of transfer under an order or
decree of Court Ramanatkan v. Unnamalm, A.I.R. 1942 Mad. 632, (1942)
2 M.L.I. 213.
, [Sec. 2
16 TRANSFER OF PROPERTY
503 AIR. 1931 ^?89 (390). 133 I.C. 904. Where the court appointing
f guard an actually orders the sale of the property of the minor by auction
and sends the auctioneer a robakari directing him to sell &e properly
the fact that the court passed the order on the application of the guardian
does not detract from the sale being one in execution of an order of the
court and such a sale need not be registered Nath v. Sundia Watt,
A.I.R. 1960 Punj. 630.
Hindu law has been omitted from this clause, as being unnecessary. The
word "Buddhist has been omitted as Ihe Government of Burma had no
objection to such omission. The word Muhammadan has been retained
as the rules in chapter 2 are not in all cases in conformity with the
personal law of Muhammadans.
fl-a V. Abbas Bandi (1932) 59 I.A. 237, A.I.R. 1932 P.C. 158.
Sec. 3 ]
TRANSFER OF PROPERTY 17
Interpretation>cIause.
Immoveable p r o -
perty':
instrument
growing crops, or grass ;
18 TRANSFER OF PROPERTY
[Sec. 3
notice.
Provided that
The definition of "notice, has been amended and the three Explana-
tions added by sec. 3 of the Transfer of Property Amendment Act, 1929.
Explanation I has been further amended by the Transfer of Property
Amendment Act V of 1930. See Note 26 below. This amendment has
no retrospective effect. See Note lA, ante.
[ Sec 3
20 TRANSFER OF PROPERTY
R-m - 22 . M (41);
" '7 7
VasiiJS! H of xn-anjmnNarai/atf v.
Sec. 3 ]
mNsFER OF PFOPERtY 2 1
(v) The grant of a right to collect Tendu leaves (for making biri)
Mulji Sicca & Co. v. Nur Mohammad, A.I.R. 1938 Nag. 377.
22 TRANSFER Of PROP^tY
ISec. 3
Sec.
TRANSFER OF PROPERTY 23
nibandha and is not immoveable property /?a ??2 Kishan v Salic. Ram
A.I.R. 1946 All. 472, 224 I.C. 391.
(Pat).
[Sec. 3
24 TRANSFER OF PROPERTV
kinds of trees m a cer a standing timber, and not one which conveys
Sec. 3 ]
TRANSFER OF PROPERTY 25
10 Cl. & Fin. 340. The afBxing of signature of the attesting witnesses
in the presence of the executant is the ordinary mode of attestation as
defined in this section Rajeshwm- v. Sukhdeo, A.I.R. 1947 Pat. 449.
The statement of an attesting witness that the document was read out
and explained by the writer and then the executants and the attesting
witnesses signed it, implies that the attesting witnesses signed in the
presence of the executants and therefore the attestation must be deemed
to have been duly proved within the meaning of this section^ Surajpal
V. Udi't Punch, 1939 A.L.J. 604, A.I.R. 1939 All. 604, 183 I.C. 270. Under
this section it is not necessary that the executant must have seen the
attesting witnesses sign the document. It is sufficient if they sign in the
presence of the executantVinayak v. Md. Hanif, A.I.R. 1954 Nag. 11.
Where the executant of a mortgage deed, a lady who did not observe
strict purdah, was inside the room while the attesting witnesses and
others were outside in the adjoining veranda and there was no curtain
in the door of the room and Ae witnesses signed the instrument in the
veranda : Held that that attesting wlitnesses must be held to have
signed the instrument in the presence of the executant, ibid.
t Sec. 3
26 TRANSFER OF PROPERTY
in
Amendment is that
sec, 3, as introduced by the
A Svn of 1926, in which the nttesting witneses did not actually see
eracutant Sian the deed but received from the executant a person^
a^Lowledmeut rf his signature on the deed, and then attesIM the deed,
mtt be dlemed to have been validly ff^-Vcumppu ^ S^amama.
Mad 123 (F.B.), 55 M.L.J. 794, 116 hC- 367, A.I,R. 1929 Mad, 1 ,
Radha Mohan v. Nripendra, 47 C.L.J 118,
The effect of the addition of the above words by the Repealing and
Amending Act X of 1927 is to overrule the decision in Girija Nandcm v.
Hanumandas, 49 All, 25 (F.B.), 24 A.L.J. 921, A.I.R. 1927 All. 1 99
I.C. 161. See also Nepra v. Safer, A.I.R. 1927 Cal. 763, 55 Cal. 67,
103 I.C. 662 in which it was held that the definition of the word attested
had no retrospective effect and did not apply to documents executed
prior to 25th March, 1926 (on which the T. P. Amendment Act XXVII
of 1926 came into force). The decision in Balaji v. Gangamma, 51 M,L.J.
641, A.I.R. 1927 Mad. 85, 99 I.C. 143, and Mohamedi v. Kashi, A.I.R.
1926 All. 725, 96 I.C. 775 will stand as correct. It has been held in a
recent Allahabad case that the new definition of attested as added by
the T. P. Amendment Act XXVII of 1926 has no retrospective effect,
even by virtue of the Repealing and Amending Act X of 1927^ Balbhadar
V. Ukshmi Bai, 1930 A.L.J. 623, A.I.R. 1930 All. 669 (672), 125 I.C. 507.
This proposition, it is submitted, is not correct. It is curious that no
reference has been made to 52 Mad. 23 (F.B.) and other recent cases. But
the actual decision in the case was right. The facts of the case are
that a deed of gift purported to be attested by three witnesses, of which
one only was produced at the date of suit. Another witness had died,
and the third was not called in as he was hostile. The witness who came
to Court deposed that the executant signed the document in his presence,
and that the t^vo other witnesses were not then present. Held that the
document was not properly attested. [As the other witnesses, could
not be called m, it was impossible to prove whether the other witnesses
^gned the deed after receiving from the executant a personal acknowledg-
^^as tne old Act, stfil if at the time of the hearing of the app?al!the
Sec. i ]
t&Al^SFER, 6F PROPERTY 27
Amendment Act (1926) came into force, the new Act applied to the case
consequently the attestation made by a witness who signed upon the
mortgagor admitting his signature, was valid 5. M. A. R L. Firm v
R. M. M. A. Firm, 5 Rang. 772, A.I.R. 1928 Rang. 101, 109 I C. 469
Radha Mohan v. Nripendra, 47 C.LJ. 118, A.I.R. 1928 Cal. 154 (156).
But although the amendment was intended by the Legislature to have
retrospective effect and to validate mortgages which were executed before
the amending Act was passed, still the Legislature did not intend to
validate mortgages which were pronounced by a competent Court to be
invalid for want of proper attestation according to the law then in force
Earhha^andas v. Ghulam Shah, 25 S.L.R. 59, A.I.R. 1931 Sind 64 (65),
131 I.C. 719.
28 TRANSFER OF PROPERTY
[Sec. 5
No doubt the attesting witnesses must sign in that capacity and must
attest the execution of the document. But if their signatures appear on
the document, and there is clear and conclusive evidence that they actually
saw the executant sign the document and they themselves signed in his
presence, notwithstanding the fact that they signed the document not
against the signature of the mortgagor but against his signature where
he has signed the receipt clause, there is sufficient and adequate attesta-
tion of the document Kaderbhai v. Fcdmabai, A.I.R. 1944 Bom. 25. I.L.R.
1944 Bom. 388.
Harishchandra V.
no pS/r
Sec 3 ]
TRANSFER OF PROPERTY 29
These words are apparently used to denote what are termed fixtures
^ [ Sec. 3
30 TRANSFER OF PROPERTY
The principle upon which the rule of law in England that fixtures
Iss with the soil was relaxed in favour of trade had no application where
the parties who affixed the machinery were themselves owners in fee of
the soA~Mather v. Fraser, 2 K. & J. 536. See Fisher v. Dixon. 12 Cl. &
Fm. 312 atme y. Wood, (1869) 4 Exch. 328 is the leading authority on
ever the chattels have been ann'ILd toffie ^^nd^^ words: When-
enjoying the land itself the land for the purpose of the better
Sec, 3 ]
TRANSFER OF PROPERTY 31
[Sec. 3
32 tr.^ksfer of property
SiJ W^TO the property mOTtgaged Inctaded a rte mill and various
p r.s or^chinery pertaihtoS <0 the engine or to the htdler which was
intended to he set np with the help of the mpne, a shelter ^stem snbse-
onenth- attached to ihe hnller by a belt and thus worked (*e two could
be separated by taking away the belt), it was held that the machmety
portaining to the shelter system was not comprised m the mortgage
security' Satyamrayammitrthi v. Gangayya, (1939) 1 M.L.j. 69^ A.LR.
1939 Mad, 684, 1939 M.W.N. 383. Unless machinery is attached to the
building for its permanent beneficial enjoyment, it is not immoveable
property, specially where the building is really put up for the purpose of
sheltering the machinery and protecting it from the weather Meg/im;
V. Krishna, A.LR. 1924 All. 365, 46 AB. 286, 78 I.C. 243. Sludge from
sedimentation tank is movable property Bengal Aff'icultural and Indus-
trial Corporation Ltd. v. Corporation of Calcutta, A.I.R. 1960 Cal. 123.
in the Registration Act /mow rh ' n ^^^ co-extensive with its definition
Sec. 3]
TRANSFER OF PROPERTY 33
See also Note 78 under sec. 8 and Note 579 under sec. 108 (h).
(a) Claim for arrears of rent Hiralal v. Tripura Ckaran, 40 Cal. 650
(651) ; Rameshwar v. Riknath. A.I.R, 1923 Pat, 165, 67 I.C. 451 ; Sheo
Gobind v. Gouri, 4 Pat. 43. A.I.R. 1925 Pat. 310 ; Madhabilata v. Butto
Kristo, A.I.R. 1944 Pat. 129, 10 B.R. 652 ; Daya Debt v. Chapala Debi,
63 C.W.N- 976 ; Kane NK. v. Biharilal, 1968 Jab. L.J. 337. Even though
the arrears of rent may be said to be a charge on the holding or tenure,
still they cannot be said to be a debt secured by a mortgage of immove-
able property 5heo Govind v. Gouri, (supra). But the Nagpur High
Court has held that the right to recover arrears of profits assigned in a
conveyance of a village share to a co-sharer is not an actionable claim,
but a benefit arising out of land and therefore immoveable property
Kamal v. Shyamldl, A.I.R. 1936 Nag. 217 (218), 165 LC. 414.
{b) A claim for rent to fall due in future is an actionable claim, for
it is an 'accruing' debt within the meaning of the definition Pobthakka
V. Annamalai, 1926 M.W.N. 774, A.I.R. 1926 Mad. 1173, 98 I.C. 263 ;
Chidambaram v, Doraisami, 31 I.C. 473 (Mad.).
, r Sec. 3
38 TRANSFER OF PROPERTY
[Sec. 3
36 TRANSFER OF PROPERTY
'Idas, A.I.R. 1930 Bom. 409, 32 Bom. L.R. 894, 127 I.C. ^0.
sale
Badridas,
Unascertained amounts neither due nor payable but accruing, the pay-
which is dependent on work being executed, can be assigned-
W M'v S Vr. 1930 Lab. 820, 128 I.C. 494. But a liability
debt,
'contin-
ship, contractual or
The amount due imder a policy is a debt within the meaning of the
definition Varjivandas v. Magimlal, A.I.R. 1937 Bom. 382, 39 Bom. L.R.
493, 170 I.C. 850. It is within the competence of a policy-holder to make
a conditional assignment of each of the policies taken out by him whether
such policy is an ordinary life policy or an endowment policy providing
therein that in the event of the death of the assignee the benefits to the
policy would revert to him and the assignee alone is entitled to receive
the sum assured in case of the death of the insured before the day named
Shamdas v. Sabitribai, A.I.R. 1937 Sind 181, 170 I.C. 225.
Sec. 3]
iftANSPER Ot PROPERTY 3?
34 TRANSFER OF PROPERTY
[Sec. 3
a''irS'm2Tc"? 3?C*N. 280, imt. 266, 59 LA. 41, 135 I.C. 635.
(k) A document of
Jhangaldas v. Chetumal, A.I.R. 1938 Smd 24 (26, 27). 173 I.C. 59 .
(ri) The right to the proceeds of a business- -Alfctis/i Ali v. Nath Bank,
Ltd., A.I.R. 1951 Ass. 56, I.L.R. (1951) 3 Ass. 1.
(o) Provident fund amount payable after retirement and not presently
Official Trustee v. Chippendale, A.I.R. 1944 Cal. 335, I.L.R. (1943)
2 Cal. 325, 47 C.W.N. 441.
(p) The benefit arising out of a contract, not involving any personal
element, is an actionable claim during its subsistence Jaffer Meher Ali v.
Budge Budge Jute Mills, (1906) 33 Cal. 702. The rights under a contract
of carriage are an actionable claim Mulji Deoji v. Unio.n of India,
A.I.R. 1957 Nag. 31. A benefit under a letter of credit is an actionable
claim /oseph Pyke & Son Ltd. v. Kedamath, A.I.R. 1959 Cal. 328. A
railway receipt is an actionable claim AWmrce Assurance Co. v. Union
of India, A.I.R. 1959 Cal. 563.
be found^dL'on^akinraSounkTrom^^*^
of money but an
TRANSFER OF PROPERTY 35
(jf) A copy right. Savitri v. Dwarka, I.L.R. 1939 All. 275, 1939
A.L.J. 71, A.I.R. 1939 All. 305.
But althou^ under this definition, a secured debt does not fall
within the meaning of actionable claim, it does not follow that a debt
without the security cannot be made the subject of transfer at all. A
debt is distinct from the security, and the debt can be transferred apart
from the security Imperial Bank of India v. Bengal National Bank, 59
Cal. 377 (P.C.), 35 C.'W.N. 1034 (1039), A.I.R. 1931 P.C. 245, 134 I.C. 651.
40 TRANSFER OF PROPERTV
tSEC. 3
JU A****'- xi
mutation"^SS57.^''Ht^ough?To^aSr^^^^^^ seeing a
Sec. 3]
taANSFER OF property 4i
46 TRANSFER OF PROPERTY
[Sec. 3
of that possession to all who may have to deal with any interest in the
property, and persons so dealing cannot be heard to deny notice of the
title under which the possession is held Barnhart v. Creenshields, 9 Moo.
P.C. 18 ; Holmes v. Powell, 8 DeG.M. & G. 572. Constructive notice of
all the rights of the jierson in possession of a property sold or mortgaged
is to be imputed to the purchaser or mortgagee of that property who made
no enquiry of the person in occupation. But the unknown occupation of
a portion of the premises by a tenant or other person does not put the
purchaser or mortgagee on inquirj as to the possible right of the occupier
over the remainder of the premises Parthasarathy v. Siibbarayya, 45
M.L.J. 175, 72 I.C. 559, A.I.R. 1924 Mad. 67 (69). The possession by a
person, who entered into an agreement for the purchase of the land, of a
portion of the land, does not amount to constructive notice of the agree-
ment to subsequent purchasers in respect of the entire property Hari
Charan v. Kaula, 2 P.L.J. 513, 40 I.C. 142.
Sec. 3]
TRANSFER OF PROPERTY 47
30A. Attestation does not amount to notice : The above rule applies
only to the parties to an instrument, and not to the attesting witnesses.
A witness subscribing to a deed does not know the contents of the deed, for
a witness in practice is not privy to the contents of the deed Hipkins
V. Amery, 2 Gif. 212; Beckett v. Cordleij, 1 Ves. J. 55. Therefore,
attestation of a document does not by itself import consent to or
knowledge of the contents of the document, nor fix him with notice of
^4 TRANSFER Of PROFERTY
[Sec. 3
i consonance with the view expressed by some of the other High Courts :
Vide, Note lA, ante.
with the knowledvp nf it ^ was registered did not fix the plaintiff
Sec. 3]
[Sec, 3
42 TRANSFER OF PROPERTY
Where the circumstances are such that the slightest pains could have
enabled the mortgagee to discover an earlier charge, he will be fixed
with constructive notice of the charge if he refrained from making any
inquiry of Bombay v. Suleiman. 33 Bom. 1 (P.C.).
Cw 2VLT9 (5r
transfer of property 43
The Allahabad High Court laid down that registration was of itself
no notice to all the world, but where it was the duty of a person to search
or where a reasonably prudent man would in his own interests make a
search, then the fact that the search if made would have disclosed a
document affecting the property, would affect that man with notice of
that document and put on him the necessity of further inquiry Jaiiki
Prasad v. Kishen Dot, 16 All. 478 (482). This case was followed in Ashiq
Husain v. Chatiirbhuj, 50 All. 328, 26 A.L.J. 41, 108 I.C. 152, A.I.R. 1928
All. 159. But see Matadin v. Kazim, 13 All. 432 (F.B.).
48 TRANSFER OF PROPERTY
[Sec. 3
To affect the principal with notice, five things are necessary : (u)
The agent must have received the notice during the agency ; (6) The
knowledge must come to him as agent; (c) It must be in the same
transition ; (d) It must be material to the transaction ; (e) It must not
have been frauddently withheld from the principal Aett/enw/ v. Watson.
Cn. D. 685 (706),
person is concerned for the rnort-/^ ^ general rule, that where the same
tor the mortgagor and mortgtgee, that notice to such
Sec, 4]
TRANSFER OF PROPERTY 49
And sections 54, paragraphs 2 and 3, 59, 107 and 123 shall
be read as supplemental to the Indian Registration Act, 1908.
33. The second para, of this section was added by the Transfer of
Property Amendment Act III of 1885.
Before this para, was added, a difficulty arose in the case of the sale
cf immoveable property of value less than Rs. 100. -Thus, while an.
unregistered sale-deed of property of less than Rs. 100 would convey a
good title under the Registration Act, it would be wholly ineffectual
under the T. P. Act, unless it was accompanied by delivery of possession
(Narain v. Dataram, 8 Cal. 597, 612),
This difficulty has now been removed and sec. 54 has been made
supplemental to the Registration Act. A sale of immoveable property
of value less than Rs. 100 can be made only by a registered instrument
or by delivery of the property, and that, if made otherwise, e.g., by an
unregistered instrument unaccompanied by delivery of possession, the
sale is inoperative and confers no title on the vendee Makhan Lai v.
Bankit, 19 Cal. 623 (626) (F.B.) (overruling Khatu Bibi v. Madhtiram. 16
Cal. 622). The effect of secs. 4 and 54 of the T. P. Act is that if a sale
of immoveable property is made by a written instrument, the instrument
is compulsorily registrable, irrespective, of the value of the property
comprised therein Muthu Karuppan v. Muthu Samban, 38 Mad. 1158
(1161), 25 I.C, 772, 27 M.L.J. 497; Sohan Lai v. Mohan Lai. 50 All. 986
CRB.), 26 A.L.r. 1084, A.I.R. 1928 All. 726 (729).
An instrument which was intended- -to create a lease hut has failed
[ Sec. 5
50 TRANSFER OF PROPERTY
It is significant that the whole of the Contract Act has not been made
applicable to a transfer of immoveable propert}'. This section merely
makes certain provisions of the T. P. Act relating to contracts as part of
the Contract Act, and not vice versa. There is a clear distinction
between a contract which still remains to be performed and specific
performance of which may be sought, and a conveyance by which title to
property has actually passed. Cases of mere contract arc governed by
the provisions of the Contract Act. Cases of transfer of immoveable
property are governed by the Transfer of Properly Act. A mere contract
to mortgage or sale would not amount to an actual transfer of any interest
v property (see sec. 54), but a deed of sale or mortgage,
338, 1930 A.L.J. 45, A.I.R. 1930 All. 1 (2). 122 I.C. 872.
Sec, 5J
TRANSFER OF PROPERTY 51
CHAPTER 11
37. Transfer The term transfer is used in law in the most gen-
eric signification comprehending all the species of contract which pass
[Sec. 5
52 TRANSFER OF PROPERTY
The term transfer does not necessarily import coin'cyance of all the
transferors interest in the property. Thus, a mortgage or a lease is treated
as a transfer under the Act, although it does not exhaust the whole in-
terest which die transferor is capable of passing Narandas v. Parsoram, 4
B.L.R. 550; Ram Kinkar v. Satya Charan, (1939) 43 C.W.N. 281 (P.C.l.
44 M. L. J. 513, A'. 1. R.
Rama<iw, 7 ,t- u ' ('Assenting from 10 L. W. 498);
Sec. 5]
TUANSl'ER OF PROPERTY 53
^vould be invalid, and she also consented that after her death
the reversioner would be tlie owner of the property, held that
the compromise was a family arrangement and did not amount to a
transfer of property Basangotoda v. Irgowdalti, 47 Bom. 597 (603j, A.I.
R. 1923 Bom. 276, /3 I.C. 196. But where a Hindu woman inheriting
property from her father with the limited interest of a Hindu widow
surredered her entire estate in such property in fav'our of her sons so
as to accelerate their succession to it, the transaction amounted to a
transfer within the meaning of s. 7 of the U. P. Encumbered Estates
Act, 1934 /oft Prosad v. Basdeo, A.I.R. 1946 All. 267, I.L.R, 1946
All. 341.
54 tra:<sfer of PROpeStV ^
Mlicre both sides claim an equal title to tlie property and each
aerec to recognise a part of the tille claimed by the. other, the ^ac-
lira, is not a sale, gift or eschange, as there is no toarKfe * Sfe
one to the other Balkrishm v. Rangnath, A.I.R. 1951 Nag. 171, I.L.R.
1950 Nag. 618. Wiere a mortgagor delivers possession of the propeitj'
mortgaged to the simple mortgagee in satisfaction of tlie debt, the
Inmsaction does not amount to a compromise of disputed claims as no
title vests in the mortgagee, Ibid. An invalid gift-deed cannot be cons-
trued as a family settlement Sulaiman v. Kader, A.I.R. 1953 Mad. 161,
(1S52) 2 M.L.J. 104. For a family settlemeiit the parties thereto must
iiar'c competing titles in respect of die propeiiies in dispute, Ibid.
SBC, 51
TRANSPER OP PROPERTY 55
rights ; or it may be used in the sense of the rights and interests of tlie
owner or other person in the property. It is in tlie latter sense that the
term is used in this Act <Umrao Singfi v. Kachem Singh, I.L.R. 1939
All. 607, 1939 A.L.J. 308, A.I.R. 1939 All. 415 (F.B.) {per Allsop,
]., at p. 425). The following are included' in tlie term Property:
(g) A hat is property, so tliat the rents and profits derivable there-
from may be validly transferred GaiUtm Mohiuddin v. Parhati, 36
Cal. 665.
relief {vide sec. 3 ante). It follows that a claim to a debt which can-
not be enforced by action, e.g., when die debt is barred by limitation,
is not "property The same limitation must apply to a part of a debt
and in order to determine whether or not it is ijroperty , it must be
found out whedier an action can be sustained to recover it Durg Singh
V. Kesho Lai, 18 Pat. 839, A.I.R. 1940 Pat. 170, {per Harries, C.J., and
Fazl Ali, J.).
t Sec. 5
A inorlgiJgc
as
no such
< .u,.v4c! and enforced in this ei/r; JIT.. ' cakes, etc.), is-
It has been held by the Lahore High Court that there can be no
mortgage of profits that would accrue from year to year, because such
profits are not an interest in immoveable property. Such profits cannot
be pledged also as pledge can be of moveable property or goods, and
such profits are neither moveable property or 'goods Punjab National
Bank v. Punjab Co-operative Bank, A.I.R. 1939 Lah. 15.
It is, however, obvious from sec. 5 that the T. P. Act is not intended
to cover transfers in future. Harnam Singh v. Md, Akbar, A.LR. 1937
Pesh. 76, 170 LC. 136 ; Muttu Kwnara v. Veerappa, A.I.R. 1931 Rang.
160, 131 I.C. 509.
8
58 transfer of PftOPfiRtY ^
of theVoperty afeVd
fRANSEfiR Of property 59
[Sec. 6
60 TRANSFER OF PROPERTV
t,m sSTj'k 19H All. 973, 150 I.C. 562; BWprf v, Stoam A.I.R.
1929 All. 781, (1929) A.L.J. 724.
A.L.J. 1151. In this last-mentioned case it was held that buildings be-
longing to a co-sharer could be sold by him in spite of the fact that after
partition under sec. 118, U. P. Land Revenue Act, the site on Avhich
the buildings stood was assigned to the Kura of anotlier co-shaiei who,
under the said section was entitled to a reasonable ground rent, but not
to the buildings.
Sec, 6]
TRANSFER OF PROPERTY 61
Before any of the clauses (a), (d), (dd), and (f) can apply to a tran-
saction, there must be a transfer of one of .the various tilings mentioned
in these clauses Sarfaraz v. Ahmad, A.l.R. 1944 All. 104, I.L.R. 1944
All. 141.
62 transfer of property
[Sec, 6
This chance of
of this section
iour Mohan, 48 Cal. 536; Nond Kishore v. Knnee Ram 29 Cal. 355
(355); Amndi Bai v. Rajaram, 22 Bom. 984; Babu v. Rafno/^ 21 Bom.
319- Bai Porvati v. Dayabhai, 44 Bom. ^88 J
Sec, 6]
TRANSFER OF PROPERTY 63
her daughters and (grandsons for dividing up the properties between
them in absolute right, and one of the daughters conveyed one item of
property which fell to her share to a predecessor of the defendant, and the
plaintiff another daughter, after the death of her other sisters sued to
recover tliis property ; Held that the plaintiff who was a party to die
arrangement made to divide the property at a time when the rights of
the widow and the daughters were in doubt could not repudiate the
same and impeach a sale made on the faith of it~Mt. Hardei v. Bhag-
u>an, 24 C.W.N. 105 (P.C.). So also, an cccknowledgment by a reversi-
oner of the widows absolute right in her husbands property under his
will does not amount to a transfer of the reversionary right in favour
of the widow Chetty v. Chetty, 31 Mad. 474. A contract between a
reversioner and the widow is not binding on the reversioner when the
succession opens on the death of the vfi^ioyf Bahadur y. Mohar Singh,
24 All. 94 (P.C.). An admission by a reversioner for consideration that
the disputed properties never formed part of the estate of the person from
whom he claims as a reversioner, does not amount to a transfer of rever-
sionary right iRTamurfl/M v. Kocherlako.ta, A.I.R. 1925 Mad. 1943,
JSec. 6
64 TRANSFER OF PROPERTY
I M All fill f616) Raglmbir v. Grain, 1930 A.L.J. 1541, A.LR.
Sill 98 (5 Rthelleaa. of H ond S two out o *e tour
1j. 30 Ail. 4a& ^ ; -urATving brothers agree that one o them, who
Sec. -6 ]
TRANSFER OF PROPERTY 65
into force, it was given eifect toLalita Prasad v. Samam, 14 P.L.T. 27,
.A,I.R. 1933 Pat. 165 (172, 173).
r g
66 TRANSFER OF PROPERTY
,, - settlement any
to its end to
1. C. 223, on appeal from Ma Yait v. Md. Ibrahim, 5 Rang. 145, 102 I.C.
690, A.LR. 1927 Rang. 165.
Sr w u Hamath v.
1945 '
in cl. (a.) of diic* c that they are not of the nature mentioned
Sec. 6]
TRANSFER OF PROPERTY 67
The Court does not allow the transfer of a mere right to succession to
be effected even by means of a consent decree Ramasami v. Ramosami,
30 Mad. 255 (263). A compromise of a suit, according to die terms of
which the mortga,gee (to whom the Hindu widow had mortgaged her
property) and the reversioner agreed to divide the property in equal
shares after the widow's death amounts to a transfer of an expectancy
by the reversioner and is therefore invalid under the provisions of this
clause 'Bhagioan v. Munnu, 15 O.C. 112, 13 I.C. 495. The relinquish-
ment of a reversionary right cannot be tlie consideration for compromise.
But a man. can, for good considei-ation, admit that the property in dispute
did not form part of the estate to which he was a reversioner
Kamaraju v. Venkatalakshmipati, A.I.R. 1925 Mad. 1043 (1044), 49 M.L.
J. 296, 88 I.C. 982. If the substance of the transaction is found to be a
bona fide settlement between the parties, then, in spite of the fact that
the same transaction might be represented in one of its aspects as a
dealing with a spes successionis, it is none the less a real compromise of
disputed rights per Srinivasa Iyengar, J., ibid at p. 1045.
6S TRANSFER OF PROPERTY ^
;. T\ eix inu up liis riglits in the family property and T instituted a suit
claiming a fiqnidated sum on account of past and future maintenance,
he assignmeit of the claim before the decree was held to be void
|,cing assignment of a mere possibilitj' and the assignee was not aUowed
to CM cute the decree passed on compromise Abasil Kami v. Taraganar,
A I R 1956 Mad. 6S1. It was agreed in a suit for partition that they
wnidd not claim any share which would otherwise have accrued to them
on the death of eitlier of the parties ; Held that the compromise was
not liit In- any rule of Hindu law or by the provisions of cl. (a) of this
section Rfli Kumar v. Abani Kumar, A.I.R. 1948 Pat. 362. If two co-
widows having the right of survivorship in the properties inherited by
them from their husband enter into a partition arrangement excluding
the right of survivorship the arrangement is not hit by sec. 6 (a) Kar-
jy.igadiachi v. Nagarafhinathachi, A.I.R. 1965 S.C. 1752.
Sec. 6]
fftANSEEft OF FROPEEtY 6 ^
dispositions are valid, the person in Avhose favour such a contract exists
cannot transfer his supposed riglit under the contract to a third person,
and the latter cannot, on the strength of such a transfer, sue for a declar-
ation of those rights Pmg Dat v. C/wfe Singh, 9 O.C. 55.
r shc 6
70 TRANSFER OF PROPERTY
In tlie Limitation Act (sec. 26), the definition is much more compre-
hensive and includes what in English law is called a 'profit d> prendre, i.e.,
a right to enjoy a profit out of tire land of another.
Sec. 6'i
TRANSFER OF PROPERTY 71
Wliere munafi rights were not given to a person personally, but were
given to him and his descendants in perpetiiity, cl. (d) did not apply
Hari Kishan v. Ratan Singh, A.I.R. 1934 All. 973, 151 I.C. 562.
Wliere a settlor creates trust of liis property, but reserves some in-
terest as allowance to himself, it is an interest to which cl. (d) does not
apply Rajamier v. Subramaniam, A.I.R. 1928 Mad, 1201. See Sham-
muga V. Chidambaram, A.I.R. 1938 P.C. 123, 42 C.W.N. 565, 173 I.C.
t^EC. 6
72 TRANSFER OF PROPERTY
772 whorcin Uk Privy Comdl ^pressed the same view. Clause (dd) ras
not'sjpplieable in either of the two cases.
Whete a ts "Sid*
A deed of partition between the father, his wife and three sons of a
Mitaksham family provided that after the fathers death his four-anna
share should remain in possession and occupation of his wife up to her
life time with life interest and that she would have a right to appropriate
the profits therefrom without a power of making a mortgage or other
transfers : /lekl that her interest under the deed was an interest in the
propertj^ restricted in its enjojmient to die owner personally within clause
(d) of this section and was therefore not transferable Luc/tmeshtvar v.
Mt. Mofi Rani, A.I.R. 1939 P.C. 157.
V. Ravi Varma,
teat
a.e Ty
transfer of fropeRty 73
the right to act as the hereditary guide of the pilgrims Gopi Nath v.
Jhandii, 4 A.L.J. 712.
[ Sec, 6
74 transfer of fropRrtV
o. s.:
Sec. 6]-
TfiANSt*R 6 f property 75
[Sec. 6
76 transfer of PROPERfV
fa a'Sf fTarioaSny
S'r
Sec, 6]
TRANSFER OF PROPERTY 77
ance arrears due to the motlier can be claimed by the t^vo sons after
the death of the motlier because they are claiming not any future right
to maintenance but arrears of maintenance tliat had already accrued
due D7?<rn Pala v. Krishna Cheffiar, A j.R. 1955 Mad. 165.
[Sec. 6
78 TRANSFER OF PROPERTY
.os.
service abolished).
56. Clanse (e) Mere right to sue Cf. clause (e) of section 60 (1),
C. P. Code, under which a mere right to sue for damages is not
attachable.
but his in^prp<!^ " cx-minor transfers not a mere right to sue
Sec. 6]
TRANSFER OF PROPERTY 79
But where the property itself is sold together with the mesne profits,
the transfer is valid. An assignment of a mere right to sue does not
convey anj'^ property, e.g., if a person out of possession of immoveable
property makes an assignment to tire effect that the assignee would have
a risrht to sue, without conveying any interest in the property, the assignee
would not be entitled to maintain anv suit for tire recovery of the pro-
rrerty. But it would be otherwise if the property itself is transferred
Monmatha v. Matildl, A.I.R. 1929 Cal. 719 ; Gcmga Din v. Piyare, A.I.R.
1929 All. 63 ; Shankarappa v. KJiatitmbi, A.I.R. 1932 Bom. 478 ; Siisai
V. Ramasioami, A.I.R. 1933 Mad. 710; Thoma v. Govindakimip, supra :
Muralidhar v. Rupsndra, A.I.R. 1953 Cal. 321. Wlrere the properties of
.A Company are tran.sferred to C Co. during the pendency of a suit by A
Company for damages or a breach of contact, C Company can proceed
with the suit on substitution New Central Jute Mills Co. Ltd. v. Rivers
Steam Navigation Co. Ltd.. A.I.R. 1959 -Cal. 352. "Where the right of
action was not a bare right but was incident or subsidiary to a right in
property, an assignment of the right of action was permissible, and did
not savour of champerty or maintenance per Scrutton, L.J., in Ellis
V, Torrington, [1920] 1 K.B. 399 (411). The distinction, however, was
not noticed in Seetamma v. Venkataramanayya, 38 Mad. 308, which was
a suit for recovery of property as well as mesne profits. A transfer of
the right to recover profits which arose out of the land along wth the
transfer of the land itself is not hit by sec. 6 (e) Gangarajii v. Gopala
ri R.^1929 Pat. 245 (Ml), 120 LC. 626; Radha Qoomda v. KJ^as Dhar-
oee also Vmon of Indw v. Alhance Assurance Co. Lid., 66 CW.N. 419.
to or in tort. It is
ia.39 Cal. 715. But this does not give the assignee of
Sec. 6]
TRANSFER OF PROPERTY 81
tlie fruits of tlie action the ri^it to interfere in the preceedings in the
acMonRajamanickam v. Abdul Halim, supra.
The words "riglit to sue not only refer to rights to damages arising
out of torts, but also include rights arising out of contracts. Tlius, a
right to sue the gomasta (agent) for accounts (wliich is a right ex con-
tractu) falls under this clause and is unassignable Kshetra Mohan v.
Biswa Nath, A.I.R. 1924 Cal. 1047 ; Kalusa v. Madhorao, A.I.R. 1926 Nag.
357. (Contra Churamoni v. Rajendra, 42 I.C. 390). The right of a person to
recover damages (whether liquidated or unliquidated) for the breacli of
a contract is a right to sue within the meaning of tliis section and is
not capable of being transfeiTed Janglimal v. Pioneer Flour MUIs, 106
P.R. 1914, 27 I.C. 115 ; Abu Muhammad v. S. C. Chunder, 36 Cal. 345 ;
Jewan Ram v. Ratan Chand, A.I.R. 1921 Cal. 795 ; Hira Chand v. Nem
Chand, A.I.R. 1923 Bom. 403; Yadaoendra v. Srinivasa, A.I.R. 1925 Mad.
62 ; Gopala v. Ramaswami, 21 M.L.J. 153, 22 M.L.J. 207 ; Ghiman Mai v.
Ganesh, A.I.R. 1951 Raj. 187. Moti Lai v. Radhey Lai, A.I.R. 1933 All.
642, (646, 647) ; Shahrukh v. Sheo Prasad, 41 I.C. 435 ; Nakhela v. Kokaya
A.I.R. 1923 Nag. 67 (68) ; Gerimal v. Raghunath, A.I.R. 1921 Sind 59 ; Mt.
Potori V. Shiva, A.I.R. 1935 Nag. 2. But see Bans Gopal v. P. K. Banerje,
A.I.R. 1949 All. 433. It has been held in this case tliat where the Official
Receiver has become entitled to the benefits of a contract between the
insolvent and another person, the right to sue for damages for breach of
the contract in his hands will not be a mere right to sue for damages.
An executory contract for the future sale of immoveable property is, how-
ever, not a mere right to sue, although a right to sue is involved in it on
breach of its conditions. But where at die time of execution of the
assignment deed by the vendee, the assignor is aware that the contract
was incapable of execution, what he assigns is not an executory contract,
but a claim in respect of coihpensation for breach thereof and hence a
mere right to sue Punjaram v. Hariso, A.I.R. 1934 Nag. 268. Tlie benefit
of a contract, that is, the beneficial right or interest of a party under tlie
contract and tlie right to sue to recover the benefits created thereby are,
however, assignable provided that, (a) the benefit is not coupled with
any liability or obligation that the assignor is bound to discharge, and (b)
that the contract has not been induced by personal qualifications or con-
siderations as regards the jiarties to it Nathu v. Hansraj, 9 Bom. L.R.
114; Jaffer v. Budge-Budge Jute Mills Co., 33 Cal. 702. See also Bha-
bhootmal v. Moolchand, A.I.R. 1943 Nag. 266. Tlie right of the mortgagor
to sue the mortgagee for the balance of the consideration which has not
been paid by the mortgagee is a right to obtain damages for breach of
the agreement to lend money, and is a right to sue ivithin the meaning of
this clause, such a riglit cannot be assigned and the transferee of the right
cannot sue the mortgagee for the money Yadavendra v. Srinivasa, A.I.R.
1925 Mad. 62. But where A, after mortgaging his property to B, subse-
quently sells it to C, who retains part of the purchase money for payment
of Bs mortgage but does not pay it, A has a charge on the property until
the amount is paid, and his right to recover the unpaid purchase money
from C is not a mere right to sue, but is assignable at \aw~Natlm Mali
V. Bansaji, A.I.R. 1931 Nag. 89 (90). But in a later case of tlie same Hi^i
Court where die mortgagee accepted the hability to pay off the
mortgagors creditors as part of the consideration for the mortgage but
11
82 TRANSFER OF PROPERTY ^
981 (285) But it has recently been held by the Patna High Court
diat a right of maintenance in a definite sum of money cannot be a
mere right to sue. It may not be attachable under cl. (n) to sec. 60 (1 ,
C. P. C but that is not sufficient to bring it witlnn cl. <e), for it will,
in ease of breadi, support a suit for a debt and not foi damages
Sf. aLIiS V. Jiul Aziz, A.I.R. 1936 Pat. 527, 165 LC. 298. A
right to recover damages from the purchaser for breach of contract to
purchase goods is not an actionable claim but a right to sue, and can-
not be transferred Hifc Cliond v. Neni Chond, A.I.R. 1923 Bom.
403. But the right to recover earnest money paid under a broken
contract is not a mere right to sue. It is a claim for an ascertained
amount and can be transferred as an actionable claim Chiman Mai v.
Ganesh, A.I.R. 1952 Raj. 187. A claim to recover damages from an
agent for negligence in collecting rents (whether the claim is viewed
as one for compensation for breach of contract or as one founded on
tort) is a mere rijght to sue and cannot be transfeired Varahata-
stvami v. Rama Chandra, 38 Mad. 138. A claim to damages for use
and occupation from a tenant continuing on the land after the exjiira-
tion of die lease widiout the landlords consent, is a mere right to sue
for damages and is not transferable Govindaswami v. Ramastvami,
30 M.L.J. 492, (reversing on appeal Gooindasivami v. Ranraswami, 31
LC. 604). Wiere a person sues not for recovery of the actual crops,
but for compensation for wrongful appropriation of tlie crops by tlie
defendant in violation of an agreement, the suit is professedly one for
damages resulting from breach of contract. Such a right of action is
jiurely personal and incapable of assignment or attachment Liladhar
V. Nago, A.I.R. 1933 Nag. 6 (9). A contract of service, being a personal
contract, is not assignable before breach, as tlie trasnfer would be of a
mere right to sue Karam KJian v. Dangiishti, 47 LC. 902 (Nag).
attachmertL^then Sd f
party Z acSSi*!? P
Sec. 6]
TRANSFER OF PROPERTY 83
sary to look into the accounts settled makes the right a mere right to
saeRamiah v. Rukmani, 24 M.L.J. SIS, 18 I.C. 138. A right to
recover past profits of a partnership on taking accounts is not a mere
right to sue but is an actionable claim, and is transferable Shrinath
V. KanhaiyaJal, A.I.R. 1924 Nag. 145. A right to reconveyance of land
is property and not a mere right to sue, and can be attached and sold
in execution Narasingerji v. Pamganti, A.I.R. 1921 Mad. 498. A
right to contribution is not a mere right to sue for damages and is
assignable v. DeUvangam^n^ A.I.R. 1922 Mlad 397'.
^^le^e tlie vendee in a contract of sale of land transfers liis rights under
die contract, die transfer is not a mere right to sue, aWiough a right to
sue is involved in it on breach of its conditions. The transfer is there-
fore not invalid under this clause Akhtar Beg v. Haq Netmz, A.I.R.
1924 Lah. 709 (711) ; Venkatestoara v. Raman, 3 L.W. 435 (439), 33 I.C.
696 ; Venkateswara v. Raman, 3 L.W. 435, 33 I.C. 696. Where the
mortgagor left with tlie mortgagee a portion of the consideration money,
witli tlie understanding that the same should be paid to him whenever
he so required, and subsequently the mortgagor assigned his rights
regarding the same held that what was transferred was a mere right
to sue which is non-transferable under this clause Indar v. Raghubir,
A.I.R. 1930 Oudh 88. A tiansfer of the share of the profits of a village
which have at die time actually accrued due, is an assignment of a debt
and not of a right to sue, and is therefore not bad in law, although
the transfer of a right to sue is a necessary incident of the transaction
Bharat Singh v. Binda, 6 O.L.J. 398, 47 I.C. 634; Girdhmi v. Ahmad
Mirza Beg, 23 O.C. 384, 60 I.C. 9 (691), Tlie transfer of a share
in a iiartnershiiJ is not a transfer of a mere right to sue and is valid
Vishindas v. Thawerdas, A.I.R. 1925 Sind 18. Where a lessee under
the mortgagor in violation of his agreement to pay the Government
dues or to jiay damages in case of default makes default in paying
Government dues and tlie mortgagee in execution of his previous
mortgage decree purchases the mortgaged propeity and clears the
Government dues in arrears, he can recover the amount so paid from
the lessee Mnnmatha v. Sheikh Hedait, A.I.R. 1932 P.C. 32. If the
consignee of goods carried by a Railway, after getting compensation
from the insurer on account of short delivery, assigns his rights
against the Railway to the insurer the assignment is not hit by sec. 6
(e) Union of India v. Alliance Assurance Co., Ltd., A.I.R. 1964
Cal. 31.
Where the right to sue has merged in a decree, the right under
the deci-ee is assignable. Thus, where a claim for mesne profits has
merged in a judgment before assignment, the right under the judgment
can be transferred, although the original cause of action was not trans-
ferable Prasanna v. Ashntosh, 18 C.W.N. 450, 20 I.C. 685; Venkata-
rama v. Ramaswami, 44 Mad. .539 (543) ; Hari Prasad v, Kodo Marya,
1 P.L.J. 427, 37 I.C. 998.
[Sec. 6
84 TRANSFER OF PROPERTY
income from the Jagir has been received by ilie certificate holder,
the other sharers can validly assign their right to take accounts of their
share in the income of the JagirAjijoddin v. Jaiwant, A.I.R. 1953
Nag. 355. A partners right to .sue for an account of a dissolved part-
nership has, however, been held to be moveable property and such ii
right is not a mere right to sue and can be assigned as an actionable
claim Tliakurdas v. Vishindas, A.I.R. 1925 Sind 72, 79 I.C. 384.
57. Clause (f) : ^Public office : ^If the office be not a public
one in tlie strict sense it would be transferable, even though the dis-
charge of its duties should be indirectly beneficial to the public 7i re
Miratns, (1891) 1 Q.B,D. 594.
V. Of ifltVi-iOU,
^ tempI^St^bbarcy^rdu v. Kotayya, 15
V MaJuira, or Shehait^Wahid
Sec. 6]
IftANSEfiR OE PROPERTY 85
valid under Hindu law; (3} tlie transaction is really not a transfer
because the office is still retained by the family Hartmappa v. Han-
mantganda, A.I.R. 1948 Bom. 233. An office of worship in a temple,
which is heritable and partible, is not a public office Narayanam
Seshacharyulu v. Narayanam Venkatacharyuhi, 1956 Andhra W.R. 1050.
A consent decree was passed irith a teitn that the 23biintiir might
recover the amount from tlie salary of the defendant at Rs. 2 per
month by attachment. Tlie defendant was a railway servant : Held,
tlie contract was opposed to public policy and i^oid under this section
M. & S. M. Ry. V. Rupchand, A.I.R. 1950 Bom. 155. Where a younger
brother, a university student, out of natural love and affection jiromises
to pay his elder brother a specified sum based on liis monthly earning
on his getting an employment, the promise is not hit by sec. 6 (f) B.
Ananthayya v. B. Svbba Rao, A.I.R. 1960 Mad. 188.
tRANSFER OF PROPEEfV
[Sec. 6
1071 ^Habibul Rahaman v. Abdul Hat, A.I.R. 1^26 All. >21 , Duni
Cliand V. Gurmiikh, A.I.R. 1930 Lah. 816,
sioLte' eJu^TuS r,
Sec, 6]
tSfic. 6
gg TRANSFER OF PROPERTY
^4/imed Saif v. Bank of Mysore, A.I.R. 1930 Mad. 512,' 53 Mad. 771,
126 I.C. 614.
bIz sr
by to
rent than that allowed by the Calcutta Rent Act, the lease was void
as it intended to defeat the provisions of that Act Saleh Abraham v.
Manekji, 50 Cal. 491, A.I.R. 1924 Cal. 57, 75 I.C. 521.
12
90 TRANSffiR OF PROPERl^ [ S C, 6
Sdtty this rale of equity but only lays dorvn tlnlt the Court rviU not
prohibited by law If, public policy is opposed (as it is) to voice and
11^6 fact that in the community to which the parties belong con-
cubmage is allowed and is not regarded as immoral does not inahe a
settlement made in consideration of concubinage any the less immoral
-Sabava v. Yamanappa, supra. Wliere the owner of a house lets out
defendant for the immoral purpose of running a
brothel, the exeemors of the will of the owner can sue to eject the
poBty' Hou're'rf r *
Sec. 6]
TRANSFER OF PROPERTY 9l
Kings enemies, are all undoubtedly unlawful things ; and you may
say that it is because they are contrary to pubhc policy lliey are milaw-
ful ; but it is because tliese tilings have been either enacted or assumed
to be by tlie common law unlawful, and not because a Judge
or Court have a right to declaie that such and siich tilings are in his
or their view contrary to pubhc poUcy at pp. 491-92. Lord Davey
in die same case went so far as to say ; "Public policy is always an
unsafe and treacherous giound for legal decision at p. 484.
92 TRANSFER OF PROPBRtV
[Sec. 6
On afipeal the last cited decision has been affirmed by the Privy Coun-
cil and it has been held that in order to make out the defence that the
contract sued on is void on account of its consideration being the stifl-
ing of a prosecution, the defendant must establish a contract whereby
the proposed or actual prosecutor agi'eed, as part of the consideration
received or to be received by him, either not to bring or discontinue
criminal proceedings for some alleged oflencc Bhowanipur Banking
Corporation v. Durgesh Nandini, 46 C.W,N. 1 (P.C.).
that S^^Si ? Full Bench of the Allahabad High Court has held
InLrflo? Zn of a mortgage by a paiwari is not a
Sec, 6]
TRANSFER OF PROPERTY 93
[Sec. 6
94 transfer of property
Sec. 6 ]
TRANSFER OF PROPERTY 95
67. Clause (i) : Tlris clause which is identical witli the secorrd
para of section 108 (/) has been inserted by the Transfer of Property
Amendment Act of 1885, in order to remove any doubt whidr might
arise in view of sec. 117, as to its applicability to leases for agricultural
purposes.
96 TRANSFER OF PROPERTV
[Sec. 7
holding in Oudh, see Amar Nath v. Nar Prasad, 7 Luck 425, A.LR. 1932
Oudh 79, 136 LC. 333.
The interests which are declaied inalienable by this clause are par-
ticular interests which have been created by statutes enacted to regulate
the relations between landlord and tenant. An interest confeired by a
decree is not covered by this clause. Tliere is an essential distinction
between restrictions on transfers imposed by tlie Legislature, and rest-
rictions imposed by contract or decree. Wliere die Legislature deem
it expedient to fetter die privilege of free alienation, tiie prohibition
founded upon considerations of public interest must be treated as
absolute. But no such force can be attributed to a restriction which
has its origin in an agreement of die parties or a decree of Court. Tlie
contract or decree does not purport to affect the rights and interests
of any one but the parties diemselves ; it merely regulates the relations
of the parties inter se. Consequendy, where there is a decree of Court
settling die rights of two parties, which contains a provision diat one
of them (tenant) shall not alienate the propeity which he has got from
the other, the presumption is that die condition against alienation is
inserted for the benefit of the otiier party (superior proprietor). Tlie
latter may waive die benefit of the amdition and if he elects to do so
by giving liis consent to a transfer, the transfer is a valid transaction-^
Wazir Muhammad v. Uar Prasad, 15 O.C. 67, IS I.C. 613 (614, 615).
Sec. 7]
TRANSFER OF PROPERTY 97
M.L.J. 941, 129 I.C. 449, A.I.R. 1931 Mad. 147 (149). See the amend-
ment made in sec. 107.
Where tlie actual lease executed by a minor was only for 5 years,
and the stipulation Avitli regard to tlie continuance of the lease in
future, should the tenant require it, had not passed from the domain
of contract, the stipulation could not be ratified' by the minor on his
coming of age, as tlie agreement with regard to the future lease was
void Indian Cotton Co. v. Raglwnath, A.I.R. 1931 Bom. 178 (182), 33
Bom. L.R. 111, 130 I.C. 598.
13
[Sec. 7
98 transfer of property
ladv had tenns are fair and equitable, and that die
Seal *>"=
own businp<:<! hprceif ' ' .W' where a lady attended' to her
give to go to Court to
ments executed by her need not hfl \ j Pardanashin lady, and docu-
of scrutiny and susnicion ne A upon with the same amount
Sec. 7]
TRANSFER OF PROPERTY 99
[Sec. ^
A man has no right to deal with property which is not liis own,
and unless he can show some right to deal with it either as agent or
guardian of the owner or as tiustee or the like, any transfer which he
purports to make cannot bind tire lawful oivner. Section 7 of the. T,
P. Act embodies this principle Cliiiu v. Charan Singh, A.I.R. 1923
All. 563 (564), 77 I.C. 705. A person who has no right at all to present
possession cannot make any valid transfer Padma Kumari v. Honda
Padhan, A.I,R. 1941 Pat, 219.
SI
after the
Sec. S]
tfiANSfER OF PROPERTY 10 I
72. Scope : ^Tliis section is not intended to lay down any rule
as to what words are necessary to effect a transfer of any paiticular kind
of property. What property is actually conveyed by a particular deed
depends upon its own terms Jyoti Prasad v. Seldon-, A.I.R. 1940 Pat.
516 (536), 19 Pat. 433, 192 I.C. 17. Where what is transfeiTed by the
endorsement is only the property in tlie promissoiy note and not either
a debt or an actionable claim, this section does not apply Vira
Raghavalu v. Rajalingam, (1939) 2 M.L.J. 531, 1939 M.W.N. 774,
A.I.R. 1939 Mad. 846. This section is inapplicable to transfers by
execution sales Subbaraju v. Seetharamaraju, 39 Mad. 283 (286) ;
Penumeta v. Veegesena, 28 I.C. 232. But see Hariharan v. Pachtive^-
iial, A.I.R. 1935 Mad. 482, 145 I.C. 174. See sec. 2 (d). But in an
Allahabad case, the principle of this section, diough not tire section itself,
has been applied to a Court-sale. Thus, if the property is at the date of
lire auction-sale subject to a charge, the purchaser gets only what the
"transferor is capable of passing, tliat is, he takes the property subject
to the charge, and cannot disregard it; he is rrot clotlied 'vitli a liigher
interest in the property than what the transferor was capable of passing
Nathan Lai v. Durga Das, 52 All. 985, 1930 A.L.J. 1267, ISO IC. 489,
A.I.R. 1931 AU. 62 (64).
[Sec. S
.1.0 transfer - t
106.
and gift, tlien also aimabsolu^ succession With right of transfer by sale
constituted maJik of the nronerKr-fS ^ grantee was
(P.C.l, . 3.5 C.W.N 90-3 (gOSl^Ain 59 Cal. 142
E(J. ]
words in order that you may perform those religious ceremonies, cele-
brate the festivals satisfactorily, and may provide for your own support,
by having the property under your authority and control, lield that the
words of the gift were limited by its imrpose, and the donors intention
as gatliered from the whole instrument was that the donee should take
the property for life only Kalidas v. KanlwyaM, 11 Cal. 121 (ISl) (P.C,).
Hie words istimrari mokurari" in a pattah granting land do not per se
convey an estate of inheritance ; but it is also true that such an estate
may be created without the addition of such expressions as ba farz-
andan" (with children) or vaslan bad vaslan' (generation after gener-
ation). Witliout them, the other terms of the instrument, tlie circums-
tances under which it has been made, or the conduct of the parties,
may show tlie intention witli sufficient certainty to enable the Courts
to pronounce the grant to be perpetual Ti/^shi Pershad v. Rafn Narain,
12 Cal. 117 ; Gaya v. Ramjioan, 8 All. 569. The grant of a mokurari
ifara at a fixed rent in a mauza may be only for the life of the grantee ;
and in the absence of words impoiiing perpetuity, the question to be
considei'ed is whether the intention of tlie parties is shown by the other
terms of the instrument, the circumstances under which it was made or
the subsequent conduct of the parties, with sufficient certainty to enable
the Court to pronounce that the grant was perpetual Bilasmani v. Raja
Sheopershad, 8 Cal. 664 (P.C.). A condition in a lease that the tenant
ivill not be ejected so long as he pays the rent due from him and
remains obedient, is at best good only for the lifetime of the tenant and
creates no heritable estate Madho Singh v. Deputy Commissioner, 8
O.C. 61. In the absence of anything to the contrary, the simple grant
of an annuity conveys only a hfe interest to the grantee. Hie mere cir-
cumstance that an annuity is continued after tlie life of the first grantee
or that it is being charged on village revenues does not lead to an in-
ference that it is of absolute duration, and does not indicate an inten-
tion to create an annuity as co-equal with the duration of the proiierty
itself Copal Krishna v. Ramnath, 5 Bom. L.R. 729. In the absence of
direct evidence of its terms or tenitorial custom to the contrary, a
kJiorposh grant cannot be presumed to be of greater duration than for
the life- time of the grantee. Such a grant ciuuiot be presumed to be more
than a grant of the rents and profits, and does not cany witli it a right
to open mines and remove minerals which are properties of the soil
Tituram v. Cohen, 33 Cal. 203 (P.C.). Trees standing on the land pass
to the puchaser on a sale of the land ; the mere fact that the trees had
been prior to the sale of the land mortgaged to another person and no
mention of the mortgage is made in the sale-deed, does not lead to the
inference of a different intention to the effect that the vendors in-
terest in the trees should not pass to the purchaser of the land Pan-
durang v. Bhimrao, 22 Bom. 610 (612).
If the purchaser of a property refuses to produce the deed of con-
veyance, it is impossible to ascertain whether a different intention is
expressed or necessarily implied and tlie Court will not be entitled to
hold tliat any easement passed by virtue of this section to the pur-
chaser as a legal incident of the proiierty Wutzler v. Sharpe, 15 All.
270 (289).
f Sec S
be imposed in-
1 Debubrata, A.LR. 1951 S.C. 293, 1951 S.CJ. 394 per ChandraseWiara
\iyar J A proviso is normally an excepting or a qualifymg clause
imd die effect of it is to except out of the preceding clause upon
which it is engrafted, something which but for the proviso would be,
within it, ibid per Mukherjea, J.
510, A.I.R. 1925 Pat. 625 87 I C 849 auR " v. Remesmar, 4 Pat
iiMidu from sac. 2 has not changed the Hindu Law in this respect.
nbuict ;f7=ti^n
Sec. S]
woman ordinarily gets an estate for life and not an absolute estate
Mf. Sheoraji y. Ram Sawari, A.I.R. 1935 All. 43, (1934) A.L.J. 1013,
152 I.C. 387. But see Rampyari Kiier v. DtiUtin Badwraj Kuer, A.I.R.
1965 Pat. 217, where it has been held that a wife may get an absolute
estate if so intended by the husband.
ships thinks tliat Hie effect of the decision is to put putni tenures
generally in tliis respect on the same footing as other permanent herit-
able and transferable tenures created by a zemindar and Hiat Hie sub-
soil rights will only pass under a ptdni, as in Hie case of oHier tenures
refeiTed to when granted in express terms : See Gobinda Narayan
Singh V. Shami Ldl [A.I.R. 1931 P.C. 89, 131 I.C. /53] Bhvpendra v.
Rajeshwar, A.I.R. 1931 P.C. 162, 59 Cal. 80, 58 I. A. 228, 35 C.W.N.
870, 132 I.C. 610 ; Jagat v. Pratap, A.I.R. 1931 P.C. 302, 10 Pat. 877,
134 I.C. 1073 ; Sashi Bhusan v. Jijofl Prasad, 44 Cal 585, 44 I.A. 46 (53).
14
tSsc. 8
B rL^?|at
121 asi? (PC) If a person is tlie executor of the estate of Ins fatlier,
ind has as one 'of Jiis Leral sons a beneficial interest in &e estate left
by his father, and then he executes a sale-deed along
brothers, the deed ^vill convey all the nght and title which all the
brotliers possessed in the property, and this tviU undoubtedly include
the right and title which the first-named person possessed as executor,
although he did not expressly state in the deed that he was conveying
the property in his capacity as executor. Tlie meaning of a deed is to
be decided by the language used, inteipreted in a natural sense ; and
there being nothing in the deed to show that only his beneficial interest
was to be sold, his interest as executor would also pass Nopani v.
Pitra Sundarij, 42 Cal. 56 (64-66) (P.G.) ; Gangabai v. Sonnhfli, 40 Bom.
69. IVliere the share of a Hindu fatlier as well as Iris power of disposal
over his sons share vests in the Official Assignee, the sons share is also
conveyed on alienation by the assignee although there is no express men-
Hon to that effect in tiie sale deed P. N. Kailasmatha Mudaliar v. P, .
Bisioamtha Mudaliar, (1967) 1 M.L.J. 383
naie acquired from her son by virtue of the sale-deed, but also such
Sec. 8]
But an injunctioir does not run with the land. Hence if a pro-
perty regarding which an injunction is granted is sold under a decree,
[Sec. 8
to B tor 20 years. Tire right of way vests in B and his legal represent-
atnes so long as the lease continues. (Illustration to sec. 19, Indian
Sec. 8]
77. Rents and profits : Tliis section speaks of rents and profits
accruing after the transfer. TIic right to recover rents and profits w'hich
ha\'e accrued to tlic property prior to the date of assignment does not
puss with the propertj' inile.ss the rigJil is e.vpie.s'slj' coni'eyed Ganesh
V. Shammrain, 6 Cal. 213 ; BhogiM v. JethaUd, 30 Bom. L.R. 1588,
A.l.R. 1929 Bom. 51. ILJ I.C. 262; Aliit/iii v. Nevanathi, 12 L.W. 44,
58 I.C. 383 ; Poongacanain v. Sulmumnya, A.l.R. 1951 Mad. 601,
(1951) 1 M.L.J. 601. Such arrears of rent are a debt or actionable claim
and if tlicy arc to be transfcn'cd, they must be a.ssigned separately,
ibid. As to pnifits that accrued due prior to sale, it cannot be said
that they arc .sulxsidiarj' to the enjoyment of the jiroperty. It cannot
be said that to make a sale operative and effective, the right to collect
past profits must be conveyed to the \-cndee ChandrasekaraVmgam v.
Nagahhushanam, S3 .M.L.J. 342, A.l.R. 1927 Mad. 817, 104 I.C. 409.
'flic purchaser of a village is not entitled to execute decrees which
relate to rents and profits w'hich had accrued prior to the transfer
Onkardas Shabaj, 1 N.L.R. 48.
78. Things attached to the earth : ^For the meaning of the term
attached to the earth see Notes under section 3.
Trees, crops : The tifle to trees and shrubs passes with the transfer
of projiriclaiy rights in the land Fiirat Hussain v. Liaqat Alt, I.L.R. 1939
All. .518 (F.B.), 19.39 A.L.J. 281, A.l.R. 1939 All. 291 (294) (F.B.). See
also Yakub AH v. Tajammul Hussain, A.l.R. 1932 All. 653, 143 I.C. 247.
Trees and shrubs being rooted to the earth are deemed to be attached
thereto, and so long as they are attJiched they form part of the soil to
which they are attached, hence the .sale of a house and compound would
comprise the trees and growing croijs thereon unless they are expressly
[Sec. 8
Tlie right to the growing crops passes by the sale unless there is
some provision to the contrary, and in the case of a Court sale the right
to possession of the crops accnies from iJie date of the delivery of
possession of the land Supfd. & Remembrancer of Legal Affairs v.
Bhagtrath, A.I.R. 1938 Cal. 610, 38 C.W.N. 854, -59 C.L.J. 482. Where
in execution of a pre-emption decree possession is delivered to the pre-
emptor from the purchaser and the crops are still standing on the land,
they pass with the land, Chela Ram v, Gopi Chand, A.I.R. 1942 Pesh 88.
Bamboo trees standing on the land are attachecd to the earth" and
pass to the transferee upon a transfer of the land fagmohan v. Emp.,
IS P.L.T. 519, A.LR. 1932 Pat. 344 (345).
ing tlie intention of the Legislature to make the building subject to sale
would be necessary iNarayan y. Jatindra, supra, at pp. 137-38 j Ismai
Kuni V. Nazardlif 27 Mad. 211 (214 ) ; In re Thcikoor Ch. Poromouick,
B.L.R. Supp. Vol. 595 (F.B.). In the last cited case their Lordships
observed : We tliink it clear that according to tlie usages and customs
of the country, buildings and other such improvements made on land do
not, by tlie mere accident of their attachment to the soil, become the
pioperty of the oivner of the soil ; and we think it should be laid down
as a general rule that if he who makes the improvement is not a mere
trespasser, but is in possession under any bo7ia fide title or claim of title,
he is entitled either to remove the materials, restoring the land to tlie
state in which it was before the improvement was made, or to obtain
compensation for the value of the building, if it is allowed to remain
for the benefit of the owner of the soil, the option of taking the building
or allowing the removal of the material remaining with the owner of the
land in those cases in which the building is not taken down by the
builder during the continuance of any estate he may possess "per Sir
Barnes Peacock delivering the judgment of the Full Bench at p. 598.
On the sale of a building only the land on which it stands does not
pass iKatikar Jute Mills v. Calcutta Match Works, A.I.R. 1958 Pat. 133.
A life tenant executed two mortgages. The mortgage- deed provided
that any future building that might be erected on the mortgaged land
by tlie mortgagor would remain security for the mortgage money. On the
death of the life tenant. Held ; that the mortgage could be enforced
against .the structure, because the remainderman on the death of the life
tenant got the land but not the structure Venkatasubbiah v. Thinipura-
sundaH, A.I.R. 1965 Mad. 185.
[Sec, 8
absence of a proof that such buildmg was excluded from sale, tl^ sale
p;isscd the building to the auction purchaser A&u Hasan v. Ramzfin Ah,
Vail -ssi.
Sec. 8]
15
[Sec. 8
1 14 TRANSFER OF PROPERTY
tion 8 cannnF 1"+^ fhe right to the debt but not to security. Sec-
to a debt nr ^ a case, because tliat section applies only
Rh/Llafv not to a moriSge-debt-I
m 44 Mad. 965, supra. See Note 356 under sec. 59, post.
Sec. 9]
Tliere can be a transfer of the debt apart from the security V. Vr.
Bank v. L. M. Bank, A. LB. 1949 Mad. 52, (1948) 1 M.L.J. 458. But it
has been decided by the Privy Council that debt and security are
separate, that debts due to a person exist as his moveable property and
do not, if secured, become identified with the security or transformed
into it, whetlier tlie security is immoveable or moveable property ; that
a debt without the security is transfei'able under this Act ; and that
consequently, when both debt and security are transferred, and the
transfer of the security fails for want of a registered instrument, the
transferee can have no riglit or interest in the security, but the transfer
of the debt still subsists and the transferee will be entitled to all sums
received by the transferor in reduction of tlie debt, whether from
realisation of the security or otherwise Imperial Bank of India v.
Bengal National Bank, A.I.R. 1931 P.C. 245.
9 .
Oral transfer.
[Sec. 9
After this Act comes into force, a transfer of immoveable property wi&.
in this Act cannot be effected in any manner not prescnbed by this
Act 'Thws where the Act requires 3 transfer to be efirected only by
iw potta is neither a mortgage nor a sale, nor a gift, nor a lease, as defin-
Sec.
(/) Excliange (subject to the same rules as sale) Sec. 118, post.
tSEC. 10
1939 All 29S 1930 Tr' S'-'/ Deoi v. Shiva Nmda, I.L.R.
Sec. io]
TRANSFER OF PROPERTY Uy
The princijjles of this section have been applied to the Rinjab al-
though the Act does not apply to that province Bhaicgan Dei v. Secre-
tary of State, (1902) P.L.R. page 518 ; Nand Singh v. Partab, 76 I.C. 16,
A.I.R. 1924 Lah. 674.
[Sec, 16
it has been held that the principle underlying sec. 10 applies to a family
settlement.
being upon
Sec. 16]
tEANSFER OF PROPERTY l21
16
[Sec. io
tarv nnPin^ gift stating that the donor had put the donee in propric-
had ^ property recited that the donee or his successor
devised an estate to his son providing that if the son or his heirs or
devisees should desire to sell the estate during the lifetime of die test-
ators vi^e, she should have the option to purchase it at a fixed price
(which was one-fifth of die real market value of the estate), it was held
that the condition to sell at a fixed price much below its real value was
equivalent to an absolute restraint on sale, and as such void Rosher v.
Rosher, 26 Ch. D. 801. See also Dolsing v. Kiiubchand, cited below.
A sold his house to B for Rs. 175 and B made an agreement that
in case he would transfer the house he would sell it back to A for
the same price and to nobody else, unless A declined to purchase it for
that price, held that it was merely a personal contract between A and
B, it was not void as absolute restraint on alienation and could be
enforced against a purchaser who had notice of the contract Debt
Dayal v. Ghasita, A.I.R. 1929 All. 667. Wliere tire defendants
made a gift of certain property to tire plaintiffs on the condition that
the land would -be liable to be taken back in the event of the plaintiff
transferring it, it was held that the gift was a gift subject to a power
of revocation and was not repugnant under this section and sec. 12
Makiind v. Rajriip, 4 A.L.J. 708.
Pre-emption : ^A stipulation for pre-emption is not void. Thus,
a stipulation in a deed of sale to the effect that in tire event of the
purchaser selling the proirerty he will give tire vendor the first offer,
is perfectly valid London and S W. Ry. Co. v. Gonvn, 20 Ch. D.
.562. Wlrere a wajib-ul-arz says that there is a custom of pre-emption
[Sec, io
A T R iSo Oudli 116. Tliis subject has been fully discussed in Note
107 to sec. 14 under heading Personal covenant' . A provision re^rv-
iiig a right of pre-emption or pre-mortgage is a valid provision. Thus,
a stipulation in a lease deed that should necessities of alienation arise
for the lessee (who had permanent rights) the property would be
suiTendered to the lessor, is valid under tliis section, and is spec^cally
enforceable against tlie covenantoi and persons clmmmg under bun
Chethu Kutti v. Kunlnmni^ 9 M.L.T. 484, 9 I.C 1/1 (1/3). Wiere in
execution of a decree for specific performance of a contract to execute
a sale deed the Court executes the deed, it does not do so as a ven-
dor, but for and on behalf of tlie judgment-debtor acting as the
machinery of law for enforcing the execution of the deed with the
result that tlie propeity conveyed by the deed is open to pre-emption
Kam Amdii v. Ghisa Pande, A.I.R. 1941 Oudli 611. Where a
partition deed states that in case any of the sharers desires to sell his
share it shall be sold to whomsoever among the other shavers offers
to purchase it, the restriction is not hit by tliis section Poramesioaran
Nair v. Janaki Amma, A.I.R. 1957 Tra\- -C(.. 1-56 hfahmud Ah' v. Bri-
kodar, A-LR. 1960 Assam, 178.
rrana ? Tamayo v.
C.L.jI 149, 46 Lc 73 Commissioner v. Md. Amir, 5
Sec, 10]
fourth of the price of the land, otherwise the transfer would not be
valid and tlie landlord would be entitled to Khash possession, are per-
fectly valid and legal C/jcnd/ Charan v. Tara Nath, A.I.R. 1942 Cal.
452, 46 G.W.N. 686. A mortgage by conditional sale followed by
and that such transfer should be void is not valid j in order that
such stipulation should be for the benefit of the lessor, i.e., it must be
supplemented by a clause that the lessor shall have a right of re-entry
in case of the lessees breach of the condition against alienation. In
other words, if there is a clause in a lease merely stipulating that the
lessee should not transfer his interest to any third person, but the lease
does not reserve a ri^if of re-entry, die clause is inoperative, in as much
as it cannot be said to be a condition for the benefit of the lessor, and
an assignment by the lessee of his interest in the lease would not work
a forfeiture of the lease Nilmadhab v. Narottam, 17 Cal. 826; Neira-
pal V, Kalyan Das, 28 AU. 400; Sital Prasad v. Nateab Dildar, 1 P.L,J.
1 ; Mcdiananda v. Sarcdmam, 10 I.C. 374, 14 C.L.J. 585 ; Basarat v.
Manirulla, 36 Cal. 745 ; Udipi v. Seshamma, 43 Mad. 503-; Parmeshri
V. Vitappa, 26 Mad. 157 ; Tamatja v, Timapa, 7 Bom. 262 (265) ;
Madar Saheb v. Sanabawa Giifran Shah, 21 Bom. 195 ; Annada v.
Dasarath, 40 I.C. 444 (Cal.) ; l^ietra Nath v. Baharli, A.I.R. 1929 Cal.
228. The landlords remedy in tlie case of a breach of such stipulation
would be a suit for damages only and not a suit for ejectment Sital
Prosad v. Nawab Dildar, 1 P.L.J. 1, S3 I.C. 408; Tamatja v. Timapa,
7 Bom. 262. See notes under sec. Ill, clause (g).
[Sec. 10
Sec. 11]
1 1 . Where, on a transfer of
1 1 . Where, on a transfer of
Compare this section with sec. 138, Indian Succession Act, 1925.
[Sec. 11
A St -
17i
[Sec. 11
. ^ ? A T n moo Mad.
ignor-
(fi) Condition in gift Where under a gift deed the donor un-
condhionally transfers all his rights over certain property to the donee
witli absolute powers to deal with the same from me date of gift, a
subsequent clause in die deed that on the death of the donee tiie pro-
perty should not devolve on any of his heirs but would revert to toe
donor, is repugnant to the absolute estate, and as such is ineffective
and wholly voidSubramanian v. Kauni Ammal, A.I.R. 1953 Tr.-
Coch. 115.
to Begum V. AMaffflmts'oXJ 49
Sec. 11]
TRANSFER OF PROPERTY 131
Where a gift deed provided inter alia that in the event of the
subject matter of the gift (site and building) not being required for the
purpose stated therein, tlie property would revert to the donor on the
condition of his paying the' donee the then estimated value of the
building alone : held that the reverter clause ^vas not repupiant to
the absolute estate created by the deed, but was if at all, only one or
132 TRANSFER OF PROPERTY
[Sec. 11
98. Second para Tlie wording of the second para, has been
changed, but the law has not been altered.
ine land anit where a person who owms a house and ndjoin-
that the latter :hnn V enters into a covenant with the purchaser
dor's house SuX to obstruct the, air and light of the ven-
Sec. i23
imposed for its own sake is not enforceable against the transferee,
and the latter may ignore it ; e.g., covenant to use the transferred
land as a garden {Tulk v. Moxhay, supra), covenant to build a sec-
ond storey, covenant to improve the transferred land (Haywood's case,
supra), etc. Moreover, these are affirmative covenants which can be
rarely enforced against the transferee.
Scope : ^Tliis section applies not only to leases but to all trans-
fer deeds. Accordingly a condition in a KJwrposh grant, which can-
not be regarded as a lease, to the effect that the grant wfll stand can-
celled if the property covei'ed by tlie grant be sold in auction for the
debts of the grantee, is wholly void under this section Shiba Prasad
V. Lekhraj Shewakaram & Co., A.I.R. 1945 Pat. 162, 23 Pat. 871.
in the transfer, which none but the grantor and the grantee may know
anything about. Under this section, if the grant is subject to sucli
a condition, it will be void and the property will pass to the Officia
(Sec. 12
For the benefit of the Lessor; For the meaning of these words,
see Note 92 under sec. 10.
Sec. 13 j
13.
Illustration.
i 36 TRANSFER OF PROPERtY
[Sec. 14
Tliis section may be compared with sec. 114 of the Indian Suc-
cession Act, 1925, r^lacing sec, 101 of Act X of 1865. Tlie two illus-
th^ section are cited below as elucidating the meaning of
sons o/b.
sons as shall first attain the age of 25. B dies in the lifetime of tlie
testator, leaving one or more sons. In this case the sons of B are persons
living at the time of the testators decease, and the time when either of
them will attain 25 necessarily falls within his own lifetime. Tlie be-
quest is vahd.
18
[6ec. i4
cse the period withm wliich the property came to the harids of the
case tne pe , ^ ^,11 ^vithin the legal limitation did not take
is
stated to be in favour of
Sec. 14]
die age of 21 years the same shall be divided and duly received by
G and his sons in equal shares confers an absolute gift on G but the
gift over is void Anandrao v. Administrator-General, 20 Cal. 450. A
- t Sec. i4
I. C. 683, A.I.R 1927 Aff .^27 (F.B.), 2.5 A.L.J. 289, 100
Sec. 14]
CoTenants running mth the land : From tlie above cases it is evi-
dent that a distinction should be drawn between a personal covenant
(which binds only tlie parties themselves, but not their heirs or assign-
ees) and cooenants running loith the land (covenants creating an interest
in the land) which are binding not only on the parties to the covenant
but also on their heirs and assignees. Tlie iule against iierpetuity is not
obnoxious to the former but invalidates the latter, because, where the
covenantor binds not only himself but his heirs and successors, the
lime for performance of the covenant may extend beyond the statutory
limit of time fixed by sec. 14 of tlie Transfer of Property Act. Tlie lead-
ing case on this subject is London and South Western Ry. Co. v. Gomm,
(1882) 20 Ch. D. 562. In this case a railway company had sold land
with an agreement by their vendee on behalf of himself as well as "his
heirs, assigns and owners for the time being of the land, and all other
persons who should or might be interested therein, and die agreement
contained an option to the railway company to repurchase at any time.
It was held that tlie covenant for repurchase, creating an interest in
the land in perpetuity without any definite limit as to the period of time
within which the covenant was to have effect, could not be enforced.
A covenant of pre-emption the operation of which is not meant to ex-
tend beyond a lifetime, does not violate the rule against prepetuities.
'Ihus, tliere was a covenant between a mortgagor and mortgagee, who had
a right to redeem the property at any time after nine years, to the effect
that the mortgagee would have a right of pre-emption in respect of the
sale of the mortgaged property, and the language clearly indicated that
the covenant was between the mortgagor and the mortgagee only, and
there was nothing to suggest that the heirs of the parties were meant to be
bound by the covenant : Held that there was no violation of the rule
not offend the party likes he has the right to redeem" does
iM L I 96 ATP TQtfs v. Sitaram, 54
Sec, 15]
conditiou. Should 1 fail to do so, I bind myself to pay you. all your
expenses that you may incur.* Held that the clause for renewal did
not amount to a transfer, and therefore it did not offend the rule against
perpetuity and was not rendered iiioperative by tliis section PicJtu
Naidii V. Jefferson, 44 Mad. 230, 60 I.C. 591. But where on the crea-
tion of a permanent lease the lessee covenants that if he or his repre-
sentab^'e intends to transfer the whole or a portion of the leasehold
interest, the transfer would be made in favour of the lessor for proper
price or to third parties only wdth the permission of the lessor, and that
any transfer m contravention of this covenant would be invalid, held
that the co^'enant is void as offending the rule against perpetuities
Sivarna Kumar v. Prohlad Chandra, 26 C.W.N. 874, A.I.R. 1922 Cal.
474 (475), 67 I.C. 719. "Where the xjurchaser of a leasehold agrees to
pay annuity to the leaseholder and his descendants in fjerpetuity mak-
ing it a charge on the jiroperty, the agreement is not hit by the rule
against jjeipetuily as it created no interest in jjroperty Kurunjilkirttia
Appti V. Alary, A.I.R. 1965 Ker. 27.
Transfertoa interest
15.
' Transfer to a
class, some
of whom
come under
sections 13
and 14.
Analogous law : The terms of this section are similar to those of sec.
102 of the Succession Act, 1865, replaced by sec. 115 of the Succession
[Sec. 13
Ar+ iq2.5 wHch again has been the subject of similar amendment by
tlie Transfer of Property Amendment .Supplementary Act XXI of 1929.
112. Old section criticised in the light of Hindo law: ^The rule in
Leake v. Robinson, on which the old section was based, has, except in
a few early Calcutta cases, never been followed in India Rantlal v.
Kanaild, 12 Cal. 663 (6S3). In the case of Hindus, when a gift is made
to a class of persons consisting of children or descendants, some of
whom cannot take, the testator may be considered to have a primary
and a secondarjf intention. His primary intention is that all members
of the class shall take, and his secondary intention is that if all cannot
take, those who can shall do so, the true rule being that those mem-
bers of the class take, who are at the testator s death capable of taking.
IVhere it appeared horn the whole of a will executed by a Hindu
testator that his primaiy^ intention was that all his nephews then born
and diose who might be bom afterwards should talce equally under
a bequest made by him, and his secondary intention was that his
nephws who were in existence should take, though not specifically
named, and where the primary intention could not be given effect to
bemuse the bequest was bad in respect of those who might be bom
su sequent), the Court Avould cany out thq secondary intention and
oU e e ec o me bequest as regards the nephews who were competent
V. Kflhcharan, .32 Cal. 992 F.B. (following In re
Cofeman, 4 D. afiSimed by the Pri\y Council in 38 Cal. 468
taking, the remaining donees took the whole of die gift Advocate-Gene-
ral V. Karamali, 29 Bom. 133 (150). But where an estate was given to
the testators daughters for their lives witli remainder for their cliildren
on attaining the age of 21, tlie Privy Council reading the will as a whole
came to the conclusion that as at the testators deatli it could not be
certain that in the case of every child a guardian would necessarily be
appointed, the bequest would possibly be delayed beyond the life-time
of the daughters and the minority of some of their children (see sec
101 Succession Act & sec. 14 T. P. Act) and hence by virtue of sec.
102 of the Succession Act the whole bequest in favour of all the child-
ren was invalid Sounder Rajan v. Natarajan, A.T.R. 1925 P.C. 244
(248).
Before the three Acts were passed, a gift to a class of persons some
of whom were not in existence at the date of transfer did not fail in
regard to the whole class, but tliese three Acts rendered such a gift void
in regard to the whole class. Sec. 15 has been amended to restore the
position that existed before the passing of these three Acts. The amen-
ded section lays down tliat the transfer will not fail with regard to the
whole class, but only with regard to those who cannot take.
19
[Sec. 16
Sec. 16]
This section may be compared with section 116 of the Indian Suc-
cession Act, 1925.
Where there was a gift by will to A for life, and after his death to
the first son of A for life, and to the first son) of As first son, and in
default of such son to B for life, held that as the gift to As grandson
was void the subsequent gift to B failed Moneypenny v. Derring, 2
DeG. M. & G. 145. A Hindu testator bequeathed as follows : My
great-grandsons shall, when they attain majority, receive the whole to
their satisfaction, and they mil divide and take the same in accordance
with Hindu law. God forbid it, but should I have no great-grandsons
in the male line, then my daughters sons, when diey are of age, -shall
take the said property from the trust fund and divide it according to
the Hindu Sastras in vogue. Held, that the bequest to the daughters
sons was dependent on, and not alternative to, the gift to the great-
grandsons, and was therefore void Brojanath v. Anandatnoyi, 8 B.L.R.
208.
One S gave away property to R for life and after her deatli if there
be any male descendants, whether born of son or daughter, to them
absolutely. If R would have only daughters they were to have no
power of transfer. In the absence of any issue, male or female, living
at the time of her death, the gifted property was not in any way to
devolve upon her husband or his family, but it was to go to D, father
of R. Held that the gift in favour of D was dependent upon the failure
of the prior interest in favour of the daughters and the result was that
the gift in favour of D also failed Girjesh v. Data Din, A.I.R. 1934
Oudh 35 (39) (F.B.), 9 Luck. 29, 147 I.C. 991.
[Sec. 17
roulation.
pectivelyasif theperioddurinn
wWeh the accumulation haf of
to be made had
Ameadmeat Bv "^<x>rdingfy.
17.
of public.
for benefit
of public.
w. r jQj- ------- --
Under the Mahomedan law the test of whether a deed was or was
not valid as a wakf in the cases decided before the Mussalman Wakf
a atmg Act VI of 1913, was that if the effect of the deed was to give
the property rabstantially to charitable uses, it would be valid; but
M gifts
of
^ \ w 7-x gtjTS :
Jan v.
Sec. 18 ]
(/) Gifts for building a well and awada (a ci.stein of water for
animals to drink) Jamnabai v. KJamfi, 14 Bom. 1.
See also the Illustrations to Sec. 118, Indian Succession Act (1925)
for instances of religious and charitable gifts.
Trust for snread of Hinduism has been held to be too vague, but
that for spread of Sanskrit language is valid-^Venkata v.SubbaRao,
A.I.R. 19^ Mad. 376. As to the nature of chantable objects see North
of England Zoological Sac. v. Chester Rural Dist. Conned, (1958) 1
W.L.rT 1258.
Sec. 19]'
is not to take possession of the gifted property until after the death of
the donor and his wife, the donee is given a vested interest, subject
only to the life-interest of tlie donor and his wife; and the donee
can transfer the property during the life-time of the donor or of his
wife (see 21 O.C. 312 cited in Note 43 under sec. 6). So also, where
under a compromise decree it was settled that A was to hold an estate
till his deatli after wln'ch it was to go B, held that the interest acquir-
ed by B under the decree was a vested interest Sundar Bibi v, Rajen-
dra^ A.I.R. 1925 All. 389. But where an estate is bequeatlied to A
until he shall marry, and after diat event to B, Bs interest in ihe
bequest is contingent, because it depends upon a condition precedent,
viz., the marriage of A, an event which may or may not happen. In a
contingent interest, the transfer is not complete until the specified
event happens or does not happen. In a vested interest, the interest is
complete, but on the happening of a specified event it may be div-
ested Resting v. Allen, 5 Hare 573; In re Eddel's Trusts, L.R. 11
Eq. 559.
20
[Sec. 1^
Kali Prasad v. Ram Golam-, AJ.R, 1937 Pat. 163, 167 I.C. 831.
Sec. 193
121. Vesting is not postponed : fllie fact that the estate granted
is subject to partial trusts or charges for partial purposes does not post-
pone the vesting in possession. Thus, where a testator, after directing
the payment of some annuities to some persons for their lives, gave tiie
whole of his propei'ty to his grandsons to be divided among diem only
after the annuities have ceased on the death of die annuitants, held that
the fact that die estate was subject to partial trusts did not postpone
the vesting in possession of the gift to the grandsons Calhj Nath v.
Chunder Noth, 8 Cal. 378. So also, a bequest in favour of a person
simply {i.e., without any intimation of a desire to suspend or postpone
its operation) confers a vested interest, and die appointment of an exe-
cutor or a guardian -to the person while he is a minor, with a direction
to make over the property to him on Iris attaining majority, does
not postpone the vesting of interest Harris v. Brown, 28 Cal. 621
(P.C.). But where die testator directs that the interest shall vest at
a particular time or on the donee attaining a particular age, it vests
at the time fixed by him Glanwill v. GlamoiU, 2 hler. 38; Knight v.
Cameron, 14 Ves, 389.
[Sec.
interest in the bequest Adams Giatj, A.I.R. 192.5 Mad. 599 (602) ,
[Sec. 21
Sec. 21 ]
properties and hold and enjoy the same If, by the will of God,
one of you should die before the other, whoever will survive will
hold and enjoy the whole of the property as malik : Held that the
wife not having predeceased her husband and having survived the
period of distribution took an absolute interest Nistarini v, Behary Lai,
19 C.W.N. 52.
A- Hindu will provided : "If botli the said dau^iters shall have
issue, they shall divide the said properties equally. Tliose who have no
issue shall, as aforesaid, enjoy die income for their lives, and those
who have issue shall enjoy the whole property". It was held that the
birth of issue was the event on which the absolute gift of a half share
to eidier daughter was to take effect, and there was no reason for
construing the words have issue to mean leave issue. Therefore
one of the daughters whose only issue died before her took a heritable
share Gurusami v. Sivdkami, 18 Mad. 347 (P.C.). .\ husband by tfl/csf-
mnama provided: Tlie property shall devolve upon B or his legal heir
and B or his legal heir shall become the absolute owner of my property'
on die death of my wife. B during the widows life-time sold the
widows property and died during the life-time of the widow : Held
that the interest in favour of B was contingent and came to an end on
his death during the widow^s life-time Ram Chandra v. Jagdeshwari
Frasad, A.I.R. 1937 Pat. 247. See Abdul Wahid v. Huran Bihi, 11 Cal.
597 (P.C.), where also it was held that the title of the sons to suc-
ceed was contingent upon their surviving the widow and that no in-
terest passed to their heirs on their deaths in her life-time. As to a
contingent interest becoming a vested one see Mt, Murfazi v. Dildar
Ali, A.I.R. 1930 Oudh 129.
i Sec. 23
This section may be compared witli sec. 121 of the Indian Suc-
cession Act, 1925. So long as the donees are below the specified age,
they possess only a contingent interest which will mature into a vested
interest as soon as they attain the specified age.
129. Gift to a class : ^As to the meaning of cla.ss see notes under
see. 15. Where a testator gave his residiuiry estate to trustees in trust
for his nephews and nieces, to be paid in certain proportions and at
certain times (viz., that the share of each nephew sliall be paid to him
upon his attaining the age of 21 years, and tlie .share of each niece to
be pmd to her on her attaining the age of 2] or previously marrjo'ng) with
benefit of survivorship between them, held that the legatees took vest-
ed interests, and that the period of distribution alone was postponed
but the bequests were valid Maseyk v. Fergusson, 4 Cal. 304 following
Wdhams V. Clark, 4 DeG. & .S. 472. Similarly, a gift to children when
e younges attains the age of 21, creates a vested interest in favour
Br CC 3S 3
Sec. 24]
A Hindu at his death left 3 sons, the eldest of full age and the
other two minors. In his will there was the following direction : My
3 sons shall be entitled to enjoy all the moveable and immoveable
properties left by me equally. Any one of he sons dying sonless, the
surviving sons shall be entitled to all the properties equally. Held
by the Privy Council that these words gave a legacy to the survivors con-
tingently on the happening of a specified uncertain event which had
not happened before the period of distribution, that is, the testator's
death. Therefore, the legacy to tlie surviving brothers could not take
eflFect and the original gift to the testators 3 sons was absolute to each
in equal shares and indefeasible on his death. Tlie rule must be appli-
ed, wherever it is applicable, witliout speculating on the intention of
the testator J^arendra v. Kamalbasfni, 23 Cal. 563 (P.C.). See also
Mt. Boh V. Mt. Koklan, A.I.R. 1930 P.C. 270.
Illustrations.
21
[Sec. 24
tint at the Icstalots death the legacy vested in the htgtdctt bm became
,, i,mtef'. death prior to division, and Uiat the gift over
(P.C.).
If all the legatees predecease tlie tenant for Ufe, their representa-
tives will take ; for the event which was to divest them not having hap-
pened, the original gift remains. (Thus in the Illustration to this
section, if both C and D die in the life-time of B; the property after
Bs dc.ilh will pass to the representatives of C and D). See Hendersons
Tcsfumcnitiry Sitccession, 2nd Ed., p. 116. See also Brawn v. Ksnyon,
3 .Maddock 410; Rc Sanders Trusts, 1. Eq. 675; Harrison v. Fore-
man, 5 Ves. 207,
lUustrattons.
(d) A transfers Rs. 500 to his niece C if she will desert her husband.
Tlie ti'ansfer is void.
[Sec. 25
executed or executory-Thasf v.
the ffettfrnr f agreement which has for its object
Sec. 2^3
held that the condition being immoral, the gift was void^humna v.
Ram Chandra, 47 AIL 619, 88 I.C. 411, A.I.R. 1925 All, 437. See also
Notes 63 and 64 under sec. 6. Wliere a testatrix by a codicil directed
that all interest given by her ^vill to her niece should go over, should
she not cease to reside !in S (thei testatrixs mill) \vithin 18 months of the
testatrixs death, it was held to be a condition which would require the
niece to omit her duty to her husband and as such it was void Wilk-
inson V. Wilkinson, L.R. 12 Eq. 604. But if a testator bequeaths a
certain poition of his property to a female legatee imposing a condi-
tion tliat she would be divested of the bequest if she marries within
the life-time of her father or if she lives an unchaste life, such a con-
dition is not void Cohen v. Cohen, A.I.R. 1932 Cal. 350.
Fulfilment of condition
precedent.
Illustrations.
[Sec. 26
Sec. 27]
tion.
Illustrations.
(b) A transfers property to his wife; but, in case she should die
in his life-time, transfers to B that which he had transferred to her.
A and his wife perish together under circumstances whicli make it
impossible to prove that she died before him. The disposition in
favour of B does not take effect.
Compare sections 129 and 130, Indian Succession Act, 1925. Tlie
illustration (b) has been taken from Underwood v. Wing, 4 DeG. M.
& G. 633.
SliuntrflS hevife attested the will, it was heU Aat the gift to fte
Sen was accelerated and took effect .mmediately-W v.
bring forth a son, his property should go to the son, and, if a daugh-
22
[Sec. is
condition subsequent.
Sec. 30]
TRANSFfiR OF PROPERTY
in
fulfilled.
Illustration,
[Sec, 31
Illustration.
A transfers a farm to B for her life, and, if she does not desert her
husband, to C. B is entitled to tlie farm during her hfe as if no con-
dition has been inserted.
Compare section 133 of the Indian Succession Act, 192.5.
Illustrations.
(a) A transfers a farm to B for his life, with a proviso tliat, in case
B cuts doAvn a certain wood, the transfer shall cease to liave anj"
effect. B cuts down the wood. He loses his life-interest in die farm.
Sec. 33]
Tliis section may be compared with sec. 135 of the Indian Succession
Act, 1925. For invalid conditions see sec, 25,
[Sec, 34
This -section may be compared wth sec. 136 of tlie Indian Succes-
sion Act 192.5 from which the following illustrations may be cited
This section may also be compared witli sec. 18, Limitation Act.
SEC. 35]
Where a testator by his will directed that if any of the female mem-
bers of his family eitlier from misuuderstaoding oj any other cause,
should li\'e in any otlier than a holy place for more than three montlis
except for ijilgrimage, they should forfeit tlieir rights under the will.
A minor widowed daughter-in-law of the testator was removed from die
house by her maternal relations and brother wth the aid of die
police and she resided for more than three mondis widi her modier;
held that as the girl itos not a free agent, her absence did not work a
forfeiture. Mere minoritj' was, however, no e.vcuse Tin Cowrie v. Kri-
shna Bhabini, 20 Cal. 15.
Fraud : For delinition of fraud, see sec. 17, Contract Act. Fraud,
like any other charge of a criminal oifence, whether made in cml or
criminal proceedings, must be established beyond reasonable doubt.
A finding as to fraud cannot be based on suspicion and conjecture
Narayanan v. Official Assignee, A.I.R. 1941 P.C. 93, 196 I.C. 404
(P.C.).
Election.
subject nevertheless,
Illustrations.
[Sec. 34
lUustration.
?om^?lm authoriS'
.he
Sec. 35]
who accepts a benefit under a deed or will, must adopt the whole con-
tents of tlie instrument conforming to all its provisions and renouncing
eveiy right inconsistent \vith ihemStreatfield v. Sireaffield^ 1 W. &
T.L.C. 397 ; Williams on Executors, 11th Ed., Vol. 2, page 1182. If a
testator gives property, by design or by mistake, whiqh is not in his
power to give, and gives at the same time to the real owner of iti
other property, such real owner cannot take both Per James, V.C., in
Wollaston v. King, 8 Eq. 165 (at p. 173).
Tile foundation of the doctrine of election is that the person tak-
ing a benefit under an instrument must also bear the burden Codring-
ton v. Lindsey, L.R. S Ch. 598 ; Pickersgill v. Rodger, 5 Ch, D. 163.
A person cannot take under and against one and the same instanment
Dillon V. Parker, 1 Swan. 359. A legatee cannot take a legacy witliout
submitting to the onerous condition of the will. Tlius, if his property
(a house) has been wrongly deidsed to another and the testator has
23
[ Sec. 35
Thnc D a Hmdu widow died makiog a will in respect of property
which sh; h^d inherited from her husband; she bequeathed Rs. 2000
i a legacy to the plaintiff and the immoveab e propm-ty to k. Both
Se pkitM and K were the heirs of her husband. Tl,e pla.nhff sued
for the legacy under die will us well as for half the immoveable property
as heir Held that the plaintiff must be put to his election either to
take die legacy under die will or half the property as lieirMonguldos v.
Ranchoddas, 14 Bom. 438.
upon them by the will r/" property and the benefits conferred
Parker v. Soilerfy, .
Sec. 35]
The intention must appear- orr the face of the will itself, for parol
evidence will not be admissible for dre purpose of showing it
Stratton v. Best, 1 Ves. 185 ; Doe v. Chichester, 4 Dow. 65 ; Clemeni-
son V. Gandy, 1 Keen. 309.
[ Sec. 35
Sec. 35]
TBAl^SFER OF PROPERTY 18 1
[Sec. 35
Cal. 60.
--/nduba/a V. 1 to her
Sec. 35 ]'
Clause (7) : ^Election when parties cannot be placed the status quo
Election rvill be presumed when the donee has acted in respect of the
propertj' gifted to him in such a manner as to make it impossible for
him to return it to the tine owner in the same position in which it has
remained before. See the illusb'ation. This is based on the principle
of English law that a contract cannot be avoided where it has become
impossible for the parties to be placed in the same position as if it
never had been made Shephard and Brown, 7th Edn., p. 110.
156. Clause (8) ; ^Timc for election : 'The Indian law specifies
a time ivithin which an election must be made. In England, no such
time is fixed by law, but if a time is limited by the instrument itself,
the donee must elect within that period, and if he lails to do so he ivill
be deemed to have renounced the benefit under the instrument Dillon
V. Parker, 1 Swan. 385.
157. Clause (9) Disability Tlie last para, of tliis section cor-
responds to section 190 of the Indian Succession Act, 1925.
[Sec. 36
Apportionment.
This section may be compared with secs. 338-40 of the Indian Suc-
cession Act, 1925. The EngUsh law on the subject is embodied in the
Apportionment Act of 1870 (33 & 34 Viet,, c. 34),
days, and &e vendee to the rent of 22 days. But tire tenant holds
Sec. 3^3
under a montlily contract, and lie cannot be made to pay die rent of
9 days to die seller on die lOdi of May. He \vill pay the rent as usual
on the 1st of June. But he ivill pay in the proportion indicated
Mukheijis Law of Transfer of Property, 2nd Edn., p. 48.
24
[Sec. 36
^ G.O., ,j.. u.
am anip, A.I.R. 1927 All. 569. Hie Rangoon High Court has
expressed an opinion that agricultural rents are not apportionable, for
Sec. 36]'
to tlie rents and profits accniing after the tiansfer as stated in secs. 8 and
55 (6) (a). Such rents and profits should be apportioned under sec. 36
which applies to agiicultural rents. Even if it does not Rpply in
terns, the nrle wiU apply as a rule of justice, equity and good con-
science. Hence petitioner in this case was only entitled to one month's
rent which alojie accrued after the transfer Pomigfivatiom v. Sttbra-
mamja, A.I.R. 1951 Mad. 601.
Tlie Receiver appointed in a mortgage ' suit leased the property and
tlie lessee was in possession. Tlie property was sold in execution of the
decree on lS-12-1941. Under the teims of the lease granted by the
Receiver rent was payable on 31-12-1941. Tlie auction purchaser
claimed a right to receive the entire rent as it was payable on a
date subsequent to the purchase. Tlie tiial Coiut apportioned the
rent as between the auction-purchaser and the Receiver representing
the estate : Held tliat the tiial Court was right David v. Rangarafu,
A.I.R. 1944 Mad. 568.
[Sec. 36
Sec. 37]
[Sec. ^7
med for the benefit of such one of the several owners as they
(b) In the same case, eadi house in the village being bound to
provide ten days labour each year on a dyke to prevent inundation, E
had agreed as a term of bis lease to perfonn this work for A ; B, C and
D severally require E to perfmm the ten days work due on account of
the house of each. E is not bound to do more tlian ten days' work in
all, according to such direction as B, C and D may join in gi\ang.
rw.y rf tail ^
Sec, 37]
165. Notice : Tlie proviso lays down that the person on whom
the burden of obligation lies is saved from liability until he had reason-
able notice of the severance. Compare sec. . 50 as well as sec. 109
which applies tlie principle embodied in secs. 37 and 50 to leases. The
notice here mentioned may be g[iven either by the assignor or by the
assignee, and not necessarily by tiie assignor. It is immaterial whether
the notice of the assignment was received by the tenant from the as-
signor or from the assignee. When a tenant pleads payment to the
assignor, the Court has to consider upon all die circumstances of the
case, whether tlie payment alleged to have been made by him was
bona "fide. If he has made tlie payment with notice, actual or construc-
tive, of tlie assignment, he cannot escape liabih'ty merely by proof that
the notice received was from die assignee and not from the assignor
Peaty Lai v. Madhofi, 17 C.L.J. 372, 19 I.C. 865 (868). Tlie tenant can-
not successfully plead that he has paid the rent bona fide to the as-
signor, if he has received notice of the assignment from die assignee ;
see Pope v. Biggs, (1829) 9 B. & C. 245. 32 R.R. 665 ; Rogers v. Hum-
phreijs, (1835) 4 A. & B. 299, 43 R.R. 340.
366. Where section does not apply : ^Tliis section does not apply
where the indivisible character of the properly is kept up on a transfer
(by ' inheritance). Thus, on the death of a creditor, his numerous heirs
are only jointly entided to enforce the right which the deceased credit-
or, if alive, could singly enforce, and no question of apportionment can
arise Ahinsa Bibi v. Abdul Khader, 25 Mad. 26 (33). Tlie English
Law in this respect is the same. The authorities all agree that what-
ever be the number of parceners, they all constitute one heir. Tliey are
connected together by unity of interest and unity of title ; and one of
them cannot distrain without joining the othei-s in the avowy. If diey
cannot distrain separately, how can diey separately claim a portion of
the rent ? In as much as there has been no division of those rents, nor
any agreement by the defendant to hold one-third of them separately
for the plaintiff, he has no right separately to sue the defendant per
Tindal, C.J., in Decharms v, Honoood, 10 Bing. 526, cited in 25 Mad.
26 (34). It has been held by the Andhra Higli Court in Damodram
Chetti V. Rttkmaniamma, (1967) 2 An. AV.R. 200 that under the Andhra
Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960 one
of two joint landlords can file a petition for eviction impleading the
unwilling landlord as a respondent. This decision is opposed to the
principle that there cannot be ewction from a part of the tenancy.
[Sec. 38
192 TRANSFER OF PROPERTY
tEp Hieh Court has held that though secs. 37 and 109 may
Illustration.
njfl/, 15 Mad. 260 (F.B.) ; Sootia Koer v. Nath Bahsh, 11 Cal, 102;
nam Mtinvar v. Ram Dai, 22 All. 326.
to give a good titlp Provided the vendor has got tlie power
give good htle and the vendee pays consideration, the vendor
has absolute power, to give such title to the purchaser. Hie fact that
the vendor professes to exercise that right and power reciting false state
of facts, cannot affect the vendee Subramania v. Krishna, 39 M.L.T. 590,
60 I.C. 77 (80).
The law in this respect has been laid domi by the Privy Council
in the following words : Hie power of the Manager for an infant
heir to chaige an estate not his own is, under the Hindu law, a limit-
ed and a qualified power. It can only be exercised rightly in a case
of need, or for the benefit of the estate. But where, in the particu-
lar instance, the charge is one that a prudent owner would make,
in order to benefit the estate, the bona fide lender is not affected by
the precedent mismanagement of the estate. The actual pressure on
the estate, the danger to be averted or the benefit to be confen-ed up-
on it, in the ijarticular instance, is the thing to be regarded. But
of course, if that danger arises or has arisen from any misconduct to
which the lender is or has been a party, he cannot take advantage of
his own wrong, to support a charge in his own favour against the
heir, grounded on a necessity which his wrong has helped to cause
Hieir Lordships think tliat the lender i,s bound to inquire
into the necessities for the loan and to satisfy himself as well as he
can, with reference to the parties with whom he is dealing, that the
Manager is acting in the paiticular instance for the benefit of the
estate. But they think that if he does so inquire, and acts honestly, the
real existence of an alleged sufficient and reasonably-credited necessity
is not a condition precedent to the validity of his charge, and they
do not think that, under such circumstances, he is bound to see to the
25
[Sec. 38
t re lady had full knowledge, and tiiat the alienation was for necessity
or lat he rras satisfied of the necessity upon reasonable inquiry
Bhagwat V. Debi Daijal, 35 Cal. 420 (P.C.).
Sec. 38]
Onus and proof : (The burden of proof in such cases is on the pur-
chaser BJwgicaf V. Debi Datjal, suijra ; Bongo Chandra v. Jagat
Kishore, 44 Cal. 186 (P.C.) ; Chandra Deo v. Mata. Prasad, 31 All. 176
(F.B.); Balappa v. Chanbasappa, 17 Bom. L.R. 1134; Brij Lai v. Inda,
36 All. 187 (]?.C.). Lapse of time does not affect the question of onus
regarding legal nccessitj', e.vcexjt in so far as it might give rise to a
Ijresumption of acquiescence or save the alienee fi-om adverse infer-
ences arising from the scant)' iiroof wliicli might be offered. In order
to justify legal necessity it must be shown that the expenses could not
have been met from the income of the i)roperty in the widows hands
and. that they u'ere reasonable Racaneshwar v. Chandi, 38 Cal. 721,
affirmed in 43 Cal. 417 (P.C.). Representations by the boiTower are
evidence of the c.\istcnce of such necessity but are not generally in
themselves sufficient to discharge the burden which rests upon the cre-
ditor of .showing a reasonable inquirj' as to the binding nature of the
purpose for which the loan u'as contracted. In iDarKcular circumstances,
however, they may suffice to shift the burden of proof to the person
impeaching (he debt or alienation Venkata v. Kanienaijani, supra.
Sometimes consent of the ne.vt reversioners may afford a pi-esumptive
proof which, if not rebutted, will validate the tiansactfon Rangasaml v.
Nadrippa, 42 Mad. 523 (P.C.).
This section lays down that if the transferee has taken reasonable
care to ascertain the existence of the circumstances alleged by tlie trans-
feror as necessitating transfer, those circumstances be presumed to
Sec. 3$i
tKANSFER OF PROPERTy
the lender should ascertahi that every pice of the money advanced
by him is required for legal necessitj^ Ghansham v. Bad'iya, supra.
Inquiry when unnecessary ; ^If the sole person who has title or
interest to chaUenge the validity of the transfer has made representa-
tions, or induced a belief by his conduct in the purchaser tliat tiia
Iransactioji was unobjcctiojiable, die inquiry may be dispensed with
Saraf Chunder v. Gopal CIttinder, 20 Cal, 296.
lllusti'ations.
Sec, 35
. j ^ 1 -. TIik section has been amended by sec. 11 of the
Amendmwt. Anif>ndment Act (XX of 1929). Tlie words with
Iransfer of ^ right have been omitted; the words
This section does not deal witli charges, but with a right which
falls short of a charge. The charge docs not arise until it is Used by
a decree or any agreement or by operation of law Ghasham v. Kund-
anbai, A.I.R. 1940 Nag, 163 (165), 1940 N.L.J. 1. This section does
not apply to a charge created by a decree >M(ihesJi v. Mf. Miindar,
A.I.R. 1951 All. 141 (F.B.), 1951 A.L.J. 39.
Sec. 39 J
Under tlie old section^ an essential condition for the enforcement of the
riglit of maintenance against a transferee wTls tliat the transfer must have
been made with the intention of defeating the right ; that is, the
transferor must have acted m fraud of tlic person entitled to the right.
Tliis right could not be equitably enforced against a transferee for
\'aliic unless the transfer was made in fraud of the right of mainten-
ance iRoni Kuntcar v. Ram Dai, 22 All. 326 (328) ; Bharatpur Slate v.
Gopal Dei, 24 All. 160 (163) ; Mohini Debi v. Pimui Sashi, 36 C.W.N.
153 (157). Where a transfer was made with the intention of defeating
the right of the person entitled to maintenance, and tlie transferee had
notice of it, he could not defeat that riglit although he might be a trans-
feree for valuable consideration Ram Kiinwar v. Ram Dai, 22 All. 326
(328) ; Ahit Mahomed v. Sarasuafi, A.I.R. 1926 Cal. 1068, 43 C.L.J. 604,
97 I.C. 194.
If the isarties knew tliat tliere was not sufficient property tlien left
in the hands of the vendor from the jirofits of which the maintenance
could be realised, the conveyance was clearly made with the intention
of defeating the right of maintenance Digamhari Dhankumari. 10
[Sec. 39
i 1
Am Ktoor V, R,
or satisfy
Sec. 39]
26
tSEC. 39
whc. ttic motive nr the reason tvith which the propeiti- was parcliased.
is given /cetOK s. Mehfab, supra.
of maintenance, she is
Sec. 3^]
[Sec. 39
20 i TRANSFER OF PROPERTi
irTtS
Sec. 40]
easement thereon,
Illustration.
[Sec. 40
The first para of this section deals wdth what are called restiictive
covenants which are enforced in equity in England on die ground that
the person entitled to the right has an equitable interest in the land or
a right in the nature of an equitable easement Boscleo v, Jhagru, 46
All. 333 (336).
Sec. 40 ]
Revitt, L.R. < Ch. D. 224. M was allowed by the zemindar of certain
lands to build houses on tlie lands on condition that if M sold any of
the houses so built, he should pay one-fourth of the purchase money
{haq-i~chaliariim) to the zamindar. M sold one of the houses to one
R who had notice of the covenant in favour of zemindar, who 'there-
upon sued R (as M^ell as M) to recover one-fourth of the
purchase-money : Held that the covenant was a restrictive cov-
enant, binding M not to transfer Iris interest without the zem-
indar receiving his one-fourth share of the purchase-money ; the
covenant was therefore enforceable against R as much as against M
(jointly and severally) .Prci/jj/ Narain v. Ramzan, 41 All. 417 (419, 420),
17 A.L.J. 469, 49 I.C. 865. Tliis case has been dissented from in Haji
AbdttI v. Nandlal, 1931 A.LJ. 429, 133 I.C. 543, A-I.R. 1931 All. 552,
which lays domi that a contract to pay a certain sum of money (e.g., a
haq~i-chahantm) on the hapjjening of a ceitain event cannot be held to
be a i'estrictivc covenant. But in Kumar v. Narendra, A.I.H. 1930 Cal.
357 (360), 57 Cal. 953, B. B. Chose and S. K. Chose, JJ., held that a
covenant binding a tenant, his heirs or successors-in-interest to pay a
certain share of purchase money to the landlord on the sale of the ten-
ure, as a condition precedent to the landlord recognizing the sale as
valid and binding on him, is a covenant running with the land and
makes the purchaser liable for die same. Absence of a negative form
of expression in a covenant is immaterial when from the substance of
the agreement a negative agreement can be seen to be implied. A
covenant in a putni lease tliat the putnidar shall submit duly, year after
year in the landlords office, the Jama-wasil-baki and lawazima papers,
runs with the. land and therefore bind the assignees from the parties
Hooghly Bank v. Mahendra, A.I.R. 1950 Cal. 195, 54 C.W.N. 327.
Wliere some of the co-sharer landlords reduced the jama for their
share and concealed the fact of reduction when they sold theii; interest,
and it was admitted that the other co-sharers had not reduced the jama,
the transferee was not bound by the reduction Tark . Nath v. Raghu
Nandan, A.I.R. 1950 Pat, 22, 28 Pat. 844.
transfer of property
I Sec. 'JO
208
1.1 lovcrtii li'K entered into an. existing contract affecting that pro-
of which specific perfonnance could be enforced, die fonner must
Sd 'tSe nrSr^ for the benefit of the latter to the extent necessarj-
fo give contract.- Urns, where a mortgage at the toe of
i"r " -
'.-t.arf /an v!
Sec. 40 J
the Lahore High Court tliat in such cases the covenant to indemnify
the vendee eitlier by cash compensation or by delivery of other pro-
perty of the I'eudor is not enforceable at the instance of the pre-
emptor, as such a covenant does not run with the land Mt. Banti
V. Mandu, A.I.H. 1928 Lah. 357, (358), 9 Lah. 659, 110 I.C. 425. Hie
Allahabad High Court has however taken a contrary view in Hamvant
V. Chandi, AJ.R. 1929 All. 293 (295), 51 All, 651, 119 I.C. 243.
In order that the second para of this section may apply, the cov-
enant must be annexed to the land. Thus, an undertaking by a ven-
dor that he would pay any revenue that miglit be assessed on the
land was not held to be a covenant falling imder this section but was
merely a personal covenant Ramadhin v. Sheoratan, 6 O.C. 184 ;
Pachan Singh v. Jangjit Singh, 39 All. 166 (170). Wliere on a partition
between the brothers, a mortgage-debt due by the f&mily is apportion-
ed and there is a covenant by which a defaulting members share will
be liable for any excess amount paid by another member, such a cov-
enant is a restrictive covenant in the natme of an obligation annexed
to the ownership of immoveable property; and a member making the
excess payment is entided to enforce tire covenant against a purchaser
of die defaulting members property with notice (actual or construct-
ive) of the covenant Abdul Razak v. Abdul Rahman, A.I.R. 1933
Mad. 715.
27
[Sec. 40
r* 7t sr rs ^a^'ooK
Sec, 40]
[ Sec. 4i
or implied of the
Sec. 41 i
[ Sec, 'ii
Sec. 4i]
This section does not apply to the case of a piurchase of the equity
of redemption. A person who purchases tire equity of redemption can-
not repudiate his liability under the mortgage even if he purchases with-
out notice of the mortgage, because there no law which requires a
mortgagee to give notice of his mortgage to die world Narayan v.
Purushottam, A.I.R. 1931 Nag. 144 (145).
[ Sec. 4i
under]viiTtr"\'f^o^* section does not apply to the Punjab; but die principle
r^i MehrChand, A.LR. 1&7
Sec. 4i 3
The mere fact that an entry is made in the survey register in favour
of the transferor is not evidence of consent of the owner within the
meaning of this section Pemmal v. Stihramania, A.I.R. 1939 Mad. 299.
28
[Sec. 4i
It is of the essence of this section that the condurt of the- real owner
. J in the transferee tl\at Ins transferor had power to
Tlie transferee must prove two things ; (1) that he made bona fide
enquir,^ and (2) that the transferor was the ostensible owner with the
eSS of die real owner-Motinnii Sowear v. Visalakshi Ammaf, A.I.R.
I 9 S M-id % Asrafi Devi v. Trilok Chand, A.LR. 1965 Punj. 140.
Sec. 4l 1
person may hold himself out as die ostensible owner of a property widi
the consent (express or implied) of tlie real owner, still if the real
owner brings a suit against the ostensible owner for the possession of
the property, and then the latter transfers the property after the insti-
tution of the suit, the previous consent must be deemed to be revoked
by the act of filing the suit. Moreover, the estoppel arising under sec.
41 cannot override the imperative provision of lis pendens laid down in
sec. 52. Further, it is immaterial tliat the ostensible owner, at the time
of transfening the property, did not know that the real owner had filed
a suit against him ; for die pendency of the suit would by itself oper-
ate as a constructive notice of the revocation of the previous consent
ShafiquJlah v. Samiullah, A.I.R. 1929 AU. 943 (945).
iEC. 4l
Where a vendee does not assert liis right and the vendor is allow-
ed to carry on the management, the latter may be an ostensible owner
D. A. V. College v. Umrao Singh, A.I.R. 1935 L.ah. 410, 157 I.C. 92.
iVhere a Burmese husband allowed his wife and children to hold them-
selves out as the sole oumers of the properties and the wife and child-
ren mortgaged die property to a peison who acted in good faith, it
was held that the husband could not impugn tlie mortgage Maung Po.
V. Maung Myit, A.I.R. 1933 Rang. 361, 146 I.C. 1068. mere during
the husbands absence on the pilgrimage the wife sold a piece of land
which had before the husbands departure been mortgaged b)' her and
die purchaser paid off the mortgage having by proper inquiries satisfied
himself that the wife was the true owuier, the husband was not allowed
to recover the laud, nor to redeem the mortgage l^hVos v. Mt, Tetri,
20 C.W.N. 106. Wliere some of the co-sharers are shown as owuiers in
the revenue records for a number of years, the other co-sharers camiot
ch^enge a sale by the former jytf/io Das v. Melier Baksh, A.I.R. 1933
Lah. 262, 144 I.C. 340, Wliere one partner has permitted another j>art-
nei to deal with partnership property as an ostensible owner and such
property is mortgaged by the latter to a bank, knowledge on the part
0 one member of the investigating committee of the bank in his per-
soiwl capacity that the property belongs to the parbiership is not itself
ank Punjab & Smd Bank v. Rustomji, A.I.R. 1935 Lah. 821 (822),
Sec. 41 ]
1966 Pat. 75. Wliere a trustee allowed a person to hold himself out
as owner in the sale of trust properties, the provisions of this section were
attracted in the purchasers favour Mi/Zchond v. Hiissomal, A.I.R. 1937
Sind 177.
[Sec. 41
^Vlicrc the manager got his name entered in the municipal house*
lax register, during the prolonged absence of the omiei, Iwld tliat the
cnln' was only made for the purpose of assessment and collection of
house tax and was not intended for registering title. Such an enlr)^
was not enough to induce anybody to tliink tliat the manager . had a
right to .sell tlie property Mfl/iomed Sulaiman v. SaJdna Bibi, A.I.H.
J922 All. 392. The mere fact that a certain person's name appears in
the mutation register is not sufficient to make him die ostensible owner,
when the mutation proceedings disclose die fact that otiier persons
claimed ownership in the propertj^ Amir Jahan v. KJwdim Husain,
.AT.R- 1931 Oiidli 2.53 (2.55).
mere trustee for hmi-Gnr Narayan v. Sheolal, 46 Cal. 566 (P.C.) ; Bii
S ^ himse] out as t!
prove that the ^ rral owner could not recover unless he cou
title or that constructive notice of the re
Sec. 41 ]
[ Sec. 41
Kutch 85.
186A. Voidable : This section does not say that a purchaser from
the ostensible owner who purchases noth notice of the real title acquires
no title. He acquires a title which is voidable at the instance of the
real owner, and until iris purdrase is avoided, he can deal with the
property -Purnendw v. Hamit Mull, A.LR. 1940 Cal. 565.
187. When purchaser will be protected The first step which the
transferee is expected to take is to search the registration office to ascer-
tain what transfers, if any, have been made by the transferor. VWiere
die. transfei-ee fails to do so, he cannot claim die benefit of this section
Mf. Fatima v. Shib Singh, A.LR. 1938 All. 917 (918).
Tlie usual search is for a period of twelve years, and when tliere
are no circumstances whatever to indicate tliat the seardi of the regis-
tration office should be made for a longer period tlie ti'ansferee need
not make such a seardi Maz/iflj- v. Mukhtar, A.I.R. 1938 All. 64.
ers title unless^ ostensible mimer cannot resist the real own-
Sec. 41]
Only those persons are entitled to claim protection under this sec-
tion who, in spite of necessary enquiry, have not been able to discover
who the real owner of the property is, and who have, in full belief tliat
the person making a transfer in their favour is the person really entitled
to tliat property, taken die transfer from liim Jagmohan v. Indar, A.LR.
1929 Oudli ieO (162); Jamsedft v. Dorabji, A.I.R. 1934 Bom. 1;
Shahar Banu v. Raj Bahadur, A.I.R. .1934 Oudli 233 ; Ram Charan v.
Joy Ram, 17 C.W.N. 10 ; Sadha v. Mongol, A.LR. 1933 Oudh 166. No
purchaser can protect himself against the claim of a real owner merely
by saying that he had no notice of the real owners title. VlHien he has
taken reasonable care to ascertain his vendors title, then no doubt if
there is an equitable interest of which he could by such reasonable care
discover no trace, die doctrine of purchase for value \ridiout notice
holds good Zungabai Bhaicani v. Appaji, 9 Bom. L.R. 388. Anybody
purchasing a property has to make a reasonable inquirj as to the title
of his vendor ; much more in a case where he sets up a title of the
ostensible owner as against the title of the real owner Sheogobind
Anwar Alt, A.I.R. 1929 Pat. 305 (307). IVliere a person takes transfer
of a propei+j', though informed of die existence of a registered sale
deed in favour of another without probing further to see whether the
29
[ Sec. 41
real owners naim> him with the fact that land stood in the
r... V. 4 s S
Sec. 41]
the time of his purchase knew that the propei-ty had been previously
mortgaged by his vendor and his fatlier, and that the father lived in a
house on the land. Held that die pin-chaser was by reason of the mort-
gage put upon inquiry as to die fathers interest in die land and could
not dierefore claim to be a bona fide purchaser for value from the osten-
sible owner (the son) in whose name die property stood in die revenue
registers Mfl/iomet? Ebrahitn. v. Mating Ba, 7 'Bur. L.T, 69, 24 LC, 482
(483). A person who takes a mortgage from one whom he knows to be
a sister s son of the last oivner ought to take reasonable care to
enquire and ascertain as to whether there are any collaterals in exist-
ence of the owner Ballu Mai v. Ram Kishan, 43 All. 263 (265), A
man who chooses to act upon a Collectors certificate in Madras as evid-
ence of title does so at his ovm risk, and cannot be said to act widi
reasonable care and good faith Thungavehi v. Mangathaye, 1913
M.W.N. 674, 21 I.C. 21 (23). Wliere a person purchased property
from one of the four members of a joint family, and it appeared
that diougli the property stood in the vendors name, a litde enquiry
on' the part of die purchaser would have put lum' on notice tiiat it really
belonged to the joint family, held diat, die purchaser was not protected
by this section Kanta v. Bashiram, A.I.R. 1929 Cal. 686 (638),
121 I.C. 409. The mere fact that- certain property is found entered in
the record of rights in the name of one person only who happens to be
the Karta of the family and that the junior members have allowed the
enti-y to stand, does not justify a transferee, who takes a mortgage from
the recorded owner alone, in making no further inquiry. He must in-
quire as to whether and how far the other members are interested in it.
His refusal to inquire into the title-deeds and resting content with the
entry in the record-of-riglits gives him no protection against the other
members Kanhu v, Palu Sahu, 5 P.L.J. 521 (533), 1 P.L.T. 546, 57 I.C.
353. Tlie mere entiy of ones name as mvner of a property either in
the Government records or in private papers does not relieve the pur-
chaser from such ovraer from the duty of making an enquiry into the
title of that owner She'o Gobind v. Anwar, Alt, 10 P.L.T. 254, 116
I.C. 779, A.I.R. 1929 Pat. 305 (306). A Govemment official acquired
some zemindary proiierty in the district in which he was employed,
and he caused that property to be recorded in the Revenue papers in his
sons names. Tlie sons sold the property. It was held that as there
were other circumstances wliidi rendered it incumbent on tlie transferee
not to rest satisfied witli merely seeing tliat the names of the transferors
were entered in the revenue records, tlie ti-ansferee did not use reason-
able care Pratap Chand v. Saidiya, 23 All. 442 (447). Wliere a pur-
chaser is told that the vendor derives his title under a registered deed
and the purchaser does not ask for tiie production of tlie original deed
he must be deemed to have constructive notice of the contents of the
deed Yew Sit v. Mating Daicood, 1 L.B.R. 196. A purchaser who
merely relies on mutation of names does not act with reasonable care,
for mutation of names by itself creates no proprietary title (Chekhey
Singh V. Joie Singh, 31 All. 73 P.C.). Mutation is merely a statement
of the facts which existed as to possession of the property. Consequ-
ently, neither the mutation entry nor the entry in tlie Record of Rights
or revenue papers can supply the place of a title-deed; and a pur-
[Sec. 41
Sec. 41 1
[Sec. 4i
tl,c rovcmiB IMPOK and he dealt Uie whole of tile property m
s- own In 1896 he alone mortgaged the property, and aftenvards
redeemed the mortgage. R had not taken any exception to that mort-
..tac Twenty years aftenvards, he again mortgaged the property to
The same mortgagee who satisfied himself diat ITs name was still in the
revenue papers as the recognised owner of the propeity. R then sued
to -inmil the mortgage so fai- as her share of the property was concem-
cA and to recover lier share. Held that the mortgagee was protected
by this section Mutraj v. Fazal Imam, A.I.R. 1913 All. 583. Where
under a registered anomalous mortgage the mortgagee is entitled to
noscssion after a specified period, he can recover posession from the
transferee of tlie mortgagor ei-en if the mortgage is not entered in the
revenue records ifi/fl Singh v. Afzal Khan, A.I.R. 1941 Pesh. 59;
see also Narayan v. Purushotfam, A.I.R. 1931 Nag. 144.
Sec, 41]
that the transferor could not be tlie real owner of the properties is
not protected under this section Mollaya v. Krishnasicami, A.I.R.
1925 Mad. 95 (101); Giirbdksh Singh v. Nikka Singh, A.I.R. 1963 S.C.
1917. A mortgagee who lived in the same locahty as die mortgagor
and had been lending money to die mortgagors family for a long time
and was apparently acquainted witii all die circumstances of die family,
cannot claim to be a transferee for good faidi ividioul notice of tiie
absence of title of die transferor Pfl#es/iri v. Nageshar, 8 A.L.J. 358,
10 I.C. 961 (962); aflSrmed on appeal, A.I.R. 1915 P.C. 103. A pur-
chaser who was intimately connected with die affairs of the transferor,
for about 14 years, and who prepared the sale-deed ivith the assistance
of persons who knew everything that ought to be known about die
estate of the transferor and knew diat die latter had no power of alie-
nation cannot claim the benefit of the provisions of this section'
Hanuman v. Abbas, A.I.R. 1929 Oudh 193 (202). In the case of a trans-
fer by die uncle to his nephew, the parties must be presumed to have
known die real nature of the transaction ; therefore the nephew cannot
be considered to be a transferee wuthout notice, under this section
Mengha Ram v. Makhna, A.I.R. 1941 Lali. 416. A person who purchases
property from anodier, knoiving diat "with respect to it a suit had been
filed by a third party against the vendor, cannot be said to have acted
in good faith Ragho v. Dwarka Das, A.I.R. 1924 Lah. 738. But when
die transferee, however minute his inquiries might have been, would
not have found any reason to believe that the tiansferor was not fully
empowered to make the transfer, and in fact no clue existed to suggest
that a third person laid any claim to the property, it cannot be said that
the transferee was not acting in good faith Maung Po v. Bank of Chef-
land, A.I.R. 1934 Rang. 139. If P purchases from T a property which
has been in possession of D ever since die execution of the deed of sale
ill favour of T, it cann 9 t be said that P lias acted' in good faith Ram-
saran Mahton v. Harihar Prasdd, A.I.R. 1961 Pat. 314. Wliere a person
purchases without any enquiry from a Muslim co-oivner on the latters
vague claim to possessor)^ title and the tnie-oivner of the share does not
consent to the transfer expressly or impliedly, the transferee is not entit-
led to protection under diis section Haji Gitlam Ahmed v. K. T. A.
Basheer Ahmed, A.I.R. 1960 Mad. 399.
ISec 41
for whom he trusted and only completed the transaction after he was
told by his solicitor that eveiything was right Fimiendu v. Haunt Mull,
A.I.K. 1940 Cal, 565.
s section Rfl/flju Kanto v. Bashham, A.LR. 1929 Cal. 636 (638). Tlie
and t
Sec. 42]
Illustration.
30
i&c. 43
are
Illustration.
Analogous law : ^This section majf be compared with sec, 1-3 of the
Specific Relief Act, 1963, which lays down : "Where a person contracts
title, the purchaser or lessee has the following rights, namely : (a)
sequentlv acouires: ^liieh he did not at the time possess but sub-
Sec. 43 ]
This section did not apply to a case where the heir of the grantor of
a khorposh grant was free to exercise his predecessors option to resume
the grant Choto Baheru v. Puma, 19 C.W.N. 1272.
fCichore AIR. 1952 All. 287. This section applies only when a party
n^ssession of special knowledge makes an incorrect representation to
the^other patty to the contract, whereby the latter is induced to enter
into the contract and the person making the representation gets the benefit
of it Adhilakskmi v. Nallasivam, A.I.R. 1944 Mad. 530.
For consideration .This section does not apply where the trans-
feror transfers without consideration Jaganmth v. Dibbo, 31 All- 53.
A gift of property in which a transferor has no interest will not be pro-
tected under this section if the transferor acquires title to the property
after the gift. But if a reversioner who has given his consent to a gift
made by a Hindu widow of a part of her husbands property cannot claim
that property on the death of the widow though by being a party to the
deed of gift he purports to be merely one of the donors. He cannot claim
the property, not because of anything contained in section 43 but because
D ^ amounts to an actual election to hold the deed good Canga
The transferee can repudiate the contract or may elect to - ask for
amages under the general law. The relief provided in the first para of
this section is additional and it enables him to get at the property itself
proiuded the contract subsists on that date^Ganeshdas v. Kamlabai,
This section creates two equities. The first equity
ferep privies on the one hand and the trans-
Sec 43]
Any interest ivhich the transferor may acquire-. ^This section applies
if the transferor subsequently acquires any interest in the property sold.
If, as a matter of fact, the property never subsequently comes into the
hands of the transferor, this section cannot apply Ramakrishna v,
Anasiiyabai, 26 Bom. L.R. 173, A.I.R. 1924 Bom. 300, 86 I.C. 265.
19SA. Section 43. T. P. Act and section IIS, Evidence Act com-
pared : ^The vital difference between the representation referred to
in sec. 43 T. P. Act and the representation mentioned in sec. 115, Evid-
ence Act is that while the representation under sec. 43, T. P. Act, is a
term of the contract or the transfer, the same is not necessarily so in
the case of representation mentioned in sec. 115, Evidence Act. Parma
Nand v. Champa Lai, A.I.R. 1956 All. 225 (F.B.).
[Sec. 43
Sec. 43 ]
92 I.C. 471, A.LR. 1026 All. 102. Thus, where A, who was entitled only
to one-third of the family property, mortgaged one-half of the property
to C, who knew that A was entitled only to one-third and did not bargain
and pay for half a share, and subsequently after the death of As father,
A became entitled to a half share held that C could enforce his mortgage
only against the one-third share Pandiri v-. Karumoory, 34 Mad. 159-
Although this section says nothing about the belief of the transferee in
the erroneous representation, still a transferee desiring to take advantage
of this section should allege and prove that he took the transfer in good
faith believing in and being misled by the erroneous representation made
by the transferor Narain v. Andar Saijad Abbas. 28 M.L.J.
44, 27 I.C. 785- (788) (following 34 Mad. 159) ; Krishnajnachariw v.
Thiruvenkatachariar, 12 L.W. 149, 59 I.C. 275 (276); Ladu Narain v.
Goberdhan, A.I.R. 1925 iPat. 470. The case of 34 Mad. 159 has iilso
been followed in Kodi Sankara v. Moiden, 35 M.L.J. 120, 49 I.C. 147:
Venkata Lakshmi Narasayya v. Meenakshi, 10 L.W. 221, 52 LC. 992 ;
and Chakrapani v. Gayamani, 48 I.C. 228 (Pat.). A mortgagee of a
Deshgat Vatan knew" that the property mortgaged to him was the life-
interest of the mortgagor in his hereditary office. Subsequent to the
mortgage the mortgagor became entitled to an enlarged estate. Held
that as the mortgagee knew at the time of the transaction that the land
was inalienable beyond the life-time of the mortgagor, its subsequent
enlargement enabling the Vatandar to alienate it permanently would not
enlarge the mortgagees interest so as to enure beyond the mortgagors
life-time Gangabai v, Baswant, 34 Bom. 175 (182). But the Oudh Court
has dissented from this view and holds that there is nothing in this section
to the effect that it is necessaiy for the transferee to show that he believed
in and acted upon the representation made by the transferor Jag Mohan
V. Sita Ram, 20 O.C. 72, 39 I.C. 186 (188) (dissenting from 34 Mad. 159).
A Full Bench of the Allahabad High Court held as follows in 1956 :
S. 43, T. P. Act, does not require that the transferee who can take
advantage of it should be one to whom not only a fraudulent or erroneous
representation about the transferors authority to transfer the property is
made but should also be one who did not have knowledge of the true
factual position and had merely acted on the belief of the erroneous or
fraudulent representation made to him by the transferor. If, however,
both the transferor and transferee knew of the true position, and
colluded to enter into a transaction which is invalid in law, the state
of knowledge of the transferee becomes material and S. 43 cannot be
availed of by him, Parma Nand v. Champa Lai, A.I.R. 1956 All. 225
(F.B.). The Andhra .High Court has followed this decision of the Full
Bench of the Allahabad High Court in Vutla Veeraswami v. Ivaturi Durga
Venkata Subbarao, 1956 Andhra W.R. 1115.
[ Sec. 43
If the transferee was quite sure that his transferor was fully entitled
to the estate as absolute owner under the documents and he believes it
to be true and acts upon it, he is entitled to protection even though if
he had been more careful he might have found out that that was not a
true representation Gopi Nath v. Rup Raw, A.I.R. 1930 All. 786 (790).
and the nurcTiacpJ* w <m the sons. Held that this section applied,
P prty. ihenD died leaving K his sole heir. ifeW that the purchaser
Sec. 43]
was entitled to the aid of this section Sunder Lai v, Ghissa, A.I.R. 1929
All. 589 (591). Where at the time of the sale the vendors had no under-
proprietary right, but subsequently they acquired an under-proprietary
right, and it was found that the vendors had at the time of sale errone-
ously but honestly represented that they had authority to transfer the
holding, held that this section applied, and the under-proprietary right
passed to the pnrchaserBalbhaddar v. Kus^har, A.I.R. 1928 Oudh 344
(346). The plaintiff purchased the undivided share of A whose family
consisted of A, B and C, and As share at the time of sale was therefore
one-third of the property. Subsequently, by the death of B pending the
suit As share became one-half. Held that the plaintiff was entitled to a
moiety of the property Virayya v. Hanumanta, 14 Mad. 459. A vendee
purchased specific lands from a coparcener of an undivided Hindu family,
but in consequence of a partition suit in the family the vendor (coparcener)
was alloted lands other than those which he had sold to the vendee.
Held that the vendee was, entitled to whatever was substituted by the
decree for partition for the land which he had bought from the coparcener
Manjaya v. Shanmuga, 38 Mad. 684 ; Sdbapathi v. Thandavaroya, 43
Mad. 309 ; Dhandha Sahib v. Md. Sultan, 44 Mad. 167 (168) ; Rain Piari
V. Ram Nath, A.I.R. 1963 All 599. A piece of land was allotted to S
under the Punjab Government Tenants Act. S induced his brother J to
come and help him to reclaim the land, and promised to give J" one-half
of whatever he might obtain. J came to his brother S and settled in the
land and shared all the expenses and labour of reclaiming the soil. Sub-
sequently, the Government conferred proprietary rights on S. Thereupon
J claimed half share of the land.. Held that Js claim should be allowed
Nathu V. Allah Dim, A.I.R. 1922 Lah. 287, Where a partner in a firm
sells the property of the firm in his own right and not on behalf of the
other partners or the firm and subsequently after dissolution of the
partnership the same property is allotted to him, the case falls within the
purview of this section and the vendees title remains intact Peyare Lai
V. Mt. Misri, A.I.R. 1940 All. 453.
[Sec. 43
the whole property, including the portion sold to him and resold by him
Sec. 43 ]
[Sec. 43
betwfen sand C that B shall give half share of the house to A free from
die Lrtgage, the purchaser of the house m execution of the mortgage
decree obtained by B is bound by the settlement-Deuat/n Siibbwayudu
V. Piwvadi Chinna, A.I.R. I960 Andh. Pra. 592.
to
infirm title subsequently got intn^n g^anted the (Ztiripeshgi) lease, had an
compelled to carrv out thi. Possession by a valid title, he could be
he became able to^do the attained a position in which
Sec. 43]
200. Time during which the contract subsists. : The option of the
transferee can be exercised in respect of an interest acquired by him,
only during the time the contract subsists, but not afterwards. If, in
case of a sale, the purchaser has repudiated the transaction and recovered
the purchase money, or in case of a mortgage, the mortgaged properties
have been sold in execution of the mortgage-decree IJadti Bans v. Sheojit.
10 I.C. 443), the relation of transferor and transferee has ceased to exist,
and the contract is no longer subsisting- In such a case no claim in
respect of property acquired subsequent to the cessation of the contract
can be made by the transferee.
. [ Sec. 43
sec. 6 (a) and would be void initio, while those of the latter class
Seg. 43 i
OF PROPERTY lAI
[ Sec. 44
Sec. 44]
32
I Sec. 44
The right of partition exists when two parties are in joint possession
of land under permanent titles, although their titles may not be identical
Bhagwgt V. Bepin, 37 Cal. 918 (P.C.). There is no fixed rule of law
that a property held in temporary right cannot be partitioned ; the only
ground on which partition may be allowed or refused is convenience.
Thus where the tenancy, although a monthlj'^ one was old and the land
was in occupation of the tenants for fifty years, the landlords were
numerous and scattered and there wm little likeliliood of their combining
to eject the tenant, the mere fact that technically the holding was monthly
enancy should not debar the parties from their lawful right to partition
Raiani Sambhii A.I.R. 1929 Cal, 710. A lessee is entitled to have
"is' V,
$Ec. 44 ]
T^nsfer Of property 251
off strangers who may purchase the undivided sh^are of some co-owner of
an immovable property and as far as dwelling houses are concerned, to
mahe it possible for the co-sharer, who has not sold his share, to buy up
Ihr stranger purchaser. The whole object therefore is to provide for
neaccable enioWent of the property and to secure privacyDwfn? Chandra
V costMari A.J.R. 1953 Cal. 259, per Chakravarti, C. J. and G. N.
Das I The mere grant of a tenancy of the ordinary kind (not a perma-
nent lease) cannot possibly have the effect of making a house, which is
otherwise a residcntal house of the members of the undivided family own-
ing it, cease to be a dwelling house ihiW.
Sec. 44]
Undivided family means simply a family not divided qua the dwel-
ling house and has not divided it. It does not mean Hindu joint family
or even joint family. The members need not be -joint in mess. The
members of tKe family may have partitioned all their other joint proper-
ties and may have separated in mess and worship, but they would still be
an undivided family in relation to the dwelling house so long as they have
not divided it amongst themselves, ibid. This character of the house
will remain so long as the house is not completely alienated to strangers
or the house is not divided, ibid.
[Sec. *13
for an order of that nature was reached when the purchaser sued for khash
nossession, and the plaintiffs not having taken any step at the time, they
were" estopped from obtaining an injunction Kanta v. Sita Kumm,
46 C.W.N. 407. Upon a transfer to a stranger of an undivided share of a
tamily dwelling house by a co-sharer, the other co-sharer or co-sharers
can maintain a suit for injunction restraining the stranger transferee from
exercising any act of joint possession in respect of the share transferred
Paresh Nath v, Kamal Krishna, 61 C.W.N. 776. If such a transferee
gets into possession he is liable to be evkt&dUdaynath SaJtu v.
Ratnakar Bai, A.I.R. 1967 Orissa 139. Possession of one co-sharer enures
for the benefit of all the co-sharers Khetrabasi Parida v. Chatwbhv.j
Panda, A.I.R. 1968 Orissa 236.
206. Scope of section : This section defines only the quantum and
T.ot the quality of the interest of the joint transferees. It is silent on the
question whether the transferee would take as joint tenants or as tenants-
in-common.
This section applies to transfers for consideration, and its principle
IS inapplicable to giits Gabriel v. Inas, 34 Mad. 80.
Sec, 45]
In India the Court strongly leans against holding any particular grant'
as a joint grant. The presumption must always be in favour of a tenancy-
in-common rather than a joint tenancy. But the Court can come to a con-
trary conclusion if the presumption is displaced by clear and cogent-
language to the contrary. Thus where a Mahomedan mother and a
daughter purchased certain immovable property each contributing towards
the purchase money, and the habendum clause in the sale deed clearly
provided that the purchasers were to hold the property as joint tenants
and not as tenants-in-common : Held that the terms of the grant made it
perfectly plain that the intention of the purchasers was to hold the pro-
perty as joint tenants and were sufficient to displace the ordinary presump-
tion in favour of tenancy-in-common Md. Jusale v. Fatmabai, A.I.R. 1948
Bom. 53, 49 Bom. L.R. 505.
[ Sec. 46
issued a certificate of sale jointly to them: Held that tiie different shares
should be entitled to equal shares in the purchased estate irrespective of
their shares in the parent estate. If there is no evidence upon the record
fo show how the amount was made up by the Collector from the funds
which the parties respectively advanced, the presumption ought to be
that each of the parties is equally interested in the property purchased
Debi Pershad v. Akiio, 4 C.W-N. 465.
Illustrations.
209. This section is the reverse of sec. 45 which lays down a similar
rule of proportion.
Sec. 47]
was hypothecated and the hypothecatee brought a suit against the sons
after the fathers death and the suit was decreed ex pane against one son,
it being withdrawn against the other three, it was held that the decree-
holder got one-fifth share of the judgment-debtor in addition to the one-
fourth of the one-fifth share of the father. He did not get one-fifth share
of the judgment-debtor and one-fifth share of the father Bore Gotoda v-
Ramegowda, A.I.R. 1954 Mys. 16.
Illustration.
Note ; In the case of transfers falling under this section, the transfer
takes effect not according to the quantum of consideration received by
each co-owner but according to the extent of the share of each co-owner.
This rule was probably enacted to guard against the complications which
Ihe former, course would entail. For the value of two shares otherwise
equal may considerably vary, and if inquiries have to be made as to the
value of each share, much unnecessary inconvenience and delay would
become inevitable Gours Laiv of Transfer, (6th Edn.), Vol. I, p. 509.
33
[Sec. 48
sale or a caio ^ ^ transfer, and does not include a mere contract for
compulsory. If a sale-deed, the registration of which is
(2) The rule is applicable only when the tivo transfers are antagonistic
and not where legal effect can be given to one without infringement of the
other. Compare the words of the section and such rights cannot all
exist or be exercised to their fullest extent together. Thus, in a case
where a property is mortgaged to one and subsequently sold to another,
this section will not apply, because the purchaser has obtained only the
equity of redemption, an interest which can exist side by side with the
mortgage Ramchandra v. Krishna. 9 Mad. 495 ; Sohhagehand v.
Bhaichand, 6 Bom, 193 (208). But where usufructuary mortgages of the
same property are created in favour of diferent persons, the two rights
cannot co-exist and the subsequent mortgage will give way and the prior
mortgage will prevail Rai v. Raghunath, 7 All. 568 (572).
Generally speaking, the question of priority between a mortgagee and a
subsequent purchaser is governed by this section. The purchaser is not
protected by sec. 41 when there is no proof of negligence on the part
of the mortgagee Ram v. Raj Narain, A.I.R. 1934 Oudh 283. Where
after the registration of a mortgage the mortgagor sold the property to
a third person by a registered deed of sale and subsequently the mortgagee'
paid the consideration money for the mortgage to the mortgagor, the
mortgagees right prevailed over that of the vendor Raghunath v, Amir
Baksh, I.L.R. 1 Pat. 281. An agreement to sell land was executed in
favour of A. Subsequently mortgage of the same land was executed in
favour of B. Later on a sale-deed was executed in favour of A. Held,
that the mortgage must have its effect as against the subsequent sale,
though the agreement to sell was executed before the mortgage Chouth
Mai V. Hiralal, A.I.R. 1950 Aj. 59.
[Sec. 48
owelty on a partition decree, they are entitled to priority o^^r the mort-
gage of a portion of the property purchased M</. Kaztm v. H%lh, 35 Cal.
388.
Sec. 48 ]'
[Sec. 48
nronerty were executed on the same day, it must be proved which was
FnTct executed first, but if the deeds themselves show an intention
e^i that they shall take effect pari passti or even that the later deed
shall take effect in priority to the earlier, then it will be presumed that
the deeds were executed in such order as to give effect to that inten-
Sec. 49 j
sold it by a registered deed: held that after such sale no suit would lie
on the prior unregistered mortgage Ishri Prasad v. Gopi Nath, 34 All.
631. Where the subsequent mortgagee takes the mortgage fully knowing
the liabilities created under the first mortgage and undertaking to clear
the prior mortgage, even where in a sale by .the prior mortgagee the
interest had been bought by the mortgagor himself the subsequent mort-
gagee takes subject to the mortgagors rights Amar Chand v. Sardar
Singh, A.I.R. 1925 Nag. 90 (93).
For other cases of priority see secs, 78 and 79 and Notes thereunder.
214 . Two questions ma3'^ arise under this section: (1) If the house
is destroyed after the contract of sale, but before it is completed by
payment of purchase-money ; (2) If the house is destroyed after the sale
is completed by payment of purchase-money.
(2) After the purchaser has paid the purchase-money, and the owner-
[Sec. 50
Shit) has passed to him, he is bound to bear any loss arising from the
de'itruction or decrease in value of the propcrtj^ not caused by
the seller see sec. 55 (5) (c) post. But if the property is insured against
loss or damage by fire, and the money payable under the policy is received
by the vendor, this section comes in and entitles the purchaser to require
the vendor to apply the money in reinstating the property.
215. Which the trensferor actually receives : ^This section docs
not give the transferee of insured property any direct claim against the
insurer, but it provides only for the case where the money payable under
the policy has been actually received by the transferor. The vendor is
liable for the money actually received by him under the policy. It may
v.-ell happen that after the vendor has sold the property and received
full consideration thereof, he may not care to enforce payment of the
insurance money from the insurer. In such a case, the purchaser can
neither compel the vendor to enforce his claim against the Insurance
Company, nor can the purchaser claim the insurance money directly from
the company. It is only when the vendor cares to enforce his claim
against the Insurance Company and actually receives the money from
the company that the purchaser can claim the benefit of this section.
The safest course for the purchaser is to get the policy of insurance
assigned over to him at the time of purchase.
Illustration.
Sec. 50 j
But this section applies where the rent is realised in advance from
the tenant as a condition of his entering into the premises. Thus, where
the mortgagor of certain mortgaged premises let them to a tenant' after
receiving 5 months rent in advance as a condition precedent to such
letting, and subsequently a Receiver appointed in the mortgage-suit
relating to those premises sued for recovery of the said rent ; held that
the lessee having paid the rent in advance only as a part of his entering
into the contract of hiring the premises, could not be compelled to pay
it over again to the Receiver Toon Chan v. P. C. Sen, 7 Bur.L.T. 139,
24 I.C. 693 (694).
34
[Sec. So
217 Rents paid in good faith This section speaks of good faith
twice; 'first with regard to payment actually made, and secondly as to
the title of the person to whom it is made. When the purchaser of the
landlords interest gave notice of his title to the tenant after the com-
mencement of his tenancy, payment of rent made by the tenant to the
vendor who inducted him on the land was protected by this section-
Sattu Lai v. Kritanta Kumar, 42 C.W.N. 378. But where a tenant knew
of the dispute between two rival claimants to the title of landlord, but
chose one of them and paid rent to him, the payment cannot be said to
be bona fide and this section does not cover the case Gainbherhja v.
Sakharam, A.I.R. 1927 Nag. 237. Similarly where the tenant of a
mortgagor has been paying rent to the mortgagee in accordance with the
terms of the mortgage deed, but subsequently pays rent to a purchaser
at the Court sale of the mortgaged property without making any enquiiy
whether the mortgage has in fact been satisfied and merely relying on
the words of the said purchaser that the mortgage has been satisfied,
the tenant cannot be said to have acted in good faith within the meaning
of this section Kristo v. Gob'mdaram. A.I.R. 1939 Pat. 540.
Where a person continues payment to a person having defective title, after
he came to know the title of the real owner, he acts in bad faitli and no
inference can be made in his favour as to previous pat'ments Mr/. Azim
V. Fateshtcari Prasad, A.I.R. 1943 Oudh 105.
rpaiicoa ^3dIord his interest devolves upon his sister but rent
mutatino ^ widow after taking possession of the property and
realised^v the sister cannot claim the rent already
siuiiy piead that he has paid the rent bona fide to the assignor, if he
Sec. 51]
TRANSFER OF PROPERTY %1
has received notice of the assignment from the assignee Poipe v. Biggs,
(1829) 9 B. & C, 245 ; Pemy Lai v. Madhoji, 17 C.L.J. 372, 19 I.C. 865
(868). Similarly, if the tenant gets notice of the transfer from the
transferor (and not from the transferee), any payment of rent made by
the tenant to the transferor thereafter is not a valid payment made in
good faith, and the transferee is entitled to claim the same from the
tenant Chandra v. Surendra, 7 C.W.N. 454. Payments made by
the tenant either in collusion with his grantor or after receiving notice
of the right of a third party are not protected under the section Mos 5
V. Gallimore, 1 Doug. 279 ; Pope v. Biggs, 9 B. & C- 245 ; Cook v. Guerra,
L.R. 7 C.P. 132.
219. Procedure : Where the tenant alleges that the rent for the
year in question has been paid to the previous landlord (the vendor of
the plaintiff), the suit for rent can be framed alternatively against the
tenant and his previous landlord. Where in such a case the Court finds
that the tenant has in fact paid the rent to the previous landlord in good
faith, the plaintiff is entitled to a decree against the previous landlord
alone for the amount paid to him, the tenant being discharged Madan
Mohan v. Holloway, 12 Cal. 555.
This section is almost the same as sec. 2 of the Mesne Profits and
Improvements Act (IX of 1855), which has been repealed by this Act.
[Sec. 5i
where a person, who is only a part owner, acting bona fide, pemiauent-
Iv benefits an estate by repairs or improvements j for a hen or trust may
iriso ill his favour in respect of the siim he has expended in such repairs
or improvements {Lake v. Gibson, 1 Eq. Ca. Ab. 290). AWiough a.per-
son expending money by mistake upon the property of another has no
equity against the owner who is ignorant of and did not encourage him
in his expenditure {Nicholson v. Hooper, 4 hly. & Cr. 186) yet if it
were necessaiy for the true owmer to proceed in equity he would only
be entitled to its assistance according to the ordinarj^ rule by doing
equity and making compensation for the expenditure, so far of course,
and only so far, as the expenditure was necessary and has proved
permanently beneficial. But a person will have no equity who lays out
money on the property of another wth full knowledge of the state of
the title {Rennie v. YoimQ, 2 DeG, J. & S. 136 ; Ramsden v. Dtjson,
L.R. 1 H.L. 129 ; Price v. Neanlf, 12 App. Cas. 110 ) ; or wlio lays out
money unnecessarily or improperly Snells Equity, pp. 148, 149.
Where a person in bona fide belief of his title to the land spends
money upon it and makes improvements and the true owner stands by,
then he is estopped from asserting his title to the land as against the person
making improvements in such bona fide belief. I'hus where A, who
has purchased a property in his own name for the benefit of B with the
mutual understau'ding that B would rejmy the purchase money with
interest to A, stands by and acquiesces in the imi>rovements made by
B in the house and does not conduct himself as a real owner, he is
estopped from subsequently asserting his ownership and denying tlie
title of B. Similarly the alinee from A purchasing the projoert)' with
notice of Bs title is also estopped from denying B's title Venkataswami
V. Muniappa, A.I.R. 1950 Mad. 53.
P of true owner
Sec. 51 ]
[Sec, 51
270
transfer of property
This section applies even though the transferor himself is the evic-
tor. Tlie words the person having a better title should not be inter-
preted to mean a person other than the transferor. There is no reason
to cut doTOr the operation of the secHon in this way Har'dal v. Gor-
dhan, A.LR. 1927 Bom. 611 (612).
222 .
aoes so at h.s orvn nsk. He cannot claim compensation under the sec-
Sec, 51 1
[Sec. 51
Cal. 69.
Sec. 51 ]
A person who is aware of the imperfection of* his title or who knows
that his tide is terminable some day or other is not entitled to the
benefit of diis section Onkar Mai v. Secretary of State, 56 I.C. 813
(Pat.). A person who purchases or takes a permanent lease from a
Hindu ivddow, fully knowing that she is in possession of die property
as a Hindu widow havuig only a life-interest, cannot claim the value
of the improvements made by him upon the property *Rc/ Kishore v.
Jarnt Singh, 36 All. 387 (395) ; Gopi v. Mi. Rafroop, A.I.R. 1925 All.
190. See also 44 All. 665 and 47 All. 430 cited in Note 224, infra. A
person who plants trees and makes improvements on anothers land,
knowing that he has no valid title to it, cannot claim the value of the
improvements Munna v. Stiklaf A.I.R. 1924 Nag. 142 (145). A person
who never had any title and was in possession by permission of the
real owner cannot believe himself to be absolutely entitled to the pro-
perty V. Rarmanand, A.I.R. 1932 Bom. 190. For, there is
no equity in favour of a person who with full knowledge of the state
of his title sjjends money upon the property while he knows that it be-
longs to another, or who incurs expenditure which is either unnecessary
or improper. Ihe lest is, whether the person has acted in the bona
fide belief that he is entitled to the property Sith v. Samiuddin, 4
O.L.J. 514, 42 r.C. 428 ; Shyam v. Ganesh, A.I.R. 1930 Pat. 20.
35
[Sec. 51
aniv. Basfocotta Colliery Co. Ltd., AJ.R. 1957 Pat 331. Where a
tenant knowing tliat he has no occupancy rights makes improvements
in the land without any hope or expectation created or encouraged by
the landlord he cannot claim any compensation on eviction
will not heln him ^ ^^l- 201 (202). Even sec. 63A
Sec, 51 ]
But long possession by the occupant may sometimes give rise to the
belief that he is absolutely entitled to the property. Thus, equitable
relief was given to a person who had been in occupation of the land
for a period of 25 years Yeshwadabai v. Ramchandra, 18 Bom. 66 (83).
Though under the ordinary law, a mortgagee cannot claim payment for
improvements effected without die consent of the mortgagor, yet where
the mortgagor did not redeem the mortgage at the end of the term, and
the mortgagee (under the mortgage by conditional sale) has for 30 years
bona fide beh'eved himself to be the proprietor and dealt with the pro-
perty as such, not knowing that he should take any steps to convert
his mortgage by conditional sale into an absolute sale, held that the
mortgagee was entitled to compensation for improvements Ladha Mai
V. Jaganath, 123 P.R. 1888 ; Ram Kuar v. Partab Singh, 58 P.R, 1919,
51 LC. 689.
[Sec. 5i
has made improvements in good faith as a bom fide occupant of the land
and in the belief that the land is his own, he may be entitled in equity
to recover the value of the improvements Dliar/wa Das v, Amuhja, 33
Cal 1119 (1129); Natesa Therani v. Dist. Boaf'd Tonjore, A.I.R. 1926
Mad. 314. Where the grantee of a piece of land under an order of the
Tahs'ildar paid the assessment in respect of the piece and spent money
in putting the land in good use without knowing that there was an appeal
decreed against him, it was held that the grantee effected his improve-
ments bona fide within this section and was, therefore, entitled to the
value thereof C/ienntipmgffdfl v. Sea'etary of State, A.I.R. 1925 Mad.
963. But a person holding under a lease of a non-pennanent character
cannot ask the lessor to pull down the structures built thereon by him
on his eviction and pay the price thereof under this section, when the
structures were built by the lessee with the full knowledge that he had
a lease only for life Chandi Charan v. Ashutosh, 40 C.W.N. 52, 164,
I.C. 837.
The words good faith" are defined in the General Clauses Act
(1897), sec. 3 (20) as follows : "A thing shall be deemed to be done in
good faith where it is in fact done honestly, whether it is done negligently
or not. This definition does not apply to the Transfer of Property Act,
because this Act was enacted prior to the General Clauses Act. In
i Penal Code, good faith has been defined as follows ;
Nothing shall be deemed to have been done in good faith which is not
done with due care and attention. But if this definition is imported
aWp the T. P. Act, it will make the section entirely unwork-
purchase the property honestly believing that he was buying good tide.
To hold otherwise would be to exclude a very large dps of cases from
i rule which is obviously based on considerations of justice Non/sppa
V Peruma, 32 Mad. 530 (531). A person who acts honestly can be said
to act in good faith, even though he may have been to some extent
negligent in inquiring into the sellers authority to sell the property-
HariU V. Gordhan, A.LR. 1927 Bom. 611 (613). Ordinarily, good faith
required by this section does not mean anything more than an honest
belief in the validity of ones own title MxJithsensa v. Apsa, 36 Mad. 194.
Even negligent belief will amount to honest belief for the purpose of this
section. Therefore, though the negligence of the buyer from the guardian
of a minor in making due and sufficient inquiries affects his title to
immoveable property, still it does not follow that the purchaser did not
believe in good faith that he was the full owner when he effected the
improvements on the property purchased v. Sarkaramrayam,
J L.W. 369, 24 I.C. 940 ; Earilal v. Qordhoti, A.LR. 1927 Bom. 611 (613) ;
Saliabuddin v. Vohidbitx, 56 I.C. 492 (Sind). A person who acts under
a mistake of law may still act in good faith within the meaning of this
section Dwrgoci v. Fakeer Sahib, 30 Mad. 197 (199) ; Sakabuddin v.
Voludbux, 56 I.C. 492. Bona fides is not incomj)atible with ignorance of
law, nor is it incompatible with a certain degree of negligence. The
degree of negligence is a matter to be determined according to the circum-
stances of each case~Rama Aiyar v. Narayanasami, A.I.R. 1926 Mad.
609 (613).
II the other hand, a man loses his property because of a defect in it,
nf to believe in good faith that he is aboslute owner
the salp found that the transferee paid full consideration, and
Sec. 5U
tfeANgFEft Ot PROPERTY
to be applied Gopi Lai v. Abdul Hamid, A.I.R. 1928 All. 381 (385).
A person who is fraudulently in possession of property cannot be deemed
to believe in good faith that he is absolutely entitled to the property.
Consequently he cannot be allowed any compensation for the sums spent
by him in improving the propettySadashiv v. Dhakubai, 5 Bom. 450.
Where the title is obviously founded on possession which was originally
gained by trespass, it can hardly be said that the person entering upon
the land as a trespasser can bona fide believe that he is absolutely entitled
thereto Secretary of State v. Dugappa, A.I.R. 1926 Mad. 921. A
mortgagee who is not entitled to possession but who somehow or other
comes into possession of the mortgaged property and makes improve-
ments thereon, cannot claim the benefit of this section Rangayya v.
Parthasarathi, 20 Mad. 120 (124). Where a Hindu widow sold her
husbands property at a very low price without any legal necessity, and
the purchaser knew of the voidable nature of the transaction, he could
not be deemed to have believed in good faith that he was absolutely
entitled to the property, and consequently he was not protected by this
section Mtiddusami v. Bhaskara Lakshmi, 29 M.L.J. 357, 30 I.C. 853
(855). But where a person, bona fide thinking that he is the heir of a
deceased person, spends money in freeing the estate from debts which
if he were the real heir he would be bound to pay before he could secure
possession, he is entitled to recover the amount paid by him from the
person who is subsequently found to be entitled to the estate Sitla v.
Somiuddin, 4 O-L.]. 514, 42 I.C. 428. A person who purchased a big
plot of land was put in possession of a larger area than he purchased.
Without knowing of the mistake he made valuable improvements on the
excess area, and the vendor took no steps at that time to prevent it. He
later sued to eject the vendee from such excess area. Held that sec. 51
applied and the vendee was entitled to compensation Natesa Thevan v.
District Board, A.I.R. 1926 Mad. 314. Where the defendant encroached
upon the plaintiffs land, believing in good faith that it belonged to him
as forming part of his adjoining land, cleared it of jungle and rendered
it fit for cultivation at his expense, held that the defendant was entitled
to compensation for the improvements before he could be ejected by the
plaintiff B/iMpcnt/ra v. Peari, 40 I.C. 646. Where the grantee of land
under an order of the Tahsildar paid the assessment in respect of the
land and spent money in putting the land to good use, without knowing
that there had been an appeal from the Tahsildar's order and that on.
appeal the grant of the land to him had been cancelled, heW that the
grantee effected his improvements in good faith believing that' he was
absolutely entitled to the land Narayanamoorthy v. Secy, of State, A.I.R.
1925 Mad. 963. A party to a litigation is not entitled to compensation
for improvements made by him pendente lite with full knowledge of the
risks he runs in doing so Velusatni v. Bommachi, 25 M.L.J. 324, 21 LC.
219. Where the defendant purchased the properly with notice of a prior
contract of sale between the vendor and the plaintiff, and without making
inquiries from the plaintiff, he was not entitled to the value of the im-
provements effected by him on the property Haradhan v. Bhagabati,
41 Cal. 852 (865).
[Sec. 51
^ nlch AIR 1930 Pat. 20. If it is shown that the real owner knew
That the occupants were spending money upon the improvement of the
tnd and knew also that they were doing so m the belief that they had a
eood title, and that nevertheless the real owner stood by and allowed
The occupants to proceed with their expenditure, he ought not to be
entitled to a decree for ejectment without indemnifying them for their
outlay Kumar v. Banomah. 29 Cal. 871 (884) ; Ismai} v. Jaigun,
so as tn roefr * 'I? *1^ suffice to raise any equitable right in the tenant
estoDoel is anniv Ki^ ^SRdlord from suing in ejectment. The doctrine of
erecdM only where the owner of the land seeing his tenant
landbid Stood by fa
Sec. Si ]
A fortiori, where the landlord did not even know of the erection of
the buildings by the tenant, while they were being constructed and did
not even become aware of the existence of the buildings after they had
been erected, the plea of acquiescence and estoppel must fail Ismatl v.
Jaigun, 27 Cal. 570 (585). In order that the tenant might avail himself
of the plea of acquiescence and estoppel, it is necessary for the tenant
to show that in spending money for the erection of the buildings of a
permanent character he was acting in an honest belief that he had a
permanent right in the land and that the landlord knowing that he was
acting in that belief stood by and allowed him to go on with the
construction of the buildings Razemini v. Manik, A.I,R. 1924 Cal. 156.
A railway company partly trespassed upon the Crown lands and
partly entered into a license which was to be subsequently turned into
a contract for allowing the erection of telegraph poles and the company
was under no mistaken belief as to its rights to the Crown lands nor was
such mistaken belief known to the Crown who could not be said to have
encouraged the construction of the telegraph line : held by the Privy
Council that there was nothing on which to ground any estoppel against
the Crown Canadian Pacific Ry. Co. v. King, A.I.R. 1932 P.C. 108.
36
tRANSFEk OF PROPERfV
tEC. 51
Spending small sums every year for the usual levelling and manuring
of the lands for the purpose of husbandman-like cultivation thereof is not
an improvement within the meaning of this section iJi/tfa/a Muthu v.
Sankara Narayana, I L,W. 371, 24 I.C. 879.
Sec. 5l J
In some cases, the transferee has not been allowed the cost of his
improvements, but has been allowed merely to remove the materials of
the building he has erected. Thus, in a Madras case, where a permanent
lease was granted by the trustee of a religious trust, the lease was held
to be invalid, and the lessee who had built a house on the leased land
was not entitled to any compensation before his eviction, but was merely
allowed to remove the materials of his house Venkatappier v. Rama-
swami, 1919 M.W.N. 548, 52 LC. 517 (519). A Hindu widow mortgaged
a property with possession, without any legal necessity, and the mortgagee
proceeded to build a house on the land. The mortagor died, and her
co-widow, on whom the land devolved by survivorship, sued for possession.
Held that the mortgagee was not entitled to claim the cost of the improve-
ments (see Note 244), but he was allowed to remove the materials of the
house Hans Raj v. Somni, 44 All. 665 (668). This case has been criticised
by the Rangoon High Court on the ground that if a person, who has not
been allowed to claim the benefit of sec. 51, is nevertheless permitted to
remove the materials of the house built by him, it would make the provi-
sions of sec. 51 nugatory, for he will practically get the benefit which he
has been declared not to be entitled to Mating Aung v. Ma Nyiin, A.I.R.
1928 Rang. 141 (142). But this is not so, for the materials of the house are
worth much less than the house itself, and all the expenses of building
the house are lost to him. The rule in Ramsden v. Dyson, (1865) 1 H.L.
129 is subject in India to the exception that a party building on the land
of another is allowed to remove the building. The right does not, of
course, exist when the action is mala fide and tortious. But when there
is acquiescence and a bona -fide belief on the part of the person building
that he had title, then if it should appear that the person building has no
title and was misled by the acquiescence, he is entitled to remove what he
has built so long as he substantially returns the land in the state it was
Abdul Razak v. Seth Nandlal. A.LR. 1936 Nag. 506 (511).
The person making the improvements has no lien on the land for
the value of the improvements. Even if it is assumed that he has a lien
on the land, still he is not entitled to remain on the land until he is re-
imbursed ; and the owner of the land is entitled to a decree for ejectment
Dharma Das v. Amulya Dhon, 33 Cal. 1119 (1130).
[Sec. 51
him but did not produce any accounts of the income he derivfed from the
nZertv during the period oi his possession andtliere was nothing on rec-
oVto shZ the presZt value of the improvements, held tliat under such
circumstances he was not entitled to any compensation-Asu Ram v.
Bulaki Das, A.I.R. 1937 Lah. 500.
Who can claim compensation. The value of improvements can be
claimed under this section by the transferee who makes the improvements
or by his heir. But if the improvements are made by the transferor, the
transferee or his heir cannot claim compensation as against a person who
seeks to recover the property as a reversioner of the transferor Meenat.
chi V. Uanicka, 1 L.W. 360, 24 I.C. 918 (920).
Where trees were planted on the land by the donees, the collaterals
of the donees were not entitled to claim compensation //crniomon v.
Dasandhi, 1 Lah. 210, 56 I.C. 733, 112 P.L.R. 1920.
Sec. 52 1
preliminary decree. The Supreme Court valued it at Rs. 19,000 being the
sale price of the improvement on the date of dispossession, namely 1.7.48.
The Supreme Court held that a Court "should assess the valuation of the
improvement as at a date as near as possible to the date of actual evic-
tion rather than the date of election. The Supreme Court further
observed, In cases of this kind it is not the actual cost of improvement
which concludes the matter. The principle... is what is the worth of the
improvement... as a vendible subject. Even after a redemption-decree has
been passed, the mortgagee can in execution-proceedings claim a revalua-
tion if he can show that since the passing of ilie decree the value of the
improvements has increased Ramtinni v. Shankii, 10 Mad. 367. So also,
the mortgagor would be entitled to obtain a reduction of the amount
mentioned in the decree, if he can prove that any part of the improve-
ments assessed therein has, since the passing of the decree, ceased to
exist Kn'sfina v. Srinivasa, 20 Mad. 124 (126).
[Sec 52
(c) The Explanation has been added ; see Notes 237 and 238.
been specificallv nrnvfl^.^ section is not among those sections which have
iTto w ^ Amending Act XX of 1929 a.s
Sec. 52]
[Sec, S2
them, ibid.
Tliis section for the purposes of Indian Courts contains the entire
law on the subject of Us pendens Shyam Lai v. Sohan Lai, A.I.R. 1928
All. 3 (&), 50 All. 290, 106 I.C. 255.
(wV) The alienation must affect the rights ol the oilier parly.
Sec. 52]
37
[Sec. 52
L r 418 80 I.C. 453, A.I.R. 1924 Bom. 467 ; SuJdideo v. Jamna, 23 All
60- Jharoo v. Raj Chunder, 12 Gal. 299; Nilakant v. Suresh Chandra,
12 Cal 414 (P.C.); Gobind Chunder v. Guru Churn, 15 Cal. 94; Mali
Lai V. Preo Lall, 13 C.W.N. 226 (233); Motilal v. Karrabuldin, 25 Cal.
179 (P.C.) ; Maharaj Bahadur v. Surendra Narain, 19 C.W.N. 152;
Harshanicer v. Sheo Gobind, 26 Cal. 966 ; Deno Nath v. Shama Bibi, 23
Cal. 23 ; Kunhi v. Ahmed, 14 Mad. 491 ; Vijthinadayyan v. Subram-
amja, 12 Mad. 439; Krishnaya v. Malhya, 41 Mad. 458 (462); Veda-
charl V. Narastmha, 45 M.L.J. 825, A.I.R. 1924 Mad. 307 ; Pethu Ayai
V. Sankarabayana, 40 Mad. 955 ; Venkotrama v. Rangiah, 46 M.L.J. ^8,
A.I.R. 1924 Mad. 449; Thammayya v. Ramanna, 51 M.L.J. 475, A.I.R.
1926 Mad. 1161 ; Tinoodhan v. Tirulokya, 17 C.W.N. 413, 18 I.C. 177 ;
Ramdulari v, Vpendra, 4 Pat. 619 ; Mathura Prasad v. Dasai, 1 Pat. 287,
65 I.C. 325 ; K. Y. Chettiar Firm v. Jamila, 7 Rang. 734, A.I.R. 1930
Rang. 132 (135), 121 I.C. 792 ; Sohan Lai v. Jofsingh, 16 O.C. 148, 20
I.C. 458; Kunfa Behari v. Ram Sahai, 2 O.L.J. 327, 30 I.C. 213; Satgur
V. Nund Kumar, 4 O.L.J. 135, 40 I.C. 146; Qudratulh v. GvJgandi,
A.I.R. 1925 Oudh 496, 29 O.C. 37, 89 I.C. 570 ; Abid Hussain v. Munno
Bibi, 2 Luck. 498, A.I.R. 1927 Oudli 261 (263), 102 I.C. 72; Naba
Krishna v. Mohit Kali, 9 I.C. 840 (Cal.) ; Ghulam Mohammad v. San-
sar, A.I.R. 1933 Lah. 171, 141 I.C. 448 ; Mtilk Raj v. Nanak, A.I.R. 1933
Lah. 10, 140 I.C. 534; Emdad v. Horan, A.I.R. 1936 Cal. 590; Ram
Sanehi v. Janki Prasad, A.I.R. 1931 All. 466 (480) (F.B.), (1931) A.L.J.
729, 134 I.C. 1 ; Gharbhoya v. Desdatta, A.I.R. 1937 Nag. 400, 172 I.C.
389 ; Ganga Prasad v. Mt. Raghubansa, A.I.R. 1937 Oudli 127, 165 I.C.
793; Amritlal v. Kaniilal, A.I.R. 1931 Bom. 280 (2-S2-83), 133 I.C. 244;
Renuka Bala v. Nagendra Nath, 43 C.W.N. 666, A.I.R. 1939 Cal. 655,
184 I.C. 518 ; Shivashankarappa v. Shivappa, A.I.R. 1943 Bom. 27, 44
Bom. L.R. 874 ; Mahimuddin v. Panu Sahani, A.I.R. 1952 Or. 64 ; Shea-
m V. Balkrishna, A.I.R. 1949 Nag. 114, I.L.R. 1948 Nag. 573 ; Krishna
V. Ousejyp, MR. 1952 Tr.Coch. 102 ; Sarat v. Chinfamani, A.I.R. 1948
operauve Bank Ltd. v. Parvathy Ayyana PiUai, A.I.R. 1959 Ker. 133.
one of them dunng the pendencj^ of the suit. Tire doctrine cannot be
Sec. 52]
applied as between parties to a suit who are arrayed upon the same
side and between whom tliere is no dispute to be adjudicated. Tlie
auction-purchaser in a mortgage suit is a representative of the decree-
holder and for purposes of the doctrine is arrayed in the same camp
with the decree-holder and the purchase by him is not affected by an-
other decree obtained by the decree-holder in a suit wliich was pending
at the time of the purchase Bafkishore v. SuJtan Jehan, A.I.R. 1953
Pat. 58.
[Sec. 52
51 M.L.J. 475, 98 I.C. 201. But the Bangoon High Court has held in
a case of municipal taxes that the doctrine of tis pendens did not apply
as it would be a dangerous extension of the doctrine to hold tliat
neitlier the Government nor a local body could recover its taxes or
rates from a defaulter so long as a law-suit was pending between the
defaulter and some of his other- creditors (though in tliis case it was a
mortgage suit) Abdiir Rauf v. Chettyar Firm, A.I.R. 1929 Rang. 175,
7 Rang. 113, 117 I.C. 575. A sale by the defendant during the pendency
of a suit even though pursuant to an agreement to sell prior to the
institution of the suit is hit by lis pendens Dakshinamurthi v. Sifha-
ramaytja, (1958) 1 Andhra W. R. 85.
tSEC. 52
[Sec. 52
At of sale, tterefore, a
sucli Dower i. nT mortgaged property by the mortgagee in e,yerdse of
though made tin ' ^ ^ ffte doctrine of h's peiidCHS, and is valid
Sec.. 52 3
Where pending a suit for pre-emption the vendee sold tlie property
to one having an equal right to pre-empt as the plaintiff, tlie right of
the plaintiff, was not affected by tlie sale Ghasitey v. Govind, supra.
But in a later Allahabad case, it has been held that in such a case, the
proper procedure is to divide the property among die plaintiff (pre-
emptor) and the vendees vendee Bachan Singh v. Bijai, 48 All. 221,
24 A.L.J. 130, A.LR. 1926 All. 180 (181), 90 I.C. 238. In this case, some
of the pre-emptors dropped out in the course of the suit. The Lahore
High Court, however, is of opinion that the doctrine of lis pendens
does not affect the validity of a sale effected by the vendee during the
pendency of a pre-emption suit to a person possessing a right of pre-
emption equal to that of the pre-emptor ; nor can the property be
divided equally between the pre-emptor and the vendees vendee
Mool Chand v. Ganga, 11 Lah. 258 (F.B.), 31 P.L.R. 342, A.I.R. 1930
Lali. 356 (357). See Salamat v. Nvr Mahomed, A.I.R. 1934 Oudh 303,
9 Luck. 475, 149 I.C. 258 ; Bishan Singh v. Khazun Singh, A.I.R. 1958
S.C. 838 ; Nabir Canal v. Md. Ismail Gaijai, A.I.R. 1960 J. & K. 112.
38
[Sec. 52
Hie sale if tlie re-traiisfer has taken place before the institution of the
suit the transferee can resist the suit on the strength of his own pre-
emotive right, regardless altogether of the consideration whether the
transfer in liis favour was made in recognition of his superior pre-
emptive ri<^ht or could otlierwise be regarded as having been made in
iecoanition of such right. In such a case it would be immaterial whe-
ther tlie transfer took the form of a sale, a gift or an exchange Wcz/r
AU V, Zahir Ahmad, A.I.R. 1949 E.P. 193 (F.B.), 51 P.L.R. 39. It is set-
tled law that unless a tiansfer pendente lite can be held to be a transfer
in recognition of a subsisting pre-emptive right, the rule of Its pendens
applies 'and the transferee takes the property subject to the result of
the suit during the pendency whereof it took place ibid.
If, pending the suit for pre-emption tlie vendee sells the property
to a person having right of pre-emption superior to tliat of the plain-
tiff, tlie docfa-ine of Us pendens will not apply, and the purchaser having
a preferential right of pre-emption is entitled to retain the properly
purchased by him iMelik Singh v. Shicm Lai, 1929 A.L.J. 5S(, A.I.R.
1929 All. 440 (442), 118 I.C. 43 ; BImg v.Ujagar, 32 P.L.R. 283, A.I.R.
1931 Lah. 435. If, however, at the time of the original sale by the ven-
dor to the vendee, the person having a preferential right of pre-emption
did not come forward to assert his right within the period of limitation,
and then after a suit for ]pre-emption was brought by another person,
the vendee sold the property to the person having the preferential right,
held dial die superior pre-emplor, having ivaived and lost his right,
was not entitled to retain the property as against the inferior pre-
emptor (plaintiff) Asa Singh v. Nattbai, 19 A.L.J. 143, 61 I.C. 34 ; Rama
Shankar v. Nanik, supra; Kamta Prasad v. Ram Jag, 36 All. 60 (62);
Ktibra Bibi v. Kfnidaija, supra.
Even die resale of the property by the Iendee to the vendor after
the insdtution of the suit for pre-emption cannot defeat the plaintiffs
right of pre-emption Kedar Nath v. Bankey Behary. 11 I.C. 645 (646)
(All.) ; Raijai v. Irbhan, 3 I.C. 923, 5 N.L.R. 136 : Bhikhi Mai v. Debt
Sahai, 47 AU. 923, A,I.R. 1926 All. 179 (180), 23 A.L.J. 615, 89 I.C. 219;
Durga Prosad v. (^ngadin, 88 I.C. 202, A.I.R. 1925 All. 502; Kahar
Smgh V. Jahangir, 47 All. 625, A.I.R. 1925 All. 487 (488), 88 I.C. 761.
Sec. 52]
debt, and a person who had Required before the sale a share in that
proiDerty in execution of a simple money-decree against the mortgagor,
sued for contribution from the otlier property and ultimately obtained
a decree in his favour, and where that other property was sold away
to another during the pendency of the conti'ibution suit, held tliat the
doctrine of Us pendens applied, and that the purchaser could take that
other property only subject to the right of contribution decreed against
it iBaldeo Sahai v. Baij Nath, 13 All. 371.
t Sec. 52
Mad 833 71 M L.J. 301, 164 I.G. 1086. Similarly, where a son has filed
an application for leave to sue in forma pauperis praying for partition
of the ioint family property against his father, the rule of Us pendens
would operate from the date of the application for leave and from that
date the plaintilF must be deemed to have become separated from his
father and a mortgage executed after the aforesaid application is not
bindiiie on his share in the joint family propertyP nth umadammal v.
Guru mniappa, A.I.R. 1939 Mad. 275, 1939 M.W.N. 311, 184 I.C. 824;
.see also Rama v. Venkatasubbaijya, A.I.R. 1937 Mad. 274, 46 M.L.W.
309, 173 I.C. 347; Biinala Bala v. Sanat Kwnar, 65 C.W.N. 701. But
where the application is dismissed no rights in respect of the property
arise in his favour and hence sec. 52 does not apply~Mf. Sahaudra v.
Radha BaUabhji, A.I.R. 1938 Nag. 30 (34, 35), 176 I.C. 67.
Under the old seetioii, the doctrine of Us pendens did not apply
unless the suit was contentious and the Courts had to consider from
what point of time the suit became contentious. Tlie present section
lias omitted that ambiguous word, and therefore the decisions bearing
on the construction of the word "contentious need not be considered.
It was held in some earlier cases that a suit became contentious only
from the date when the summons was serv'ed on the defendant, and
therefore Us pendens did not begin until such summons was served.
before tlie Priw P 9cs wn of fact and was not allowed to be raised
vy ouncil when it was not raised in the Courts below-
Sec. 52]
the date of ft, which elapsed between the date of the decree and
ed could not which the decree was pass-
Sec. 52]
said that the purchase was made during the active prosecution of a
suit or proceeding Bho/e Mahadeo v. Gangabai, 37 Bom. 621, 21 I.C.
54. So also, where there was a delay of two years in executing a dec-
ree for specific performance, it was held that tliere was no active
prosecution on the part of the decree-holder Haralal v. Lala Prasad,
A.I.R. 1931 Nag. 138 (140), 133 I.C. 395 ; Lakshman v. Rama Chandra,
34 Bom. L.R. 117, A.I.R, 1932 Bom. 301. Under the present section,
by reason of the omission of the words active prosecution the ques-
tion of negligence has become immaterial ; and the Explanation extends
time of Us pe7'idens up to tlie date of satisfaction of the decree.
[Sec. 52
for restoration was made on the 24th Apnl. On the 2Stii April
defendant sold away a part of the property in dispute; the
IppUcation for restoration was granted on 4th hlardi 1908. Held that
the restoration n,nst be deemed to Uve relnt^ baA to Hk dale ol
Ihe aopUoJtlon for restoration on tlie Mil. Apr. , so tlial Ihc sale on the
25th April \vas affected by the rule of lis pendensAshulosh v. Amnia
Ram, 50 I.C. 727 (Cal.).
Sec. 52]
Pendency of suit in wrong Court : ^It was held under the old- sec-
tion that the words "active prosecution did include the prosecution of
a suit in a wrong Court which from defect of jurisdiction was unable to
entertain it. Therefore, the doertine of Us pendens applied where the
transfer of property took jilace during the interval between the return
of the plaint by the wrong Court and its re-presentation in the proper
Court Ma Than v. Mating Ba, 5 Rang. 101, A,I.R. 1927 Rang. 145
(148), 101 I.C. 797; Tangor Majhi v. Jaladhar, 14 C.W.N. 322 (324), 5
I.C. 691. But these decisions are no longer good law, because the words
"active prosecution" have been omitted, and because the Explanation
expressly lays doum that tlie pendency of a 'suit c(mmences from the
date of presentation of the plaint in a Court of competent jurisdiction.
TIius where a minor member of a joint Hindu family institutes a suit
for partition against his father in a wong Court and the father executes
a mortgage of the family property before the plaint is presented to the
proper Court, the doctrine of Us pendens does not apply to the mort-
gage Nathu Singh v. Anandrao, A.I.R. 1940 Nag. 185 (186), 1940 N.L.J.
20, 186 I.C. 688.
in dispute during the pendency of the suit and thus sustained loss, ad-
aside a sale made by him to B as void the plea of B that the sale and
mortgage were good was upheld, a purchaser from B pending the suit
. 39
[Sec. 52
was however allowed to plead that the mortgage was invalid for want
of consideration on the ground that no contest was made by his vendor
in the previous suit as to the validity of the mortgage Mon/eshtwira
V Vawdeca, 41 Mad. 458 (F.B.). Where a plaintiff in a suit abandons
Ins claim the result of the suit will not operate ^s Us pendent against
any purchaser pendente Ute of the suit property Amidmonol v. CheJl-
akufii, A.I.R. 1963 Mad. 300.
^0[cbhagtjammal^AlR%i^}^^T''o^ possession-tKtifandaioelw v.
mmai, A.i.R. 1945 Mad. 350 (1945) 1 M.L.J. 261.
Sec. 52]
decree. The principle of lis pendens applies tliougli the right claimed
in tlie suit was not the right given bj'' the decree Hiranya v. Gouri'
A.I.B. 1943 Cal. 227, 76 C.L.J. 191.
[Sec. 52
V Uvendra 4 Pat 619, A.LR. 1925 Pat. 462, 90 I.C. 251. As to the
Tlie mere fact tliat a suit terminated by a consent decree does not
take tlie suit out of the operation of the doctrine of Us pendens-
Tinoodban v. Traitokhya, 17 C.W.N. 413; Ram Dulari v. Upendra,
supra Juthan v. Varasnath^ A-I.R. 1934 Pat. 270, 151 I.C. 70. Simply
because the defendant admitted the plaintiff s claim, it would not render
the suit non-contentious C/mrbhoyfl v. Deodatta, A.I.R. 1937 Nag. 400,
172 I. C. 389.
air 193A Cal - 570 ^^ ' Maharaj Bahadur Singh v. Nari Mollani,
Sec. 52]
tenant transfers the holding, the doctrine of Us pendens does not apply ;
and the same view has been expressed in Josna Bank v. Asian Bank, A.I R.
1962 Ker. 309.
t Sec. 52
dispute is
Sec. 52]
the property covered by the trust, the alienee takes the property subject
to the orders and directions that may be given by the CouvtPuran
Chaizd V. Monmotho, 55 Cal. 532 (P.C.), 32 C.W.N. 629 (633), 108 I.C.
342, A.I.R. 1928 P.C. 38. Where a creditor of the deceased brought a suit
against the heirs of the deceased for recovery of the sum due to him and,
if necessary, for administration of the estate and the appointment of a
receiver, held that as there was no specific property mentioned in the
plaint, the suit was not one in which a right to immoveable property was
directly and specifically in question merely because the plaintiff .included
in his plaint a general prayer that if necessary the estate should be adminis-
tered by and under the directions of the Court Bepin Krishna v. Byom-
kesh, 51 Cal. 1033 (1042), A.I.R. 1925 Cal. 395, 84 I.C. 880.
Suit for rent: A suit for rent is not a suit in which any right to
immoveable property is directly and specifically in question. It is primari-
ly a suit for money, and althou^ rent is a first charge on the property,
no charge is created in any event before decree. The suit by itself can
hardly be regarded as a claim to charge specific property Syed Jctynal
Abedin v. Hyder AH, 55 Cal. 701, 32 C.W.N. 268 (271, 272), A.I.R. 1928
Cal. 441 ; Maharaj Bahadur Singh v. Nari Mollani, A.I.R. 1936 Cal. 279,
40 C.W.N. 683, 63 Cal. 1117, 165 I.C. 17 ; Nrisingha v. Nil Raton, A.I.R.
1951 Cal. 221, 54 C.W.N. 683 ; Dirpal v. Karamchand, A.I.R. 1952 Pat. 9 ;
Giridhan v. Abdul, A.I.R. 1951 Or. 41, I.L.R. 1950 Cut. 195 ; Sheolal v.
Balkrishna, A.I.R. 1949 Nag. 114 ; I.L.R. 1948 Nag. 537. Therefore an
involuntary sale effected during the pendency of execution of a rent decree
is not affected by the doctrine of Us pendens ibid. The rights referred
to in this section are rights such as arise with regard to sale, specific
performance, lease and so on ; a mere claim for rent is not a right to im-
moveable properly within the meaning of this section Dhirindra v.
Charushashi, A.I.R. 1926 Cal. 191, 90 I.C. 431. If in a suit to recover
a simple money debt a charge over the immovable property of the debtor
is created by the decree sec. 52 is not attracted as no right in immovable
property was involved in the suit Raichand Gulabchand v. Dattatraya
Sankar Mote, A.I.R. 1964 Bom. 1.
A suit for specific performance of a contract for sale or lease of im-
moveable property is a suit in which the immoveable property is directly
and specifically involved within the meaning of this section, and the pur-
chaser pendente lite is bound by the result of the suit Moti Lai v. Preo
Lai, 13 C.W.N. 226 (232) ; jahea Lai v. Bhupendra, 49 Cal. 495 (499) ;
Vedachari v. Narasimha, 45 M.L.J. 825, A.I.R. 1924 Mad. 307, 76 I.C, 793 ;
Hadley v. London Bank, (1865) 3 DeG. J. & S. 63 ; Bhaskar v. Shankar,
26 Bom. L.R. 518, A.I.R. 1924 Bom. 467, 80 I.C. 453 ; Pancham v. Kandhai,
A.I.R. 1934 All. 713, 148 I.C. 653 ; Khaja Bi v. Mohammad Hussain, A I.R.
1964 Mys. 269 (F.B.) Sec. 47, Registration Act can only be read together
with sec. 54, T. P. Act on the basis that the transfer by a registered in-
strument under sec. 54 once effected relates back to the date of execution
or other conventional date. Consequently a deed of sale executed before
the institution of the suit for specific performance of a prior contract for
sale of the same property but registered thereafter cannot be held to be
executed pendente lite Sadei Sahu v. Chandramani, A.I.R. 1948 Pat. 60,
13 Cut. L.T. 21, If during the pendency of a suit for the specific perfor-
C Sec. 52
M.PX.J. 142.
Sec. 52]
tfiANSfER OF PROPERTY
When a suit is, filed for maintenance with a prayer that it be charged
on specified properties it is a suit in which right to immovable property is
directly in question and the Us commences on the date of the plaint and
not on the date of the decree creating the charge. Hence the purchaser
of the suit properties during the pendency of the suit for maintenance
but before tne decree takes them subject to the result of the suit for
maintenance Wngi/hfli v. B. Shama Rao, A.I.R, 1956 S.C. 593 ; Krishnaji v.
Amisayabi, A.I.R. 1959 Bom. 475.
40
I Sec;, b'i
485 A I-R- 1930 Mad. 824 (831, 832), 127 I.C. 809, distinguishing (and also
dissenting from) Rattamma v. Seshachalam, supra.
reallv nno f also, where the claim in the administration suit was
entire estat^^ > ^oney-decree to be calculated on the realisation of the
Sec. 52]
could not apply to a sale of property pending that suit Lee Lim Ma Hock
V. Sato Math Home, 2 Rang. 4 (19), A.I.R. 1924 Rang. 221, 79 LC. 729.
Where a creditor or a next-of-kin instituted an administration-suit against
an executor or administrator, the mere institution of the suit or obtaining
of a mere administration-decree ivill not bring the doctrine of Its pendens
into operation and does not deprive the executor or administrator of his
general power to dispose of the assets, unless and until the plaintiff has
obtained an order appointing a Receiver of the estate or at least an
injunction restraining the executor or administrator from exercising the
powers vested in the executor or administrator Zh/d (at p. 21) following
Berry v. Gibson, L.R. 8 Ch. App. 847. A suit in which one of two
co-heirs sues the other heir, who is administrator of the estate, for his
share of the estate and asks for the profits of the estate, in which a
preliminarj' decree is given declaring that the plaintiff is entitled to a
half share of the estate and directing that the usual accounts and enquiries
be taken and made, in which a commissioner is appointed to take those
accounts and make enquiries, and in which a final decree is given for
the half share in the estate as found by the commissioner, is in fact an
administration-suit, and the doctrine of Us pendens does not apply to
such a suit Ma Kin v. Ma Btoin. 5 Rang. 266, A.I.R. 1927 Rang. 186
(187), 103 I.C. 264. A creditors action for general administration of an
estate nia^' be a sufficient Us pendens so as to entitle the plaintiff to
priority over a purchaser or mortgagee from the defendant taking subse-
quently to the institution of the lis, if the plaintiff, previously to the
purchase or mortgage, has sufficiently indicated his intention to make
the particular estate specifically liable for his debt ; a mere general claim
for administration is not of itself a sufficient indication of such intention
Price V. Price, (1887) 35 Ch. D. 297. In an administration-suit brouglit
in 1914 by the heir of the deceased, at first there was no specific mention
of any property and no indication as to the property which was claimed,
and the Court passed a preliminaiy administration decree in January
1917, and then the proceedings went before a Commissioner for an
enquiry as to what the estate consisted of. The land in dispute was
then claimed before the Commissioner to be part of the estate, and the
Commissioner submitted his report in April 1917 recording his finding
that the land was part of the estate. In 1926, the defendant in that
suit transferred the land. Held that when the suit was first filed, there
was no property directly or specifically in question, but when the matter
went to the Commissioner, before whom tlie land was specifically claimed,
and he reported that the land was part of the estate, the doctrine of Us
pendens came into operation, and the subsequent transfer of the land
was affected by it K. . Chettyar Firm v. Jamila, 7 Rang. 734, 121 I.C.
792, A.I.R. 1930 Rang. 132 (136).
[Sec. 52
any disposition of the deceased's estate that might he made by the Court
in due course of administration-5epi Krishna v. Byomkesb, 51 Cal.
1033 (1044) AIR 1925 Cal. 395, 84 I.C. 880. See also Piiran Chand v.
Mo;i)no(/zo/55 Cai. 532 (P.C.). "It is difficult, observed their Lordships
of the fudicial Committee, "for their Lordships to understand that the
Legislature could have intended that vrhen a suit for administration of
any estate is before a Court competent to entertain it and to order that
accounts should be taken in the suit, any other Court should have power
to erant permission for the sale of property, part of the estate Me Chit
V, Notional Bank of India, A.I.R. 1925 >P.C. 26l (263),- 91 I.C. 432.
Suit for partition : ^The section does not apply to a suit for partition
in which neither the shares of the parties nor the rights of the parties to
the shares are disputed. "In this case, the question is, whether the mode
in which the lands should be allotted between the ascertained sharers
affects the right to any property specifically. I do not think it does. The
shares are ascertmned shares, and the only office that the Court has to
perform is to divide the property which belongs to them all, in such plots
o land as are most convenient for the enjoyment of each- Shaik Khan
TOO ^ C.W.N. 62 (64) ; Ramchandra v. Jaideo, A.I.R. 1928 Nag.
198 (199), 109 LC. 566 ; Bhupati v. Bon Behary, A.I.R. 1941 Cal. 436. In
other words, if the rights are not disputed and the shares are ascertained,
and the Court has only to divide the plots of land between the co-sharers'
m a convenient manner, the suit cannot be said to be one in which the
ng t to immoveable property is directly and specifically in question. But
the shares are not ascertained and the Court has to decide the question
as to whether the defendant is entitled to a share, or to decide what share
Tu ^ e ta en by each sharer, then this section unquestionably applies.
me quantum of interest to which each member is entitled is a right to
Sec. 52]
[ Sec. 52
318 TRANSFER OF PROPERTY
nublic on enquiry or give a clue for further and more definite knowledge,
the description must be so definite that any one reading it can learn
thereby what property is intended to be made the subject of the litigation.
On the other hand, if enough appears m the proceedings to put a
purchaser on guard, although they do not in themselves describe the
property with that particularity which amounts of itself to complete
identification, Us pendens would be created. In other words, in order
to make the doctrine of Us pendens applicable, ' the property must be
described in the pleadings with sufficient accuracy Lake Nath v. Achuta-
nanda. 15 C-LJ- 391, 2 I.C. 85 (87) ; Periamimigappa v. Manicka, A.I.R.
1926 Mad. 50 (51), 46 M.L.J. 68. Whether the misdescription of the
property is of such a character as to render the identification of the
property impracticable, is a question of fact which must be decided with
reference to all the records of the suit 15 C.L.J. 391. But misdescription
of the property will not prevent the application of the rule of Us pendens,
in the case of a person having knowledge or notice of the true state of
things Bepin Krishna v. Priya Brata, 26 C-W.N. 36, A.I.R. 1921 Cal. 730.
Sec. 52]
Kandhai, A.I.R. 1934 All. 713, 148 I.C. 653. The doctrine of Us pendens
is as much applicable to agricultural leases as to any other kind oI transfer
Rati Ram v. Shri ^ishna, A.I.R. 1949 All. 257, (1948) O.W.N. 376.
An agricultural lease (in C.P.) is a transfer, and it lies on the partv reiving
on the lease to show that it did not aSect the rights of the other party
to the litigation 5*?-/ Canesh v. Pandurang, 14 N.L.R. 133, 45 LC. 762 ;
Matildl V. Ganpatrap, A.LR. 1924 Nag. 211 ; Narain v. Abdid Majid, 15
C.P.L.R. 6 ; Dhiraj v. Dinanath, 6 N.L.R. 140, 8 I.C. 288 (290) ; Chandan
Singh V. Fakirgir, 11 N.L.R. 21, 27 LC. 940 (941) ; Maroti v. Tiilsi, A.r.R.
1927 Nag. 299. If the agricultural lease does not affect the rights of the
other party, it will not come within the mischief of the rule. Thus,
where an agricultural lease was granted by the mortgagor in the ordinary
course of management, and it was for the benefit of the mortgagee as he
would clearly get the lessors share of the crops, held that this section did
not z.pp\ySakharam v. Tukaram. A.I.R. 1927 Nag. 316 (318). Where
during the pendency of a suit on a mortgage of the proprietar} right in
a field, a lease of the land was granted in good faith, and with no inten-
tion of affecting the rights which the mortgagees would acquire if thej'
obtained a final decree for foreclosure, held that sec. 52 had no application
Seth Misrilal v. Bhimrao, A.I.R. 1927 Nag. 295 (296). A lease for a
year given by a mortgagor who was allowed to remain in possession,
pending the execution-sale of his property, was an ordinary and reason-
able incident of an interim beneficial enjoyment, and was not affected
by the doctrine of Us pendens, and the lessee was entitled to the crops
raised by him for the year Subbarajii v. Seetharamarajn, 39 Mad. 283
(285) (dissenting from Thakiir Prasad v. Gaya Sahii, 20 All. 349) : Radhika
V. Radhamani, 7 Mad. 96 (99); Karu v. Pandia, A.I.R. 1924 Nag. 226
(227), 75 LC, 874.
This section hits all transfers affecting rights of the other party. It is
only in cases where there is no such express provision of law which is in
force that the principle underlying sec. 100 can come into pla_v, namely
the postponement of the rights of a charge-holder to the right of a boimfide
purchaser for value without notice ; where the charge falls witliin the ambit
of sec. 52 there is an end altogether of ffie transfer or alienation prevailing
over the rights of the party in whose favour a charge has been created
under the decree Kidandaivelu v. Sowdhagyammal, A.I.R. 1945 Mad.
350, (1945) 1 M.L.J. 261. Where the defendant became' the purchaser
during the pendency of the plaintiffs mortgage suit, he was bound by the
result of that suit Maulabnx v. Sardarmal, A.LR. 1952 Nag. 341 (F.B.).
The transfer to which the provisions of sec. 52 can property be applied
is the creation of the mortgage itself, not the subsequent sale in the enforce-
ment of the mortage Natesg v. Sitbbiinarayana, A.I.R. 1945 Mad. 91,
LL.R. 1945 Mad. 578. a' mortgage executed after a mortgage
decree and during the course of the proceedings in execution of
that decree is subject to Us pendens. Therefore a mortgage execut-
ed by the mortgagor before the suit to which he was a party ended b\^
sale of the mortgaged property in execution of the mortgtge decree passed
in the suit is affected by Us pendens Madho Ram v. Kritya Nand, A.I.R.
1944 P.C. 96, 49 C.W.N. 75, (1944) 2 M.L.r- 343. The right of the plain-
tiff co-sharer to pre-empt under sec. 4(1), Partition Act, 1893 the share
purchased by a stranger is not affected by the subsequent reconvej'ance
[Sec. 52.
Sec. 52]
248. Transfer by nersons other than narfies to the suit : The rule
in this section applies where the property is transferred by a party to the
suit or proceeding : and those persons only are affected by Us pendens
who purchase from any of the parties to the litigation. Thus, where a
decree-holder is seeking to establish his right to attach and sell his judg-
ment-debtors property by a suit against a successful claimant, the judg-
ment-debtor is not a party to the claim suit, and if another decree-holder
attaches the same property and brings it to sale, the auction-purchaser
who purchases at such sale is not affected by the doctrine of lis pendens
and is not affected by a subsequent sale held in execution of the decree
of the first-named decree-holder Pethu Aiyar v. Sankaranarayana, 40
Mad. 955 (958), 32 M.L.J. 374, 38 I.C. 778. The doctrine of lis pendens
is not applicable in favour of a third party. Where the onl 3 ^ point for
decision in the suit was whether a deed of settlement was true or false,
a right to immovable property was not in question and this section did
not apply, nor could it be invoked by a person who was not a party to
the suit Shammugasundarani v. Parvathi Ammal, A.I-R. 1945 Mad. 454,
(1945) 2 M.L.J. 173.
41
So also the operation of the law of lis pendens cannot extend to per.
<;nns whose title is paramount to that of the parties to the suit, or whose
title is not in any way connected with them. Therefore, where pending
a suit between a pattadar and his mortgagee, the landlord got the land
sold for default in payment of rent, held that the landlord's right being
paramount to that of his pattadar, the suit did not affect his statutory
power of sale under the Madras Rent Recovery Act, and the purchaser
was also unaffected by the smtMuntsanri v. DakShinamurthi, 5 Mad.
371.
The words "by any party are not merely descriptive ; they refer to
the time at which the transaction which it is sought to assail actually
took place. Therefore, the doctrine of lis pendens does not apply where
the transfer was made, during the suit, by a person who was not a party
to the suit at the time of the transfer but who was subsequeniltj made a
party Ammayya v. Narayana, 21 L.W. 125, 86 I.C. 187, A,I.R. 1925 Mad,
407 ; Bala Ramabhadra v. Daiihi, 27 Bom. L.R. 38, A.I.R. 1925 Bom.
176, 86 I.C. 126 ; Sheoratan v. Kama Prosad, 11 Pat. 485, 139 I,C. 78,
A.I.R. 1932 Pat. 270. Thus, in 1910 V made a gift of his land to his
daughter R. The plaintiff sued V in 1914 to recover possession of the
land, V died pending the suit and R was brought on the record as Vs
legal representative. But before she was so brought on the record, she
had sold the land to the defendants. The plaintiff thereupon sued the
defendants to recover posession of the land from them on the ground
that the sale was affected by the doctrine of lis pendens. Held that R
was not a party to the suit of 1914 and the sale to defendants took place
before she was brought on the record, and therefore the doctrine of Ik
pendens did not apply R c??(t Ramabhadra v. Daiihi, (supra).
^ ^ ^ transfer will not affect the rights of any party thereto under
Prasad vCh A.I.R. 1936 Nag. 125, 165 LC. 550; Mathura
then the CniiT+'!i tween A and B, A mortgages the suit property, and
the morteaK share of the property,
Sec. 52]
shara Hindu joint family mortgage some property for the benefit of the
family and the mortgagee obtains possession after purchasing the property
in execution of his mortgage decree, alienations in the meantime by the
other sons are hit by Its pendens S. A. Venkatagiriah v. A. Ramarthana,
(1968) 1 Mys. L. J. 384. Where a lease is made after the decree for the
sale of the mortgaged property but before its final satisfaction, the lease
is hit by Us pendens and is not binding on the mortgagee or the auction-
purchaser Maganlal Jajiwandas Firm v. Lakhiram Haridasmal, A.I.R.
1968 Guj. 193;
The purchaser can have no higher right than the vendor, and the sale
having been made during the prosecution of the litigation, the purchaser
must be bound by the result of the litigation Shib Chandra v. Lachmi
Narain. 33 C.W.N. 1091 (1096) (P.C.), 56 LA. 339, A.I.R. 1929
P.C. 243, 119 I.C. 612 ; Bhagirathi v. Raj Kishore, A.I.R. 1930 All. 354,
122 I.C. 887. In transfers of this kind the transferee stands in the shoes
of tHe transferor, and takes the title of the latter subject to the pending
litigation. If the- litigation terminates in favour of the transferor, the
title of the transferee becomes valid ; if however the transferor fails, the
interest acquired by the transferee becomes voidable, and the other party,
if his rights in the subject-matter of the litigation are affected by the
alienation, may eject the transferee from the property; Hukum Chand
on Res Judicata, p. 730. If the transferor succeeds in the Court of first
instance but fails in the appellate Court, and the transfer was made
while the suit was pending in the first Court, the transferee is bound by
the decision of the appellate Court, and cannot obtain possession under
the transfer. It makes no difference to the application of the doctrine
of Us pendens that the decree of the Court of first instance was in favour
of the transferor. That decree was open to appeal, and the decree being
appealed against, it was the decree of the appellate Court that was the
decree in the suit, and the parties were bound by that decree Gobind
Chunder v. Guru Churn, 15 Cal. 94 (99). In other words, the decree
or order which may be made therein means the final decree or order in
the suit. This is also borne out by the words of the Explanation which
says that the Us continues "until the suit or proceeding has been disposed
of by a final decree or order,
The word rights in this section (so as not to affect the rights of
any other party etc.) has reference not only to substantive rights but
also to a matter of procedure. Thus,' it includes a right to Execute a
[Sec. 52
Notice The wording of this section makes it clear that the doctrine
of Us pendens is not based upon notice, but it rests upon the ground that
neither party to a suit can alienate the property in suit pending the suit
so as to defeat the rights of the other party. It is based upon expediency
and it is immaterial whether the alienee pendente lite had or had not
notice of the suit. A purchase made for valuable consideration
and without any express or implied notice affects the purchaser
pendente lite in the same manner as if he had notice Achat v. Shibaji-
rao. A.I.R. 1937 Bom. 244, 39 Bom. L.R. 224, 170 I.C. 172 ; Kulandamhi
V. Sowbhagyammal, A.I.R. 1945 Mad. 350, (1945) M.L.J. 261. The
doctrine of Us pendens is independent of notice Maharaj Bahadur Singh
V. Abdul Rahim, 62 I.C. 900 ; Krishnaji v. Anusaya 'Bai, A.I.R. 1959
Bom. 475. A purchase made of property actually in litigation, though
for valuable consideration and without any express or implied notice in
point of fact afects the purchaser in the same manner as if he had
such notice Storys Equity Jurisprudence, Sec. 405 : Baswan v. Natha,
11 O.L.J. 452, 1 O.W.N. 319, 82 I.C 747, A.I.R. 1925 Oudh 30 ; Sohan
lal V. Jot Singh, 16 O.C. 148, 20 I.C. 458. Where a litigation is pend-
ing, the decision in the suit shall 'be binding not only on the litigating
parties but also on those who derive title under them by alienations
made pending the suit, whether such alienees had or had not notice of
the pending proceedings. If this were not so, there would be no
litigation would ever come to an end Bellamy v. Sabine,
D ^ ^ Cranworth) ; Lakshmandas v. Dasrat, 6 Bom.
Hot' f V. Gulkando, A.I.R. 1929 AH. 601, 118 LC. 650. The
pendens is not based on the equitable doctrine of notice
the necessary to the administration of justice that
inp T.!ir ^ Court in a suit should be binding not only on the litigat-
with nntv thosc who derive title from them pendente lite, whether
I.C.
Sec. 52]
joined as a party to a suit but had not been joined before the decree,
cannot be impleaded in the course of execution proceedings so as to make
him bound by the decree Ammanm v, Ramakrishna, A.I.R. 1949 Mad.
886, I.L.R. 1949 Mad. 904.
t Sec. -52
Under this section protection is given only to the rights of the parties
as they existed when the suit was commenced. Nothing done by a party
durina the pendency of the suit affects the rights of any other party under
the decree but if a right exists in a stranger from before in relation to
the property it will not be affected merely because the title to the property
in pursuance of that right was perfected during the pendency of the suit
l^arciyan v. Rujkishore, A.I.R. 1951 Pat. 613.
of transfer, Le.. that the transfer took place after the institution of the
suit. If the execution of the deed of transfer takes place before the insti-
tution of the suit, the doctrine of lis pendens cannot apply even though
the deed is registered during the pendency of the suit Rafiuddin v. Brij-
mo m, 9 N.L.R. 155, 21 LC. 602 (603). A mortgage executed before
the institution of the suit may be enforced (by a sale in pursuance of
mortgage- ecree) after the suit. The doctrine of Us pendens does not
mLr,- 0 Pi'eviously existing transfers or to legal proceedings taken to
rr V. Darmaiinga, 63 M.L.J. 394,. 139
309, A.I.R. 1932 Mad. 566 (573) ; Joy Chandra v. Sreenath, 32 Cal.
cedent rieht^ fmm not afford any protection from any ante-
Snc. 32]
So als.o. this section does not apph' where the sale actually took place
before the commencement of the suit but by virtue of a compromise
entered into in the suit the validity of the sale-deed was accep'cd by the
other partv Krishnaji v. Motilah 31 Bom. L.R. 476, A.I.R. 1929 Bom. 337
(339), 122l.C. 66.
ISec. 5i
Sec. 53]
(a) The first para of the old section wliich related both to trans-
ferees and creditors, has been split up into die two sub-sec-
tions of which sub-section (1) relates to creditors, and sub-
section (2) applies to transferees. See Note 253.
(c) The second iiara of old section has been omitted. See Note
266.
(d) Tlie third para of old section, which was an exception to the
whole section, has now been appended to sub-section (1) of
the new section. See Note 261.
(e) The 3rd and 4tli paras of sub-section (1) and the second para
of sub-section (2) are new. See Notes 263 and 269.
42
[ Sec. 53
The amended section has been framed on the lines of. secs. 172 and
173 of the (English) Law of Property Act, 1925. Tire section as it stood
before amendment has been printed on the left hand side.
ed in riU can India have held that the phrase 'may bo presum-
to sav tlip mpa P^^^^Sraph .should be given its plain mcanmg, that is
season 3 -S! Evidence Act, 1872,
Sec. 53]
Such being the case, it is desirable to split the section into two
pjirts one deah'ng exclusively wndi transfers .made witli intent to
defraud creditors and the other with ti-ansfers made to defraud subse-
quent transferees. In drafting the two sub-sectiojiis we have followed
Ihe lines of sections 172 and 173 respectively of the Enghsh Law of
Property Act, 1925. Report of the Special Committee (1927).
By virtue of secs. 2 (d) and 5 the present section in terms does not
apply in the case of a transfer under an order or decree of Court. But
where a person has obtained a transfer under an order of the Court
as a result of gross fraud,, the Court can give relief by applying the irrin-
ciple of common law for avoiding fraudulent transfers Ramanathan v.
Unnamalai, A.I.R. 1942 Mad. 632 (1942) 2 M.L.J. 213. Tire principles
embodied in this section are iir accordance witli the general principles
of justice, equity and good conscience and as such should be taken as
a guide by the Courts even in cases such as when a party bases his title
on a transfer by a decree of tire Court where the provisions of this
section do not apply Mt. Akramunnissa v. Mi. Mustafannissa, A.I.R.
1929 All. 238, 51 All. 595, 116 I.C. 445.
[Sec. 53
rmestion depends upon the animus transf_erendi which the parties had at
the time of the transaction Tirupathi v, Lakshmana, A.I.R. 1953 Mad.
545, (1953) 1 M.L.J. 123.
6 AI.R. 1929 P.C. 279; Naraindas v. Bliojraj, I.T..R. 1939 Kar. 269,
A.I.R. 1939 Sind 97 (99), 181 I.C. 888. Sec Note 263, post.
If tlie debtor does not retain any benefit for himself and if it is found
that the transfer was for adequate consideration which was entirely expen-
ded in satisfaction of genuine debts of tire debtor, then this section does
not apply Gharbhoya v. Deodotto, A.I.R. 193/ Nag. 400, 1/2 I.C. 389.
Where the sale was effected in order to satisfy a decree and was the
means of the decree-holder securing a benefit in the previous execution
proceedings, it would not be set aside under this section Chettyar Firm
V. Ma Mai, A.I.R. 1937 Rang. 51, 167 I.C. 599. The mere fact that the
judgment-debtor has other property to meet a creditor's decree does
not, however, prevent the application of this section Gopi Chand v.
Jodhraj, A.I.R. 1929 AU. 458, 116 I.C. 815.
nd Rtazat Husain v. Mf. AU Bandi, A.I.R. 1920 Oudh 182, 60 I.C. 725.
Sec. 53 ]
Where two debtors allowed the wife of one of them to apply for
mutation on a false allegation of an oral gift of their property and to
allege possession under the gift and themselves acquiesced in the passing
of an order for mutation by stating that they had no objection, such an
act amounted to a transfer and was voidable under this section Askari
Begam v. Bdttabh Das, A.I.R. 1938 Oudh 165, 175 I.C. 708.
I SBC. 53
ffnn 9 I A) does not prevent this section from applying to tlie case Ahmad
SLi V Mim, 1929 A.L.J. 460, AXR. 1929 AU. 277 (278), in
I C 97 BimlUah v. TaMn AU, 1930 A.L.J. 616, A.I.R, 1930 AU, 4
(46^ 124 IC 722. Before the amendment of this section in 1929 a
wadimma made by the settlor with intent to defeat or 'delay his credit-
tors would only be voidable at the option of the creditors so defeated
nr dflaved Until so avoided the deed would remain valid Zo/nd
Hcmn V krid-ud-Din, A.I.R. 1946 P.C. 177. 40 C.W.N. 115, (1944)
A.L.J. 517. See in this connection Har Prasad v. Ud. Usman, A,I.B,
1942 Al. 2.
wue at a time when the husband is heavily indebted and all the taiv
S.. f given to the wife leaving property of a flimsy charac-
Sec. .53 ]
fer .was intended to defeat or delay the ca'editors, and not whether the
creditors have been defeated since. The fact that all the creditors have
been paid oflt since the date of tiie transfer is however immaterial
Deokali v. Ram Deoi, A.I.R. 1941 Rang. 76, 1940 P.L.R. 777. But on
this last point see Abdvl Rahman v. Sultan Begam, infra. The relevant
period of time for judging the intention of the transferor is the date of
the transfer. Tlie Court must consider whether on that date the trans-
feror had the intention to defeat or delay and not whether the creditors
have been defeated since Bibi Kura Begum v. Jainandon Prasad,
A.I.R. 1955 Pht. 370 ; Umafl Suit v. Union of India, I.L.R. (1965) 2 Mad.
250.
[Sec. 53
344 See also Abdul Ht/e v. Mozaffar Hossein, 10 Cal. 616 (RQ.,
mha V Dhanbai, 23 Bom. 1. Where a person executes a deed of gift
in hvour of his wife the crucial question is however one of intention to
defraud the creditors, and the facts that all the creditors existing at the
date of the deed have been paid off before the institution of the suit
and that no fresh debts were incurred by tlie donor for about three years
after the execution of the deed, even though not conclusive, afford a
verv strong evidence negatiAung the intention to defraud lAhdi/l RaJir.
m7n V. Sultan Begam, A.I.R. 1941 Oudh 178, 1940 O.W.N. 1336, 1941
O.L.R. 65; see also Mt. Bibo v. Sampuran Singh, A.I.R, 1936 Lah. 222,
162 I.C. 922 and Zahir AJimed v. Det>i Dayal, 6 Lticlc. 397, 1931 Oudli
134, 129 I.C. 333. Vlhiere a transfer is made in order to settle a debt
created by money advanced previously by the transferee, the mere fact
that the transferee is relative of the transferor by marriage does not
estabhsh the fact that the transfer was bogus and entered into witliout
consideration with a view to defeat and delay the creditors of the trans-
feror Ahmed Din v. Partap Singh, A-I.R. 1939 Lah. 438, 41 P.L.R. 373.
Where the purpose of dedication to charity of a very small quantity of
land of the donor was real and not illusory, it could not be said that
the dedication was made with intent to defeat or delay the creditorsi
when the bulk of the property was placed in the hands of the sons of
the donor for the express purpose of paying off all his debts Raman,
Chettiar v. MvthusiMmi, A.I.R. 1941 Mad. 188. (1940) 2 M.L.J. 803,
1940 M.W.N. 1180.
debt tor winch no demand of payment had been made, held that the
m emon was to defeat and delay the creditors Chettyar Firm v. Ma
bem, 5 Rang. 588, A.I.R. 1928 Rang. 1 (3), 105 I.C. 582. Where the
nS hransferor and his transferee clearly was to defraud the
Sec. 53]
43
[ Sec. 53
/{wVflu Climd V. Kishcn Chand, A.I.R. 1938 Lah, 136 (137). ^Vllere at
liiJ date of transfer of the property to her sons the transferor owed money
to the creditors and subsequently had to transfer her goods at a great
i().ss to some of tlie creditors and there were stdl creditors who had not
been satisfied, tlie inference was irresistible tiiat her motive in transfer-
riiin tlie property in favour of her sons was to screen it from her credit-
<.rs fhid at p. 138. If the intention of the transfer is to defeat one of
(Iiu creditors, that is not a transaction contemplated by this section; but
It by no means follow's that because a transfer is for tlie purpose of
defeating one of the creditors, tlie intention of the transfer is not to
defeat all the creditors JiCedam-ati v. Radhey Lai, A.I.R. 1937 Pat. 609,
107 l.C. 353. S. 53 (1) applies where only a part of the property of tlie
debtor is sold C. Abdul Shukoor Sahib v. Ar}i Papa Rao, A.I.R, 1963
S.C. 1150.
But an intention to defeat the creditor may w'ell exist on the part
of the I'endor, yet the sale will be valid unless the vendee was also a
S fraud yjnayoA- v. Kaniram, A.I.R. 1926 Nag. 293, 92 I.C.
Ijwden lies on die creditor to show that die ti-ansfer was in-
II in I r defeat or delay his claim, or at least that his claim against
Sec. 53]
]iot only those creditors who have obtained decrees, but also tliose
whose claims have yet to be proved in a Civil Court. It also includes
tliose creditors who become so subsequent to the transfer AhdnZ/a-
khan V. ParshoUam^ A.I.R. 1948 Bom. 265, I.L.R. 1947 Bom. 807 ; Dw-
Mct Board v.Md. Abdul Salem, A.I.R. 1947 All. 383, (1947) A.L.J. 408;
M-urli Motiram v. Rewachand, A.I.R. 1946 Sind 137, I.L.R. 1946 Kar. 14 ;
Ishiuar Timmappa v. Deoav Venkappa, 27 Bom. 146; Chinamal v. Gid
Ahmad, A.I.R. 1923 Lah. 478, 73 I.C. 719 ; Faiz Alt v. Harkuar, A.I.R.
1923 Nag. 334; Gamti v. Nathu, A.I.R. 1926 Nag. 494; Reese River
Silver Mining Co. v. Atwell, (1869) L.R. 7 Eq. 347.
[Sec. Si
In a suit by the creditor under this section he should ask for the
amount and the relief of a declaration that the transfer by the debtor is
void as regards him, because he is defrauded, defeated or delay-
ed. But no issue under this section can be framed if the creditor asks
for a decree for the amount against the transferee from the debtor and
treats the transfer as a valid one Satju v. Shycini Siindey, A.l.R, 1934
All. 918,, 153 I.C. 674; Sachiianand v. Radhapaf, A.I.R. 1928 All. 234,
26 A.L.J. 524.
noiA-; 779, 82 I.C. 945 ; Rain Das v. Debit, A.I.R. 1930 All. 610,
EJc ^ szardous business, and immediately before doing so, to settle all
voluntarily ; the object being Tf I succeed in business I make
bear t>iT 1 ^ ^ leave my creditors unpaid. They will
Sec. 53]
IRAS'SpfcR 6r ntOIl,l!T^
^ ^
^ t J
In a suit to set aside a deed of assignment under lliis section, the Court
passed a decree that the deed of assignment was bogus and fraudulent and
declared it as cancelled and of no effect again.st the creditors; /iM. the
Judge intended to cancel the assignment and not merely to declare it
void in part leaving it effective as between the assignor and the assignee
and ineffective only against the creditors Ramchamira v. Vittu Covtnd,
A.LR. 1941 Bom. 65, 42 Bom. L.R. 1057. In this case the proper form
of decree to be passed in such cases was indicated.
[Sec. 53
Sec. 53]
Singh V. B. N. Sinha, A.I.R. 1940 Lah. 198, 191 I.C. 639- A fraudulent
grantee takes the entire estate of the fraudulent grantor, and a bona fide
purchaser from the fraudulent grantee takes the entire estate, even though
the deed is voidable at the instance of the creditors of the original grantor
Shikar ' Chand, supra. But where the original transfer was supported
by no consideration, and devised by the parties to defeat the creditors of
the transferor (and was therefore not merely voidable but void) and the
property was afterwards assigned for value to an innocent purchaser, held
that this last mentioned person was not protected by this para ; since his
assignor had acquired no interest in the property under the void transfer,
he had no title to convey to his transferee, although this person was a
transferee in good faith Basti Begam v. Benarsi Prasad, 30 All. 297 (308),
explained in Shikai- Chand's case, supra.
This clause lays down that when the consideration for the transfer
and good faith on the transferees part are present, the intention of the
transferor to defeat or delay his creditors is immaterial. Shephard and
Brown, 7th Edn., pp. 160-161. There can however be no good faith when
the transferee knows that part of the consideration is fictitious and when
he assists the debtor in his device to defeat and delay his creditors. It
does not matter whether part of the consideration is good, nor whether
part of the motive is good Jamadar Singh v. Naiyab Ali, A.LR. 1941
Cal. 378, 45 C.W.N. 498.
The meaning of this para is that where a person acquires any pro-
perty for value and in good faith, that is, without being a party to any
design on the part of the transferor to defraud his creditors, his right
he would be a transferee for good faith and for consideration and his
rights would be protected under this section,; but if both of them are
actuated by the same common intention to defraud creditors, there is no
good faith, even though full consideration has passed Shaukat Ali v.
Sheo Ghulam, A.LR. 1936 All. 663, 165 I.C. 124 ; Waryam Singh v.
Thakar Das, A.LR. 1935 Lah. 404, 16 Lah. 680, 158 LC. 254 ; Mnthuswami
V. Ramaswami, A.LR. 1942 Mad. 751, (1942) 2 M.L.J. 444. A mere
fraudulent intention on the part of the grantor alone will not invalidate
the transfer, if it is for valuable consideration and there is no want of
good faith on the part of the grantee Hakim Lai v. Mooshahar Sahii,
34 Cal. 999 (1017) ; Gopal v. Bank of Madras, 16 Mad. 397 ; Bhagtoant v.
Kedari, 25 Bom. 202 (224). The knowledge and intention of the transferee
are the determining factors in such a case. If he buys in good faith and
for valuable consideration, his purchase cannot be set aside by reason of
the transferor having sold the property for the express purpose of defeating
or delaying the creditors. It is a question of fact in each case whether
the transferee purchased in good faith without knowledge of the trans-
ferors fraudulent intention' Ibrahim v. Jiwan Das, A.LR. 1924 Lah. 707
(709), 75 LC. 1043 ; Daulat Ram v. Ghulam Fatima, 89 I.C. 953, A.LR.
1926 Lah. 25.
44
t Sec. 3
was executed as a mere cloak, the real intention of the parties being th-
the ostensible grantor should retain the benefit to himselfRamasantia
V. Adinarayana, 20 Mad, 465 (466) ; Natha v. Maganchand. 27 Bom \r)
(327) ; Ex yarte Games, (1879) 12 Ch. D. 314.
Sec. 53]
[ Sec. 53
Dec. 57, cited in 34 Cal. 999 (1014) ; Alagappa v. Dasappa, 24 M.L.J. 293
18 I.C. 332 ; Palamalai v. South Indian Export Co., 33 Mad. 334 ( 336 ')
Kammi Kumair v. Heera Lai, 23 C.W.N. 769, 51 I.C. 736 ; Aftabuddin v'
Basanta Kumar, 22 C-W.N. 427 ; Ishan Chunder v. Bishu Sardar, 24 Cal
825 (828) ; and such a transfer cannot be held to be valid on the ground
that a portion of the consideration-money was applied by the transferor
in payment of some debts which he owed to third persons Aftabuddin v.
Basanta Kumar, (supra). A gift of property by a person under embarrassed
circumstances to his wife and so to make provision for their maintenance
cannot be held to be bona fide, because although the donor is bound to
maintain his wife and minor son, still such obligation is a personal obliga-
tion, and the payment of debts takes precedence over a right of main-
tenance Sundar Singh v. Ra?n Nath, 1 Lah. 12, A.I.R. 1926 Lah. 167 (168)
93 I.C. 1013.
Onus: ^Either under sec. 100 or under the more general rule of la-vv,
the burden is on the transferee to establish that he is a bona fide trans-
feree for value without notice Remikabai v. Bheosan Hapsaji, A.I.R. 1939
Nag. 132, 1939 N.L.J. 129, 185 I.C. 33 following Bhiip Narain v. Gokiil
Chand, 61 LA. 115, 13 Pat. 242, A.I.R. 1934 P.C. 68 ; Errachi Riddiar v.
Vallayya Reddiar, A.I.R. 1968 Mad. 256.
Sec. 53]
If it is proved that the transferee paid what was the full value of the
property transferred to him, the Court will lean towards holding that the
transferee acted bona fide in the transaction Ah Foon v. Hoe Lai, 9 Rang.
614, A.I.R. 1932 Rang. 13 (15), 135 I.C. 641. A transfer is not void under
this section where there is nothing to show that the transfer was not
made entirely in good faith, that is to say, that there was not full con-
sideration for the transfer, even though the transferee may have got a
[Sec. 53
Sec. 53]
[Sec. 53
no Court has any power to disturb it ' Siiba Bibi v. Balgovmd, 8 All. 178
Bibi Saira v. Bibi Saliman, 2 P.L.T. 577, 63 I.C. Ill (113); Mahadeo Lcil
V. Bibi Maniram, 12 Pat. 297, 145 I.C. 213, A.I.R. 1933 Pat. 281 (283). It
there is a real dower-debt due to the wife, equal to or exceeding the value
of the property transferred, the transfer cannot be impeached if it is a
genuine transfer and the transferor reserves no benefit for himself
Mahadeo Lai v. Bibi Maniram, supra. A gift by a Muhammadan husband
of a portion of his property to his wife could not be impeached under this
section, when it was found that part of the wifes dower-debt was still
due and it was further shown that the husband still retained in his posses-
sion other immoveable property to meet the claims of his creditors--
Amina Bibi v. Md. Ibrahim, 4 Luck. 343, 114 I.C. 504, A.I.R. 1929 Oudh
520 (521) : Umrao Singh v. Kaniz Fatima, 1901 A.IV.N. 67.
Sec, 53]
were genuine debts and were in fact discharged out of the consideration
for the conveyance, and the consideration for the deed represented the
value of the properties transferred ; held that the transfer was not void-
able at the instance of the other creditors Hakim Lai v. Mooshahar, 34
Cal. 999 (1019), affirmed b}' the Privy Council in Musahar v. Hakim Lai, 43
Cal. 521 ; Body of creditors of Filer Khasim Saheb v. Bkaskar Chatamiah,
(1963) 2 Andh. L.T. 224. A preference of one creditor to the detriment
of another is no ground for impeaching the deed, even if the debtor was
intending to defeat an anticipated execution by another credtor. In a
case in which no consideration of the law of Bankruptcy applies, there
is nothing to prevent the debtor paying one creditor in full and leaving
others unpaid, although the result may be that the rest of his assets will
be insufficient to provide for the payment of the rest of his debts. But
the debtor must not retain a benefit for himself Musahar v. Hakim Lai,
43 Cal. 521 (524) (P.C.) ; Miithia Chetty v. Palaniappa, 51 Mad. 349 (P.C.l,
109 I.C, 626, A.I.R. 1928 P.C. 139 ; Ma Paioa May v. Chettyar Firm, 7 Rang.
624 (P.C.), 34 C.W.N. 6 (10), A.I.R. 1929 P.C. 279, 120 I.C. 645 ; Badri
V. Hazari, A.I.R. 1930 Oudh 93. 5 Luck. 625, 125 I.C. 163 ; Atmaram v.
Dayaram, A.I.R. 1929 Sind 94, 115 I.C. 330; Martoadi, etc.. Firm v.
Sripathi, A.I.R. 1927 Mad. 1114, 101 I.C. 568 ; Motilal v. Kashibai, A.LR.
1938 Nag. 249, 172 I.C. 398 ; Lalit Mohan v. Anil Kumar, 43 C.W.N. 1036 ;
Mila V. Mongol, A.LR. 1938 Lab. 156 ; Chettyar Firm v. Chettyar Firm,
A.I.R. 1937 Rang. 531 ; Dewan Chand v. Punjab & Kashmir Bank, A.I.R.
1937 Lah. 220, 170 I.C. 68 ; Parmanand v. Jairamdas, A.I.R. 1938 Sind 215
(216) ; Ram Ratan v. Mt. Akhtari Begum, 14 Luck. 621. A.I.R. 1939 Oudh
230 at p. 231, 1939 O.W.N. 398 ; Nathusa v. Mtmir, A.LR. 1943 Nag. 42.
1943 N.L.J, 133 ; Haque Brothers Private Ltd. v. Mohendra Nath Sarma,
A.LR, 1966 Assam 36. The transfer of property to one creditor for a
price far in excess of the debt due to him and the retention of the excess
amount for his own benefit indicates an intent to defeat or delay the other
creditors, especially when he has no other property left Bai Hakimbu v
Dayabhai, 41 Bom. L.R. 1104, A.LR. 1939 Bom. 508 (512). 185 LC. 655 ;
see also Mina Kumari v. Bijoy Singh, 44 LA. 72, 44 Cal. 602. Apart from
the law of bankruptcy a creditor may take a transfer although he is fully
aware that the other creditors are thereby defeated and even when pro-
ceedings at their instance are pending. The principle is this: What the
law contemplates is the defeating or delaying of creditors, by which is
meant the whole body of creditors, and so long as there is even a single
creditor who takes the benefit, it cannot be said that the transfer amounts
to a fraud ; all the creditors not having been defrauded, the preference
of one creditor to another even though fraudulent in the law of insolvency
cannot be impeached under the general law Dasamsetti v. Offlcidl
Receiver, A.LR. 1935 Mad. 250, 68 M.L.J. 57 ; C. Abdul Shukoor v. Arji
Papa Rao, A.LR. 1963 S.C. 1150, The provisions of para 2 of sub-section
(1) do not come into operation until the provisions of para 1 of that
sub-section have been fulfilled Parmanand v. Jairamdas, supra. The
circumstance that the debtors action is prompted by revenge against a
creditor who got him imprisoned for his debt is irrelevant Mila v.
Mongol, supra. The mere fact that one creditor is preferred to another
does not in itself render the transaction in favour of the preferred creditor
voidable under this section, if the debtor reserves no benefit to himself.
45
[Sec. S3
A debtor, for all that is contained in sec. 53, T. P. Act, may pay his
debts in any order he pleases, and may pay and creditor he chooses
Mina Kumari v. Bijoy Singh, 44 Cal. 662 (P.C.) ; Palamahi v. South Indian
Export Co., 33 Mad. 334 (337) ; Muthia v. Palaniappa, 45 Mad. 90. A.IR
1922 Mad, 447, 70 I.C. 432, 41 M.L.J. 594; Kalu v. Randhir, 21 O.C. 97
46 I.C. 330 (331) ; Amina Bibi v. Md. Ibrahim, 4 Luck. 343, 114 I.C. 504*
A.I.R. 1929 Oudh 520 (521) ; Madan Gopal v. Lahri Mai, 12 Lah. 194*
130 I.C. 62, A.I.R. 1930 Lah. 1027 (1028) ; Uttamrao v. Gangaram, 27
N.L.R. 382, A.I.R. 1932 Nag. 33. The meaning of the statute is that the
debtor must not retain benefit for himself ; it has no regard whatever
to the question of preference or priority among the creditors of the debtor.
See the above cases and Mahadeo v. Bibi Maniram, A.LR, 1933 Pat. 281,
12 Pat, 297, 145 I.C. 213 ; Daya Ram v. Nader Chand, A.I.R. 1934 Lah!
318, 150 LC. 640. A settlement which preferred certain creditors and
intended to defeat others might be good under the statute Mzdd/efon
V. Pollock, (1876) 2 Ch. D. 104 (108), cited in 34 Cal. 999 (1010). In one
sense it may be considered fraudulent for a man to prefer one of his creditors,
to the rest and give him a security which left his other creditors un-
provided for ; but that is not the sense in which the law understands the
term fraudulent. The law leaves it open to a debtor to make his own
arrangements with his several creditors and to pay them in such order
as he thinks proper per Baron Ralf in Eveleigh v. Purssord, 2 M. & R.
541 ; Mina Kumari v. Bijoy Singh Dudhoria, 44 Cal. 662 (P.C.).
Sec. 53 ]
this section Gobmd Ram v. Chhogmal, A.I.R. 1934 Lah. 161 (162), 152
I.C. 472. Unless the debt advanced to the mortgagor at the time of execu-
tion of the deed can be considered as a part of his pre-existing liability
to the mortgagee, no preference can be claimed for that debt over the
debts of other creditors. What is protected is the preference of one credi-
tor over the others for his pre-existing liabilities and not for those that are
being freshly incurred Wanyam Singh v. Thakar Das, A.I.R. 1935 Lah.
404, 16 Lah. 680, 158 LG. 254.,
An agreement by which an insolvent who obtained his personal but
not his final discharge without notice to tiie Ofiicial Assignee or his other
creditors, settles the claim of one creditor and by which the creditor agrees
not to oppose his final discharge, is void as in fraud of creditors and as
inconsistent with the policy of insolvency law Naoraji v. Siddick, 20
Bom. 636.
t Sec. 53
860 (864), 113 I.C. 129 ; Labhu Ram v. Chartiu, 30 P.L.R. 306, 116 I.C. 317
A.LR. 1929 Lah. 409 (413) ; Visvancmda v. Raja Venkata, 25 L.W. 223
A.I.R. 1927 Mad. 278, 99 LC. 709. Thus, if a barred or irrecoverable debt
is set up as part of the consideration for the property transferred to the
creditor, or if the value of the property transferred to the creditor is great-
ly in excess of the amount of the debt due to the creditor, it will be
presumed that the transfer was made with intent to defeat the other
creditors Rangilbhai v. Vinayak, 11 Bom. 666 (674, 677) ; Hanifa Bibi v.
Punnamma, 17 M.L.J. 11 ; Narayana v. Viraraghava, 23 Mad. 184 (189)
see also Loorthia v. Gopalasami, supra.
Sec. 53 j
1951 Tr.-Cocli. 237. See also Ratnibai v. Khemraj, A.I.R. 1944 Nag. 133,
I.L.R. 1944 Nag. 125. But the creditors are not entitled to get at what the
friends of the debtor have. It would be no fraud for a debtor to say to his
friend do not give it to me ; if you do, it will just go to my creditors.
Keep it and I will ask you to give it to me when the creditors have been
finished with. I am filing my petition" ibid. A surrender by a Hindu
widow may operate as transfer within the meaning of sec. 53 Chidambara
Coundar v. Senniappa Goundar, A.I.R. 1965 Mad. 337.
tSEc. S3
Sec. SS]
and YaramaH v. Chundru, 20 Mad. 326, the Judges did not make any
distinction between cases where the fraud was inchoate and cases where
the fraud was perfected, and they have laid down as a general rule that
(even in cases where the fraud is inchoate) the transferor will not be
allowed to come into Court alleging his own fraud and ask the Court
to set aside the fraudulent deed or make a declaration to protect him from
the threatened consequences of his own act. But these cases have been
dissented from by the Calcutta High Court in Jcidu Nath v. Run La\ 3.3
Cal. 967 (969).
(b) Where the fraud is perfected, i.e., where the creditors have been
actually defrauded, the transferor will not be entitled to recover back
the property from the transferee on the ground that conveyance was a
merely colourable one. He cannot, in such a case, escape from the con-
sequence of his fraud Yaramati v. Chundru, 20 Mad. 326 (331); Hon-
appa V. Narsapa., 23 Bom. 406 (413 ) ; Rajani Kanta v. Abani Kanto,
A.I.R. 1926 Cal. 850, 94 I.C. 33 ; Samp Narain v. Madho Singh, 30
I.C. 253, 18 O.C. 131 ; Banshidhar v. Ajudhia, 27 O.C. 175, A.I.R. 1925
Oudh 120, 82 I.C. 333 ; Lalji v. Bachchoo, 9 O.W.N. 275, A.I.R. 1933 Oudli
6; Lachman Das v. Mttlchand, A.I.R. 1923 All. 411, 71 I.C. 441;
Mating Tin v. Ma Mai Myini, 65 I.C. 459, 11 L.B.R. 83 ; Mating Po Zu
V. Mating Pa Kwa, 65 I.C. 322, 11 L.B.R. 323, .^.I.R. 1921 L.B. 58;
Brahmaijya. v. Kamisetti, A.I.R. 1924 Mad. 849, 47 M.L.J. 652, 82 I.C. 14;
Gascoigne o. Gascoigne, (1918) 1 K.B. 223 ; Rupai Devi v. Bamdeb,
A.I.R. 1953 Pat. 199, 31 Pat. 787 ; Anantam Veerajii v. Velltiri Venkatjtja,
A.I.R. 1960 Andh. Pra. 222. Wiere the intended fraud has been carried
into effect, tlie Court will not allow the true owner to resume the indi-
viduality which he has once cast off in order to defraud osiers Jadu
Nath v. Riip Lai, S3 Cal. 967 (978). Wjere the illegal purpose has been
answered by defeat of third persons rights, a claim for reconveyance
will be properly dismissed. The transferee will not be treated as a
trustee holding for the benefit of the transferor. Tire particeps crimitiis
stands on a quite different footing from an innocent third party, and if he
has actually parted with the direct ownership of the property, he cannot
at the same time have annexed to the ownership a trust in his own
favour, the necessary effect of which would be to give success to a con-
spiracy for defeating the law Chenvirappa. v. Puitappa, 11 Bom. 708
(713, 718, 719). To lay down that when the illegal puqrose has been
fully or partially carried out, the transferor is nevertheless entitled to
claim relief, would not only remove the risk of the sham transferor
losing his property, which operates as a check upon knavery, but would
also stain the administration of justice and make the Courts active in-
struments for securing to the guilty plaintiff the fruits of his successful
fraud a position which, it is hardly necessarj' to say, is absolutely in-
defensible iRangammal v. Venkatachari, 18 Mad. 378 ; Honopa v.
Narsappa, 23 Bom. 406 (413). Where the plaintiff with the object of
defeating tlie claims of his creditors executed a colourable conveyance
of his property in favour of anotlier person, and the, fransferee success-
fully resisted the creditors of the plaintiff from seizing the property in
.execution of their decree, and then conveyed the property to a tiiird
person who took possession, held that the plaintiff would be precluded
from maintaining a suit for recovery of the property. If in such a case
Sec. 53]
I StC. 33
A suit to set aside a transfer on the ground that it was made w'ith
intent to defeat or delay the creditors should be brought on behalf of
all the creditors. It is not competent to any of the creditors to institute
such a suit. Tlie proper test to apply in determining whether a suit
comes within tlie purview of this section is to see whether if tlie plain-
tiff succeeds the property claimed in tlie action would be available to
the general body of creditors Fakir Bux v. Thakur Prasad AIR I 941
Oudli 457 (465), 1941 O.W.N. 801, 194 I.C. 588. In a suit under tliis
section the plaintifl has to accept the genuineness of the deed as an
initial fact and has to prove that the transfer, though genuine, was made
with a view to defeat or delay the creditors of die transferor Jhid.
It is competent for one creditor alone to sue to set aside the fraudulent
transfer, without impleading the other creditors of the transferor ; but he
must sue not in his individual capacity but in a representative capacity,
i.e., he must sue on behalf of himself as loell as all the other creditors;
and the decree will enure to the benefit of all the creditors Ishwar
fimappa v. Devar Venkappa, 27 Bom. 146 (150) ; Hakim Lai v. Mooshdhaf
Skahu, 34 Cal. 999 (1006) ; Chatterput v. Maharaf Bahadur, 32 Cal. 198,
217 (P.C.) ; Shantilal v. Munshilal. 56 Bom. 595, 139 I.C. 820, A.I.R. 1932
Bom. 498 (504) ; Ebrahimbai v. Fulbai, 26 Bom. 577 (581) ; Burjorji v
Dhanbai, 16 Bom. 1 (19) ; Natha v. Maganchand, 27 Bom. 322 ; Palaniandi
v. Appavu, 30 M.L.I. 565, 34 LC- 778 (per Courts Trotter J.) ; Sunder Sing/t
v. Ram Nath, 7 Lah. 12, A.I.R. 1926 Lah. 167 (168), 93 I.C. 1013 ; Champo
V. Shankar Das, 74 P.R. 1912, 14 I.C. 232, 165 P.L.R. 1912 ; Sri Thakiirji v.
larsingh Narain, 6 P.L.J. 48 (50), A.I.R. 1921 Pat. 53, 63 I.C. 788 ; Chetty
Firm v. Maung Po, 7 Bur. L.T. 257, 23 LC. 341 ; Deo Kali v. Ram Devi,
A.I.R. 1941 Rang. 76, 1940 R.L.R. 777. And hence the death of some
of the creditors who were the parties originally to such a suit does not
cause an appeal therein to abate, though the legal representatives were
not substituted in time Sunder Singh v. Ram Nath, (supra). This rule is
based on perfectly sound and intelligible principle. To allow one cr^itor
(in his individual capacity) to impeach the validity of a conveyance would
expose the transferee to several attacks by different creditors, each of
whom might litigate the same question in a different suit, and it is not
inconceivable that the Court might arrive at different conclusions in
different suits brought at the instance of the different creditors Hakim
Lai V. Mooshahar, 34 Cal. 999 (1007) ; Magnibai Kishorjee v. Kesnmal
Sewairam, A.I.R. 1955 M.B. 159. In England also it has been held ttat
if an action is brought to set aside a conveyance on the ground that it is
voidable under statute 13 Eliz. c. 5, it should be by a creditor on behalf
of himself as well as all other creditors of the settlor Reese River Silver
Mining Co. v. Atwell, (1869) L.R. 7 Eq. 347 ; Daniells Chancery .Practice,
pp. 201, 490 ; Seton on Decrees, p. 1372 ; May on Voluntary Conveyances
(2nd Edn.), p. 525.
Sec. 53]
I.C. 405, A.I.R. 1926 Mad. 66, is no longer correct. Consequently the
opinion expressed in Lai Singh v. Jai Chand, 12 Lah. 262, A.I.R. 1931 Lah.
70 (71), 130 I.C. 778, that the omission to sue by one creditor does not
bar the general body of creditors, no longer holds good.
i Sec. 53
Whether the plaintiff has brought the suit in his individual capacity
or whether the suit is of a representative character, depends upon the
nature of the averments made in the plaint, the pleadings, and the decree
that is ultimately passed. Where it is found that though the pleadings
raised the larger issue between the transferor and the body of creditors
still the suit was not for benefit of the creditors as a whole and the plaintiff
was content with merely a money-decree in his favour and did not claim
a decree in terms of Form No. 13, Appendix D to Sch. I. C. P. Code, held
that the suit was not brought in a representative capacity Rahimtulla v
Rasulkhan, 29 N.L.R. 246, A.I.R. 1933 Nag. 169.
But this view is no longer good law, because the 4th para expressly
lays down that the term creditor includes a decree-holder whether he has
or has not applied for execution of his decree. We also do not agree
with the view expressed by the High Court of Madras that a decree-hol er
Sec. 53 j
is not a creditor and that he may therefore bring a suit on his own behalf
to set aside the transfer. Report of the Special Committee. It has been
held in Bandarii v. Alhiri. A.I.R. 1962 Andh. Pr. 25 that a suit under
sec. 53 cannot be instituted by a decree-holder.
[Sec, 53
It has been held by the Bombay High Court that a suit brought
under Or. XXI, r. 63, C.P.C. by a judgment-creditor who has
been defeated at the instance of an intervenor in proceeding taken
in execution of his decree, need not necessarily be a representative suit
under sec. 53 Shrimal v. Hiralal, I.L.R. (1938) Bom. 445. There is no
rule of law, it has been held by the Patna High Court, that a
plaintiff, who has been sought to be defeated by a fraudulent and colour-
able transfer which is a sham transaction, is limited to the remedy of this
section, and there is no bar to the plaintiff succeeding on the strength of
his title after obtaining a declaration that the nominal transfer was a
colourable and sham transaction Sheo Gobind v. Ram Asratj, A.I.R. 1939
Pat. 5, 19 P.L.T. 697.
Sec. 53 ]
facie case has been established on that basis, then the burden shifts to the
alienee to show that he is a transferee in good faith for valuable con-
sideration Javvadi Narasimhamurti v. Maharaja of Pittapiir, supra ; sec
also Narayana v. Viraraghauan, 23 Mad. 184; Har Prasad v. Md. Usman,
A.I.R. 1943 All, 2 1942 A.L.J. 645. The vendee, who personally knows the
whole circumstances of the case, should be examined. It is an error to
rely on the abstract doctrine of burden of proof' Mohideen v. Mustappu,
supra. See also Copal v. Sheokiimar, A.I.R. 1937 Nag. 85, 169 I.C. 954.
It is evident that by omitting the second para of the old section, the
Legislature intends to lay down that the intent to defraud, defeat or delay
must not be presumed merely from the effect of the transfer or from
absence or inadequacy of consideration, but is to be established by looking
to all the circumstances surrounding the execution of the conveyance. See
next Note.
[ Sec. 53
Sec. 53 1
If there be only one creditor, then the act of the debtor in transferring
all his properly to a stranger with a view to secrete the same and defeat the
creditor will be fraudulent and the transfer can be set aside if the trans-
feree has notice of the circumstances and of the debtor's evil design-r-
Mohideen v. Md. Mustappa, A,I.R, 1930 Mad, 665, 126 LC, 604, But if
the transferor is in fact indebted to the plaintiff, the mere fact that the
transfer to him has the effect of giving preference . will not render the
transaction fraudulent Madan Copal y. Lahri Mai, A.LR. 1930 Lah, 1027,
130 LC. 62. The mere fact that debts are due from the transferor is not
itself sufficient to establish a fraudulent intention ; it must be proved
that at the time of the transfer, motive for the transaction was to defeat
.or delay the creditors Rattan Chand v. Kishen Chand, A.LR. 1938 Lah.
136.
If the evidence shows that the transactions were not bona fide, that
they were made gratuitiously and presumably to defraud the plaintiff, he
can impeach the transfers, and the mere fact that mutation had been
effected in favour of the so-called transferees is immaterial Parkash^
Narain v. Birendrd. 7 Luck. 131, A.LR. 1931 Oudh 333, 132 LC. 51.
8 O.W.N. 593.
-47
[ Sec. 53A
The amendment in this section was made to clarify the law and not
to alter it. The mere fact that there was intent to defraud does not, a.s
against a subsequent transferee render the transaction void Nathusa v
Munir, A.I.R. 1943 Nag. 129, I.L.R. 1943 Nag. 42.
269. Sub-section (2), Second para : This para is new, and has been .
inserted for the following reasons :
53A.
Sec. 53A]
270. Previous law : Before the enactment of this section there were
three views as to the rights of the vendor and vendee in cases where the
vendor delivered possession of immoveable property worth Rs, 100 or
upwards to the vendee but executed no registered conveyance.
' One view was that the express words of the statute must prevail and
that no title was created by mere delivery of possession, in the absence
of a registered deed. Another view was that even in the absence of a
registered instrument of convenience, the vendor against whom the pur-
chaser could maintain a suit for specific performance of an oral or un-
registered written agreement for sale was disentitled from recovering
possession from the purchaser, provided that the Court deciding the ques-
tion of ejectment had jurisdiction to decree specific performance and the
circumstances were such as to entitle the defendant to such a decree in
the suit. This view is based upon the English case of Walsh v. Lonsdale.
A third view would refuse to the vendor (or to a purchaser taking from
him with notice of the prior transaction) any right to eject even though
the time has elapsed within which a suit for specific'performance is allow-
ed by the Limitation. Act.
In the case of Ph' Bux v. Md. Tahar, A.I.R. 1934 P.C. 235, 39
C.W,N. 34, 60 C.L,J. 370, 151 I.C. 325 the Privy Council again considered
the law as it stood before the insertion of sec. 53A and held that an aver-
ment of the existence of sale whether with or without averment of posses-
sion following upon the contract was not a relevant defence to an action
of ejectment. If the contract was- still enforceable the defendant might
found upon it to have the action stayed, and by suing for specific perform-
ance obtain a title which would protect him from ejectment. But if it
was no longer enforceable, its part performance would not avail him to any
extent. [In this case .their Lordships followed Ariff v. Jadunath, A-I.R.
[ Sec 53A
1931 P.C. 79, 58 Cal. 1235- and Currimbhoy v. Greet, A.LR. 1933 PC 29
60 Cal. 980, 141 I.C. 209]. These cases have been followed in NemtuIJa v
Tyeballi, A.I.R. 1935 Bom. 208, 37 Bom. L.R. 82, 156 I.C. 779 ; Mukteswar
V. Barakar Coal Co., A-I.R. 1934 Pat. 246, 152 I.C. 498; -5fli/fl Hmm v
Saya Hla, A.I.R. 1935 Rang. 448.
The object of inserting this new section was to alter the statute law
by partial incorporation of the English doctrine of part performance
Durgapada v. Nrishingha. 62 Cal. 492, A.I.R. 1935 Cal. 541, 39 CW.N.
416, 159 I.C. 20 ; Dhanrajmal v. Hazarimal, A.I.R, 1943 Sind 81, I.LR.
1942 Kar. 513. The right conferred by this section can be invoked only
by way of defence Prabodh Kumar v. Dantmara Tea Co., A.LR. 1940 P.C.
1 ; Dammulal v. Mohd. Bhai, A.I.R. 1955 Nag. 306 ; Karoi Mai v. Parama-
nand, A.I.R. 1955 Punj. 252 ; Siisheelamma v. Palla Bucha Reddy, (1969)
1 Andh. L.T. 150.
The object of the Statute of Frauds was to prevent fraud and perjuries^
But, in practice, it encouraged dishonest dealings. The equitable
of part performance seeks to prevent such dishonest dealings. Under this
doctrine the' court will in certain cases allow a contract of a nature require
to be proved by writing, to be proved by parol evidence, when the
seeking to enforce the contract has done acts in performance of his o i
gation under the contract. The attitude adopted by the court of -
that it would be fraudulent for a defendant to take advantage o
is
tSAMFER OF PROPERTY 373
Ec. 55 a ]
absence of writing if he has stood by and allowed the plaintiff to alter his<
position for the worse by doing acts in performance of his obligation
under the contract. If, for instance, P agrees to let out a plot of land to Q,
and if Q enters into possession of and improves the land, it would be fraudu-
lent, at least, inequitable for P to refuse to grant the lease on the ground
that the agreement is' not in writing. Equity grants a decree for specific
performance of the contract against P.
[Sec. 53A
samma, A.I.R. 1952 Or. 143. But see Manak Chand v. Lai Shanker, A,I.R,
1956 Ajmer 22.
I. L.R. (1940) 1 Cal. 161, A.I.R.1940 Cal. 356, 44 C.W.N. 247 ; Tantooram
V. Chandrika, I960 M.P.L.J. 673. This section has imported a modified
form of the English doctrine of part performance into this country. The
basis of the doctrine is' not contract, but the acts subsequent to the con-
tract per Nasim Ali J. in Nakul v. Kalipada, I.L.R. (1938) 2 Cal. 328,
A.J.R. 1939 Cal. 163 (166), 42 C.W.N. 630. It is not the law -that this '
section applies only to the case where a contract can be specifically
enforced. On the other hand, it will be brought into aid when the specific
performance of a contract is barred or the contract is otherwise unenforce-
able Bharat Chandra v. Md. Ramjan, 45 C.'W.N. 489 ; Jahangir Begum v.
Culam Ali Ahmed, A.I.R. 1955 Hyderabad, 101,
J. "that sec. 26C not only provides for the registration but also for bring-
ing in a third party, namely the landlord, to whom notice has to be
issued and certain fees are to be paid. But where these conditions are not
complied with, it only means that the transfer has not been completed in
the m'anner prescribed therefor by law, which' again satisfies one of the
conditions for the application of sec. 53A of the Transfer of Property Act
Nokul V. Kalipada, 42 C.W.N. 630 (633). Again in the same case his
Eordship observes: "As a result of this section (section 53 A) the
defendant has now got a statutory right which is limited by two condi-
tions, viz., that the contract must be in writing and further that it^ is
available only as a defence or to use a convenient expression, as a passive
[Sec. 5U
Specific Relief Act. In such a case it is not necessary for him to resort
to sec. 53 A of the Transfer of Property Act, and since' the provisions of
that section confer a right which is only available to a defendant to pro-
tect his possession, no question of limitation arises thereunder since there
is no bar of limitaton to a defence. This is consistent with what was said
in Pir Bukshs case [ (1934) 61 LA. 338, 39 C.W.N. 34] and we ourselves
said in the case of Dantmara Tea Co. .v. Probodh Kumar Das, (supra)
at p. 635. See also Kuchwar Lime & Stone Co. v. Secretary of State, supra
The difference between the protection given by this section and the
right conferred by sec. 27 A of the Specific Relief Act is that the former
creates a defence while the latter a groimd of claim. What sec. 53A creates
is a defence by prohibiting the enforcement of^a right by the transferor
while sec. 27 A gives a right to the transferor and transferee to enforce
specifically the contract by compelling registration where there is a part
performance Hari Prasad v. Hanumantrao, A.I.R. 1937 Nag. 74 (76) ;
Md. Rowther v. Tinnevelly Municipal Council, A.LR. 1938 Mad. 746 (748),
4S M.L.W. 74. In granting relief under the present section the question
whether a contract is specifically enforceable or not has no bearing at all.
S. 12 of the Specific Relief Act is also quite distinct from the present
section Sobharam v. Totaram, A.LR. 1952 Nag. 244. A transferee in
possession under a contract of sale in a suit for specific performance of
the contract cannot also avail himself of the provisions of the .present
section Parul Bala v. Saroj Kurruxe, A.I.R. 1948 Cal. 147, 82 C,L.J. 273.
The legislature has by sec. 27A, Specific- Relief Act recognized that
the equity of part performance- is an active equity as in English law and
enables the plaintiff to support an independent action. The section how-
ever has no application to contracts executed before 1st April, 1930, though
in such a case the defence xmder the present section is available to a
person who has an agreement of lease in his favour Maneklal v. Harnuisjt,
A.LR. 1950 S.C. 1, (1950) S. C. R..-75. 52 Bom. L.R. 521.
Sec. 5Ui
^sec. 53A, it is, however, necessary that the possession relied upon as part
performance must be referable to the agreement only and not to anything
else Bahadur Singh v. Jyotirupa, 40 C.W.N. 476. Thus, the possession
of a Receiver caused to be appointed by a decree-holder in execution
proceedings is not possession in part performance of a contract so as to
make this section available and to cure the effect of non-registration of
the dsctQs.Sambhuram v. Gulzarilal, 40 C.W.N. 974. The absence of an
avertment in the written statement that the defendant is ready and willing
to' perform his part of the contract is not fatal Karthikeya Mudaliar v.
Singaram PiUtti, A.I.R. 1956 Mad. 693 ; Malikajappa v. Bhimappa, A.I.R.
1966 Mys. 86.
Para 4 . ^This section debars the transferor from exercising rights which
he would have apart from the agreement. There is, however, an excep-
tion to this disablement in the words other than a right expressly pro-
vided by the terms of the contract. But the transferor can derive no
rights from this section which are inconsistent with the conditions subject
to which the section comes into operation. Since it is a condition
precedent that the transferee shall have performed his part of the contract
or should be willing to perform his part, the material time being the time
when the section is sought to be made use of, a suit for damages for
breach of a contract can never be founded upon this section Bechardas v.
Borough Municipality of Ahmedabad, -supra. See in this connection Ram
Protap v. National Petroleimi to. A. I, R. 1950 Cal. 23, 54 C.W.N. 53.
48
[ Sec. S3A
Objection under this section will not be entertained for the first time
in a second appeal Sailajananda v. Lakhichand, A.I.R 195 i' Pat m
P.L.T. 388.
Sec. 5^Aj
For the application of this section to sale see Kaura Ram v. Chaman
Lai, A.I.R. 1934 Lah. 751, 154 I.C. 1088. In a case where the vendee enter-
ed into possession in part performance of a contract of sale, the Rangoon
High Court held that although he was not entitled to a declaration of his
right as plaintiff, he was entitled to the possession of the property as against
third , persons Mastram v. Ma Ohn, A.I.R. 1934 Rang. 284, 154 I.C. 769 ;
Somi Reddy v. Ranganayakahi, (1967) 2 Andh. W.R. 2. A Mahomedan
for himself and as guardian of a Mahomedan minor purported to enter
into a contract for sale of a property belonging to them to a person who
was in possession of the property as^a tenant. There was no evidence to
show that the tenant continued in possession after the alleged contract
[ Sec. S3A
of sale: held that sec. 53 A did not apply Bharat Chandra'v. Md. Ram a
45 C.W.N. 489. A transferee in possession of the property by way of i -
performance cannot maintain a suit under Or. 21, r. 1U3 C.P.C. agabst the
auction-purchaser of such property Maruti Gurappa v Krishna Uni
A.I.R. 1967 Bom. 34.
This section applied where the transfer was made before the Act but
the suit was brought after the Act came into force Fateh Md. v.
Bibi, A.LR. 1953 Aj. 19 ; Kanbi Karshan v. Kahbi Harkha, A.LR. 1953 Sau.
56 ; Jahangir Begum v. Gulam Alt Ahmed, A.I.R. Hyd. 101.
Sec. 53A]
general rule of equity which would prevail in India apart from the provi-
sions of the T. P. Act, it can have no force in the Punjab to 'which it has
not been applied Mt. Shankri v. Milkha Singh, A.LR. 1941 Lah. 407 (410)
(F.B.). A later Full Bench have however held that sec. 53A being based on
the equitable principles which were previously applicable to the whole of
India including the Punjab and even after the enactment of that section
which is not applicable to the Punjab, the- principles embodied in the
section are applicable to the Punjab Milkha Singh v. Mt. Sankari, A.I.R.
1947 Lah. 1 (F.B.), I.L.R.- 1947 Lah. 449.
The above words in the newly added Proviso to sec. 49, Registration
Act do not deprive the Province of Punjab of the benefit of the Proviso
simply because the T. P. Act is not in force' in that Province Milkha
Singh V. Mt. Shankari, A.I.R. 1947 Lah; 1 (F.B.), LL.R. 1947 Lah.
449.
[ Sec. 53A
It has been held under this section that Art. 113 'of the Limitation
Act does not apply. Limitation does not observed Nasim Ali J i
generally apply to a plea in defence ; see Sri Kishan Lai v. Mt. Kashmtro,
[20 C.W.N. 957 (P.C.), 31 M.L.J. 362] ; Somi Reddy v. Rangnayakalu {1967)
2 An. W.R. 2. Section 53A has imported in a modified form the Englis
doctrine of part performance into this country. It confers only a passive
Sec. 53A]
165 LC. 92^ ]' Katireddi v. Koonam, A.I.R. 1936 Mad. 916, 71 M.L.J. 639,
166 I.C. 535 ; Baldeo Singh v. Md. Akhtar, A.I.R. 1939 Pat. 488, 20 P.L.T.
399. In Md. Serajul Haque v. Dwijendra Mohan, A.I.R. 1941 Cal- 33, Mr.
Justice Bisvvas seems to have been inclined to agree with the judgment
of Wort, J. in Jagadamba Prasad v. Anadi Nath, supra but felt bound by
the decision of the Division Bench in Md. Hosein v. Jamini, infra ; Veera-
brahmacharyulu v. Monduru Venkata, A.I.R. 1961 Andh. Pra. 31.
On the other hand it has been held in the following cases that the
section is retrospective ; Gajadhar v. Bachan, A.I.R. 1934 All. 768, 153 LC.
717; Suleman v. Patell, A.I.R. 1933 Bom. 381, 145 I.C. 557; Benarsi v.
Ali Mahammad, A.I.R.- 1936 Lah. 5, 157 I.C. 839 ; Shyam Sundar v. Din
Shah, A.I.R. 1937 All. 10, I.L.R.- (1937) All. 312, 166 LC. 540 ; Md. Hushen
V. Jamini, A.I.R. 1938 Cal. 97, 42 C.W.N. 38, I.L.R. (1938) 1 Cal. 607,
176 LC. 41 ; Ashutosh v. Nalinakshya, A.I.R. 1937 Cal. 467, 64 C.L.J. 558,
170 I.C, 267 ; Wakefield v.' Sayeeda Khatun, A.I.R. 1937 Pat. 36. 15 Pat.
[ Sec. 53A
786, 166 I.C. 797 ; Ko Po v. Maung Lit, A.I.R. 1937 Rang. 402 ; Tukaram
V. Atmaram, A.LR, 1939 Bom. 31, 40 Bom. L. R. 1192.
This section applies only when the contract is a valid and completed
contract. A person cannot seek the benefit of the section on the basis of
a contract forbidden by law or of negotiations which had not matured into
a contract Bharat Chandra v. Md. Ramjan, 45 C.W.Ni 489. A contract
between a person and the cantonment infringing certain provisions of
the Cantonment Act, 1924 cannot be set up to sustain the plea of part
performance Akrammea v. The Secunderabad Municipal C.orporatton,
A.I.R. 1957 Andhra Pra. 859 ; Jitendra Nath v. Commissioner of Badhuria
Municipality, A.LR. 1967 Cal. 423. Again this section contemplates
reliance upon an entire contract. When part of the alleged contract is
not valid, the contract cannot be split up and the section brought in ni
of the part which is valid ibid. It cannot however be said that a docu-
ment which is primarily a receipt is always insufficient for the purpose o
this section Mt. Firdos Jahan v. Md. Yunus, 15 Luck. 43, A.LR. 19
Sec. 53AI
Oudh 1, 1939 O.W-N. 876 ; see also Shira Khatim v. Maimg Pan, A.I.R.
1939 Rang. 206, 1939 R.L.R. 575, 182 LC. 523. Where an agreement to
sell land by a tenant is entered into without the sanction of the competent
authorit}'^ required for such transfer and possession is given to the trans-
feree, such possession is not protected by sec. 53-A Muprial Raghava-
chari V. SttnkeijpaUi Ramahista Reddy. I.L.R. (1965) Andh. ,Pra. 1226.
Where a landlord agrees in writing to sell the demised property to the
tenant and the tenant continues in possession pursuant to such agreement,
the landlord is precluded from filing a suit for eviction Anmmalai
Coimdan v. Venkatasami Naidu, A.LR. 1959 Mad. 354. If a lease is
executed by the lessor alone and the lessee is put in possession, the lessee!
can invoke sec. 53-A~Maliadei Haluai v. Ram Krishna Singh, A.I.R. 1960
Pat. 353.
Possession: ^This section requires that the transferee has either been
put in possession or has continued in possession in part performance of
the contract. Where he was never put in possession or allowed to continue
in possession, actual or constructive, the section does not apply Subbd
Rao V. Rajti, A.I.R. 1950 F.C. 1, 1949 F.L.J. 398, (1950) 1 M.L.J. 752;
Nila Padhan v. Gokulananda, A.I.R. 1952 Or. 118. Where the transferor
has put the transferee in possession in part performance of the contract,
the latter can enforce a right expressly provided by the terms of the con-
tract, and the fulfilment of all the conditions mentioned in this section
is not a condition precedent to the enforcement of such right Muralidhar
V. Tara Dye, A.I.R. 1953 Cal. 349. But see Venkatasubbayija v. Rosayya,
A.LR. 1957 Andhra Pr. 58, where it has been held that the defendant can
non-suit the plaintiff only if he has complied-with the conditions laid down
under sec. 53-A. This section does not require that the contract must
contain a direct covenant regarding transference pf possession. If the
transferee is already in possession and some act is done in furtherance'
of the contratt, that is sufficjent Eioaz Alt v. Firdous A.I.R. 1944
Oudh 212, (1944) O.W.N. 228 ; Ratanlal v. Kishanlal, A.I.R. 1952 Raj. 141.
See in this connection Gopinath v. Hangsnath, A.I.R. 1950 Ass. 129 ;
Anandiravan v. Anandiravan, A.I.R. 1950 Tr.-Coch. 81 and Gopalan v.
Kanran, A.I.R. 1953 Mad. 925. Where the transferee is admittedly put in
possession, the fact that subsequently he loses possession cannot deprive
him of his rights under the section Yemigo Achayya v. Eranki Venkatd
Subha Rao, 1956 Andhra W.R. 830. Where a property is leased by A and
B to a partnership of which B is a partner and there is an agreement by
the partnership to transfer their leasehold interest to a company, no
advantage of sec. 53-A can be taken by the company against A at all and
as against B in his capacity as one of the owners of the property Stevart-
& Co. Ltd. v. C. Mackerich. A.I.R. 1963 Cal. 198. If the tenant of a
house agrees to purchase the house but the house is purchased by P with
knowledge of the tenants agrement P can obtain a decree for ejectment
during the pendency of the suit by the tenant for specific perform^ce
because the tenant cannot invoke sec. 53-A Bhagwandas v. Surajmal,
A.I.R. 1961 Madh. Pra. 237.
It is not necessary undw this section to show that the transferor has
delivered possession. It is only necessary to show that, the transferee has
taken possession or continued in possession in part performance of the
49
I Sec. 53A
contract and has done some act in furtherance of it Mt. Firdos fahan
Md. Yunus, supra. Where a vendee in pursuance of a contract of sale o{
a house paid earnest money and did other acts such as repairs and payment
of Municipal tax, it can be said that the vendee took possession of the
house in part performance of the contract Ibid ; see also Taiiquir AU v
Ram Ratan, A.I.R. 1941 Oudh 41 (43), 190 I.C. 85, But the act of part
performance must not be an act preparatory to the completion of the con-
tract, and acts introductory to and previous to the agreement cannot be
treated as acts of part performance Kukaji v. BasantiM, A.I.R. I 955 m.b.
93. But see Vithdl Das v. Mohanlal, 1967 Raj. L;W. 413, where it has
been held that payment of consideration amounts to part performance.
The test of determining whether the words "or any person claiming
under him" {Le., the transferor) apply to a Hindu reversioner, is whether
the acts of &e widow bind the reversioner or not. If her acts bind the
property, they must bind the reversioner in the same manner and
same extent as the acts of an absolute owner would bind his heir. T e
reversioner may not be her heir, but is certainly her successor Balawn
V. Kewalram, A.I.R. 1940 Nag. 396 (399, 400), 1940 N.L.T. 499,- 199 l.L.
881 ; Ramchhod v. Manubai, A.I.R. 1954 Bom. 153 ; Babba Surawma v.
Smt. Peddireddi Chandramma, A.I.R. 1959 Andh. Pra. 568 ; Karunakar v.
Mahakuren, A.I.R. 1960 Orissa 170. But see Jagad Bhusan v. Panna
A.I.R. 1941 Cal. 287, where the purchaser from a Hindu widows daughter
was held not to be claiming under the widow and Satyanarayanamur y
Tadi Subramanyam, A.I.R. 1959 Andh. Pra. 534. where it has been nem
that a transferee under a contract to transfer by the Karta of a
joint family cannot avail of sec. 53A against a member of the joint a
who has not signed the agreement to transfer. It has also been e .
the Mysore High Court that where a deed of transfer is executed y
Sec. 53A]
These cases are no longer good law. Under the present section, the
doctrine can be applied only when there is a written document from which
the terms of the contract can be ascertained with reasonable certainty
Ar/z Ahmad v. Alauddin, A.LR, 1933 Pat. 485 ; U Lu Pe v. Oo Kim,
A.I.R. 1933 Rang. 136 (138); Suleman Haji v. Patell, 35 Bom. L.R. 722,
145 I.C. 557, A.I.R. 1933 Bom. 381 (384) ; Ma Mya v. Annamalai, A.I.R.
1934 Rang. 127, 7 Rang. 59, 151 I.C. 227 ; A. P. Bagchi v. Mrs. Morgan,
A.I.R. 1937 All. 36, 166 I.C. 897 ; Bechardas v. Borough Municipality of
Ahmedabad, A.LR. 1941 Bom. 346 (348), 43 Bom. L.R. 603 ; Narayan v.
Guru Prasad, A.I.R. 1952 Nag. 246 ; Shravan v. Garbad, A.LR. 1943 Bom.
406, 45 Bom. L.R. 874 ; Narasayya v. RamachaJidrayya, A.LR. 1956 Andhra
209, The words signed on his^ behalf" must mean signed by a person
who has authority to bind or represent the transferor Such written
agreement may, of course, be the embodiment of what has already been
agreed upon orally and may also refer to payment by the purchaser and
receipt by the vendor of the purchase-money, but it must essentially be a
written agreement. Unless a document can be held to be an agreement
or contract of sale, it will not, by the mere fact that from it the terms
necessary to constitute . the transfer can be ascertained with reasonable
certainty, be sufficient to satisfy the requirements of sec. 53A Maung
Po V. Maung Po, A.I.R. 1938 Rang. 49, 174 I.C. 169. The section does
not apply to oral sales Krishnabai v. Parwati Bai, A.I.R. 1936 Nag. 282,
165 I.C. 934 ; Subodh v. Bhagwandas, A.LR. 1947 Cal. 353, 50 C.W.N. 851 :
Balkrishna v. Rangnath, A.I.R. 1951 Nag. 171, I.L.R. 1950 Nag. 618. A
distinction, however, must be drawn between a writing which is a reduc-
tion into writing of a previous oral agreement which will fall within sec.
53-A and writing in which there is a mere reference to a previous oral
[Sec. 53A
agreement Maw/zg Ohn v. Maung Po, A.I.R. 1938 Rang. 356 Shrm,n
V. Garbad, supra.
A. I.R. 1953 S.C. 503. See also Mooiji Sicca & Co. v. Ntir Mohammad,
infra. But when actually the transferee has such notice, the informality of
the manner in which he acquired that notice or information is not material
Gopalan v. Kanaran, A.I.R. 1953 Mad. 925. Where A obtains
possession of a piece of land in pursuance of an agreement
to sell executed by P and Q, two joint owners, but the deed of sale
is executed by P alone in respect of his share, an assignee from
A with possession cannot invoke sec. 53A in a suit for recovery of posses-
sion by Q K. Dharma Rao v. K. Satyavathi, A.I.R. 1969 Andh. Pra. 129.
Sec. 53A creates no real right, it merely creates rights of estoppel, which
are not available against a third person-^, N, Banerjee v. Kuchtvar Lime
and Stone Co. Ltd., A.I.R. 1941 P.C. 128. Where the defendant fails td
prove the elements necessary to sustain claim under the main provision
of sec. 53A, he cannot defeat the suit by a vendee by merely proving that
the ventfee purchased with notice of the defendants contract to purchase
Prova Rani v. Lalit Mohon, A.LR. 1960 Cal. 541.
A person having notice of the same cannot, however, resist the claim
of the right of a person to -defend his possession under the unregistered
contract Mooiji Sicca & Co. v. Nur Mohammad, A.I.R. 1938 Nag. 377.
The burden of proof as to notice- is on the person claiming the
of the doctrine of part performance Ko Ma v. M<? May,
Rang. 12, 154 I.C. 474 ; Sasirekhamma v. Suramma, A.I.R. 1952 Or. 163. A
mortgaged with possession his house with B. Subsequently A sold e
house to B in consideration of the mortgage debt and the amount spen
by B on the improvement and repair of the house. The deed was no
registered. A sold his equity of redemption to C under a registere sa
deed. C sued B for redemption. The trial court gave a decree
possession on payment of the mortgage money plus the amount spen
B for repairs and improvements and the decision of the trial court was
held on appeal and thereafter by the Hi^ Court. The suit was ecre ^
B, the mortgagee failed to prove that C was not a bona fide pur ^
for value and that he had notice of the earlier transaction *** *^^ [ ^ t,g
The suit was decreed also on the ground that B failed- to _g(;
CHAPTER III
Sale defined
exchange for a
or part-paid and
[ Sec. 54
But some cases have laid, down that for the purposes of pre-enm
/ion, tluis section need not be entirely applied to Mahomedans, so' tlmt
if a sale is invalid under this section but valid under the Mahomedan
Law, the pre-emptor would get a right of pre-emption. Tims, a pro-
perty worth Rs. 300 can be sold only by a registered deed under the
second para of this section, but under the Mahomedan law delivery of
possession of the property would be sufficient to complete the sale.
Therefore, if the property is orally sold and possession delivered, there
would be a valid sale under tlie Mahomedan law, which would give rise
to a right of pre-emption, though the sale is invalid under this Act
AbduUiaJi v. Ismail, 46 Bom. 302, A.I.R 1922 Bom. 124, 64 LC. 91.3;
Janki v. Girjadut, 7 All. 482 (F.B.). In considering the question of pre-
emption, the rule of Mahomedan law alone is to be applied, and if the
sale is valid under that law; the right of pre-emption will arise, although
the sale may be incomplete under this Act 'Begum v. Muhammad Ya-
kub, 16 All. 344 (F.B.). But the Patna and Calcutta High Courts are of
. opinion tliat sqc. 54 of this Act abrogates the Muhammadan law of sale
even in respect of pre-emption, and no -right of pre-emption arises until
the sale has been completed under this section by registration
Prasad v. Mtdlick Nazartd Alum, 20 C.W.N. 1048, 1 P.L.J. 174, (177,
178), 34 I.C. 210 ; Budhai v. SonapUa, 41 Cal. 943 (949), 18 C.W.N.
890, 23 I.C. 385 {per Carnduff J.). The same opinion was expressed by
Banerji J. in Begum- v. Yakub, 16 All. 344 (356).
Where transfer was made in the form of^ a sale in lieu of Kharch-i-
pandan in favomr of tire transferors wife and the money consideration
shown in the deed of transfer not to be the capitalized value of the
right, the transaction is neither an exchange nor a sale. In such a case
there is no right of pre-emption Shujat AH' v. Mt. Salim Jahan, A.I.R.
1949 All. 204, 1948 A.L,J. 527.
Sec. 54]
a sale or any other transfer the Court should look not merely to the
ostensible appearance given to it by the words used by the parties, but
the real nature and essence of the transaction should be looked at as
a whole. Tlie conclusion arrived at by the Court should be the cumu-
lative result of .the totality of circumstances emerging from tlie agree-
ment Central Finance and Housing Co. v. British Transport Co., A.I.R.
1954 All. 195. What is commonly called hiba-bil-ewaz is not a gift but
partakes of the diaracter of a sale Fateh AH v. Md. Bakhsh, A.I.R.
1928 Lah. 516, 5 Lah. 428 ; Suburannessa v. Sabdu, A.I.R. 1934 Cal.
693, 38 C.W.N. 654, 1.54 I.C. 480. So where the property is immoveable
and is of the value of Rs. 100 or upwards the transfer must be effected
by a registered insti'ument Ibid. The Ondh Chief Court has however
taken a different view. It holds tliat all cases of hiba-bil-ewaz cannot
be held to be sales TOtliin the definition in this section, and writing and
registration are not always necessarj^ Abdul Hamid v. Abdul Ghani,
A.I.R. 1934 Oudh 163, 148 I.C. 801, following Bashir y. Zubaida, A.I.R.
1926 Oudh 186, 92 I.C. 265.
Tlie mere fact that in tlie contract between tlie jiarties there might
be various covenants or the existence of a provision giving the seller
certain rights as consideration does not change the character of the tran-
saction if in substance it is one of sale Matta Sura v, Mana Rama,
A.I.R. 1937 Mad. 714, 176 I.C. 444.
Execution of a sale deed does not mean signing the deed but it
means all acts necessary to make the parties bound thereby. If a man
merely signs a contract and puts it in his pocket and does not allow it to
depart from him as his act, that is not execution per Sir Courtney
Terrel, J. in Sunder v. Lalji, A.I.R. 1933 Pat. 129, 145 I.C. 698.
t Sec.
Sec. 541
Under this section a sham deed of sale, even if registered, does not
jjass title, for the sale does not become complete in such a case by mere
execution of the deed-^llft. Boofa v. Gur Prasad, A.I.R. 1937 Oudh 20,
12 Luck. 313, 164 I.C. 817. In such a case title does not pass to tlie
vendee and a suit by the latter for possession is not maintainable
Abdul Wahab v. Muquarrab, A.I.R. 1939 Pesh. 27, 1939 Pesh. L.J. 35,
183 I.C. 221 ; see also Basalingava v. Revanseddappa, 56 Bom. 556, 34
Bom. L.R. 427, A.I.R. 1939 Bom. 247 ; Parsotam v. AU Haidar, 13 Luck.
484, 1937 O.W.N. 944, A.I.R. 1937 Oudh 493 and Hemraj v. Trimbdk,
A.I.R. 1924 Nag. 146, 78 I.C. 1011.
50
[Sec. 54
1980 Oudh 481 (49.5), 1.32 I.C. 753. Tlie tiansaction does not beconie a
sale merely because the parties are sometimes described as yen o
and vendees Ibid.
Sec. 54]
Wliere at the time of sale the proijerty sold was not in the posses-
sion of the vendor but was held by a third party against whom a suit
had to be instituted for recovery of possession, but the vendor being
too poor to sue for its recovery sold the property to the purchaser for
Rs. 5,000, and it was agreed that the vendor was not to get any further
sum if the vendee succeeded in liis suit for recovering the property,
nor was the vendor liable if the suit failed, held that the total consi-
deration was Rs, 5,000, neither more nor less, and the property was
transferred for this cash consideration. The transaction was therefore
a sale Badri Prasad v. Bijay Nand, 54 All. 905, 139 I.C. 693, A.I.R. 1922
All. 685 ; Beni Madho v. John, A.I.R. 1947 All. 321.
IVhere the larger part of the consideration was paid by the vendee,
the sale cannot be held as hollow Radhabai v. Gopal, A.LR. 1944 Bom.
50, 45 Bom, L.R. 980. Title passes to the vendee, unless there was in-
tention of the parties that it would not pass until the entire amount of
the consideration has been paid Rajkumar v. Uchit, A.I.R. 1951 Pat,
454. Non-delivery of the original document of sale and non-delivery of
possession were not held to be important in the circumstances of this
CRse.
2 Bom. 547 (548); Ramdiiari v. Borakh Rai, 10 Pat. 261, 1.33 I.C. 34,
A.I.R. 1931 P,t. 236 ; Tafia v. Babaji, 20 Bom. 176 (183) ; or he can
maintain a suit for declaration of his proprietars' right, in case the pro-
perty is in the possession of other persons, e.g., mortgagees Kesri v.
Canga, 4 All. 168 (170). If the executant conveys title to the vendee
fi'om the date of the execution of the document and the recital legard-
ing consideration comes later independently of the clause regarding
title, then the title passes independent of the question of consideration
Michha Kumar v. Raghu Jena, A.I.R. 1961 Orissa 19.
As regards the remedy of the vendor, it has been held in some cases
that he is to bring a seiiarate suit for recoveiy^ of the purchase-money.
Tlie Court cannot, in a suit brought by the ijurchaser for possession,
make the decree for possession conditional on the payment of the pur-
chase-money, nor can it decree payment of the vendor in the purchasers
suit Krishnamma v. Mali, 43 Mad. 712 (713, 714); Velayutha Go-
vindaswannj, 34 Mad. 543 (544); Somasimdaram v. Shws Ba, supra;
Sagaji V. Namdeo, 23 Bom. 525 (527). ' Tlie grounds of this decision
ere : firstly, that it is not competent for the Court to incorporate the
vendors charge for unpaid purchase-money into the decree passed in
the suit brought by the purchaser for reco\erj' of the propretj'; and
secondly, that as the vendor is not able to set up a counter claim, the
decree cannot incorporate the vendors lien. But these are mere mat-
ters of convenience and procedure, rather than of substantive law, and
from the point of yiew of convenience it has been decided in some other
cases that in decreeing the purchasers suit for possession the Court can
make it subject to the condition that the purchaser shall pay th.c pur-
chase-money within a time fixed by the Court, and that on his failure
to pay within the time so fixed the suit shall stand dismissed Baij
Nath v. Paltu, 30 All. 125 (127) ; Basalinsfiva v. Cliinnava, '30 Bom.
L.R. 1084, 114 I.C. 369, A.I.R. 1929 Bom. 60 (62) ; Basalingava v. Chin-
nava, 56 Bom. 556, 1-38 I.C. 534, A.I.R. 1932 Bom. 247 (250) ; Jogeendra y.
Manmatha^ 34 I.C. 106 (108) ; Umedmal v. Dami, 2 Bom. 547 (349) ;
Rama Aiyar v. Vanamamalai, 27 I.C. 3-36 (337) ; Nilmadhab v. Haran-
prasad, 17 C.W.N. 1161, 20 I.C. 325 (327) ; Mt. Bran Dei y. Sat Deo,
A.I.R. 1929 All. 85, 111 I.C. 761 ; U Tin v. Chettiyar Firm, A.I.R. 1933
Rang. 401, 147 I.C. 742. In other words, the right of the purchaser to
obtain possession and the right of the vendor to realise the unpaid pur-
chase-money should be recognised and enforced in one action. If the
Court gives an unconditional decree to the purchaser for possession, the
\'endor will be driven to institute another suit for tlie unpaid purchase-
money. It is ob\'iously undesirable that tlic m.atler in controversy which
may be settled without disadvantage to any of the p.arlics in a single
[Sec. 54
passing of the title is postponed till the payment of the entire price
depends on the intention of the parties' to be gathered from the sale-deed
itself ; but where it is not clear, the surrounding circumstances and the
conduct of the parties may be considered Pirtam Singh v. Jagannath,
A.LR. 1947 Pat. 1, 12 B.R. 318; Qhanshyam v. Udaijanath, A.I.R.1949
Or. 14, 14 Cut. L.T. 40; Ramchandra Biharilal Firm v. Matlmramohon
Naik, A.I.R. 1964 Orissa, 239. In cases of sale, it is seldom the intention
of the parties to allow title to pass without the receipt of consideration
and this intention can be gathered from the sale-deed Shiba Prasad v.
Upendra, A.I.R. 1935 Pat. 45, 154 I.C. 612 ; Mnnshi Bahem KJtan v.
Ramachandra Samat, I.L.R. (1964) Cut. 381. ^ere the sale-deed
expressly stipulates that if the vendee omits to jjay the balance of pui-
chase-money within a specified time the deed will be treated as null an
void, the vendor is entitled to avoid the deed on the vendee failing o
make the payment agieed . upon Bakhtawar v. Naushad Ali, 55 I-
659 (Oudli). But in a recent case, in similar circumstances, the Pnvy
Coimcil has held that there is nothing in sec. 31, which merely dedares
that a limitation upon a condition subsequent is a lawful method o
grant, to exclude the light of the Court to give relief to vendees win
failed to make pa)'ment by the date agreed upon in the sale-deed wnc
Sec. 54]
B. L.J.R. 291. Refusal by the vendee to pay the price to the vendor
would not by itself be a reason for setting aside the sale. Once a sale
is completed, it cannot be rescinded for failure of consideration, unless
that riglit is expressly reserved, in which case an action wiE he not in
consequence of any general right 'vested in the vendor but on the
express covenant made in die deed. In another case, aU .that
the vendor could claim would be damages for breach of the pro-
mise to pay the price-^Bai Devmani v. Ravishankar, 53 Bom. 321, 31
Bom. L.R. 109, 116 I.C. 236, A.I.R. 1929 Bom. 147 (150) ; Prem Singh
V. District Board, A.I.R. 1934 Lah. 917, 151 I.C. 163.
Wliere the father of a minor got a sale-deed in the name of his son
by which tlie father agreed to discharge certain debts binding upon the
property sold to the minor and the deed provided "the debt shaE be
discharged and the minor may hold and enjoy the lands exclusively :
held that the property vested in the minor though the debts were not
discharged Gangai v. Govinda, A.I.R. 1924 Mad. 544, 84 I.C. 626.
[Sec. S4
abstained from paying the piii:phase-money for more than tliree vea
and allowed his vendor to retain possession and to sell the land to oth
persons, held that the vendee was not thereafter entitled to brine a sO
for possession Sflngu v. Cumarasami, 18 Mad. 61 (63). Where th '
sale-deed was registered and possession delivered to the vendee but ^
consideration was paid (although it was expressed in the sale-deed to
have been paid) and it was found that the vendor was forced to execute
the deed during his illness under ,undue influence, held that the vendor
was entitled to have the sale-deed cancelled and possession restored-
Tatia v. Balaji, 22 Bom. 176. Where the parties enter into a bargain
for the sale of property, then if the real intention is that die property
should pass, the mere fact of non-payment of part or even the whole of
the consideration will not make the deed of transfer fictitious. But the
non-passing of the consideration may often be a very strong evidence
that the conveyance is not a real transaction and diat the deed was not
intended to operate. Each case must be decided upon the facts proved
Alamdar v. Moti Ram, 16 A.L.J. 454, 46 I.C. 382. Wliere the fact found
is that a portion of the consideration set out in a sale-deed has been
found to be good consideration, the mere fact that another portion of
the consideration has not been paid is no ground for coming to the con-
clusion tliat the parties did not intend the document to be enforceable
between them Muniram v. Amjad Ali, 26 A.L.J. 539, A.I.R. 1928 All.
891 (392), 114 I.C. 192.
124 Rang. 267, 83 I.C. 270; Nathu v. Gtdab C/wnd, A.I.R. wag.
J, 144 I.C. 919. Tlie right to remove sand and earth from a po
51
[Sec. 54
A.I.R. 1939 All. 305, 1939 A.L.J. 71 ; nor to the transf^ of a li^ns
sell electricity ,Monmohan v. O. L. Lower Ganges, rrii,pre is
Co., I.L.R. 1940 All. 568, A.I.R. 1940 All. 458, 1940 A.L.J. 449.
no latv that such a license can be effected only by a written &
Sec. 54]
[SEa54
Sec. 54]
V. Sobhanadri, A.I.R. 1936 P.C. 91, 40 C.W.N. 545, 63 I.A. 169, 161 I.C.
29 ; Collector v. Ram Sunder, A.I.R. 1934 P.C. 157 (167), 38 C.W.N.
' 1101, 56 All. 468, 61 I.A. 268, 150 LG. 545 ; Rowther v. Official Receiver,
A.I.R. 1937 Mad. 32, 168 I.C. -87.
[Sec. S4
y. Aforlw!,, A.I.H, 1926 Cal. 705, 30 C.W.N. 254, 03 1.C. 115. S*'>
TfiANSfEil dF PRdPfiRTY 407
Sec. 54]
[Sec.- 54
Sec. 54]
a later period does not prevent the - sale from being complete Hari
Chand v, Qordhan Das, A.I.R. 1957 -Punj. 23S.
52
[Sec. 3'
34
195, Santokhi v. Siro Jha, A.I.R. 1934 Pat. 301; Blmkar y pfiman^n
Bom. 313, Mating Mya v. Kkiine, A.I.R. 1936 Rang. 497, 166 I C 267 w.
ku V. Syed Ali, A.I.R. 1937 Pat. 178, 15 Pat. 772, 167 I.C. 890;
V. Gajadhar, 92 I.C. 478, A.I.R. 1926 AH. 300 ; and Muthi Karupaan v
Mnthmamhan, 38 Mad. 1158 (1160), where it has been held that deliven'
means such delivery as tlie thing to be delivered is Ci\pable of, and that
even where the purchaser is already in possession (e.g., as tenant or
mortagee) there can sfill be a formal delivery of possession widiin the
meaning of this clause, if the vendor by appropiiate acts and declarations
converts the possession of tlie tenant or mortgagee into that of a purchaser.
Tliese rulings have now been followed by the Calcutta High Court
(correcting its earlier view Kiihi Chandra v. Jogendra, 60 Cal. S84, 144
I.C. 155, A.I.R. 1933 Gal. 411 (412). And so, where property of value
less tlian Rs. 100 which had been aheady mortgaged with possession
was sold to the mortgagee, and possession was delivered by pointing out
boundaries, by endorsing on the back of the mortgage-bond tlie fact of
sale, and by handing it over to the mortgagee, the.se acts amounted to
formal delivery of possession within the meaning of tins section, and
the sale was validly effected Sonai Chutia v. Sonaram Chtifia, 20
C.W.N. 195 (196), 31 I.C'. 692 ; see also Ghana ram v, Paltoo, A.I.R. 1954
Nag. 109 (case of 4 tenant) ; Bihari Pradhan v. Doitari Dash, 25 Cut. L.T.
281. Where a property wliich is the subject of a usiifructuar)' mortgage
is sold to die mortgagee in discharge of die mortgage, a direction by die
vendor to die vendee to keep die property as absolute owner amounts
to delivery of possession Sheikh Dawood Moideen Batcha Saheb,
48 M.L.J. 264, A.I.R. 1925 Mad. 566, 87 I.C. 331. mere die mortgagor
of usufnictuaiy mortgage sold liis equity of redemption to tiie vendee
and as provided in the contract of sale die vendee paid off the mortgage
and got possession, it was held tiiat he got possession \vitli the assent
of the vendor which amounted to delivery of possession by die latter
Tukaram v. Atmaram, I.L.R. 1939 Bom. 77, 40 Bom, L.R. 1192, A.I.R.
1939 Bom, 31 (33). In such cases die mere existence of an unregistered
instrument does not debar die purchaser from falling back upon his
tide by delivery of the propeiiy Ghanaram v. Paltoo, supra.
In, a case of sale of immoveable proper ty,wordi not more than Rs.
100, by means of an unregistered sale-deed, it is not necessary- that
delivery of possession should be contemporaneous vddi the execution
of the sale-deed, which wall be valid even if the possession is delivete
some time after its execution Md. Yaqooh Ally v. Chhotey Lai, A.L
1939 Pat. 218, 179 I.C. 583 ; Bhulkoo v. Hereyabai, A.I.R. 1949 Nag. 41u,
I.L.R. 1949 Nag. 534.
Sec. 54]
Transfer of property 41 1
conticict of sale does not in ' itself create any interest in or charge on
the property. Under tlie English law, the purchaser by virtue of the
contract of sale becomes in equity the owner of the property from the
date of the contract. See Sugdens Vendors and Purcdwsers, (14th Ed),
p. 186 ; Walsh v. Lonsdale, 21 Ch. D. 9. Tliis principle of English law
has no application to places whei'e tlie Transfer of Property Act is in
force Ufai/ng Shwe v. Maung Inn, 44 Cal. 542 (P.C.), 21 G.W.N. 500,
38 I.C. 938 ; Daijabhai v. Maharaj Bahadur, 1 P.L.J. 238 (246), 34 I.C.
482; Jainarayan v. Balwant, A.I.R. 1939 Nag. 35, (1938) N.L.J. 379;
Narayanastcatni v. Lakshmi Narasimha, A.I.R. 1939 Mad. 220, 1939
M.W.N. 98, 48 M.L.W. 959 ; Mt. Shankri v. Milkha Singh, A.I.R. 1941
Lah. 407 (F.B.) ; Maung Shwe v. Mating Dun, 44 I.A. 15, 44 Cal. 542.
In the Punjab where the T. P. Act does not apply it has been -observed
in Jalahiddin v. Miran Baksh, A.I.R. 1941 Lah. 240 that an agreement
for sale gives the purchaser an equitable title as owner of the property
concerned, though it does not operate against a person who obtains a
legal interest in the same property in good faith witliout notice of
the equitable title. But see the later Full Bench decision of Mt. Shankri
v. Milkha Singh, suiwa, where it has been held that the purchaser under
a conti-act for sale which has not yet been completed cannot claim any
title as owner of the property whether as legal or equitable owner.
(It should be noted tliat prior to the Transfer of Property Act a
contract for the sale of immoveable property created an equitable
interest in the land and made the purchaser the owner in equity. See
Dinkarrao v. Narayan, 47 Bom. 191, at p. 215). A mortgaged Ins property
to B and then sold it to C, who agreed to sell it to D. B brou^rt a
suit on his mortgage imjileading C. D also filed a suit for the specific
performance of the contract to sell against C and got the sale deed
executed through court. But B was already in possession as an auction-
purchaser. D brought a suit for possession, contending that he had
acquired an interest akin to a charge on this property and that therefore
he was a necessary party to the mortgage suit instituted by B. Held
that suit was not maintainable because D acquired no interest in the
property under the agreement of sale Sankaram Vishnu v. Neelakanta
Iyer, A.I.R. 1955 Tr-Co. 195.
I Sec, S4
Sec. 54]
[Sec. 54
295, Sale to minor : The Madras High Court was once of opinion
that the Privy Council decision of Mohari Bibi v. Dharmadas Ghosh,
30 Cal. 539, declaring contracts by minors void, applied also to sales o
immoveable property to minors ; and hence such sales ..were wholly void
Navakoti Narayana v. Loyalinga Chetty, 33 Mad. 312, 19 M.L.J- 752,
4 I.C. 383 (SS4). But this decision has been overruled by the Full Bench
case of Raghava Charier v. Srinivasa, 40 Mad. 308 (313), where it las
been held that the Privy Couned decision in 30 Cal. 539 which was a
case of transfer by a minor should not be applied to a transfer ma e m
Sec. 55]
.53 I.C. 121 ; Kamsala v. Hussain Sab, A.I.R. 1935 Mad.' 55, 152 I.C. 988.
(e) between the date of the contract of sale and the deli-
very of the property, to take as much care of the
property and all documents of title relating thereto
ISEC. 55
Provided that, {a) where the seller retains aiiy part of the
property comprised in such documents, he is entitled to retain
therii all, and, {b) where the whole of such property is sold to
different buyers, the buyer of the lot of greatest value is enti-
tled to such documents. But in case (a) the seller, and in case
(b) the buyer of the lot of greatest value, is bound, upon every
reasonable request by the buyer, or by any of the other buyers,
as the case may be, and at the cost of the person making the
request, to produce the said documents and furnish such true
copies thereof or extracts therefrom as he may require ; and in
the meantime, the seller, or the buyer of the lot of patesc
value, as the case may be, shall keep the said documents sai ,
uncancelled and undefaced, unless prevented from so domg oy
fire or other inevitable accident.
Sec. 55 ]
53
[Sec. 55
Amendment In clause (1) (a) and clause (4) (b) the italicised
words have been added, and in clause 6 (b) tlie words with notice of
the payment have been omitted, by sec, 17 of the Transfer of Property
Amendment Act, XX of 1929. Tlie reasons have been stated in proper
places.
Gh. D. 42. The seller is bound under clause (2) of this sertion S*'
to his purchser a title free from reasonable doubt. But the pure m
may relieve the vendor of tlris obligation by a special contract
contrary and may choose to take such title as the vendor can giv '
siah Begum v. Rustamjah, 13 Mad. 158 (163);
JBut in. order to enable the parties to evade the operation of this
Sec. 55]
perty under stipulations which are against common right and place the
purchaser in a position less advantageous tlian tliat in which he other-
\vise would "be, it is incumbent on tlie vendor to express himself with
reasonable clearness; if he uses expressions reasonably capable of mis-
construction, if he uses ambiguous words, the purchaser may generally
construe them in the manner most- advantageous to himself per Knight
Bruce, V.C. in Seaton v. Mapp, 2 Coll. 556 (562) ; followed in Motbi-
ahoo V. Vinayak, 12 Bom. 1 (17). Moreover, in order to evade the opera-
tion of this section, the contract must be contrary to (i.e., inconsistent
with) its provisions. Tlius, where a conveyance was made in considera-
tion of a sum of money a portion of which was paid and the balance was
expressed to be payable wth interest in annual instalments, for which
the purchaser executed an agreement, it was held that the agreement
was not inconsistent with the creation of a charge under clause (4) (b),
and that the vendor was entitled to a charge for the balance of purchase-
money iiispite of the agreement v. MacphersOn, 31 Cal. 57 (72,
73) (P.C.). See also Notes under clause (2), infra.
[SEass
not be iJointed out by the vendor. Thus, the existence of an onen fnnf
path over the property (Kerofs v. Earl of Cadogan, 10 C.B. 591 a T
burner v. Sewell, [1891] 3 Ch. 405) or die ruinous state of the buildinp
is an instance of patent defect which tlie purchaser might have fou d
out by the exercise of ordinary diligence. But a vendor is bound to dh '
close all latent defects known to him, even though he may have stinu
lated to sell the property with faults Schmider Vr- Heath, %'CmQ 506
Latent defects are such as the greatest attention would not enable the
purchaser to discover Sugdens Vendors and Purchasers, p. 333 , ^
buyer is not bound to complete the sale if there are defects in' the pro-
perty or in the title which are material and also latent, that is, not dis-
coverable by the exercise of ordinary care, or if the title is not free from
reasonable doubt. A defect to be material must be of such a nature that
if the buyer had been aware of it he might not have entered into the
contract at all. Tlie liabihty of property to be compulsorily acquired
may fairly be said to amount to a material defect which is not capable
of being discovered with ordinary care Lallubhai v. MohanM, A.LR.
1935 Bom. 16, 59 Bom. 83, 155 I.C. 564. Wliere' the seller knowngly
made a representation in the sale-deed which was false and received con-
sideration on the strength thereof, it was a case of fraudulent mis-
representation. The principle of caveat emptor did not apply in such a
case, Varkkey v.-Chacko, A.I.R. 1953 Tr.-Coch. 256. Wliere the non-dis-
closure amounts to fraud the plaintiffs remedy is a suit for rescission
of the sale-deed and for return of the price pnder sec. 58, Specific Relief
Act. He cannot ask for a return of die iirice before the sale is rescinded
AUahadino v. Udhoomal, A.I.B. 1942 Sind 81, I.L.R. 1942 Kar. 32. But
see Varkkey v. Chacko, supra.
Acqording to the last para of this 'section, if the seller does not dis
close to his buyer any material defect in the property of j.
aware and of which the buyer is not aware and which he could no
cover with ordiriaiy care, tlie omission is said to be fraudulent ; a
the seller himself had no knowledge of the defect, the ^se
fall within this section -(fVt/rsmg Das v. Chutto Lai, 50 Cal. . J
74 I,C. 996, A.I,R. 1923 Cal. 641. Tlie'duty to disclose is not auemaa
TRANSFER OF PROPERTY 42 1
EC. 55i
by the fact tliat the buyer could have discovered the defect had he in-
spected the properly Ratanlal v. Nanabhai, A.I.fi. 1956 Bom. 175.
Whether the sale is made by auction or by private treaty the purchaser
is under no obligation to make enquiry as to defects in the vendors title,
but it is the duty of the vendor to disclose all that is necessary for his
own protection Sk. Moula Buksh v. Dhammchand Raniivala, 65 C.W.N.
881.
[Sec. 53
Sec. 55]
[Sec. 5}
Clause (1) (b) imposes upon the vendor the duty of producing his e
Sec. 551
54
[Sec. 55
Clause (1) (b) however, is not exhaustive, because it does not state
where the deeds are to be produced, at whose expense, and how far is
tlieir non-production vital to the contract 'Goirrs Law -of Transfer, 6th
Edn. Vol. I. p. 723.
Sec. 55]
was to deliver his statement if tliere were objections and requisitions, was
to date from the delivery of a perfect abstract which meant an
abstract that contained wth sufBcient fulness the effect of every instru-
ment whicli constituted the vendors title and contained all facts, e.g.
as the death of the father, where the title has to be shown to have
devolved upon the son Nilmoney v. Dhirendra, A.I.R. 1930 Cal. 428,
57 Cal. 1115, 126 I.C. 705. Tlie stipulation was not to be used to
thrust upon the purchaser a property to which there was no title at all
and even if the abstract be perfect, tlie stipulation could not debar the
purchaser from enquiring into the title or from making an objection to
it, if such an objection goes to the very root of the title Ibid, at p. 43)0.
It is the duty of the vendor to make out his title. Even where a
\endor has under the contract an express power of rescission if requisi-
tions are made, which he is umviUing to comply with,, yet that power
does not enable him to override reasonable requisitions R. G.
Lakshmidas & Co. v. Sir Dorab Tata, A.I.R. 1927 Bom. 195, 51 Bom.
247, 101 I.C; 229.
304. Cl. (1) (e) Take care of the property ; The vendor is pro-
tanto a trustee in possession although he holds the purchaser at arms
lengUi^ and, as a trustee, is bound to do those things wliich he would
be bound to do if he were a ti'ustee for any other person per Lord
Selbome in Phillips v. Silvester, L.R. 8 Ch. 173 (177). Cf. .section. 15 of
the Indian Tnists Act (II of 1882). He is bound to protect the property
t Sec. 5S
305. Cl. (1) (f) Delivery of possession: ^In eveiy contract of sale,
unless the contrary appears, the vendor must be deemed to impliedly
agree to give possession of the property' to the purchaser, in addition
to executing a conveyance in his favour Svrendra Ramanujan v. Sico-
Zingam,. 47 Mad. 150, 45 M.L.J, 431, A.I.R. 1924 Mad. 360, 77 I.C. 542,
Under clause (1) (f), the obligation is upon the vendor to give the
vendee possession, and not upon the latter to get possession for him-
self, especially when any difficulty arises in identifying die particular land
sold. It is the duty of the vendor to ascertain the subject-matter of sale
-tarpon Koer v. Kedar Nath, 1 P.L.J. 140, 35 I.C. 539. Where the
condition in the sale-deed was inter alia drat the vendor would not be
liable if any defect in title was found subsequently and that if the
vendee did not get possession, he should himselLtake steps to do so and
the vendor would help him ; but it was found that at the time of the sale
the vendor did not have possession and he had lost all right to obtain
possession, it was held that the above clauses did not exonerate the ven-
dor from the statutory liability under tliis clause Barisnl Loan Office v.
Satish, A.I.R. 1936 Cal. 12, 40 CW.N. 19, 160 I.C. 407.
Sec. 55]
buys, tlie nature of the contract shows that possession means possession
as Jandlord iSY/grfeHff Vendors and Purchasers^ p. g ; Venkata Siiraya-
siibba Rao v. Vasiideva, A.I.R. 1956 Andhra 113 ; Visicanatha Iyer v,
Muhammad Ktinju, 1964 Ker. L.Jl 12. If tlie property is already mort-
gaged with possession to a usufructuary mortgagee, the purchaser will
get such possession as the vendor had, viz proprietary possession
Mumtaziinnessa v. Bhagirath, 6 I.C. 114., The presence of tenants or
trespassers in the property does not affect the natiue of the property
as tlie expression its nature in tliis clause mean an incident which is
inherent in the j)ropertj' Sashi Bhttsan v. Rai Chand, A.I.R. 1950
Cal. 333.
[Sec. 55
305A. Cl. ( 1 ) (g) : 'The seller imposes upon himself the obligation
mentioned in this clause. The fact that the trustees of the property and
not the seller were to be the conveying parties does not affect diis obliga-
fion. Tlie meaning of the word seller cannot be limited in tliat way
Govindram v. State of Gondal, A.I.R. 1950 P.C. 99, 54 C.W.N. 419, 77
I.A. 156, 52 Bom. L.R. 450. Tlie terms of the contr.act 'of sale may ,
operate to substitute the date of possession for the date of sale. Mere
use of the word net in the price in the contract may be sufficient to
exclude the application of this clause ibid.
Sec. 55]
[Sec. 55
the pre-emptor after becoming aware of tJie fact tliat dip 7 t.r i
had not been paid off could iuid should have obtained a
m respect of it in the pre-emption suit-SitcZ v. A S
Clause (1) (g) clearly means what it says, viz., that there must be
a provision in the sale-deed that the property is sold subject to incum-
brances, and if diat provision is not siiecifically set out in the sale-deed,
dien the vendor will be liable for all prior incumbrances. Tliis clause
cannot be inteipreted to mean that the vendor is only liable if he
stated' in the sale-deed diat he sold the property free from incum-
brances Jugal Kishore v. Banwari, 51 All. 1053 119 I.C. 1, A.LR. 1929
All. 791; Alagappa v. Chettyar Firm, A.I.R. 1937 Rang, 287, 14 Rang.
766, 170 I.C, 484.
The mere fact that the vendee was aware of die existence of an
incumbrance does not relieve the vendor of the statutory liability to get
the incumbrance discharged in the absence of a conb-act to the con-
trary Podapati v. ManduvO', A.I.R. 1927 Mad. 193, 98 I.C. 450. -In sue
a case if the mortgagee institutes a suit on his mortgage impieading.
both the vendor and the vendee gets a decree and the properfaes a e
sold, the vendee would be entitled to damages, a suit ?
553, 138 I.C. 495. But where in such a mortgage suit it was touna m
the vendees were negligent in tlreir defence and did
pleas available to them and that there was really no cloud on
of the vendors and the vendees unnecessarily paid an exorhitan
the mortgagees without even consulting the vendors, the vend ,
not entitled to recover the amount so paid Seth Lookmanp v. g
Sec. 55]
TRANSFER OF PROPERTY 433
Even in tliose provinces {e.g., Berar) to which the T. P. Act did not
apply, a covenant for quiet enjoyment and freedom from incumbran-
ces should independently of this Act, be held to be implied in a sale,
in accordance with justice, equity and good conscience. Consequently,
the vendor was liound to reimljiirse the purchaser for the payment
made by the latter to discharge the incumbrances created by the
vendor and Jiot disclosed in the conveyimce Keshrimal v. Kadhai, 5.5
I.C. 152 (153) (Nag).
55
434 TRANSFER OF PROPERTY
I Sec. 55
Where the condition in the sale-deed was merely that the mortgage
was to be paid off by the vendee and provided that he was responsible
for future interest and was to pay it off before the property was endan-
gered, the presumption is that he was to ijay it off immediately, at any
rate, as soon as it was reasonably possible Kallu v, Ramdas, A.I.R. 1929
All. 121, 26 A.I.J. 53, 107 I.C. 679.
1929 A.L.J. 433, A.I.R. 1929 AH. 293 (295), 119 I.C. 243. See the tti
Sec. 55]
XJarR of clause (2), This para lays down that the benefit of the covenant
of title may be enforced by any person in whom tlie property is in
whole or in part from time to time vested. So, where the purchasers
have sold the property purchased by them to another person, they are
no longer entitled to get a decree for damages against the vendor for
his failing to convery proper title, because the property 'is no longer
vested in tliem but in their vendee, and it is their vendee and not they
themselves who have sustained damages for defect in the vendors title
Ramayya v. Kotayya, 32 L.W. 138, 1930 M.W.N. 195, A.I.B. 1930
Mad. 748 (751), 127 I.C. 617.
This clause applies not only to cases where there has been a com-
plete sale, but also applies to cases where the transaction has not pro-
gressed beyond the stage of contract per Abdur Rahim J. in
Adikesavan v. Qurunatha, 40 Mad. 338 (350) (Sadasiva Ayyar J. contra ) ;
Imiad Ali v. Mohini, 27 C.W.N. 1025, A.I.R. 1924 Cal. 148, 80 I.C.
623j Kathamvtliu v. Subramaniam, 50 M.L.J. 228, 94 I.C. 561, A.I.R.
1926 Mad. 569 ; Suhayya ChowdUtury v. Veerayya, 1955 Andhra W.R. 502.
In some other cases the Madras High Court also lays down that a
covenant of title is not only attached to a contract of sale but is also
attached to the conveyance Arunachala v. Ramasami, 38 Mad. 1171
(1175); Sigamani v. Munibadra, 49 M.L.J. 668, A.LR. 1926 Mad. 255,
91 I'.C. 514. Tlie words "seller and buyer include persons who have
agreed to sell and buy 'Surendra Maneklal v. Bat Narmata, A.I.R.
1963 Guj. 329.
[Sec. 55
.209, AJ.R. 1926 Mad. 495, 94 I.C. 302. So also, a guarantee of title coesu
include payment of arrears of rent which passed with tire an .
remedy of the purchaser, if the tenants fail to pay the aweM's o
suit against the tenants and not against the seller^- 1- ^ I
That. 6 But, L,J, 24, A,I,R, 1927 Rang, 134 (13,5), 101 I-C-
vendor gives guarantee of quiet enjoyment, his estate at e .
IS
SEC. 55 ]
OF PR6^ERTY 437
Ezhumalai Nattar, 81 Mad. L.W. 272. If the purchaser is. evicted the
measure of damage is the market value of the land at the time of
eviction 'Ibid. The covenant for good title can be enforced against
the universal legatee of the vendor, but not against a legatee of the
universal legatee Polamreddi v. YaratapalU, A.I.R. 1960 Andh. Pra. 29.
Under this clause, the seller merely gives a warranty that he has
in fact and in law the estate which he professes to have a warranty
which would take effect upon proof of breach: but he does not under-
take (as in England) to shoio a good title by production of documents
and verification of facts Jyoti Prosad v. H. V. Low & Co. 34 C.W.N.
347 (3511, A.I.R. 1930 Cal. 561.
[Sec. 55
a Court of Equity will not enforce the contract iP. B. & TOp r-n
Butler, 16 Q.B.D. 778 (787). Unless a marketable title is proved, specific
performance of the contract of sale cannot be granted UHegan v
Talyrkhan, A.I.R. 1938 Bom. 77, 39 Bom. L.R. 1166, 173 I.C. 714, i
1892 certain property was mortgaged to two joint mortgagees. In 1918
the owner of the property contracted to sell it and in order to prove
that the mortgage had been discharged, produced a certified copy oi a
registered release, dated September, 1902, which was executed by one
only of the mortgagees, but which recited that the other mortgagee
was dead and that the executant of the release was his sole heir and
representative and that the mortgage had been redeemed. No fuiiher
proof of the recital was offered : held by the Privy Council that the
vendors had failed to deduce a marketable title to the property, recitals
being evidence only against the parties to the deed or those pl aitning
through or under them Shrhiivas v. Meher Bai, 41 Bom. 300 (P.C.), 21
C.W.N, 558, 39 I.C. 627. The marketable title was the right, title and
interest of the mortgagee himself and the equity of redemption of the
mortgagor which the mortgagee was entitled to convey as the mort-
gagors agent Abraham v. Abdul, A.LR. 1949 Bom. 154. If a proper
title by adverse possession can be successfully made out, this would
fulfil the vendors obligation to make out marketable title
Shankerlal v. Jethmal, A.I.R. 1961 Raj. 196.
Sec. 55]
the land sold due to want of title of the vendor in it Naihuni Shah
V. Satyanarain Prasad, A.I.R. 1961 Pat. 11. If, however, the pur-
chaser obtains possession but is subsequently dispossessed owing to the
vendor's defect of title, tlie remedy of the purchaser is not a
refund, of the original consideration but damages measured accord-
ing to the market value of the land at the time of dispossession.
It would be unjust and inequitable ' to base the amount of damages
on the original consideration paid at tlie time of purchase, because
since that lime the situation might have considerably changed Md.
SiddHq v. Md. Nuh, 52 All. 604, 28. A.L.I. 653, A.I.R. 1930 All. 771
(777), 124 I.C. 185. See also Narasingaraytidu v. Ankineedu, 1961 Andh.
L. T. 421. In a suit for refund of purchase-money where the land is
still in possession of the purchaser, the fair rule will be to give him
such compensation as will compensate him for the defective quality of
his title. This of course, will vary considerably according to the cir-
cumstances of the ijarticular case Har Lai v. Mulchand, A. I. R. 1928
Bom. 427, 52 Bom. 883, 112 I.C. 27; Papu v. Kashiram, A.I.R. 1929
Bom.S61, 31 Bom. L.R. 658, 119, I.C. 659. A suit for refund of pur-
chase-money may be regarded as a suit for damages Enjad v. Mohini,
A:I.R. 1924 Cal. 148, 27 C.W.N. 1025, 80 I.C. 623. Wliere the vendor
who was impleaded as a defendant to tlie suit impeaching his title and
damages against the vendor for breach of the covenant. Held, that
the vendor was liable and he could not without imputing bad faith to
the vendee blame him for compromising the suit Narayan Kishan v.
Bhaurao, A.I.R. 1956 Nag. 124.
I Sec. 55
Wiere a contract of sale provided that "if any dispute arises from
any one, I (seller) shall settle them at my own expense. Held that .
the clause being vague was not sufBcient to constitute a contract to
the contrary. Held, further that the taking of possession and payment
of the balance of price did not amoimt to a waiver of the purchasers
rights to require a good title Subbayya Chowdary v, Veerayya., 19K
Andhra W.R. 502.
The effect of a covenant for title implied in this clause can be got
rid of by the vendor indicating by clear and tmambiguou^
he does not mean to guarantee that he has got title ^ gg
Sec. 55 ]
IfiANSFER OF PROPERTY 441
knowledge of the defect of his title. Under this clause there is a statu-
tory guarantee for good title unless the same is excluded by the con-
tract of parties, and the question of knowledge of the purchaser does
not afFect his right to be indemnified under the Indian statute law
Subbaroyya v. Rajagopala, 38 Mad. 887 (889) ; , Anmachala v. Ramasami,
38 Mad. 1171 (1175), 25 I.C. 618, 27 M.LJ. 517 ; Thekkemannengath
Raman v. Pazhiyot Manakkal, 28 M.L.J. 184, 27 I.C. 989; Basaraddi
V. Enajaddi, 25 Cal. 298 (301) ; Bapu v. Kashiram, 31 Bom, L.R. 658, 119
I.C. 659, A.I.R. 1929 Bom. 361 (364); Lakhpal v. Diirga Pvasad, 8 Pat.
432, 117 I.C. 654, A.I.R. 1929 Pat. 388 (389) ; Adikesavan v. Guru Natha,
40 Mad. 338 (351) (F.B.) ; Mahomed All v. Budbaraju Venkatapathi, 39
M.L.J. 449, 60 I.C. 235 (237) ; Nawal Kishore v. Sarju, 54 All. 774, 139
I^C. 99, A.I.R. 1932 All. 546 (547) ; Ramachandra v. Dwarkanath, 16
Cal. 330 ; Lachman Das v. Jatoahir Singh, 44 P,L.R. 1922, A.I.R. 1924
Lah. 476, 70 I.C. 250; Subbayya Chotodhary v. Veerayya, 1955 An. W.R.
502. ^Vhere the purchaser knew that there were disputes about the
title, but he was assured that he would be given documents to prove
that the property was' the vendors by ancestral right, held that the ven-
dee had a claim for damages against the vendor Parasurama v. Muthu-
swamy, -50 M.L.J. 100, A.I.R. 1925 Mad. 1209, 91 I.C. 313. Where the
vendor sold under the condition that the purchaser shall take such title
as the vendor possesses, and the vendor shall not be bound to give any
belter title to the purchaser than he possesses, and the purchaser believed
that the vendor had some title, however defective, but it was afterwards
found that the vendor had no title, nor even possession, held tliat the
purchaser could not be compelled to take the property Motivahoo v.
Vinayak, 12 Bom. 1 (17). ' Unless the purchaser took the conveyance with
all defects in the vendors title, the mere fact that he knew or was
expected to know all about the property conveyed to him would not dis-
entitle him to repudiate the contract and get a refund of the piurchase-
money Basarad^ v. Enajaddi, 25 Cal. 298 (301)). But a breach of
covenant for title or quiet possession would not entitle the buyer to
avoid the sale but would entitle him to damages, and such breach is no
bar to a suit for recovery of unpaid purcliase-money Soorayya v. Kateeza
Beegum, A.I.R. 1957 Andhra Pra. 688.
56
442 tRANSFER of PROPERIY
[Sec. 5S
&e vendee for the costs in suits in which the latter .would be .
to defend his title to the property conveyed, and where a suit
and the vendee incurred costs therefor in defending his title L If ^ ^
perty : held that the vendee was entitled to recover the costc-_V f
Rangayya v. Satijanarayam, 39 M.LJ. 316, 60 I.C. 164
swami Chettiar v. Muthukrishna Aiyar, A.I.R. 1967 S.C. 3.59
The clause in a sale-deed that if upon the objection of any one any
damage or loss accrues to the vendee, the vendor wll be liable amounts to
a contract of indemnity and is not a mere covenant for title and quiet pos-
session Manghdha v. Ganda Mai, A.I.R. 1929 Lah. 388, 102 I.C. 424.
\Vhen the buyer knows that the sellei has no title and still agrees to
buy with knowledge of want of title implied warranty cannot be invoked
Ramalinga Padavachi v. Nafesa Padayachi, A.I.R. 1967 Mad. 461. But
see Krishna Chandra v. Aireyaparupu Apparao, 33 Cut. L.T, .155.
Sec. 55]
Wliere there are several purchasers, the purchaser of the lot of the
greatest value (and not the largest area) is entitled to the custody of
the deeds [see clause (3) (b); see also Sugdens Vendors and Purchasers,
p. 434] even if he is the purchaser of the last lot and the vendor has
given a covenant to different purchasers to pi'oduce to them the
title-deeds Khademo v. Romer, 42 Bom. L.R. 1024, A.I.R. 1941 Bom.
48. But if there be a condition that the j^urchaser of the largest lot
shall have the title-deeds, such condition uall be given effect to and
the purchaser of the lot largest in superficial area sliall get them
Griffiths V. Hatchard, 1 K. & J. 17.
310. Clause (4) (a) Sellers right to rent before completion of sale :
The seller is entitled to all rents and profits of the land be-
tween the date of the contract of sale and the date of its completion.
The vendee will, however, be entitled to compensation for breach'*
of the contract to convey in addition to the execution of the conveyance,
and such compensation will naturally be the value of the mense profits
which could have been obtained between the date when the breach of
contract took place and the date when the conveyance was actually
executed Subbarot/ar v. Kottaya, 1916 M.W.N. 284, 34 -I.C. 737. But
although the vendor is entitled to rents and ]Drolits till the completion of
the sale, he cannot commit waste by taking crops in an immature state
or otherwise than by due course of husbandry-^Darts Vendors and
Purchasers, p. 733. After a suit for the specific performance of an agree-
ment for sale or in the alternative for damages was decreed, the
purchaser filed a subsequent suit for mesne profits: Held that the
suit was not maintainable as the jdaintiff was not entitled to rent and
profits until the conveyance had been executed in his favour, and also
on the ground that the suit was barred under Or. 2 r. 2, C.P.G.
Gogineni Ramakrishnayya v. Vennan Viraraghaviah, (1954) 2 M.L.J.
(Andhra). 11.
tHC.!i
purchaser, and he can maintain a suit for possession of the nmn i+t
notwithsanding such uon-paymeent. See Note 281 under sec 54 r
the vendor has got a charge for the unpaid purchase-money undw 2
chuseVelaijutha v. Covindasiuami, 30 Mad. 52-1 ; on anneal id j
54S (544). If II, e vendor ha, already deBvered posersta of fc o
perty to the purchaser before the payment of the price, he is not
entitled to rescind the contract and to recover possession from the
purchaser, or to resell the property to a third party. His remedy is
to sue for the money and he has a charge on the property for that
amount, under tliis clause Trimalrao v. Municipal Commissioner 3
Bom. 172 ; Moidin v. Acaran, 11 Mad. 263 (264). He will be entitled
to recover interest on the unpaid purchase money if the sale is not
completed v. Blumappa, A.I.R. 1966 Mys. 86-
Rajlingam v. Somanna, A.I.R. 1967 Andh. Pra. 7.
The charge which tlie vendor obtains under this Act is different
in its origin and nature from the vendors lien given by the Courts of
Equity in England; and the English cases as to a vendors lien for un-
paid purchase-money, though useful for tlie purposes of illustration,
are not autlioritative in the interpretation of the law on the subject
as laid down in sec. 55 ^ebb v. Mucphersm, 31 Cal. 57 (72) (P.C.).
Tlie Transfer of Property Act, observe their Lordships in this case,
"gives a statutory charge upon the -estate to an unpaid vendor unless
it be excluded by contract. Such a charge, therefore, stands in quite a
different position from the vendors lien, You have to find something,
either express contract or at least' sometliing from which it is a
necessary implication that such a contract exists, in order to e.\clude
the charge given by the statute. In their Lordships opinion there is no
ground whatever for saying that that charge is excluded by a mere
personal contract to defer payment of a portion of the purchase-money,
or to take the purchase-moilfey by instalments, nor is it, in their
Lordships opinion, excluded by any contract, covenant or agreement
with respect to the pmrchase-money which is not inconsistent with the
continuance of the charge. See also KfishfWwami v. Vijiaraghava,
(1939) 1 M.L.J-. 344, A.I.R. 1939 Mad. 590 (691), 49 M.L.W. 597;
Sobhalal v. Sidlielal, I.L.R. 1939 Nag. 636, A.I.R. 1939 Nag. 210, 1939
N.L.J, 252. The mere execution of a promissory note by tlie purchaser
for the amount due to the vendor does not extinguish the vendors
lien C. Sunduraja Fillai v. Sakthi Talkies, A.I.R. 1967 Mad. 12b
Dhanikachala Fillai v. A. Raghava Reddier, A.I.R. 1962 Mad. 423.
Sec. 55 ]
When the ownership passes at once, the money value of the charge
at the date of the sale-deed must be the amount of the purchase-money
remaining unpaid at that date, neidier more nor less Shaixkar v. Gofiram,
A.I.R. 1942 Bom. 67 (70), 43 Bom. L.R. 1014. But the charge is not
excluded by the fact that the buyer is to pay the money to a creditor of
the seller Ibid. As to the relinquishment of the statutory charge by a
subsequent agreement, see this case.
[Sec. 55
The vendors charge is non- possessory and does not confer on liim
the nght to retain possession by virtue of his charge. He is only entitled
to retain the title-deeds and to charge interest on the unpaid purchase
moneyVelayutha v. Govindasami, 30 Mad. 524. If the vendor retains
possession of die property, he is liable for mesne profitsHari Prasad v
Harihar, A.I.R. 1923 Pat. 205 (206), 70 I.C. 804. If the vendor continues
in possession of the property sold, and the vendee takes no steps for a
long period (e.g., 7 years) to take possession of the property, the vendor
has a right to retain possession until the purchase-money is paid Subrah-
mania v, Poomn, 27 Mad. 28 (30), Where title in the property has pass-
ed to die vendee notwihstanding the non-payment of part of the pur-
chase-money and die vendee brings a suit for possession, although it is
not competent to the Ckiurt to pass a decree for possession conditional
on the vendee paying the balance of ^e purchase-money, it is open to
the Court, while decreeing possession to the vendee, to incorporate in
the decree the statutory charge under die clause in favour of the vendor,
and it would be open to the vendor to enforce the charge by seeking
execution of that decree Shobhalal v. Sidhelal I.L.R. 1939 Nag. 636,
A.I.R. 1939 Nag. 1939 210, 1939 N.L.J. 252, following Bcsalinguc v.
CMnnava, 56 Bom. 556, 34 Bom. L.R. 427, A.I.R, 1932 Bom. 247 j Ro(
Lingam v. Somanna, (1965) 2 An. W,R, 401.
Where lost and 'where not : Tlie vendors charge is not lost by a
mere personal contract to defer the payment of- a portion of e pur
chase-money or to take the purchase-money by instalments; nor is i
lost by any contract covenant or agreement with respect to the pur ase
money which is not inconsistent with the continuance of the c arge
Webh V. Macpherson, 31 Cal. 57 (72), (P.C:), The mere taking of a proii^-
sory note from the purchaser for die purchase-money does n^ ex^
guish the UenKaruppiah v'. Hari Row, 21 M.L.J. 849, ^ ' .
Sec. 55]
. [Sec. 55
un-
Sec. 55 ]
Wliere the vendor leaves a part of the price wntH tlie vendee to be
paid to Iiis illegitimate son after tlie latter attained majority, the vendor
cannot be said to have a hen for the amount on the propertj^ sold
Chandra Kesavalu v. Periimal Chettier, (1939) 1 M.L.J. 820, A.I.R. 1939
Mad. 722, 1939 M.W.N. 437 ; see also Swaminafha v. Subharama, 50 Mad.
548, 51 M.L.J. 856, A.I.R. 1927 Mad. 219.
57
[Sec. 55
The vendor can enforce the charge against the property in flie
hands of the vendee within twelve years from the date of the sale-deed,
under Art, 132 of the Limitation Act Ahmad v. Raihan, A.l.R. 1934 All. \
525, (1934) A.L.j. 682, 148 I.C. 639. If the vendee sues for possession
and the vendor alleges non-payment of the full purchase-money, rauil
can pass a decree in favour of the vendee conditional oh payment of t e
balance of the consideration money Dhnri Sah v. Krishun Prasad
A.I.R. 1965 Pat. 29.
Against whom, enforceable : ^Tliis section, if read with sec. 40, s ows
that the vendor's lien is enforceable against the properly not only m le
hands of the purchaser but also in the hands of the transferees taii
of the non-payment of rjurchase-money Ramanand v. Sheo Has,
314; Meghraf v. ' Abdullah, 25 I.C. 208, 12 A.L.J. 1034;
United Refiners, 9 Rang. 56, A.I.R. 1931 Rang. 139, 134 I.C. 737 1 ms
is now expressly provided by the addition of the words any "
without consideration or any transferee with' notice of the n p
ment, The Special Committee remarks ; -4Sub-clause [b) ot
Sec. 55]
4 of the same section provides that the vendors lien for the purohase-
money can be enforced against tlie property in die hands of the buyer.
Tlie provision as it stands is insufficient, as such lien can easily be defeat-
ed by the buyer by parting witli the property. It is, thei-efore, proposed
fp provide that it can be enforced against the property in the hands not
only of the buyer, but also of all other persons claiming under him" if
they had notice of the sale. Tlie lien will be enforceable against a
purchaser, at a Couit-sale who had full notice of all the facts Sheo
Dulare v. Jaganmth, 7 Luck. 405, A.I.R. 1932 Oudh 88 (90), 136 I.C.
222 .
311B. Personal remedy ; ^Apart from die vendors lien on the -pro-
perty for the impaid purchase-money, the vendor has got a personal
remedy against the vendee. Under sutsec. (5) (b), the buyer is bound to
pay or tender the purchase-money to the seller, at the time and place
of completing the sale. Tliis shows that die vendee is held personally
liable for the purchase-money apart from the liability imposed on the
property purchased (Rag/u/7cZ v. Pitam, 52 All. 901, 1930 A.L.J. 1524,
A.I.R. 1931 AU. 99 (100), 130 I.C. 198. But, where the vendors had
bound themselves to accept as purchaser either the fiim or a person no-
minated by the firm and there was no provision that in the case of a-
nominee the firm would be liable for die balance of the purchase-
money, the members of the firm were not personally liable iRcm
Raghubir v. United Refineries, A.I.R. 1939 P.C. 143, 37 C.'V7.N. 633,
142 I.C. 788.
[Sec -55
tage of his own wrong, and the Court will deny him interest vun
V Nag.,, fa Iyer, 6 L.W. 233, 42 1.C, 5o/;
313. Clause (5) (a) Purcbasers duty to disclose facts : -|C3lause (5)
(fl) casts upon the purchaser the duty of disclosing to the seller any
of which the buyer is aware but of which he has reason to e lev
the seller is not aware, and wliich materially increases the
property. The duly of a buyer is not a duty arising from ^ x F ^
contract, but is a statutory obligation imposed on the buyer-Hua g
Sec. 55 3
T&ANSfEft 6# Pft6PERTY 45 }
Govinda, A.I.R. 1924 Mad. 544, 84 I.C. 626. Under the last para of
this section, the omission to make a disclosure under this' clause amounts
Id fraud, irrespective of intention. And so it has been held in an English
case ; . If a person comes to me and offers to sell to me a property whidi
I know to be of five times the value he offers it for, he being ignorant
df his rights and in the belief that he cannot make out a title which I
know that he can, and I conceal that knowledge from him, is that not a
sttpressio vert, which is one of tlie elements wliich constitute a fraud ?"
Summers v. Griffiths, 35 Beav. p. 32. Tims, a purchase for an inade-
quate price from an old and infirm woman ignorant of tire value of the
property sold was set aside on the ground of fraud Sadashiv v. Dhaku-
bai, 5 Bom. 450.
Wliere the purchaser is directed by' the vendor to jiay off, out of the
purchase-money, certain debts due by the vendor to his creditors, and
the vendee undertakes to do so, such creditors can institute a suit against
the vendee and recover the amount due to them although they had no
notice of, and were not parties to, the agreement between the vendor
and the vendee in respect of payment of their debts. Tlie purchaser in
such a case is treated as the trustee of the vendors creditors for the
money reserved in his hands, for their benefit Divarka Nath v. Priya
Nath, 22 C.W.N. 279 (281), 36 I.C. 792, folloiving Gregory v. Williams,
(1810 3 Mer. 582. It is doubtful whether the purchaser in such a case
[ Sec. 55
Tliis. section does not affect the passing of title^ to the vendee. R
Sec. 55 3
merely fixes a starting point of limitation for the recovery of the consi-
deration money -Ghanashyam v. Udayanath, A.I.R. 1949 Or. 14, 14 Cut.
L.T. 40. If money is left with the buyer to pay off an incumbrance and
the buyer fails to do so, he is liable to return the amount to the seller
Soorayya v. Katuza Beegam., A.I.R; 1957 Andhra Pra. 688. A suit to
recover the amount is to be brought within 12 years, not from the date
of the sale but from the date when the incumbrance is satisfied by the
vendor or is otherwise extinguished iD. Bubbaiah v. G. Suryanarayana,
A.I.R. 1959 Andh. Pra. 636 (S.B.).
315. Clause (5) (c) From completion of sale purchaser must bear loss :
-r-After tlie sale is complete and the ownership - of the property pas-
ses to the buyer, the purchaser must suffer any loss of' the property
caused by destruction. If, however, the property had been insured by the
vendor against loss by fire, the .purchaser is entitled to the benefit of the
insurance. See this subject discussed under sec. 49 ante.
315. Clause (5) (d) ^Payment of public charges and rents : ^The
liability of tlie purchaser to pay rents and discharge burdens incidental to
his ownership commences from tlie very date the oivnership has passed to
him, irrespective of the fact whether he obtained possession on that date ;
and this principle is applicable also to Court-sales, though the section as
sucli does not apply to them. Tlius, where the purchaser at a Court-sale
had his sale confirmed on the 31st March but did not obtain possession
till the 11th May following, he was held .to be liable to pay the two
instalments of rent which fell due subsequently to the confirmation' of
the sale, namely on 1st April and 1st May, and it was immaterial when
he recovered actual possession of the land Ramasami v. Annandurai, 25
Mad. 454.
[Sec. 55
chaser takes the property subject to the burden attadied to it. If the
incunibran 9 es turn out to be invalid, the vendor has notliing to complain
of. He has got what he bargained for. His idemnity is complete. Hae
vendor cannot pick up the burden of which the land is relieved and seize
it as his own property Izzatunnessa Begam v. Kunivar Pertab Singh,
31 All. 583 (589) (P.C.) overruling Inayat Singh v. IzzatHnnessa, 27 All.
97 (F.B.). But see Ram Lai Sin^i v. Harihar Prasad, A.I.R. 1955 Pat.
254, where A sold in 1937, certain properties to B who undertook to pay
to the creditors of A certain specified amounts in discharge of mortgages
on tire other properties of A, out of the consideration for sale. As the
Biliar Money Lenders Act, 1938 provided that interest in excess of the
principal could not be realised there was an excess of purchase-money
in the hands of B. A sued to recover the excess. Held that B being in
the position of a trustee was liable to refund the excess. Hie Kerala
Hi^i Court has, however, held in Kunjikavit Amma v. Jandki Amma,
A.I.R. 1957 Ker. 98 that where any property is sold subject to an incum-
brance which is subsequently found to be invalid, the benefit goes
exclusively to the purchaser. On a conveyance for value of lands
subject to a mortgage and expressed to be so conveyed there is
in the absence of express agreement, an undertaking implied by law on
the part of the jjurchaser to indemnify die vendor against personal liability
on foot of the mortgage Janki v. Md. Ismail, A.I.R. 1932 Pat. 273, 139
I.C. 52.5.
This clause is divided into two parts. Under the first part, the pur-
chaser is entitled to certain rights which he can enforce 'unless he has
improperly declined to take delivery, which means that he is to lose
those rights if the other party can show that he (the purchaser) has
improperly declined to accept delivery, and the onus lies on such party.
Under the latter part of the clause, the purchaser gets certain additional
Sec. 55 ]
rights which he can claim only if he can show that he has properly
declined to take delivery, and tlie burden of showing it will be upon
himself. The latter part of this clause corresponds to sec. 18 (c) of tire
Specific Relief Act.
Where the vendor is not able to give die vendee a title free from
reasonable doubt, the latter properly declines to complete the sale. The
fact that ultimately the Court finds the title elear does not disentitle
the vendee to claim return of the earnest money Tulsidas v. Fritbai,
A.I.R. 1943 Sind 92, I.L.R. 1942 Kar. 543. Tire Court will not force a
doubtful title on the vendee. Where the purchaser properly declines
to accejjt delivery of tlie property, he is entitled to get back the earnest
money and a charge on the property for the same Mvnnalal v. Zamak-
lal, A.LR. 19.52 M.B. 145.
Tliis clause undoubtedly gives tlie buyer a charge over the property
which he has contracted to buy for the price, pre-paid. There is no
question of ownershqi involved in die assertion of diat charge, for the
ownershqi in the jiroperty would still be in the seller until the execution
of the conveyance under sec. 54, which in effect provides that a contract
for the sale of immoveable property does not of itself create any inter-
est in or charge on such property. But at the same time it does not
destroy effectively the equities of parties to the contract Hari Bapuji v.
Bhagu, A.I.R. 1937 Bom. 142, I.L.R. (1937) Bom. 140, 162 I.C. 804.
^Vllen an owner purxiorts by an oral sale to transfer his property and
delivers possession to another iierson, the possession of the transferee
must be deemed to be adverse to the owner and a suit for recovery of
ipossession must be filed within 12 years of the delivery of possession
Dagadu Dhondu Patil v. Trakadu Motiram Patil, A.I.R. 1957 Bom. 79.
58
[ Sec.
on liis part Whitebread & Co, v. Watt, (1902) 1 Ch, 835 (C.A.) ; Bal-
bhadra v. Sheomanga], A.I.R. 1931 Mad. 592, 54 Mad. 708, 131 I.C. 487;
Abdul Hamid v. Mahomed Ali, A.I.R. 1952 Bom. 67, 53 Bom. L.R. 817
Saraswatibai v. Kishenchand, sui^ra. Tliere can be no doubt, tliat when
a purchaser has paid his iDurchase-money tJiough lie has got no convey-
ance, the vendor becomes a tiustee for him of the legal estate. When
instead of paying the whole money he pays a part of it, it would seem
to follow as a necessary coroUaiy that to the extent to which he has paid
tlie purchase-money, to that extent the vendor is a trustee for him ; in
other words, that he acquires a lien exactly in the same way as if upon
the payment of a part of the purchase-money the vendor has executed
a mortgage to him of the estate to that exirent per Lord Cranworth
in Rose v. Watson, 10 H.L.C. 672 (683) ; Kesar v. Minma, 13 N.L.R. 19,
39 I.C. 50 (51). Thus, if the vendor refuses to grant a proper convey-
ance, the purchaser is not bound to tender a draft conveyance to the
vendor for execution nor to tender any purchase-money, and is entitled
to recover the money already paid \Essaji v. Bbimji. 4 B.H.C.R. (O.C.)
125. If the vendor received the purchase-money but executed a convey-
ance which he failed to register within the period of registration, where-
upon it became invalid, held that the vendee was entitled to a charge
under this clause, though he could not claim possession of the property
Lalchand v. Lakshman, 28 Bom. 466.
In cases of oral sales, which are invalid, the vendee has a charge on
the property for the advance and tliis charge is not affected by the fact
that he is in possession of the property Jibhaoo Had Singh v. Ajab
Singh, A.I.R. 1953 Bom. 145, 54 Bom. L.R. 971.
SEC. 55 ]
The Act does not provide expressly for the return of a portion of
the purchase-money when the buyer fails .to complete payment and the
sale therefore falls through ; but die provisions of the Contract Act
apply generally to contract of sale of immoveable property. Tlius where
the buyer refuses to complete the contract of sale and the seller puts
an end to the contract under sec. 39, Contract Act, the buyer loses his
charge under this clause, but the seller has no right to retain any instal-
ments 0 ^ price that have been paid, unless they have been paid as
deposit or earnest. In such a case the buyer can sue for return of liis
p.art payment, but he has no right to interest on his jpart payment. Where
the contract does not provide a penalty, the seller has a riglit to make
a counter-claim for damages which right is something quite independ-
ent of the amount of any part payment made Madhaodas v. Jan Maho-
med, I.L.R. 1941 Kar. 495, A.I.R. 1942 Sind 37. An improper refusal
by the buyer to accept delivery disentitles liim to a charge on the pro-
perty Rambadan v. Prasanfh Choubey, A.I.R. 1965 Pat. 404.
Deposit and earnest money : TTlie deposit or earnest money has two
characteristics : (1) it is an earnest or security and (2) it is also a part-
payment of the price. In the absence of a contract to the contrary,
express or implied, the earnest money is liable to be forfeited when the
contract is not carried out owing to the vendees default Naresh v.
Ram Chandra, A.I.R. 1952 Cal. 93. - Where the contract could be speci-
fically performed under sec. 13, Specific Relief Act, the vendee is not
entitled to get a refund of the earnest money Ruidu Ram v. Bhtiri Lai,
A.I.R. 1952 Punj. 380.
Tlie deposit paid iqjon a contract between the vendor and purchaser
is in the nature of an earnest or guarantee for the fulfilment of die con-
tract as well as a part payment of die purchase-money Hall v. Burnell,
(1911) 2 Ch. 511. Earnest money is part of the purchase-price when
the transaction goes forward ; it is forfeited when the transaction falls
through by reason of the fault or failure of the vendee Chiranjif v. Har
[ Sec. 55
Swarup, A.I.R. 1926 P.C. 1, 24 A.L.J. 248, 94 I.C. 782 ; Krishna Chan-
dra V. Khan Mamud, A.I.R. 1936 Cal. 804, 161 I.C. 166. A vendor
obtaining rescission owing to default in completion by the purchaser is
entitled to the deposit in' the absence of any express stipulation to the
contrary Hall v. Burnell, supra. But where the seller has no personal
interest in the property there is no statutory charge on the earnest money
under this clause Shailendra v. Hade Haza, 59 Cal. 586 ; Panchanan
V. Nirode, A.I.R. 1962 Cal. 12. Though there may be nothing specific
about the forfeiture, the mere fact that a deposit \vas demanded carries
with it the implication that it should be forfeited if the contract was
broken, unless the purchaser iDrovcs an agreement to the contrary
Gopalaratna. v. Rajaratna, A.I.R. 1938 Mad. 246, 173 I.C. 955. It must
however be a deposit proper. There may be cases where the Courts
may find that the amount of the deposit or jjart payment in advance is
so great in comparison with the amount payable under the contract, that
the parties cannot have intended it as a mere security for performance,
but rather as a punishment for non-performance of the contract and in
those cases the Court may doubtless refuse to allow' the retention of the
w'hole of the deposit Venkoba v. Sanjivappa, A.I.R. 1937 Mad. 681, 173
I.C. 233. 'Wliere a contract for sale is not completed, the purchaser jray-
ing a certain sum in part payment of the price and not as earnest money
is entitled to recover it w'ith interest, whether the breach is on his part
or on the part of the seller Krishna Chandra v. Khan Mamud, supra.
Wiere a vendee was in the process of paying the balance of purchase-
money and was ready to joay it all, and w'as asking for performance by
the vendors of the contract, then the vendee is entitled to recover not
only tliat part of the purchase-ijrice which he had already paid, but also
the earnest money and he is entitled to have a charge on it U Tha v.
Chettier Firm, A.I.R. 1938 Rang. 367. The vendee is entitled to a refund
of the earnest money where the transaction falls tlirough for the reason
that the vendor is unable 'to convey a valid title free from doubt, although
he was aware of the defect in the vendors ijosition ; but he is not
entitled to interest on the amount Lachmcfn v. Jawahir, 70 I.C. 250,
44 P.L.R. 1922.
Where tlie vendor agrees to sell the land w'hich cannot be trans-
ferred without the sanction of the revenue authorities and fails to obtain
sanction for lack of diligence he is guilty of breach of his obligation
under the contract and is bound to return the sum jjaid to him including
earnest {Krishanlal Onkardas Goyanka v. Suryadatta, A.I.R. 1958 Madh.
Pra. 239.
The purchaser loses his deposit money if the sale goes off through
his default or if he unjustifiably repudiates the contract Balvanta v.
Bira, 23 Bom). 56 (61) ; Rabina Bibi v. Satyamthi, A.I.R. 1963 Andh.
Pra. 304. Tims, where owing to the non-payment of the balance of pur-
chase-money within the specified time by the purchaser, the vendor is
entitled to rescind the contract of sale and does so, he is not bound to
return the deposit money to the purchaser Nafesa v. Appaou, 33 Mad.
373 (374) ; Bishan Chand Radha. Kishen, 19 All. 489 (491) ; Ex parte
Barren, In re Parnell, L.R. 10 Cli. App,. 512. And if the sale falls
through on account of the purchasers own default, he cannot take advan-
Sec. 55]
But the fact that the balance of price was not paid on due date by
the purcliaser, does not entitle the vendor to retain the deposit, if there
are no facts found to sho^y that the purchaser has by his delay in pay-
ment lost his right of specific performance, or if tliere is no conduct on
the purchasers jiart sucli as to amount to a repudiation of the contract.
If in such a case the vendor denies the contract in toto, he cannot be
allowed to retain the deposit Alokeshi v. Hara Chand, 24 Cal. 897
(899). I do not say that in all cases where tliis Court would refuse spe-
cific performance the vendor ought to be entitled to retain tlie deposit.
It may well be that there may be circumstances which would justify this
Court in declining and which would require the Court according to its
ordinary rules, to refuse to order specific performance, in which it could
not be said that the purchaser had repudiated the contract or that he
had entirely jiut an end to it so as to enable the vendor to retain the
deposit. In order to enable the vendor so to act, in my opinion, there
must be acts on the part of the purchaser, which not only amount to
delay, sufficient to deprive him of the equitable remedy of specific per-
formance, but which would make his conduct amount to a repudiation
on his part of the contract {per Cotton, L.J. in Howe v. Smith, (1884)
L.R. 27 Ch. D. 89 (95). Wliethei' a sum of money was paid as earnest or
as part payment towards the discharge of the contrart for sale depends
upon the intention of the parties and the circumstances surrounding
the payment Krishanlal v. Suryadatta, A.I.R. 1958 Madh. Pra. 239.
[Sec, 55
ment" in this clause makes the charge of the buyer for price pre-paid
effective not only against the seller, but against all persons claiming under
him, iiTespective of notice. Therefore, if a buyer has a statutory charge
against the property purchased by third persons, he can enforce it against
that -property and the plea- of want of notice on third persons part would
be of no avaHHari Bapuji v. Bhagti, A.I.R, 1937 Bom. 142, I.L,R. (1937)
Bom. 140, 167 I.C. 804.
Pleading : ^Where the only issue presented to the trial Court was
simply cancellation of a contract for sale and a contractual charge on
the land under a fresh agreement for the purchase-price advanced, the
High Court was not justified, on failure of that case, in entertaining the
question of a statutory charge under this clause, as owing to its absence
from the pleadings and the issues, important questions of fact, arising
under the section had not been considered M. M. R. M, Chettiar Firm
V. S. R. M. S. L. Firm., 46 C.W.N. 57 (P.C.), Aa.R. 1941 EC. 47. Wliere
there is no completed sale and there is no valid contract of sale no charge
can be claimed on the property purported to be sold for the purchase
money paid Nadoda Khirna Keshar v. Bombay State, I.L.R. (1967) Guj.
323.
Agreement for sale need not be registered : ^It was held by tlie
Privy Council tliat, having regard to the provisions of tins clause, if a
vendor entered into an agreement for sale of any immoveable property
in writing and received earnest money as part of the consideration, the
purchasers suit for specific performance would not lie unless the agree-
ment itself was registered Dayal Smgh v, Indar Singh, 31 C.W.N. 125
(128) (P.C.), 53 I.A. 214, 24 A.L.J. 807, 51 M.L.J. 788, 98 I.C. 508,
A.I.R. 1926 P.C. 94. Tliis rulmg came as a surprise to the Bench and
Bar in India, as being contrary to law and precedents, for the Indian^
law never required a mere contract of sale of immoveable property to
be registered. Tire Indian Legislature thereupon intervened to rectify
tliis erroneous decision by enacting die Indian Registration Amendment
Act (II of 1927), which added the following Explanation to sec. 17 of die
Registration Act : "A document purporting or operating to effect a con-
tract for the sale of immoveable property shall not be deemed to require
or ever to have required registration by reason only of the fact that such
document contains a recital of the payment of any earnest money or of
the whole or any part of the purchase-money.
Sec. 56]
otlier of the two parties j but where the sale has been actually carried
out and the purchaser has obtained possession (so that there has been
no failure of the contract) this clause does not apply ; and he cannot
recover interest, owing to delay in his obtaining possession after the pay-
ment of purchase-money where the delay was not through any default
on the part of the vendor Kapatoanj MimicipalHy v. OcJiJiaval, 30 Bom.
L.R. 920, A.I.R. '1928 Bom. 328 (332), 113 I.C. 161. Interest can be claim-
ed from the date of the institution of the suit for the refund of the
purchase money and not from the date of payment Krishanlal v. Sr-
yadatta, A.I.R. 1958 Madh. Pra. 239.
Tliis clause gives the purchaser a lien for tlie advance purchase-
money and for interests and costs, but not for the damages awarded to
him ^uZfan Kani v. Meera, 56 M.L.J. 99, A.I.R. 1929 Mad. <^89 (191),
115 I.C. 251. Where the seller did not disclose to the buyer that the
permission from the Gwalior Government accorded to the seller for using
his land, though agiicultural, for building a house on it was non-trla'ns-
ferable. Held that it was a material defect in the sellers title which
the buyer could not witli ordinary care discover Jhamaklal v. Mishrilal,
A.I.R. 1957 Madh. B. 23.
The Punjab : ^Altliougli tliis Act is not in force in tlie Punjab, the
principle enunciated in clause (6) (Jt>) being a general rule of English
law applies as" being in accordance with justice, equity and good consci-
ence Mt. Shanhri v. Milkha Singh, A.I.R. 1941 Lah. 407 (F.B.).
[Sec. 56
The section begins with the words Wliere two properties are sub-
ject to a common charge, and does not provide for the case when there
are more properties wliich are subject to a common charge and some or
one of them is afterwards sold. To provide for such cases we pro-
pose to amend this section and bring it into line witli sec. 81 which deals
with the marshalling of securities. Report of the Special Committee.
The principle of,^this section does not rest on want of notice. It can
be applied before another person acquires interest in the property for
valuable consideration Sain v. BuJaqui, A.I.R. 1947 Lah. 530.
Sec. 56]
Vellaya, 47 Mad. 688 and Amir Chand v. Sheo' Pershad, 34 Cal. IS! The
right of tlie mortgagee to bring any portion of tlie mortgaged property
to sale was not curtailed by the fact of the mortgagor selling a portion
of die mortgaged property to a third person ; and it was not incumbent
upon die mortgagee to proceed first against that portion of die property
which had not been sold by die mortgagor Dilawar Singft. v. Balakiram,
11 Cal. 258 ; Bliikhari v. Dalip Singh, 17 All. 434 ; Siibba Rao v. Lalcshi-
mratjana, 22 L.W. 389, 92 I.C. 593, A.I.R. 1925 Mad. 1214 ; Ram Raju
V. Subbarayndu, 5 Mad. 387. This was a great disadvantage to the pur-
chaser, consequendy die words as against die seller have been omit-
ted from, the present section. A subsequent purdiaser can claim mar-
shalling even though he is the mortgagee of some other property of his
seller Braham Parkash v. Manbir Singh, A.I.II. 1963 S.C. 1607.
59
[Sec. 56
there seems strong' ground to contend that the original incumbrance or
lien ought to be borne rateably between them according to die relative
values of the estates Robbing Peter to pay Paul is not a prin-
Sec. 57]
TRANSFER OF PROPERTY 467
.trary need not be express. It may be implied from the facts .and sur-
rounding circumstances Venkata v. Venkayamma, A.I.R. 1946 Mad. 59.
(1945) 2 M.L.J. 412.
The statutory charge under this section" does not provide for interest
and costs Pirthiraj v. Riikmin, supra.
Execution Sales : Tlie rule laid down in this section has been
applied to execution sales Ram Lochan v. Ram Narain, 1 C.L.R. 296;
Tadigabla v. Lakchmana, 5 Mad. 385; Sain Ditto v. Bulaqui Mai,
A.I.R. 1947 Lah. 230, 226 I.C. 366; Bishonath v. Kishiomohan, 7 W.R.
488 ; Blodh Mai v. Ram Harakli, 7 All. 711 ; Was Deo v. Dhem Mai,
A.I.R. 1940 Lah. 291, 42 P.L.R. 321, 190 I.C. 525. But see contra
Naubafv. Mahadeo, 51 All. 606, 1929 A.L.J. 419, A.I.R. 1929 All. 309
(311), 116 I.C. 297, and Rama Shankar v. Ghulam Hvssain, 43 All. 589
(594). In the last mentioned case, four villages L, P, S and D were mort-
gaged to a certain person. Out of tliese properties, P, S and D were
sold in execution of a money-decree and purchased by A. The mortgagee
then obtained a decree on his mortgage and in execution of it caused
the village L, which still remained in the hands of the mortgagor, to be
sold by auction. Tlie amount realised being insufficient, the mortgagee
caused the village D to be then sold. Held that this section would not
apply since the sale in this case was a Court-sale (sale in execution of a
money-decree), that the property -L would not be primarily liable for the
mortgage-debt under this section but that all the four villages would
rateably contribute to the mortgage-debt in accordance with the provi-
sions of sec. 82.
Though this section does not in terms apply to execution sales, the
equitable principle hereof can be invoked" by an auction purchaser sold
in execution of a money decree a bonafide purchaser for value
without notice of the prior mortgage Lachminarayan v. Janmajoy,
A.I.R. 1953 Pat. 193. In the case of executable charge decrees against
several properties the Court can sell the charged property or a sufficient
part thereof. Tlie Court can decide what properties should be proceed-
ed with without prejudicially affecting the decreeholders riglits Nilkan-
thrao v. Satyabhama, A.I.R. 1944 Nag. 25 ; I.L.R. 1944 Nag. 340. If a
person purchases one out of the Rvo mortgaged houses from the mort-
gagor judgment-debtor the purchaser can invoke this section IKaram
Singh v. Shvkla, A.I.R. 1962 Punj. 477.
[Sec. 57
But in either case there shall also be paid into Court such
additional amount as the Court considers will be sufficient to
meet the contingency of further costs, expenses and interest,
and any other contingency except depreciation of investments
not exceeding one-tenth part of the original amount to be
paid in, unless the Court for special reasons (which it shall,
record) thinks fit to require a larger additional amount.
Sec. 5:^]
Tliis- section, excepting the last two clauses, has been taken almost
w'ord for word from sec. 5 of the EngUsh Conveyancing Act, 1881.
Object of the section : ^Tlie power w'hidi under this section the
Court may exercise in the case of any sale is intended to facilitate the
alienation of incumbered estates by relieving the land from the incumbr-
ance and substituting for the land another form of security. Shephard
and Brown, 7th Edn., p. 218.
and the case was covered by sec. 244 {c) of the C. Pi Code, 1882
CHAPTER IV
Sfid. 58 ]
[ Sec. -58
(1) A proviso has been added to clause (c). See Note 338.
(2) Tlie italicised words have been added to clause (d). See Note
342.-
(3) Clauses (/) and (g) defining equitable and anomalous mortgages
respectively have been newly added ; clause (/) has been taken
from the last pai-a of sec. 59, and clause (g) from section 98
with certain modifications.
The reasons for the amendments have been stated below in propei
places.
Early laws of mortgage : ^In the early days of the British rule,
mprtgages were legislated for in Regulation 1 of 1798, and later on vi
Regulations XXIV of 1803 and XVII of 1806, but these Regulations gave
a somewhat cumbrous and unsatisfactory procedure, and were confined
to bge-bil-waffas, katkobalas, and other mortgages with possession, and
did not cover simple mortgages, ^is form of mortgage never having
been legislated for, there was no protection to the debtor. Tlie practice
was for the creditor to get a money-decree and sell up the mortgaged
property without allowing any time for redemption. Hie sale being
an ordinary execution sale of the riglit, title and interest of the debtor,
whatever it might be, it was usual, when the same jiroperty was pledged
to different creditors in different mortgage bonds, for each creditor to
hold a separate sale, and leave the purchasers to fight out in Court the
question of. what they had brought under their respective sales. Hiere
being no machinery for bringing togetlier in one suit the various incum-
brances on tlie property, endless confusion had been die result, and the
decisions of the Court upon the almost insoluble problems arising from
this state of things had been numerous and contradictory. The result
Sec. 58]
vyas that the mortgaged property could not fetch anything like its A^alue.
Hie debtor was ruined, tlie honest and respectable money-lender dis-
couraged and a vast amount of gambling and speculative litigation fost-
ered. It has been one of the objects of this chapter to remedy those and
other similar evils Speech of Honble Mr. Evans on the Transfer of
Property Bill (1882).
60
tSEc. 58
gages, and every word of the definition is borne out by the decisions of
the Indian Courts of Justice per Mahomood, in Qopal y. Farsotam
3 All. 121 (137).
Sec. 58 ]
Natesa v. Sahasranama, A.I.R. 1927 Mad. 773, 103 I.C. 814. If mouzas
A and B are sijecifically mortgaged and the mortgagee is given the right
to sell mouza C if necessary, mouza C too is covered by the mortgage
Monimala Devi v. Indii Bala Debya, A.I.R. 1964 S.C. 1295.
Mi TRANSFfifi. O? PR6pMfy
[Sec. S8
for Rs. 100 or upward it must be registered ; if below Rs. 100, it may be
by registered deed or by delivery of possession (sec. 59).
Sec, 58]
[ Sec. 58
Where the mortgagee has advanced tha money but the mortgagor
refuses to execute a mortgage, the former can bring a suit for specific
performance for compelling the mortgagor to e,xecute a deed of mort-
gage, though of course it will be open to the latter to elect to repay the
loan. Ghoses Laio of Mortgage, 5th Edn., pp. 74-75, Where an agree-
ment between a Company and H provided that all stock-in-trade of the'
Company shall be under hypothecation to H, and that the Company will
soon execute in favour of H a regular deed of mortgage of the land, etc.,
for the sum of Rupees five lakhs to meet any deficit that may be due to
H for the advances made by him after availing of the stock under
hypothecation to H as afoi-esaid held that the agreement created a
right in Hi to obtain a regular deed of mortgage which was to be execut-
ed by the Company Nnkinnchand v. Radha Kishen, 34 C.W.N. 506 (511)
(P.C.), A.I.R, 1930 P.C, 76, 123 I.C. 157, 32 Bom, L,R. 533, 58 M.L.J.
453.
Sec. 58]
Under the English system of law in cases where the ordinary fomi
of mortgage in use in England before the passing of the Law of Property
Act of 1925 is adopted, the whole of the mortgagorV interest passes to
his mortgagee, notwithstanding that an equity of redemption remains in
the mortgagor. Tliis equitable right is, however, an estate in the land
and is not merely a personal contract on the part of transferor. But in
India, since tlie passing of the T. P. Act, there is no distinction in Indian
law between law and equity in regard to the rights of mortgagors and
mortgagees. This Act is a self-contained code by which alone tlie rights
'of mortgagor and mortgagee have to be ascertained Ram Kin-
kar v. Satya Cbaran, A.I.R. 1939 P.C. 14, 43 C.W.N. 281. The Indian
authorities recognize the principle that the distinction between law and
equity has no place in Indian law Ibid, at p. 287. By the Indian law
the interest which remains in the mortgagor is a legal interest and its
retention may, therefore, prevent the whole of the mortgagors interest
from passing to the mortgagee Ibid., at p. 288. See also Bhupati v. Bon
Behari, A.I.R. 1941 Cal. 436. There is no doctrine of law in India which
prevents a beneficiarj'^ under a trust from dealing with his interest by way
of mortgage, though it is true enough that in India such an interest is
not technically regarded' as an equitable estate Hem Chandra v. Sura-
dhani, I.L.R. 11940) 2 Cal. 436 (P.C.), A.Ii.R. 1940 P.C. 134, 45 C.W.N.
253.
[Sec. 58
Sec. 58]
61
482 TRANSFER OF PROPERTy
[Sec. 5.8
to contract you may sell the said fields through the Court and recover
amount. If any balance remains, we will pay it off pereonally or by
means of our other property ; held that the above stipulations created
a mortgage and not a mere charge Vnkar v. Goverdhan, 14 Bom. 577.
A borrowed a sum of money from B and mortgaged certain properties.
A charge was created afterwards in favour of C by a consent decree.
Subsequently B made a further advance to A and this sum was secured
by an instrument described as a "further charge. The provisions in the
first mortgage-deed transferring the property to the mortgagee by way
of security was also incorporated in the deed of furtlrer charge ; held
that the deed of further charge was a transfer and therefore a mortgage
and the rights of B under the deed of further charge ranked in priority'
to the rights of C under the consent decree Bhupati v. Bon Behari,
A.I.R. 1941 Cal. 436.
\ ^
Sec. 58 ]
A.L.J. 902, 119 I'.C. 81. Wliere a security bond, after reciting an order
of the Court made upon an application lliat the possession of certain
immoveable property should not be delivered over to the plaintiff, stated
that we have for^a sum not exceeding Rs. 300 made the properties men-
tioned below security, held that the document did not transfer an in-
terest in the property but that it merely created a charge and not a
mortgage Rama Chariar v. Darastaami, 29 I.C. 605 (Mad.). A deed set
out that the executant had borrowed a sum of money. Certain immove-
ablQ properties were specified widiout anything more. Tliere was a
covenant to repay and also a covenant not to alienate until repayment
of the loan. Held, tliat there was merely an undertaking by the bor-
rower not to alienate the property until the loan was repaid ; but there
was no transfer of an interest in the property to the creditor, nor did it
give the creditor a right to put the propeity to sale ; therefore tire tran-
saction was not a mortgage witliin tiiis section and it is doubtfu'l also
whether it even created a charge on the property Mohan Lai v. Indo-
mati^ 39 All. 244 (251, 2.52) (P.B.) ; Jatoahif v. Indomati, 36 All. 201 [per
Richards, C.J.).
, A.L.J. 120, 16 I.C. 638. A mortgage of "my house and landed property
is void for uncertainty Ddrs/icn Singh v. Hamuanta, 1 All. 272. In
Ramsidh v. Balgovind, 9 All. 158, "the obligors of a bond described them-
selves as residents of a certain- place and said that they pledged their
property for a debt; the hypothecation was held to be too indefinite to
be acted upon. But if they had described themselves as the o^TOers of
certain property and then gone on to pledge their rights and interests
therein, the case would have been different Deojit v. Pitambur, I'All.
[Sec. 58
mortgagor having -at the date of tlie deed owned a specific zemindary
interest Shadi Lai vj Thakur Das, 12 All. 175. A document of mort-
gage did not give the boundaries of the lands, but specified tliem as
my jirayati and imm lands which* I own at thq village pf my residence.
Held that the description was suflScient to satisfy the requirements of
this section and that it created a mortgage Dakkata v. Sasanapnri 1
L.W. 96, 22 I.C. 524.
Where a mortgagor mortgages his right to recover rent from the ten-
ant in respect of a certain holding and makes reference to the area of such
holding and the amount of rent due thereof in the mortgage-deed, die
mortgage is really a mortgage of an interest in immoveable property, as
rent is the first charge on the holding Ramzan v. Babu Lai, A.I.R. 1938
Pat. 16, 18 P.L.T. 801, 173 I.C. 64. Mortgage widi possession of fruit-
bearing trees is a mortgage, either of immoveable property or at least
of an interest in immoveable property Shio Daijal v. Pirttoo Lai, A.I.R.
1933 All. 50, 54 All. 437, 140 I.C. 491.
[Sec. 58
the consideration of the mortgage is not only .tlie raoiiey actually taken,
but also the money left in the hands of the mortgagee and to be advanc-
ed when occasion requires Hart Ram v. Sheo Dayal, 11 AH. 136.
[Sec. 58
Sec. 58 ]
does not show that interest is not charged on the property 'Rang Raj v.
Sheonarain, 9 P.L.T. 785, A.I.R. 1928 Pat. 398 (399), 110 I.C. 594.
The mortgaged property is liable to be sold not only for die prin-
cipal sum secured but also for the interest Jainandan V. Bai] Nath, 2
P.L.T. 229, 63 I.C. 297 (301). But this section does not enable a mort-
gagee, to make a claim to interest which is not given to him by the
mortgage-bond. Tliiis, a property was mortgaged with possession to
the plaintifiF ; . under the terms of the mortgage the profits were to be
enjoyed in' lieu of. interest and if after the stipulated period the principal
amount was not paid, it was to be recovered without interest by sale of
the mortgaged property. Held' that under the terms of the bond the
property was a security only for die amount borrowed and not for inter-
est, that the interest was payable only out of the profits, and the plaintiff
was entitled to recover only the principal amount by sale of the mort-
gaged property Manik Chand v. Rangappa, 45 Bom 523 (526, 527), 22
Bom. L.R. 143-5, 59 I.C. 765. See also Nammahcar v. Krishnasioami, 16*
L.W. 743, A.I.R. 1923 Mad. 71, 72 I.C. 987.
Other Cases : ^Where the mortgagees are to enjoy tlie profits of the
property in lieu of interest, presumably the interest contemplated by the
jjarties is the prevailing rate of interest Thakur Singh v. Jagaf Singh,
A.I.R. 1933 Lah. 1, 140 I.C. 495.
62
[Sec. S8
14 Cal. 781], but it is not applicable outside such jurisdiction [Het Narain
15 I.C. 824. The Madras High Court has, however, held that the rule
does not apply to mortgages executed after the. Transfer of Property Act
Sec. 5^3
Statute Law ; Under the Usurious Loans Act, X of 1918 (as amend-
ed by Act XXVIII of 1926), secs. 2 and 3, where in a suit for enforcement
or redemption of any secuiity, whether heard ex parte or othenvise, the
Court has reason to believe tiiat the interest is excessive, the Court may
re-open the ti'ansaction, take an account and relieve the debtor of all
liability in respect of any excessive interest and if anything has been
paid or allowed in account in respect of such liability, order tire creditor
to repay any sum which it considers to be repayable in respect thereof.
The Act does not definitely say what rate of interest is excessive, but
in a general way indicates what may be regarded as excessive ^sec. 3 (2)
of the above Act. Where in a mortgage-bond the rate of interest stipu-
lated was 24 per cent per annum and the mortgagee allowed the interest
to accumulate obviously with the intention of absorbing the entire pro-
perty, it_was held that the interest .was very high and it was reduced to
6 per cent. Ram Ajodbya v. Feringi Tetcari, A.I.R. 1936 Pat. 3, 160
I.C. 681 ; see also Jessore Loan Co, v. Shailaja Nath, 59 Cal. 722. But
where interest on a mortgage was. payable at 12 per cent, per annum,
merely because compound interest was payable on default to pay interest
regularly, tlie fate of interest was not held to be excessive Abdul v.
Sheo Dayal, A.I.R. 1934 All. 152, 55 AU. 496, 151 I.C. 900.
i Sec. 58
thing in any other act. Section 5 of the same Act enacts that interest
exceeding 10 per cent, per annum shall not be recoverable in respect of
any loan made, after tire commencement of the Act, under a contract
wliich provides for the payment of compound interest. The rate of in-
terest has further been scaled down by sec, 30 of the Bengal Money-
lenders Act, 1940.
For more or less similar provisions and other similar Acts recently
passed by other Provincial Legislatures see the Central Provinces Act,
XI of 1934, Assam Money Lenders Act, IV of 1934.
Sec. 58 ]
not subject to any independent debt iri no way connected with the
mortgage Subramania v. Subrarmnia, 40 Mad. 683.
gagor must have bound himself personally to repay the loanj (3) diat
to secure the loan he has transferred to the mortgagee the right to have
specific immoveable property sold in die event of his having failed to
repay; and (4) that possession of the property has not been and is not
to be transferred to the mortgagee during the pendency of the mort-
gage Om Prakash v. Mukhtar Ahmad, A.I.R. 1940 Lah. 486, 42 P.L.R.
660 ; Dalip Singh v. Bahadur, 34 AD. 446 ; see also Haji Khan v. Chaihu
Ram, A.I.R. 1939 Pesh. 41, 184 LC. 585. Tliese stipulations may be
express or appear by necessary implication from the terms of the parti-
cular transaction, llius a promise to pay necessarily arises out of the
, acceptance of the loan. It is imjjlicit in the transaction itself "that the
obligoij is under a personal liability to repay, unless diis liability is exclud-
ed by the terms of the contract, expressly or impliedly, as for example,
in the case of a usufructuary mortgage or a mortgage by conditional sale,
where the agreement is to repay out of a particular property or fund
alone and in a particu].-!!' manner Om Prakash v. Mukhtar Ahmad, supra;
see also Ram Nqrain v. Adhindra, 44 I.A. 87, 44 Cal. 388 (P.C.). Tlie
mortgageeT in the case of a simple mortgage, has, in the event of default
- being made in the payment of the debt, two causes of action, the one
arising out of the breach of the personal obligation, and the odier aris-
ing out of the contract of hypothecation. He may put both these causes
of action in suit at once or he may pursue the one remedy at one time
and die other at another. If he sues on the personal undertaking only,
he obtains what is known as a money-decree ; if he sues on the contract
of hypothecation, he obtains an order for the sale of the property
[ Sec. 58
But where a deed speaks of repayment of the loan and promises not
to transfer the projierty till such repayment, but does not give the right
to have the property sold to the mortgagee, it is not a simple mortgage
Mohan, Lai v. Indomati, 39 All, 244 (F.B.).
Wliere in a simple mortgage for Rs. 8,000, Rs. 360 was deducted to-
wards first years interest in advance, it was held that there was .no
reduction in principal Haji AbdvUa v. Band Mahomed, A.I.R. 1953
Sau. 84. -
Sec. 58 ]
336. Right to have the mortgaged property sold ; ^llie most essen-
tial of the elements which constitute a simple mortgage is the right to
cause the property to be sold a right without which the transaction,
whatever else it may be, certainly cannot be called hypothecation, .pledge,
or simple mortgage. Tins right (foes not come into existence when die
actual sale takes place by virtue diereof, but it comes into e.xistence at
the time when die mortgage is made; it subsists in the property ever
afterwarck so long as die mortgage-money remains unpaid : it limits the
interests of die mortgagor as they were at the time of the mortgage
Gopal V. Parshotam, 5 All. 121 (138). If an instrument is expressly stated
to be a mortgage, and gives the power of realisation of die mortgage-
money by sale of die mortgaged premises, it should be held to be a .
mortgage. If, on the other hand, the instrument is not on the face of it
a mortgage, -but simply creates a lien or directs die realisation of monej
from a particular property loithout reference to sale, it creates a charge
Gooinda v. Bicarka, 35 Cal. 837 (844), 12 C.W.N.849.
[Sec. 58
The words cause the mortgaged property to be sold imply that
the mortgagee has no power to. sell the prop^ty without the intervention
of the Court Kishan Lai v. Ganga Ram, 13'All, 28, A simple mortgage
does not directly confer on the mortgagee the power of private sale ; in
order to make his security available, he must obtain an order of a Civil
Court for saleWahid-un-nissa v. Gobardhan, 22 All. 453. See also Ma
Hnim v, Chettyar Firm, A.I.R. 1939 Rang. 321 (F.B.) (1939) R.L.R. 403
183 I.C. 728.'
Sec. 58 ]
TRANSFER OF PROPERTY 497
[ Sec. 58
(1) One important test was to consider whether the sale was subject
to the agreement for reconveyance or was independent of it ; that is,
whether the two documents were part and parcel of the sa7ne transaction
or were mutually independent. If the two were separate transactions
altogether, the sale could not possibly be said to have been subject to any
condition of repurchase Mathura v. Jagdeo, 49 All. 405, A.LR. 1927
All. 321 (326), 104 I.C. 504. Where two documents, vone for sale and
another for agreement of reconveyance, were executed on the same date,
and the sale was expressed to be subject to the terras of the deed of
agreement executed by the vendee, it was held that the sale-deed
incorporated the deed of agreement and that the two deeds read together
constituted a mortgage by conditional sale and were not separate trans-
actions Wajid Ali v. Shafakat Husain, 33 All. 122 (123) ; Ram Charan
V. Dharam Singh, 46 All. 173 (174) ; Md. Hamiduddm v. Fakir Chand, 18
A.L.J. 478, 58 I.C. 717 (720).
W. R. 190. See also Kinuram v. Nitye Chand, 11 C.W.N. 400, where one
of the contemporaneous documents purported to be a deed of sale and
the other provided that on the vendor repaying the purchase-money with
costs within a fixed period, the vendee would return the land and in case
he did not do so, the vendor would deposit the money in Court and take
possession, it was held that the two documents together did not constitute
a mortgage.
Sec. 58 1
V. Lain Fakirchand, 58 I.C. 717 (718), 18 A.L.J. 478 ; Gtilzar Singh v. Sheo
Nath. 11 O.L.J. 275, 78 I.C. 547, A.I.R. 1925 Oudh 11.
(5) Another test to applj' was whether the two documents were
executed on the same date- If the two deeds were not executed on the
same date but on different dates, and were also registered in different
dates, held that it might be reasonably inferred that the parties intended
that the transactions should be kept separate and distinct and that the
two. deeds were not intended to be parts of the same transaction so as
together to constitute a mortgage by conditional sale Jhanda Singh v.
Wahiditddin, 33 All. 585 (588) ; see also Uthandi v. Ragavachari, 29
Mad. 307. If they were executed on the same date, the Court would
infer that the transaction was a mortgage Ram Charan v. Dharam Singh,
46 All. 173 ; see also Kasttir Chand v. Jakhia, 40 Bom. 74 (80) ; Madhavrao
V. Shebrao, 39 Bom. 119 ; Mokini v. Sarat Siindari, A.I.R. 1925 Cal. 862,
86 I.C. 353 ; Durga v. Paresh, A.I.R. 1925 Cal. 105, 76 I.C. 335, and a
fortiori, where the ttvo documents were executed on the same date, written
by the same scribe, attested by the same witnesses, registered on the same
date, and the parties were identified before the Registrar by the smtie
witnesses Kirpal v. Sheoambar, 28 A.L.J. 610, A.I.R. 1930 All. 283 (285),
126 I.C. 366. If the deeds were executed on different dates but registered
on the same day the effect was the same, and they must be construed
together as forming a single transaction in the nature of a mortgage by
conditional sale ; see Palaniyappan v. Snbbaraya, 1914 M.W.N, 222, 22
I.C. 4 (6).
(6) Another test to apply was whether the relation of debtor and
creditor subsisted between the parties. The rule of law on this subject
is one dictated by common sense, that prima facie an absolute conveyance
containing nothing to show that the relation of debtor and creditor, is to
exist between the parties does not cease to be an absolute conveyance
and become a mortgage merely because the vendor stipulates that he shall
have a right to repurchase per Lord Cranworth in Alderson v. White,
(1858) 2 DeG. & J, 97 (105). If there was nothing to indicate an intention,
that there should be a relationship of debtor and creditor or that the
lands should be a securi.ty for the debt, or that there was any question
of repayment of the debt, then the transaction could not be interpreted
as a mortgage Maruffiai v. Dasappa, 31 M.L.J. 375 ; Ganesa Mudaliar v.
Gnanasikamani Mudaliar, 47 M.L.J. 385 ; Ma Hnin v. Osman, 5 Bur.L.T.
99, 15 I.C. 423 ; Maung Tha v. Mating Mya, 3 Bur.L.T. 136, 8 I.C. 981
(982) ; Md, Yusiiff v. Jasadha, 2 I.C. 930 (931) ; Jhanda Singh v. Sheikh
Wahiduddin, 38 All. 570 (580) (P.C.). But if the apparent price was
treated and regarded as a continuing debt between the parties, the trans-
action was a mortgage, and not a sale Kastiir Chand v. Jakhia, 40 Bom.
74 (82, 83), 31 I.C. 388. Thus, where the agreement for repurchase
stipulated that whenever within 5 years the vendors paid the vendees the
amount of the consideration money together with interest thereon (at a
certain rate) but deducting therefrom the actual profits realised by tho
vendees from the property, the vendors would get the property reconveyed,
held that the provision as to the accounting at the time of the demand
for reconveyance showed clearly that the relation of debtor and creditor
existed between the parties, and that the two documents taken together
[Sec. 58
(8) Where the parties in one document were not the same as the
parties in the other document, the transaction .could not be deemed'
a mortgage. Thus, where three vendors together sold some property to
the purchaser, and some months afterwards the latter executed an agree-
ment to resell in favour of one of the vendors. Held that since the two
transactions were not between the same parties, the latter agreement could
not be used to modify the earlier transaction and to convert the sale into a
mortgage Uthandi v. Raghavachari, 29 Mad. 307 (308).; Ramakanta v.
Kalijoy. 11 LC. 124 (125) (Cal. ).
(10) The best general' test as to the nature of the transaction was
the existence or non-existence of a power in the original purchaser to
recover the sum named as the price for such re-purchase ; if there is no
such power, there is no mortgage. Dart on Vendors and Purchasers; 3rd
Ed., p. 536 ; Sugdens Vendors and Purchasers, 13th- Ed., p. 166 ; Coote on
Mortgages, 3rd Ed-., pp. 14, 21 ; Perry v. Meddowcrofi, 4 Beav. 197, 203 ;
Verner v. Winstanley, 2 Sch. & Lef. 393 ; Bell v. Carter, 17 Beav. 11 *,
Cogden V. Battams, 1 Jur. N.S, 791 ; Williams v. Owen, (1840) 5 My. & Cr.
303, 48 R.R. 322 ; Aldersonv. White, 2 DeG. & ]. 95 (97). Thus, if the
amount agreed upon- as the price of repurchase was the same as the con-
Sec. 58 ]
sideration for the original sale, the deed was clearly a mortgage by con-
ditional sale, and not a sale with agreement of repurchase Maung Po
Giji V. Hakim Ally, 2 Rang. 113, (116), A.I.R. 1924 Rang. 235, 3 Bur.L.).
44, 80 I.C. 759 ; Mt. Gomti v. Meghraj, A.I.R. 1933 All. 443, 145 l.C. 147.
In construing the documents, the main question for enquiry was the
intention of the parties, and this intention had to be gatliered from the
language of the documents themselves, the circumstances attending their
execution and from the conduct of the parties Jhanda Singh v. Sheikh
Wahiduddin, 33 All. 585 (602) ; on appeal, 38 All. 570 (574) (P.C.) ; Ramdas
V. Brindaban, 1931 A.L.J. 571, A.I.R. 1931 All. 113 (120, 121, 123);
Madhwa v. Venkata, 26 Mad. 662. The case had to be decided upon a
consideration of the documents themselves with such extrinsic evidence
of the circumstances as might show in what manner the language of the
documents was related to existing facts Balkishen v. Legge, 22 All. 149
(P.C.). If the documents purported to connote an absolute sale, it lay on
the party who contended that it was a mortgage to prove his contention
Ramdas v. Brindaban, supra. In Sitiil v. Lachmi, 10 Cal. 30 (35) (P.C.),
tlieir Lordships looking at the surrounding circumstances, among other
things, at the value of the property and at the relation of the parties came
to the conclusion that the transaction was, in fact, what it purported to
be, a perpetual lease with a condition as to cancellation. See also
Narayan v. Vighneshwar, 40 BonL 378 ; Ma Tok v. Maung Chek, A.I.R.
1927 Rang. 132, 101 I.C. 204 ; Gattesh v, Gnanasikhamani, A.I.R, 1925
Mad. 37, 47 M.L.J. 385, 84 I.C. 505 and Gobardhan v. Raghubir, A.I.R.
1930 All. 101, (1930) A.L.J. 799, 124 LC. 405, where the transactions were
held to be out and out sale.
In a transaction entered into in 1915 it has been held that the two
[Sec. 58
Two things are laid down in the proviso: (1) first, the mortgage by
conditional sale is to be effected by one document ; and thus the various
criteria for determining whether the two documents operate to create a
mortgage will no longer be necessary. But the mere fact that the condition
of repurchase is contained in the same document which effects the sale
does not render the transaction a mortgage by conditional sale, unless
there is a relationship of debtor and creditor between the parties Kz/pprt
Krishna v. Mhasli, 33 Bom, L.R. 633, A.I.R. 1931 Bom. 371 (373), 134 I.C.
337. (2) Secondly, the condition which converts the sale into a mortgage
must be embodied in the document, so that no extrinsic evidence will be
admissible to prove that a document which purports to be an absolute
sale is in reality a mortgage.
In two Calcutta cases, evidence was admitted of the acts and conduct
of the parties to. show, that the document which purported to be a sale
was in reality a mortgage by conditional sale Khankar v. Ali Hafez, 28
Cal, 256 (258) ; Mahamed Ali v. Nazai Ali, 28 Cal. 289 (291). These cases
are no longer good law.
Sec. 5S]
t Sec.
Sec. 58]
64
[Sec. 5S
(iP.C.). But in Madras, C. P, and other provinces where the Bengal Regula-
tion was not in force, the mortgagee had not to bring a suit for foreclosure,
but on the expiry of the stipulated period of repayment the mortgage
executed itself and the transaction was closed and became one of absolute
sale, without the intervention of the Court, See Thambiisamy v. Hossein,
1 Mad. 1 (P.C.). But after the passing of the Transfer of Property Act,
the law is uniform in all provinces, and now under a mortgage by condi-
tional sale, the ownership will not be vested in the mortgagee in default
of payment on due date until there is a decree absolute for foreclosure
Raghwtath v. Sheolal, 13 N,L.R. 69, 39 I.C. 849 ; Afsar Sheik y. Sauraba
Sundari, 25 C.L.J. 560, 40 I.C, 371. The essential characteristic of a mort-
gage by conditional sale is that on the breach of the condition of repay-
ment within the stipulated period the contract executes itself and the
transaction is closed and becomes one of absolute sale, to be enforced by
foreclosure Sheoram v. Babu Singh, 48 All, 302, 24 A.L.J. 295, A.I.R.
1926 All. 493, 94 I.C, 849.
Sec. 58]
This section provides that where a mortgagor has ostensibly sold his
property on condition that on payment of the mortgage-money the buyer
shall retransfer the property to the seller, the transaction is a mortgage
by conditional sale. And this would be so even though the language of
the document itself does not use the word mortgagor, mortgaged pro-
perty or mortgage-money. The conveyance may ostensibly be a deed
of sale, with all the phraseology employed in drafting sale-deeds, but if
that sale is in reality subject to a condition of a retransfer on payment of
the amount, the law regards it as a mortgage by conditional sale. The
presence in the deed of such words as imply a mortgage is not absolutely
necessary. The cardinal point is whether the sale is subject to a condition
of repurchase on payment Mathura v. Jagdeo, 49 All. 405, 104 I.C, 504,
A.I.R. 1927 All. 321 (326) ; Lalta Prosad v. Jagdish, 48 All. 787, 24 A.L.J.
1057, A.I.R. 1927 AIL 137 (143), 98 I.C. 961.
t Sec. 58
A mortgagor does not not lose his title or his right to possess on the
date of the mortgage, even if the mortgage is by conditional sale Gmzga-
prasad v- Iswarsmgh, A.LR. 1939 Nag. 287, 1939 N.L.J. 429.
Sec. 58]
in the month of Jeth-, I, the executant, pay the consideration Rs. 3,000,
and the arrears of rent which may then be due against the tenants, tho
vendee shall reconvey the vended property to me, otherwise the property
will not be reconveyed." Further in the body of the'document the con-
sideration for the transfer was described as mortgage-money. Held that
the transaction was a mortgage by conditional sale and not an out and
out sale Mohindra v. Maharaj Singh, 45 All. 72 (75), 20 A.L.J. 810, A.I.R.
1923 All. 48. A document was framed and worded exactly in the same
manner as a mortgage by conditional sale in English precedents of con-
veyancing ; the consideration was stated to be the same amount that was
specified as the sale-price, and there was a direction that after paying
certain creditors of the executant the transferee should obtain the debt-
bonds with an endorsement of discharge on them, and that he should keep
them with him as vouchers in support of the sale-deed. Held that the
document was not one of outright sale but a mortgage by conditional
sale ; for . if it were an outright sale, it would be difficult to understand
why the transferor should have required the transferee to obtain those
bonds and keep them in support of the deed Padmanabha v. Sitarama,
54 M.L.]. 96, A-LR. 1928 Mad. 28 (30). The plaintiff executed a docu-
ment in favour of the defendant for Es. 4000/- in the form of a sale deed
the market value of the property being Rs. 8000/-. There was a stipulation
in the document that the defendant should reconvey the property to the
plaintiff on his repaying Rs. 4000/- after 5 years and before the end of
the 7th year. Held that the transaction was a mortgage by conditional
sale and not a sale with option to repurchase Bnpt/swnm/ v. Pettai.
Goimder, A.f.R. 1966, S.C. 902 ; V. Venkatavama Iyer v. K. Rangamthan
Pillai, (1965) 2 M.L.J. 480. See also Satyadeo Sharma v. Ranisanip Sharma,
A.LR. 1964 Pat. 193. Where a deed of conditional sale provides
that the property is to be returned on repayment of consideration the
transaction is a mortgage by conditional sale Bai Kanku v. Victorbhai,
A.I.R. 1969 Cuj. 239,
[ Sec. 58
USUFRUCTUARY MORTGAGE ;
Sec. 58 ]
words we have this day put the said land and house into your posses-
sion but the mortgagee lias not actually taken possession, the mort-
gage is still a usufructua^ mortgage Motirenn v. Vitai, 13 Bom. 90 (100).
But in a Madras Full Bench case it was held that a mortgagee did not be-
come a usufructuary mortgagee under sec. 58 (d) imtil die mortgagor '
had given him iiossession of the mortgaged property Subbanitna v. Nar-
(lytja, 41 Mad. 259 (263) (F.B.). The Full Bench further held that since
the mortgagee had not been given possession of the property,, he became
entitled to sue for the mortgage-money under sec. 68 ; in other words,
the mortgage-money became payable to him ; and as he was not a
usufi-uctuary mortgagee, for the reasons stated above, the jiroviso (a) of
section 67 did not apply to him, and he was entitled to sue for fore-
closure or for sale under sec. 67, which entitles a mortgagee to do so at
any time after the mortgage-money has become payable. Tliere was
an anomaly in this decision which the Full Bench failed to notice, viz.,
that the mortgagee was treated as a usufructuary mortgagee for the pur-
pose of sec. 68 (which applies to usufructuary mortgagees) and as not a
usufructuary mortgagee for the purpose of applying proviso (a) of sec. 67.
[Sec. 58
gage pure and simple Wahid-ud-Din- v. Makhan Lai, A.I.R. 1938 All 564
(566), (1938) A.L.J. 872. -
Sec. 58]
65
[ Sec. 58
at a rent equal to interest, the mortgagee is not entitled to file a mort-
gage suit on his failure to recover anything in execution of a money-
decree for rent passed on an earlier suit, because the lease foimed a
component part of the mortgage Haji Muhammad v. Shah Akhtar, A.IR
1960 Pah 106.
Where there was a covenant that the mortgagor would pay interest
every year but that if he failed to pay interest, the mortgagee could take
possession, and would aiDpropriate the usufruct towards interest and pay
the balance (if any) to the mortgagor, held that the transaction was a
simple mortgage, and not a usufructuary mortgage, because no present
possession was delivered, but possession was merely contingent on the
failure to pay interest Yeshvant v. Vithal, 21 Bom. 267 (272). For simi-
lar cases see Note 335, ante. It seems that such a mortgage will now be
treated as an anomalous mortgage. See Note 335. \Vliere the creditor
is given the right to take the mango crop in lieu of interest the ti-ansac-
tion is not a mortgage Rehman v. Nathulal, I.L.R. (1960) 10 Raj.- 978.
[ Sec. 58
Sec. 58)
a mortgage, and tlie landlord is not entitled to get possession of the land
by payment of the Zarpeshgi amount Bamautar v. Lcitak Behari, A.I.R.
1952 Pat. 312. Where a iliicka patta did not give the thickdar the right
to remain in possession after expiry of tlie period of the thicka, until
repayment of the peshgi money, the patta could not be regarded as Zar-
peshgi amounting to a mortgage Svdhan v. Ramamigrah, A.I.R. 1947
Pat. 78, 13 B.R. 332. The transaction is really one in which rent is paid
in a lump sum in advance instead of by mstahnents during the term.
Wliere, however, the interest created m the lessee continues after the
expiration of the term until the advance is paid, the transaction has the
essential characteristics of a mortgage Maharaja Kesho Prasad v. Chan-
drika Prasad, 2 Pat. 217, 3 P.L.T. 797, 69 I.C. 394, A.I.R. 1923 Pat. 122.
In construing a document as to 'whether it is a lease or a mortgage the
following test may be applied : If it is not a security for the payment
of any money or for the performance of any engagement ; if no accounts
are to be rendered or required ; if there is no provision for redemption,'
express or implied ; it is simply a lease even though it may be described
as a mortgage Hussain Ali v. Sardar Ali, A.I.R. 1933 Lah. 786, follow-
ing Tasadug Rasul v. Kashi Ram, 25 All. 109 (P.C.), 30 LA. 35. See also
Mahadeo v. Rameshar, A.I.R. 1935 All. 150, 157 I.C. 364; Ramdhan
Puri v. Banket/ Bihari Saran, A.I.R. 1958 S.C. 941 ; Neelakanda Pillat
V. Sankaran Padmanavan, A.I.R. 1967 Ker. 70; Suhramania Iyer v. K.
R. Anantanarayana, A.I.R. 1963 Ker. 261 ; Frenchikkose Thommi v.
Chacko Devasia, A.I.R. 1963 Ker. 75. Oh the other hand, if the transac-
tion- is one of mortgage the fact diat it is called a lease will be quite
irrelevant Sam/Zjfls/jinf v. Baijnath, A.I.R. 1938 Pat. 388, following Shah
MukJiun Lial v. Sree Kishen, 12 M.I.A. 157. Thus, where the essence of a
transaction was one of loan and security and tlie creditors secured the
net profits of the land/ for a term of years ivithout entering into possession,
the transaction wa's a usufructuary mortgage Sarajbashini v. Baijnath,
supra, at p. 389. Where a person executed an instrument purporting
to be a mortgage of certain villages widi possession for a period of 14
years, by which it was provided that on the expiration of die teim the
mortgagor shall come into possession of the mortgaged villages without
settlement of accounts, that on the expiration of the term the mortgagee
shall have no power whatever in respect of the said estate, and that after
the expiration of the term this mor^age-deed shall be returned to the
mortgagor without his accounting for (paying) the mortgage-money secu-
red under the document, held that die instrument was not a mortgage
in any proper sense of the word. It was simply a grant of land for a
fixed term free of rent in consideration of a sum made out of past and
present advances tNidha Salt v. M'urlidhar, 25 All. 115 (P.C.). Such
deeds should not be held to be mortgages merely because the parties
used such nomenclature, although die fact of- the parties hav-
ing designated the same in such a way shows that they be-
lieved themselves to be clothed udth all the rights and remedies
incidental thereto Tukaram v. Ramchand, 26 Bom. 252 (258) (F.B.) :
Ankaiah v. Veeraiah, A.LR. 1957 Andhra Pra. 504. A document stjded
a lease, under which, in consideration of money advanced, the claimant
under it was only to enjoy certain specified lands for a certain number of
years, but which contained nothing as to repayment of the borrowed
5 IS TRANSFER OF PROPERTY
t Sec. S8
amount, nor provided for payment of any rent as such, was not a lease
but usufructuary mortgage, under which the rents and profits had beeii
estimated to be sufficient to satisfy both principal and interest, so that no
subsequent accounting might become necessar} on either side Reference
under Stamp Act, 21 Mad. 358 (F.B.) ; Reference under Stamp Act, 1 Mad.
203. A executed a document in favour of B, under which possession cl
land was delivered ,to B on receipt of Rs. 1000. Although period of
10 years was mentioned in the deed, B was to pay rent to A, who was not
entitled to bring the property to sale. B was to hand over possession to
A not at the end of the term but on return of the consideration to him
by A sometime after the end of the term. Held, the transaction was a
usufructuary mortgage and not a lease Apaya Dundyappa v. Covind
Dattatraya, A.I.R. 1956 Bom. 625. Where by a thika zurpeshgi lease the
mortgagee obtains a thika lease at a certain reserved rent retaining for
himself a fixed amount of the rent as specified interest upon the Zuripeshgi
money and agrees to pay the balance to the mortgagor, it is a usufructuary
mortgage Bachu Lai v. fang Bahadur, A.I.R. 1939 .Pat. 427, 180 I.C. 795.
A deed purporting to be a mortgage-deed with possession regarding land
provided that in consideration of a debt of Rs. 240 due by the plaintiff
(an agriculturist) to the defendant, the latter was to lake possession of
certain lands for ten years and appropriate the income thereof in liquida-
tion of the debt, and that after the expiry of the said period the right to
the land was to cease. The mortgagor having sued to redeem before the
expiration of the ten years, it was held that the transaction amounted to
an anomalous mortgage and not a lease, and that the mortgagor was
entitled to redeem Tukaram v. Ramchaml, 26 Bom. 252. Where under
a Zurpeshgi lease the mortgagor lessee holds over the rem^y of the
mortgagee is to institute not a suit for rent but a suit for the enforcement
of the mortgage Gaya Prasad v. Chitrakut, A.I.R. 1960 Pat. 485.
Sec. 58]
ENGLISH MORTGAGE
(289), where their Lordships state: Section 58 (e) deals with the form,
not substance. The substantial rights are dealt with in secs. 58 (ja) and
60. Whatever form is used, nothing more than an Interest is transferred
and that interest is subjdbt to the right of redemption. Their Lordships
recoghizS in this case that the wording of sec. 58 (e) undoubtedly gives rise
to some difficulty (at p. 288). That section speaks of the mortgagor
transferring the mortgaged property absolutely to the mortgagee. In using
those words does it mean that no interest or no legal interest in the
property remains in the mortgagor? Their Lordships cannot think so
Ibid, at p. 289. In this case the Privy Council affirmed Satya Charan v.
[Sec.
Where the mortgagor binds himself to pay the money lent on a certain
day and conveys the property absolutely to the mortgagee and there is the
provision for reconveyance by the mortgagee to the mortgagor on payment
of the loan, simply because the mortgagor undertakes to pay the taxes, etc.,
on the motgaged property will not change the character of the mortgage
from an English mortgage. In India a. mortgage is the transfer of an interest
in specific immoveable property. In substance it is not the transfer of
the whole interest of the mortgagor to the mortgagee. In determining
such questions clause (a) of sec. 58 cannot be ignored pej- R. C. Mitteri
J. in Cohen v. Baidyanath, A.I.R. 1936 Cal. 646 (648), 40 C.W.N. 1270. The
same view was taken in Janaki Nath v. Asad Reza, A.I.R. 1936 Pat. 211,
14 Pat. 560, 158 I.C. 738.
Sec. 5SJ
66
[Sec, 58
a security thereon.
Sec 58]
Ratan v. Sew Kiimari, A.I.R. 1938 CJal. 823 (829). An equitable mortgage
is valid only if made vvitliin the towns specified in this clause. If exe-
cuted outside those towis it is invalid and give? no right to the mort-
gagee to proceed against the properties comprised in tlie mortgage *
Darbari v. Khctra, S P.L.T. 85, A.I.R. 1927 Pat. 41 (12 ) ; Konchadi v.
Siva Rao, 28 Mad. 54. But the property mortgaged may be situate out-
side those towns. See below.
(2) deposit of title-deeds ; and (3) an intention that the transfer should
be security for the former Behram v. Sorabji, 38 Bom. 372, 23 I.C. 140 ;
Jowala Das v. Thakar Das, A.LR. 1936 Lah. 251, 158 I.C. 562. There
may be consti-uctive deposit Nathan v. Mariithi Rao, A.I.R. 1965 S.C.
430.
But the delivery of the title-deeds must take place witlun the towns
mentioned in this clause ; so where the title-deeds were delivered out-
[Sec. 58
side Calcutta to an attorneys assistant who was acting for both parties
for taking them to his employer to keep them in his Calcutta Office
the mere authorization to the solicitor outside Calcutta by the debtor
to dehver the title-deeds to the creditor does not amount to deliver^' iu
Calcutta Swro/muH v. Gopeeram, A.I.R. 1932 Cal. 823, 36 C.W.N. 1028
141 I.C. 257. Wliere the creditor in Bombay requested the debtor out-
side Bombay to send the title-deeds by post and the debtor ,sent them
accordingly, it was held tliat althougli the Post Office became the agent
of the creditor and the transaction though complete under sec. 7 of the
Contract Act, did not create an equitable mortgage as the deposit of the
title-deeds, was made outside Bombay Zndtfln Cotton Co. v. Hari Foon-
joo, A.I.R. 1937 Bom. 39 (43), I.L.R. (1937) Bom, 763, 38 Bom. L.R. 1222,
166 I.C. 974. A deposit of title-deeds can be both actual and construc-
tive Kakoo Shah v. Kamalaxoati, A.I.R. 1969 DeUii 120.
Sec. 58 ]
respect of tlie said property, the original being lost, a valid' mortgage was
effected. But an attested copy would not be enou^ unless there is proof
of die original not being available Swrendra v. Mohendra, 59 Cal. 781,
36 C.W.N. 420 A.I.B. 1982 Cal. 589 (593). Where a person himself puts
a superstructure on the site of which he is a tenant, and subsequently
purchases die site from the landlord, the title-deeds, though relating only
to the land would clearly cover the house and his deposit would create
an equitable mortgage of the entire property consisting of the ground
and the superstructure Berumull v. Velu, A.I.R. 1942 Mad. 369, (1942)
1 M.L.J. 372, 1942 M.W.N. 261. But if the document that is deposited
shows no kind of title of the depositor in the property, and there are
documents in existence showing his title to the property which are not
deposited, an equitable mortgage cannot be said to have been validly
created Venkataramayya v. Nat-asingfi Boo, 21 M.LJ. 454, 9 I.C. 309.
[ Sec. 58
Wliere tlie oi'iginal title-deeds have been lost, copies of such deeds
may be deposited Mrs. Stewart v. Bank of Upper India, 31 P.R. 1916,
34 I.C. 937. But unless it is proved that tlie original has been lost or is
not available, an attested copy would not be enough Surendra v. Mohen-
dra, supra. A mortgage-deed executed by the oivner of the property in
favour of a third person can never be deemed to be a title-deed of the
mortgagor Nageswara v. Srinivasa, A.I.R 1926 Mad. 743, 94 I.C. 427.
Sec. 58]
was tlie managing partner, discharged die mortgage and took delivery of
the title-deeds from the mortgagee, no equitable mortgage was created in
favour of the managing partner merely because he took cliarge of tlie
title-deeds, in tlie absence of an intent to create a security. He took
charge of tlie title-deeds merely as manager and chief of the partnership
business, and the tiansaction was to be treated as an advance from one
parhier to another to be paid off out of the profite Heng Moh v. Lim
Saw, 1 Rang. 545 (P.C.), 29 C.W.N. 12 (16, 17), 45 M.L.J. 776, A.I.R. 1923
P.C. 87, 75 I.C. 287. Both under die English and the Indian law, mere
possession of title-deeds by the creditor coupled widi the existence of
a debt does not necessarily lead^ to a presumption of an equitable mort-
gage in the absence of an intention to create a security Jethabai v. Pi/f-
libai, 14 Bom. L.R. 1020, 17 I.C. 722 j Darbari v. KJietra, 8 P.L.T. 85,
A.I.R. 1927 Pat. 41 (42) j Featherston v. Fenwick, 1 Br. CC. 270n ;
Behram v. Sorabji, 38 Bom. 372, 23 I.G. 140 ; Chapman v. Chapman, 13
Beav,. 308 ; Fisher on Mortgage, 5th Ed., p. 20. A fortiori, when there
is no existing debt, the mere dehVery of title-deeds is not sufficient to
create an equitable mortgage unless it is accompanied with an agieement
that the deeds should stand as security for future advances Jaitha v.
Haji Abdul, 10 Bom. 634 (645) ; Dixon v- Muckleston, L.R. 8 Ch. 155 ;
Ganpat v. Adarji, 3 Bom. 329. No equitable mortgage is created by an
agreement to execute a mortgage in future in case the amount due on a
promissory note be not paid together with the delivery of the tide deed
of the property agreed to be mortgaged Subramania Iyer v. Nedungadi
Bank Ltd., I.L.R. (1963) 2 Ker. 60.
[ Sec. 58
2 M.L.J. 328 ; Rangbati v. United Bank of India Ltd., A.I.R. 1961 Pat.
158 ; Sham Lai Thakar Boss Agancal v. Punjab National Bank Ltd.,
A.I.R. 1961 Punj. 81 ; Parkash Deo Chopra v. New Bank of India Ltd.,
A.I.R, 1968 Delhi 244 ; Binapani v. Rahindra Nath, A.I.R. 1959 Cal. 213.
In this case the draft memorandum, signed and delivered, was as fol-
lows ; We write to put on record that to secure the repayment of the
67
ANOMALOUS MORTGAGE
See the new clause (g). Under the old section 98, an anomalous
mortgage was a mortgage *not being a simple mortgage, a mortgage by
conditional sale, a usufructuaiy mortgage or an English mortgage, or a
combination of the first and third or the second and third of such forms."
In other words, a simple mortgage usufructuary (i.e., a combination of a
simple and a usufructuary mortgage) and a mortgage usufructuary by
conditional sale (i.e., a combination of a usufructuary mortgage and a
mortgage by conditional sale) did not fall under the old definition of an
anomalous mortgage. See for instance Lai Narsingh v. Mohammad Ya-
kub, 4 Luck. 363 (P.C.), 33 C.W.N. 693 (698), and Kandtila Venhiah v.
Donga Pallaija, 43 Mad. 589 (600), where a combination of a simple and
usufructuary mortgage was held not to be an anomalous mortgage. Under
the present clause (g) of section 58, those- two classes of mixed mortgages
will be included in anomalous mortgages.
- Md. Saeed v. Abdul Alim, A.I.R. 1947 Lah. 40 (F.B.), I.L.R. 1946 Lab.
805 ; ChhadOmrai v. Ram Naresh, A.I.R. 1943 All. 337 (F.B.), I.L.R.
1943 All. 802. In such a case it is a mixed or anomalous mortgage even
if the personal remedy is not accompanied by a right of sale Akbar AH
V. Mafizuddin, 45 C.W.N. 823, 74 C.L.J.' 370, A.I.R. 1942 Cal. 55 (58).
Thus, a mortgage-deed after acknowledging receipt of the consideration
and mortgaging the land wth possession (tlie usufruct apparently being in
lieu of interest) contained the following provision as to redemption :
Thereafter on (date) on paying the aforesaid Rs. 200 we shall redeem
or recover back our land. If on the date so fixed the amount be
not paid, in whatever year we may pay Rs. 200 in full on the 30th Pan-
guni in any year, then you shall deliver back our lands to us. Held
that the first sentence contained a promise by the mortgagor to pay on
the date named, and that the mortgage was a combination of a simple
and usufructuary mortgage Kangayya v. Kalimtithu, 27 Mad. 526 (527)
(F.B.). A mortgage provided for payment of interest and compound in-
terest; it also provided that the mortgagee should take possession and
enjoy the net profits in lieu of interest and during the time of such pos-
[Sec. 58
session the interest and the profits should be deemed equal ; and it was
further agreed that if the profits did not cover tlie amount of interest
the mortgagors would make good tlie deficiency from their pockets in
accordance with the accounts prepared by tlie agent of the mortgagee. It
was a combination of a simple and a usufructuary mortgage /oisa/iir v.
Sameshar, 28 All. 225 (231) (P.C.). Where by a mortgage landed pro-
perty was hypothecated, the mortgagee to get and retain possession appro-
lariating the profits after payment of a revenue towards interest, and any
further surplus towards principal, but by a furdier clause it was stipula-
ted that the mortgagors should remain entitled to enhance tlie rents, eject
tenants, cultivate land and grant leases, and that the mortgagee like the
mortgagors should possess all the remaining powers during his possession,
held that the mortgage was a combination of simple and usufructuary
mortgage Lflf Narsingh v. Md. Yakub, 4 Luck. 363, 33 C.W.N. 693 (698)
(P.C.). The terms of a mortgage were as follows : ^Possessory mortgage-
thereon at Re. 1 per cent., per month I shall pay on 23-8-11. If I fail to
pay on that date I shall give up the said land as sold to you and e.\ecute
a proper sale-deed. The property has been delivered possession of to
you on this very date you shall appropriate the profits towards inter-
est. Held that the fust portion of tliis deed with the covenant to repay
with interest contained all the essentials of a simple mortgage, and the
latter part (appropriation of profits towards interest) contained the ele-
ments of a usufructuaiy mortgage. It was therefore a combination of
the two Kandtila Venkiah v. Donga Pallaija, 43 Mad. 589 (599) (F.B.). A
mortgage-bond provided as follows : Tlie whole debt, including princi-
pal and interest will be paid in 4 years If the amount due to you on
account of jirincipal and interest be not paid within the time fixed, then
you are to take up the management of the land and house. We have this
day put the said land and house into your possession. Held that it was
a combination of simple and usufructuary mortgage Motiram v. ViYfli.
13 Bom. 90 (94). Wlien a due date has been fixed for the payment of the
mortgage-money, the mortgage is not a purely usufructuary mortgage-
jog Sahu V. Ram SakJU, 1 Pat. 350 (355).
But in an Allahabad case it has been held that where the mortgage
is in other respects a usufructuary mortgage (e.g., where interest is stipu-
lated to be taken out of the usufruct), the iriere insertion of a personal
covenant to pay the mortgage debt, unaccompanied by a hypothecation
of the property (i.e., without an indication of an intention on the part of
the mortgagor to charge the mortgaged property with the payonent of the
entire mortgage-debt) cannot alter the chai'acter of tlie mortgage, and it is
still a pure usufructuary mortgage Kashi Ram v. Sardar Singh, 28 All. 157
(160) (dissenting from 14 Mad. 232 and 17 Mad. 131).
EC. ]
particular date and to redeem tlie land on that date, it. was an anomalous
mortgage Qadir v. Mehr Nur, A.I.R. 1935 Lah. 103, 16 Lah. 612, 158 I.C.
206. Where a mortgage-deed contained one clause which would make
it a usufructuaiy mortgage, but another clause provided in the most
explicit terms recovery of the amount due from the mortgaged property,
it was an anoihalous mortgage Mohan Devi v. Talib Mehdi, A.I.R. 1938
Lah. 145. A deed of mortgage with possession provided for payment of
principal and interest at a specified rate. By a separate document of the
same date the mortgagee leased part of the mortgaged property to the
mortgagor providing that" upon default in payment of the rent reserved
it should be a charge upon the property included in the mortgage-deed.
A mortgage with possession provided that the rents and profits should
be set off against the interest, that the mortgage should not be redeem-
able for 5 years, and that if the mortgage was not redeemed within a
334 of pfioPE&TV
[Sec. S8
period of 20 years, the mortgagee should treat the lands as having been
sold to him absolutely. Held that tlie mortgage was an anomalous mort-
gage, or a combination of a usufructuary mortgage and a mortgage by
conditional sale Narayanamurthi v. Applawrasimhulu, 41 M.L.J. 563
68 I.C, 717. A mortgage-deed covenanted that the mortgagee should
have possession of the mortgaged property in lieu of interest, that the
mortgage-debt was payable at the end of the year 1307, and tliat if the
mortgagors failed to pay the amoimt of the debt at the end of the specifi-
ed period, the mortgagee should be at liberty to foreclose according to
law. Held that the mortgage combined the incidents of a mortgage by
conditional sale with an incident of a usufructuary mortgage Sita i^ath
V. Thakurdns, 46 Cal. 448 (452).
Sec, 58]
(5) San mortgage of Gujerat. Its j)eculiarlt)' is that the sfln mort-
gage without possession has priority over a subsequent bona fide pur-
chaser with possession Paramaya v. Sonde Shrinivasapa, 4 Bom. 459.
property for three years by virtue of the arakatta otti on the condition!
that, on the expiry of the said three years, we should redeem the land
without paying either principal and interest. You will, on the expirj' of
LSec. 5
EC. 58 1
68
i Sec. 58
Maung Thaung v. Chettyar Firm. A.I.R. 1936 Rang. 366,-164 LC. 724-
Giirnam Kaur v. R. K. Banerji, A.I.R. 1937 Rang 69, 14 Rang. 522, 168 ic
830 ; Ramamthan v. Dowlat Singhji, A.I.R. 1938 Mad. 865 (874),' (1938) 2
M.L.J. 534. A sub-mortgage of an equitable mortgage is deemed to be
concluded on the day on which the deeds are deposited Gokul v. Eastern
Mortgage & Agency Co., 33 Cal. 410.
EC. S8l
Sheikh Papa Miya, 29 Bom. l99 (202). If the original mortgagor had notice
of the sub-mortgage, he is bound to pay his debt to the sub-mortgagee, and
the sub-mortgagee can hold the property against the original mortgagor,
till the sub-mortgage is redeemed iVgfl Kye v. Nga Po, supra ; Ma Myat
V. Ma Nyan, 2 Rang. 561 (565), A.LR. 1925 Rang. 140.
[Sec.
however, arise if payment has in fact_been made. The mere fact that the
consideration or a part of it was not paid by the transferee is not sufficient
to show that the right did not pass to the transferee, when it is otherwise'
clear that it was the intention of the parties that the trailsaction was to be
effective Ibid at p. 266.
Sec, 59 ]
[Sec. 59
Under the first para of this section, a simple mortgage for Rs. 100 or
upwards, must be efected by a registered instrument. The second para
lays down that a mortgage under Rs. 100 may be effected by a registered
instrument or by delivery ; but delivery of possession does not take place
Sec. 59]
A husband and wife borrowed Rs. 500 and subsequently put the
lender in possession of their land by an ral transaction. The lender
utilized the usufruct of the land in payment of interest on the loan. There
was no mortgage but the lender alleged that he was put into possession as
usufructuary mortgagee ; held, that as this was an entirely oral transaction,
it was ineffective to create any interest in the land U Talok v. Mating Tha,
A.I.R. 1937 Rang. 148, 169 I.C. 945.
with a view to effect the registration of the bond in a particular office the
registration must be deemed to be invalid, with the result that there is no
enforceable security under sec. 59 of this Act Kedamath v. laiianta 18
C.L.J. 355, 70 I.C. 583, A.I.R. 1924 Cal. 348; Kesati v. Mtisafir AIR
1937 All. 711, (1937) A.L.J. 815, 171 I.C. 825 ; Akshoyalingam v. Rammiua
A.LR. 1929 Mad. 426, 120 I.C. 876 ; Harendfa v. Haridasi, 41 Cal 972
41 LA. 110; Biswanath v. Chandra Narayan, 48 Cal. 509, 48 LA 127*
Where a plot of land in another district was purchased and included in a
mortgage-deed, but it was found that the purchase was a paper transaction
only, the registration of the mortgage was mvaMParsotam v. Ali Haidar,
A.LR. 1937 Oudh 493, 171 I.C. 233 ; Biswanath v. Chandra Narayan, supra*.
Until the mortgage-deed has been registered, the mortgagee is not under
any obligation to advance any mortgage-money to the mortgagor. Conse-
quently, it is not open to the creditor of the mortgagor to attach the
mortgage-money in the hand of the mortgagee until registration of the
mortgage Tiilsiram v. Harakh Narain, A.I.R. 1922 All. 384 (385).
But non-registration may be cured if the mortgage has been acted upon
by the parties for a long period. Thus, money-decree for Rs. 300 was com-
promised by the parties, and they came to an agreement (which was
embodied in an application to the Court) under which the plaintiffs werd
put in possession of certain plots belonging to the defendants, and it was
further agreed that the plaintiffs would take the usufruct in lieu of interest:
and the defendants would be entitled to redeem on payment of Rs. 300.
The agreement embod}dng the compromise was not registered but the
plaintiffs remained in possession for more than fifty years, when it was
challenged on the ground of want of registration and attestation. Held that
although the formalities had not been complied with, still it is now far
too late to challenge a mortgage which has in fact been given effect to for
50 years Ram Sewak v. Sheo Naik, 45 All. 388 (389). Even where the
mortgage is not a valid trahsaction because of non-compliance with sec.' 59,
the person inducted on the property as mortgagee may acquire the status
of mortgagee by prescription, and the mortgagee or his vendee is entitled
to redeem Siikra Oraon v. )agat Mohon, A.I.R. 1957 Pat. 245 ; Rupa
Nonia v. Ram Brich, A.I.R. 1959 Pat. 164. It is for the mortgagee to have
a proper and valid mortgage-deed executed in his favour. Therefore, where'
a mortgagee takes possession of the mortgaged property under a deed which
requires registration but is not registered, the principle "once a mortgage
always a mortgage applies, and he cannot be permitted, to resist the
redemption by the mortgagor Rajpati v. Sukwaro, 63 I.C. 400 (Pat.).
69
[Sec. 59
Mg. Po Sin, 5 Bur. L.J, 106, A.I.R. 1926 Rang. 201 (202). These cases will
now be decided under sec. 53A.
Sec. 59]
of Property Act but its definition is to be found in the General Clauses Act
of which sec. 3 (52) runs- as -follows: Sign with its grammatical varia-
tions and- cognate expressions, shall, with reference to a person who is
unable to write his name, include mark with its grammatical variations
and cognate expressions. It is clear therefore that an illiterate mortgagor
may sign a mortgage by affixing his markGabind v. Bkat/, 41 Bom. 384
(388). A signature may be put down in various ways. The executant may
sign by pen and ink, or put his name down by means of types, or if he
uses a facsimile for signing his name he may use it for his 'signature Mrwa?
Chandra v. Saratmani, 25 Cal. 911.
The words signed by the ihorlsagor do not mean that the mortgagor
must personally sign the document ; the mortgage-deed may be signed by
another for him and tinder his authority on the principle quo facit per dlhim
tacit per se (he who acts through another acts through himself). Beforo
the T. P. Act was passed, a mortgage was a good instrument, whether it
was signed by the mortgagor personally or by some other person signing
for him, and it is not the intention pf flie present Act to curtail that free-
dom Deo Narain v. Kukur Bind, 24 All. 319 (F.B.) (overruling Moti
Begum V. Zorawar, 1889 A.W.N. 196) ; Sasi Bhiisan v. Chandra Peshkari
33 Cal. 861 ; Sristidhar v. Rakshakdly, 49 Cal. 438. The insertion of the
words on behalf of in sec. 123 and the omission of those words in sec-
tion 59 cannot be taken to show that the Legislature intended to lay down
in sec. 59 a different rule from that provided in sec. 123. Further, to hold'
that the Legislature requires that the personal signature of the executant
is indispensable in the case of a mortgage which is only the transfer of
an interest in the immoveable property, while it does not require the same
in the case of a gift or a sale whereby the transferors immoveable property
is absolutely transfered, is an anomaly, and a construction, which leads to
such anomaly, should not be adopted Deo Narain v. Kukur Bind, 24 All.
319 (F.B.) {per Banerji, ].). Where the executant of a document is illiterate,
some other person can sign his name on the document on his behalf in
his presence and at his request Ibid ; Sashi Bhusan v. Chandra Peshkar,
33 Cal. 861 ; Ra?n Charan v. Bhikari, 12 O.C. 257.
[Sec. 59
The proviso to sec. 68 lays down that no proof under that section is
necessary unless the executant specifically denies the execution of the docu-
ment. Where the executant says that he has no knowledge of the mort-
gage, and that if it is genuine, it must be hollow, held that these words
mean that the executant neither admits nor denies the genuineness of the
mortgage, but that he asserts absence of consideration if it is held to be
genuine ; these words do not amount to specific denial, and consequently it
is not necessary to call an attesting witness in proof of the execution
Yakub Khan v. Gujar Khan. 52 Bom. 219, A.I.R. 1928 Bom. 267 (268), 111
I.C. 287. The mere fact that the executant of a mortgage does not admit
the genuineness of the bond, or says that the attesting witnesses did noS
sign as witnesses or did not sign at the proper place in the bond, does not
amount to specific denial of the execution of the bond ; and therefore
does not necessitate any proof of attestation Biswanath v. Kayastha Cor-
poration. 8 Pat. 450, 10 P.L.T. 379, 119 I.C. 405, A.I.R. 1929 Pat. 422 (423).
See the new definition of 'attested' in sec. 3, and Note 18A, ante.
EC. 59]
[Sec. 59
$C. 59 ]
TRANSFER OF PROPERTY $5 1
But where a document consists of several sheets of paper and the exe-
cutant signs each sheet, it is not necessary that every signature of the
executant must be attested by the witnesses; it is sufficient if one sig-
nature is attested. A mortgage-deed consisted of three sheets of paper;
the mortgagor signed the second sheet in the presence of the attesting
witnesses who also signed at the foot as having witnessed the signature
of tire mortgagor. The third sheet (which enumerated certain additional
properties included in the mortgage) was signed by the mortgagor in the
presence of the same witness but without again affixing their signatures.
Held that the whole document was properly attested. To vahdate the
third page of the mortgage-deed, it was not necessary for the two wit-
nesses again to sign it fati/ct v. Aswini Kumar, 60 I.C. 736 (Cal.).
tSEC. 59
Where an attesting witness merely states diat die executant has sign-
ed the document in liis presence and he witnessed its execution, it is not
a sufficient proof of attestation. There must be some eindence to show
that the other witness was also present at the time of execution or at
least he attested the deed after he had received a personal acloiowledg-
ment from the executant of his signature or mark Zaharut Hussain v.
Mahadeo Ramji, A.I.R. 1949 Nag. 149, I.L.R. 1948 Nag. 621.
Sec. 5$i
70
[Sec.
Prior to the decision of the Privy Council in 35 Mad. 607, it was held
in several cases that it was not necessary for the mortgagor to affix his
signature to the mortgage-deed in the actual presence of the attesting wit-
nesses, but it was sufficient if he acknowledges 4iis signature on the deed
in their presence Sheikh Ghazi v. Bhawani Prasad, 1896 A.'W.N. 89;
Bunkatesh v. Rama Das, 6 A.L.J. 737 ; Ramji v. Bai Parbati, 27 Bom. 91 ;
Gatiga Devi v. Shiatn Sunder, 26 All. 69. These decisions will now stand
as good law.
Sec. S 9 ]
1927 All. 1, 99 I.G. 161, must be deemed as overruled by. the Amendina
and Repealing Act of 1927.
Where the mortgagee states in the presence of the mortgagor that the
mortgage-deed has been executed by the latter and asks the attesting
witness to attest it which he does without any dissent having been expressed
by the executant, the mortgage-deed is duly attested on acknowledgment
received from the mortgagor A7nir Husain, v. Abdul Samad, A.I R 1937
All. 646, I.L.R. (1937) All. 723, 171 LC, 743-
In a recent case the fudicial Committee has held that where the Sub-
Registrar and identifying witnesses have affixed their signatures- to the
registration endorsement under secs. 58 and 59 of the Registration Act
admitting, execution of a mortgage-deed, but there is no evidence that the
signatures were made in the presence of the executant, the signatures,
assuming that it would be legitimate to look at the proceedings relating
to the registration for the purpose of proving due execution and attesta-
tion, cannot be said to have proved due attestation as requird by this
section. In such a case secs. 58, 59 and 60 of the Registration Act are of
no avail. The endorsements made at the time of registration are relevant
to the matter of registration only Surendra Bahadur v, Behari Singh, 43
C.W.N. 669 (P.C.), LL.R. 1939 Kar. 222, A.LR. 1939 P.C. 117 (121), 1939
A.L.J, 492. See also Zaharul Hussain v. Mahadeo Ramji, A.LR. 1949 Nag.
149, LL.R. 1948 Nag. 621 ; Shanmughavelu Mudaliar v. Niranand Narain-
das, (1967) 2 Mad. L.J. 388. In the absence of evidence that the Sub-
Registrar put his signature or seal on the mortgage-bond in the presence
of the lady executant, it cannot be said that the mortgage-bond was pro-
perly attested Hem Chandra v. Guiram, 58 C.L.J. 545, 150 I C. 762 ; see
also Atul V. KrishJta, 67 C.L.J. 31. Where in the regstration endorsement
there is no statement to the effect that the identifying witnesses signed the
[Sec. sH
Sec. 59]
lady had not seen her face, but had identified her by her voice, held that
the . execution of the mortgage-deed was sufficiently attested Padorat/j
Halwai v. Ram Narain, 37 All. 474 (P.C.) ; Rai Radha Kishen v. Jag Sahu,
60 LC. 173 (Pat). But where the witnesses did neither see the face of
the executant pardanashin lady nor hear her voice, the deed was not validly
attested. Thus, a mortgage-deed, purporting to have been granted by
a pardanashin lady on behalf of her minor son, was executed as follows :
the lady was behind the pardah, when the document was taken to her for
signature ; none of the witnesses saw her sign it ; her son came from behind
the pardah, and said that it had been signed by her, and then the witnesses
attested it. Their Lordships of the Judicial Committee observed that the
requirement as to attestation contained in sec. 59 was not complied with,
since the attesting witnesses were neither able to answer as to the act of
execution nor as to the identity of the person performing the act Ganga
Pershad v. Ishri Pershad, 45 Cal. 748 (754) (P.C.), 22 C.W.N, 697, 45 LC. 1.
The same view is taken in Hira Bibi v. Ram Hari, 5 Pat. 58 (P.C.), 89 LC.
659, -A.I.R. 1925 P.C. 203, where the facts are exactly the same. Even the
fact that the pardanashin lady subsequently admitted that she had execut-
ed the mortgage-deed would not validate the deed by operation of sec. 70
of the -Evidence Act, for that section applies only to a document validlp
attested, which is not the case here Hira Bibi v. Ram Hari, (supra).
Where the attestors did not see the lady sign the instrument, and the lady
did not acknowledge to them that she had signed it, and the attestors did,
not sign the instrument in the presence of the lady (as for instance, where
the witnesses were waiting in the parlour of the lady's house and tho
document was taken inside the house for her signature, and after its return
with her signature it was brought to the place where the witnesses werd
waiting and there they signed), the instrument could not be said to have
been validly attested Venkata Jagannadha v; Venkata Kumara, 54 Mad.
163, 60 M.L.J. 56, A.I.R. 1931 Mad. 140 (141), 135 I.C. 17.
.[Sec, 59
li ^^rain v. Adhindra
But tiiough the deed may be' ineffectual as a mortgage for want of
attestation, still it will be admissible as an evidence of a personal cooen-
ant to repay the debt, whether the deed has been registered or not
Muthalakulangara v, ThiruthipaUi, 82 Mad. 410 (F.B.) ; Soda Kamur v.
Tidepatttf, SO Mad. 284; Venkata JaganmdJfa v. Venkata Ktmara 34
Mad. 163 A.I.R, 1931 Mad. 140 ; and a single money-decree can be 'pas-
sed on the personal covenant to pay Mfl/ifldeo Prosad v. Gairaj Sins 3
O.L.J. 164, 34 I.G. 397; Mathura Prosad v. Chedi Lai, 13 A.L,J. 553;'
Sama Rao v. Vannajee, 46 Mad. 64 (67) ; Dhana Mohammad v. Nastulla
A.LR, 1926 Cal, 637; Tofaluddi v. Mehar Ali, 26 Cal. 78. So, in a suit
on a simple mortgage for sale of die mortgaged property, if it is found
that the document fails for want of proper attestation to take effect as
a mortgage-deed, the Court can allow the plaintiff, even at a late stage
of the case, to amend the plaint by adding an alternative prayer for a
simple money-decree Mahadeo Prosad v. Gajraj, 3 O.L.J. 164. But' this
rule win not hold good in the case of a usufructuary mortgage in which
the mortgagor does not bind himself personally to repay Ae money. If
such mortgage is not validly attested, neither a personal decree will be
allowed against the mortgagor nor wiU the document create a charge'
Ram iNarain v, Adhindra Nath, 44 Cal. 388 (P.C.), In a case where a
mortgage-bond failed tO'take effect for want of due attestation, tlie Privy
Council gave effect to it as a validly executed transfer of the earlier
mortgages by the mortgagees Lucas v. Bank of Bengal, A.I.R. 1926 P.C.
129 (ISO), 31 C.W.N. 178, 98 I.C. 925. If any person enters into posses-
sion on the basis of a deed of usufructuary mortgage not properly attest-
ed he cannot resist die claim for recovery of possession by the owner
especially when he does not deny the execution of the mortgage Aaob
AH V, Farid Ali, A.I.R. 1961 Assam 48, Attestation is not required in the
case of a mortgage deed executed by the court in pursuance of a decree
for specific perfonnance Sait Genamal v. Pachigrdla, A.I.R. 1960
Andh. Pra. 465.
that the actual mortgage was intended to take place die following year
and before the date on which the mortgage was to operate, the docii-
ment would presumably amount to an agreement to mortgage, and deli-
very of the property was 'not necessary at the time document was drawn
up Mapi V. Gottennkkala, A.I.11. 1938 Mad. 85, 46 M.L.W. 742. An
oral usufructuary mortgage or charge in extension of a previous such
mortgage is invalid ^thout registration v, Fatima Bi, A.I.R.
1952 Hyd. 5. ...
Art. 187, Limitation Act does not start from the date on which the mort-
gagee took possession of the property ibid.
356. Equitable mortgage The last para of tlie old section which
provided for an equitable mortgage was not happily worded : it was in
the nature of a negative provision. It gave rise to the contention (in a
ease before the Privy Council) that tliis para did not validate or expressly
recognize an equitable mortgage but threw on those who relied on it to
establish tlie validity of such mortgage, and that if tlie mortgagee did
not discharge that burden, tlie mortgage was invalid. But their Lord-
ships overruled this contention, saying that although this Act did not
itself validate .such mortgages, the validity of such mortgages must be
deemed as recognized by this Act, and that no onus lay on the mortgagee
to prove tlie validity of the mortgage Papiah Naidu v. Naganatha Setli-
upathi, 61 M.L.J. 408 (P.C.), 35 C.W.N. lOBl (1065), A.I.R. 1931 P.C.
239, 134 I.C. 328.
[Sec, 59
deed, and the letter together with the title-deeds was handed over to
the mortgagee V held, not only were the writing of the letter and the
Sec. 59]
71
I Sec. 59A
If in a suit on a mortgage by deposit of title-deeds the mortgage is
held to be invalid, but the mortgagee is found entitled to a money^cree
by virtue of a promissoiy note executed for die loan, only a simnle
money-decree can and should be passed against the mortgagor and tiie
suit must be dismissed ^s against a third party impleaded as a subsequent
mortgagee Krislxnaswami v. Kamalamma, 46 C.W.N. 29 (P.C.), A,IR '
1941 P.C. 90, Tlie validity or otherwise of the mortgage of such third
party cannot be investigated, nor a money-decree passed in his favour
on the finding that liis mortgage is invalid as qgainst the prior mort-
gagee, nor a sale ordered of the mortgaged property with directions as
to the distribution of the sale-proceeds as between only these creditors
Ibid.
59A.
References to mort-
gagors and mortgagees
to include persons deri-
ving title from them.
of section 59A.
Sec. 60]
60. At any time after the principal money has become due,
Right oF mortgagor the mortgagor has a right, on payment or
to redeem. tender, at a- proper time and place, of the
[ Sec, 60
EC, 601
The' remedy under this section depends 'Upon existence of the relation-
ship of mortgagor and mortgagee Batuk Prosad v. Rudra Das, A.LR. 1950
Pat. 206.
[Sec. 60
882.
Where the suit was in effect one for redemption- of an oral mortgage
it was necessary for the plaintiff to prove that he was the mortgagor entitled
Sec. 60 J
Where the alleged mortgage is not proved the plaintiff cannot take
advantage of a different mortgage not set up by him Kanhiya v. Jamha,
A.I.R: 1950 Raj. 47.
Costs: The ordinary rule that costs follow the event applies with
greater force in mortgage suits including redemption snitSr-Varaha Devas-
wom V. Utnmer Sait, A.LR. 1.951 Tr.-Coch. 17. See also Kaliya Pillai v.
[ Sec. 60
Sec. 601
Shiam Lai v. Jagadamba, 25 A.L.I. 1051, A.I.R, 1928- All 131 (132, 132) ;
Raghtibar v. Biidhii Lai, 8 .AH- 95 (98). This principle has been recognised
in Husaini v. Husain, 29 All. 471 (473), and has been ultimately approved
of by the Privy Council. Ordinarily, and in the absence of a special con-
dition entitling the mortgagor to redeem during the term for which the
'mortgage is created, the right of redemption can only arise on the expira-
tion of the specified period Bakhtawar v. Husaini, 36 All. 195 (199)
(P.C.) ; see also Ram Datta v. Me/. Husain, A.I.R. 1940 Oudh 428, 19^10
O.W.N. 897, 190 I.C. 828. The rule is not affected by the fact that the
term fixed is such a long period as 60 years or that it is provided in the
deed that even after expiry of the term, there should be no redemption
Narain v. Jagan, A.I.R. 1925 All. 42, 80 I.C. 728 ; see also Md. Sher Khan
V. Swami Dayal, A.I.R. 1922 P.C. 17, 44 All. 185, 49 lA. 60 ; Bakhtwar v.
Hussain, 36 All. 195, 41 I.A. 84 ; Mela Ram v. Prithvi Chand, A.I.R, 1929
Lah. 523, 116 I.C. 609 ; Akbar v. Shah Ahsanul Hag, A.I.R. 1932 All. 155,
134 I.C. 459.
In an earlier Madras case Turner, C.J. expressed the opinion that where
a date'" was fixed in the mortgage.deed, the presumption was that the date
was fixed for -the convenience of the mortgagor, and that he might repay
the debt at an earlier period Sri Raja Satmcherla v. Sri Raja Vairicherla,
2 Mad. 314 (316) : and jelying on this view, Mahmood, J. laid down that
"no general rule exists in India as would preclude a mortgagor from
redeeming a mortgage before the expiry of the term for which the mort-
gage was intended to be made, unless the mortgagee succeeds in showing
that by reason of the terms of the mortgage itself the mortgagor is then
precluded from -paying off the debt due- by him to the mortgagee
Bhagivat v. Parshad, 10 All, 602 (609). In a Madras case, where the
mortgagor covenanted to repay the mortgage-moneywithin a specified date
(e.g., within 20th April 1904), held that the mortgagor could redeem
before that date, that the rule of mutuality (viz,, that the right- of redemp-
tion and the right of foreclosure are co-extensive) was not an inflexible
or universal one, and that when the mortgagor covenanted to repay the
money within certain date, it must be presumed that he intended to
reserve the liberty of redeeming at his pleasure Rose Ammal v. Raja-
rathammal, 23 Mad. 33 (35, 36), dissenting from Tirugnana v. Nallatombi,
16 Mad. 486. -
But the Legislature has adopted the rule of mutuality, and the word
due has' been substituted for the word payable in order to make it
clear that the redemption should not be allowed within the term of the
mortgage.
72
.[Sec. 60
legislature has substituted the word payable by the word due c
that the mortgagor can redeem only when the money has become due
to the mortgagee, when , the mortgagee can call for the money and
not ^rlier.
Where no time was fixed for the payment of the mortgage-money, but
after the execution of the deed a clause was added to the effect that the
arnount will be paid, principal and interest, within one year, and this
clause was separately signed b}'^ the mortgagor, held under .circumstances
of the case, that the mortgagor was entitled to redeem before the expiry
of ^he year Puma Chandra v. Peary Mohan, 39 Cal. 828 (833). Where
no period is mentioned in the mortgage deed the mortgage- money becomes
due immediately on the date of the mortgage Raf v. Hargurdial Singh,
A.LR. 1959 Punj. 249-
363, A.I.R. 1925 Mad. 825, 90 I.C. 138 ; Chhotku v. Baldeo, 34 AH 659
Sec. 60 j
(662). Where the period of redemption was fixed as 50 years, but the
mortgagor sought to redeem after 26 years only and the mortgagee sought
to set up adverse title, redemption was allowed on the ground that the
mortgagee did not act in accordance with the terms of the contract and
was not willing to do^urga v. Paresk, A.I.R. 1925 Cal. 105 (106), 76 I.C.
336. Where the mortgagee failed to perform his part of the contract, e.g.,
paying the mortgagor by instalments, the mortgagor was entitled to redeem
'before the due date S'anwaley v. Sh6o Samp, A.I.R. 1927 Oudh 589, 122
I.C. 411. Where part of the principal money was made payable by the
mortgagee to another forthwith and the mortgagor was entitled to redeem
within 20 years, but owing to unexpected events payment by the mortgagee
was made only subsequently, the right to redeem accrued only 20 years
from the date of actual payment and not from the date of mortgage Hira
Lai V. Kkizar, A.I.R. 1936 Lah. 168 (174), 161 I.C. 251. Where under the
terms of a mortgage the . mortgagee is to enjoy the -property in lieu of
interest for five years and the mortgagor is to repay the amount when
demanded in any year at the close of the agricultural season after the
expiry of five years, money becomes due on expiry of five years period
without any demand from the mortgagee Narayana Chettiar v. Ranga-
swami Naiaii, (1968) 2 M.L.J. 445.
[Sec. 60
A.I.R. 1939 P.C. 14 (19), 43 C.W.N. 281, 66 I.A. 50, I.L.R. (1939) 1 Cal.
SEC. 60]
[Sec. 60
Sec. 60]
[1^01] 2 It. R. 653 ; Tiriimala v. Srinivasa, 52 Mad. 300, A.I.R. 1929 Mad.
243 (248), 5o M.L.J. 318, 121 I.C. /53. Tliere were tliree morlgage.s in
favour of tlie same person in respect of the same property and possession
had been given under the first mortgage. Tire third mortgage deed pro-
vided that in case of failure to repay the mortgage money on tlie tliird
mortgage widiin two years, the deed should be deemed to be a sale deed
and the total amount due on all tlie three mortgages sliould be treated as
the consideration for the sale : Held, (1) all the three mortgages sliould
he read together and die mortgagee should be treated as a mortgagee
in possession under a mortgage by conditional sale ; (2) the provision was
a clog on die equity of redemption ; (3) die possession of the mortgagee
did not become adverse to the mortgagor ; and (4) obtaining a patta of
the mortgaged property in his name by the mortgagee without notice to
the mortgagor did not affect the latters right of redemption
[Sec. 60
SEC. 60]
All. 283 (285 ) ; Kuddi Lai v. Aisha, 2 Luck. 564, 102 I.C. 263, A.I.R 1927
Oudh 199 (200). But see Shiani Lai v. Jagadamhu, 25 A.L.T. 105*1
A.I.R. 1928 All. 131 (134), IDS LC. 561. So also, where a mortgagor under-
took that he would not alienate the equity of redemption and that tlie
mortgagee should not be obliged to receive the money from any one but
the original mortgagor, it was held that as the undertaking absolutely
forbade alienation, and thus deprived mortgagor of a right which was
an essential incident of the estate he had in the properly by virtue of
his equity of redemption, it could not be given effect to~Trimbak v.
Sakharam, 16 Bom. 599. In mortgage-bonds in this country, a clause
is generally inserted restraining alienation of tire mortgaged property;
such a clause does not prevent an alienation being made subject to the
right of. the mortgagee Syam Peary v. Eastern Mortgage and Agency
Co., 22 C.W.N. 226, 40 I.C. 865.
Mad. 312 ; Viranna v. Pallaya, A.I.H. 1948 Mad. 7, (1947) 1 M.L.J. 244;
Pinfo V, Sheenappa, infra ; Gangadhar v. Shankar Lai, .A.,I.R. 1958 S.C.
770; Ratanlal v. PraVkudayal, I.L.R..(1960) 10 Raj. 517; Sirinivas
Pogla V. Satyanand Gupta, A.I.R. 1969 Pat. 64. An agreement in a mort-
gage that in default of payment of the mortgage-money on the due ^^t^
the mortgagor will sell the property to the mortgagee at a price to be feed
by umpires, constitutes a fetter on the equity of redemption, and is there-
fore unenforceable Kanaram v. Kuttooly, 21 Mad. 110 ; Narayanan v.
Kochupenna, A.I.R. 1954 Tr.-Coch. 142. Similarly, a condition in the
the deed tliat tire mortgage will work itself out into a
mortgagee shall be absolute o\vner of the projjerty) should uie amount
be not paid wthin a feed period, is a clog on ademption and theretore
void 'Mehrhan v. Maklma, 11 Lah. 251 (P.C.), 34 C.W.N. - ( )?
73
[Sec. 60
A.I.R. 1930 P.C. 142, 123 I.G. 554 ; Srinivasa v. Radha Krishna
m - CM jg i c, 338 (Pat); t
Sec. 60]
I Sec, 60
such a stipulation does not bar a suit for redemption, yet it preclude
the mortgagor from redeeming the mortgaged property in the same un.
fettered state in which he had held it when he mortgaged the propertv
inasmuch as after redemption he will have to hold it subject to a rieht
of pre-emption which the mortgagee has secured under the instrument of
mortgage. Such a collateral advantage bargained for by the mortgagee is
really a clog upon the right of redemptioni^u/nosomi v, Chinnan Asciri
24 Mad. 449 (458). See alko Pinto v. Sheenappa, A.I.R. 1951 Mad. 524,
(1950) 2 M.L.J. 169. Where six days after the mortgage the mortgagor
executed an agreement in favour of the mortgagee stipulating that in case
the mortgagor should happen to sell the property he would sell it to the
mortgagee at a concession rate, it was held that the agreement was part
of the same transaction as the mortage and was a clog on the equity of
redemption Tirumala v. Kandala, 52 Mad. 300.
(8) Covenant to pay interest in addition to usufruct : A covenant,
in a usufructuary mortgage, to pay interest in addition to usufruct
(especially in a case where the mortgagors are a pardanashin lady without
independent advice and a boy of tender age without experience, and the
mortgagee is the superior proprietor of the mortgagors) is hard and
oppressive, and amounts to a clog on redemption Mahomed AJi v,
Rakdan AH, 3 0,L.y. 746, 38 I.C, 454. So also, where the mortgagor is
not entitled to rents and profits though he has to pay interest at> per
cent and the mortgagees are entitled to spend any amount they like on
improvements and charge the same on the property with interest at 6
per cent the whole transaction is unconscionable f^ow/dor v. Abdul
Samad, 5 Lah. L.), 394. But where the profits from the land being small,
the mortgagee in possession was allowed to take the produce as well as
to charge interest at 6 per cent at the time of redemption, held that the
terms of the mortgage were not unconscionably onerous Sarhon v.
Bhagwan, 28 P.L.R, 59, A.I.R. 1926 Lah. 457 ; see Cokiil v. Goitri, 4
O.W.N. 147, A.I.R. 1927 Oudh 595 (596) ; Ramkishore v. Ram Nandan,
25 A.L.J. 1086, A.I.R. 1928 All. 99 (100) ; Sarfaraz v. Udwat, 4 Luck. 147,
A.I.R. 1929 Oudh 30 (32), 113 LC. 46. A stipulation that the mortgagor
would continue to pay interest,- even if he wants to redeem the mort-
gage, till the widow died was a clog on the euqity of redemption Sawrc
v. Manikyam, A.LR. 1949 Mad. 768, (1949) 1 M.LJ. 468.
Dhar v. Shankar Lai, A.LR. 1958 S.C. 770 ; Saleh Raj v. Chandan Mai.
A.I.R. 1960 Raj. 47. The right of redemption and the right of
Sec. 6q]
Sayad Abdul Hak v. Gulam JUatii, 20 Bom. 677 ; Sari v. Motiram, 22 Bom.
375 (377) ; Rahmat Ali v. Shadi Ram, 28 P.L.R. 150, A.I.R, 1927 Lah!
226 (227). A covenant in a mortgage-deed postponing redemption after
the expiry of the period fixed in the deed for redemption, amounts to a
clog on redemption and is invalid. Thus, a mortgage-deed provided that
the mortgagor was to redeem at the end of five years and that if he did
not do so, the mortgagee was to have the option of taking possession
for a period of 12 years, and that if the mortgagee took possession, the
mortgagor was not to be entitled to redeem, till at the expiration of the
12 years. Held by the Privy Council that the mortgage being for a term
of five years, the mortgagor had a right to redeem on payment of the
mortgage-money on the expiration of the five years, and. that the clause
in the deed postponing redemption for the further period of 12 years was
a clog on redemption and therefore invalid Muhammad Sher Khan v
Rafa Seth Swami Dayal, 44 All. 185 (189) (P.C,), 68 I.C. 853, A.LR. 1922
P.C. 17. A condition in a usufructuary mortgage barring redemption,
(1) within 5 years and (2) after 20 years from the date of mortgage
amounts to a clog on the equity of redemption Vaddiparthi v. Cadim-
setti, 41 M.L.J. 563, 68 I.C. 717. See also Davis v. Symons, (1934) 1 Ch.
442. Conditions in a mortgage deed providing for redemption after 49
years and permitting mortgagee to rebuild, repair, pay taxes and to
recover at a higher rate of interest the mortgage money amount to a
clog Sarju Ram v. Taji Bibi, A.I.R. 1962 All. 422. A clause in a deed
of sub-mortgage that if the sub-mortgage is not redeemed for five years
the mortgagee \yill lose his right of redemption is a clogJang Singh v.
fewa Singfi, .A.I.R. 1962 Punj, 478. A covenant postponing redemption
for a long term does not necessarily of itself amount to a clog on redemption.
But where a mortgage was made for a very long term as 40 years, and a
provision was inserted in th'e deed fixing a particular date on which it
was to be redeemed, failing which the mortgage was to be renewed for
another term of 40 years, held that the provision giving a right of redemp-
tion on one day only in 80 years was designed to make redemption almost
impossible, and should not be enforced, and that the Court would allow
redemption at any time on such terms at it thought fit Sarbdawan Singh
V. Bijai Singh, 36 All. 551 (553), 12 A.L.J. 927, 24 I.C. 705 ; Ram Ganesh
v. Rup Narain, A.LR. 1925 All. 34, 80 I.C. 944 ; Bhullan v. Bachcha, 53
All. 580, A.LR. 1931 All. 380, 131 LC. 520; Ditrgo Singh v. Naivab
Mirza Muhammad, 17 O.C. 313, 25 LC. 912 ; Kunj Behari v. Prag Narain,
9 O.L.J. 294, A.LR. 1922 Oudh 283 ; Rajai v. Randhir, A.LR. 1925 All.
643, 87 LC. 30 ; Chandanmal v. Saleraj, A.LR. 1958 Raj. 298. See also
the cases under Note 363 (2).
t Sec. 60
363. What is not a clog The mere fact that the terms of a
mortgage are hard does not lead to the conclusion that they are to be con-
sidered as forming a clog on redemption. A man who ehters into a tran-
saction with his eyes open, and without any undue influence being broug t
to bear upon him, cannot ask to be relieved of the consequences of Ins
action N oMm Ram v. Shadi Ram, 40 P.W.R. 1919, 49 I.C. 946. See also
Aga Mahomed v, Venkatappaya, 35 M'.L.J. 287, 48 I.C. 379 (382). Wher
at the time of the transaction there was no covenant which could neces-
sarily postpone the mortgagors right of redemption to a very indefinite
period or which would create an insuperable difficulty m his way, .there
A. I.R. 1928 AH. 99, 25 A.L.J. 1086, 108 LC. 149 ; Mt. Rangili v. Pearey
Lai, A.I.R. 1940 All. 101, 1939 A.L.J. 1056, 186 LC. 519; Har Prasad.
v. Ram Chandra, 44 All. 37 (F-B.). So again, a covenant in a subsequent
mortgage' not to redeem that mortgage without redeeming at the same
time a prior debt or mortgage, is not a clog on the equity of redemption
but is a part and parcel of the subsequent contract, and the parties are
bound by it hnam Baksh v. Anwari Begam, 18 LC. 718 (All.); Abhai
Nardih v. Mata Prosad, 24 O.C. 240, 64 I.C. 82 ; Abdul Hamid v. Jairaj,
3 A.L.f. 768 ; Har Govind v. Tula Ram, 10 LC. 222 (AH.) ; Hari v. Vishnu,
28 Bom. 349 (F.B.) ; Paras Ram v. Sheo Dhan, A.I.R, 1932 All. 558, 138
LC. 492. This subject is more fully discussed in Note 378- under section 61.
[Sec. ^0
Baldeo V. Losai, 4 Luck. 203, 5 O.W.N. 1091, 114 I C sn atd
O udh 54 ; or 150 years Abdulla v. Sadulla, 15 i,c 917 Tasannnrfh
Venuthurupalli; A.I.R. 1944 Mad. 501, (1944) 2 M.L.M44^. or
Side Munja v. Giga Kama, A.I.R. 1953 Sau. 193 ; Jodhirani Sah v Harlh
r seeDurga Charan v. Poresh, A.IR 1925
Cal. 105, where though the period of redemption was 50 years redemotinn
was allowed after 26 years. ^ emption
redemption. The decision in each case must depend upon its own circums-
tances. The mere fact that the mortgage-deed contained a condition that
in case the mortgage was not redeemed on the date on which the mort-
gage-period (20 )'ears) expired, the mortgagor would not be able to redeem
it for another period of 20 years, would not amount to a clog on the equitj'
of redemption, in the absence of materials to show that there was a design
to make redemption very difficult, if not impossible Narsingh Prasad v.
Rupan Singh, 1929 A.L.J. 606, 116 I.C. 876, A.I.R. 1929 All. 388 (389).
Although the mortgage may be for a long period (e.g., 35 years), still if
there are no provisions in the mortgage-deed which are wholly advantage-
ous to the mortgagee and do not confer any corresponding advantages on
the mortgagor, there is no clog on redemption Sarfaraz v. Udwat, 4 Luck.
147, 5 O.W.N. 974, 113 I.C. 46, A.I.R. 1929 Oudh 30 (31). But where a
mortgage-deed contained onerous and one-sided covenants "which operated
to postpone the right of redemption for 60 years, while allowing the mort-
gagee to call for the mortgage-money at any time he liked, held that as the
covenant postponing redemption was unilateral and an unreasonable fetter
on the equity of redemption it could not be enforced Lai Bahadur v. Zaltm
Singh, 2 O.L.J. 1, 27 I.C, 581 ; Saijad Abdul Hak v." Culam Jilatri, 20 Bom.
677 ' Smi v. Motiram, 22 Bom. 375. A provision fixing a very long term
in ^usufructuary mortgage is not a ground for holding that the provision
should not be enforced, but where a further provision has been inserted
in' the deed which makes redemption very difficult, if not impossible, a.
Sec, 60]
the end of that term, such a provision is a clog on redemption and cannot
be enforced Sarbdawan v. Bijai, 36 All. 551 (553), 12 A.L.J. 927, 24 I C
705. Where a usufructuary mortgage-deed provided that redemption
should take place after 99 years on payment of double the amount of the
principal money secured, held that the covenant created an unreasonable
and oppressive fetter on the right to redeem, and the Court would allow
redemption, irrespective of that term, on such condition as it may deem
fit to impose Muthura Prosad v. Bhagwat Prosad, 22 O.C. 191 ; Abdul
Hakim v. Sajjad. Husain, 26 O.C. 209, A,I.R. 1923 Oudh 209. A covenant
postponing redemption for 200 years has been held to be a clog on redemp-
tion Fute/i Mohammad v. Ram Dayal, 2 Luck. 588, 4 O.W.N. 502, A.LR,
,1927 Oudh 224 (225). Where under the agreement the mortgagor was to
redeem the mortgage 99 years after its execution and the mortgagee was
authorized to build any structure on the mortgaged plot as he liked, it
was held that the two terms were so unreasonable that they amounted to
a clog on the equity of redemption Vadilal v. Cokaldas, A.LR. 1953 Bom.
408. But see Sar/ug Mahto v. Devrap Devi, A.I.R. 1963 Pat. 114.
[ Sec, 60
(7) High rate of interest : The mere fact that a' high rate of interest
has been stipulated in a mortgage-deed does not entitle the mortgagor
to put forward a case of clog, in the absence of any proof of undue influence
or unfair dealing in the stipulation for interest Saheb Baksh v. Mahomed
AH, 7 O.LJ, 389, 58 LC. 115 ; Sarfaraz v. Vdwat, 4 Luck. 147, 113 LC.
Sec. 60]
sion so long as there were .fruit-bearing trees on the land planted by the
morgtagee, is not a clog on the equity of redemption Genu Tukaram v.
Narayan, 45 Bom. 117 (123), 59 I.C. 258-
[Sec, 60
Sec. 60]
payment of the full dues under a mortgage has been established, the ex-
tinguishment follows as an inference of law. A mortgage is not extin-
[Sec. 60
Sec. 60]
got the. money ready for immediate payment and intimated to the execu-
tors that the money was waiting -to be paid to them, but did not actually
make payment because the executors had not yet taken probate, there
was a valid tender as from the time the intimation was given, and tlie
mortgagor was not bound to pay any interest, after that date Panduraim
V. Dadabhay, 4 Bom. L.R. 453.
Wliere one of the terms of redemption was that the mortgagor should
deposit the mortgage-money on or before a particular date, the non-
deposit of the mortgage-money on that date is no ground for dismissing
the redemption suit. The equities of the case, if necessary, may be set-
tled by making a proper order for costs Amha Prasad .v. Mooga Ram,
A.I.R. 1930 All. 523, 128 I.C. 235.
[ Sec. 60
withdraw the same, tlie suit which tlie mortgagor has to institute a
suit for redemption, and the mortgagor must include in such a suit hk
claim for over-payments to the mortgagee or excess profit received hv
Inm. If he does not do so, he would be debarred from claimins the
same in a subsequent suit. Tlie mortgagee does not become a tiesnasser
from the moment of the tender or from the moment he receives tlie notice
of deposit, and a suit for mesne profits after a suit for possession or
redemption for a period anterior to the date of the institution of the suit
for possession oi- redemption will not lie. After a tender or deposit the
mortgagee still continues as a mortgagee ; the only effect is that interest
ceases to run i\nd that a heavier burden in the matter of accounts is
throw'll on the mortgagee flfl/ Mohan v. Saroda, A,I.R. 1936 Cal 200
(201, 202), 40 C.W.N. 627, 162 I.C. 709 per R. C. Mitter, J.
ties and that such rent also Iiad to be paid before redemption could be
allow'ed. Held, that the mortgagor was entitled to redeem on payment
of the statutory percentage of the debt under the Debt Relief .Act a^nd
that the mortgagee lost his status as lessor with the disappearance ot tim
mortgage on redemption Sicany Cheitiar v. Sivaram Iyer, A.l.n.
Trav.-Co. 13,
Sec. 60]
the mortgage, the payment of the balance will entitle the mortgagor to
redemption Hira Kuer v. Paiku, 3 P.L.J. 490.
The mere fact that the mortgagor entered into a personal covenant
to pay a certain sum does not prevent the said amount being taken into
consideration in settling the total sums which would be paid by the mort-
gagor when redeeming the mortgaged propei ty Hordiwr v. SUa Rani,
A.LR. 1934 AU. 888, 150 I.C. 879.
conditional sale) j that the omission to insert the amount of the price for
repurchase was either due to an oversight or intentional ; and that in the
absence of any specific agreement as to the jpayment of a different sum
for redemption, the mortgagor was entitled to redeem on payment of
the mortgage-money' which in this case meant the amount actually due
under the deed (/. e., Rs. 600) Mating Pe Gyi v. Hakim Ally, 2 Rang.
113 (116).
Wliere it was stipulated that die mortgagor would iiay interest until
delivery of possession of the mortgaged property to the mortgagee, held
that after the mortgagee took possession the mortgagor was not bound
to pay interest and was entitled to redeem on payment of the principal
sum only-^Partah v. Gajadhar, 24 All. 521 (531) (P.C.).
75
[Sec. 60
594 TRANSFER OF PROPERTY
{d) Tlie mortgagor can, after receiving possession of the pmpt ttv
and paying under protest the amount demanded b\ tlic morlg.tgee, sue
to recover suiplus amount from the mortgagor if the amount paid is in
excess of the amount due Daifajirao v. Prahaldas, A.I.R 193G .M idh
B. 72.
kata, 11 Mad. 403. A mortgage by conditional sale docs not become irie-
deemable after the e.vplry of the period fixed ; the right of the mortgagoi
to redeem the property remnins unaffected b\' the expin- of the tenn
Lfl/ta Prasad v, Jagdisli, 48 All. 787, 24 A.L.J. 10.57, A.I.R. 1927 All.
137 (1-10), 98 I.C. 961 ; Balkissen v. Leggc, 22 All. 1 19 (P.C.). But if the
lestrictive condition is entered into subsequently to the mortg.igc trans-
action, tlie contract will have the eifcct of extinguishing the right of
redemption Ram Singh v. Baij Nath, 17 A.L.J. 117, -19 I.C. 863. S^v
also 27 Bom. 297 and 22 Bom. L.R. 9K cited in Note 3G2 (!), ante. 1 uc
act of parries means an act subsequent to the mortgage transaction ;
there can be no e-xtinction of the right of redemption by an agreement
contained in the transaction itself, for the law as codified in see. 60 giv-
ing the mortgagor a right of redemption prevents him from contr.icling
himself out of itAmbu v. Kclu. 53 Mad. S05, 12-3 I.C. 5Sf. A.I.R. 1930
Mad. 305 (313). If a mortgagor in a petition to the Municip.ility s.iys
that the transacb'on is a sale he will not thercbv lose his right of redemp-
tion Fulchand V. Kanhaiyalal, 1962 M.P.L.J. '423. Right to redeem is
not extinguished by the mortgjigoi admitting the title of a third Pyty
to the mortgaged projjertj' in a suit between the mortg.igor and the third
party Hirabai v. Ganesh, A.I.R. 1959 Bom. 172.
[Sec. 60
receipt-DuZc/wnd v. Dlmanidhar
1961 M.P.L.J. 404. Where a mortgagor sells the property to a usufmc^
^ary mortgagee by an unregistered deed, the possession of tlie mortKagee
trom the date of sale becomes adverse to the mortgagor and ripens into
ownership after tlie lapse of the statutory penod-^Udaibhanmimh v
Shw Narain, 1959 M.P.L.J. (Notes) 282. ^ '
Sec. 60]
[Sec. 60
Ec. 60]'
Where the mortgaged land was sold for arrears of revenue owing to
the default of the mortgagee, and was purchased by him at the auction-
sale, such sale did not deprive die mortgagor of his
Thakur Jai Karan v. Sheo Kumar, 50 AU. 36, A.I.R. 1927 All. /4/ {/48)j
Kalappa v. Shimyya", 20 Bom. 492 (494); Lakshmatjya v. Appadu, i
Mad. Ill (112).^ But when betiveen the mortgagor and the mortgagee
[Sec. 60
there is an apeement that the mortgagee need pay only the Govemmerit.
rpenue on the land in die patta mortgaged, and as a result of default on
tte part of the mortgagor to pay the revenue on die other lands in die natta
the land mortgaged is sold and purchased by the mortgagee, die rieht of
redemption is extinguished Afinor Pachi v. Perumal Thevor, 1955 Mad
W,N. 662; Stiraj Narayan Prasad' v. Rameshwar Prasad, 1956 P.L.rR
495. Where, in execution of a rent decree for arrears of -rent for the per-
iod prior to the mortgage die property is sold, die ri^t of redemption
is extinguished even if the propertjf is purchased at die rent-sale by the
mortgagee /fly Prasad v. Mt. Jasoda, A1.R. 1958 Pat. 649. mere the
mortgagee acquires a portion of the mortgaged propertj' at a rent-sale
he is not liable for the payment of any portion of the debt Ibid.
Sec. 60]
value of the properly purchased be equal to the amount due 0 )i the mort-
gage Pannamf>fffn V. Annatmlai, 43 Mad. 372 (379, 380) (F.B.) Sham-
shad AU V. Mohammad Ali, 21 O.C 172 ; Bisheshai; Dial v. Ram Sanm
22 All. 284 (F.B.) ; Nyaiinglebin Co-operative Bank v. Maun Ba, 6
Rang. 417, A.I.R. 1928 Rang. 263. Compare Laklxmi Das v. Jamna'das,
22 Bom. 304 (313) ; Sankaran Lekshmi v. Adima Kunju, A.I.R. 1965
Ker. 132 ; Venkappa v. Gangadhar, A.I.R. 1959 Ker 112. In this respect
there is no distinction in principle between a private sale and
an execution sale, i.e., whether the ' mortgagee purchases a por-
tion of the mortgaged property under a private contract or at Court-
auction. The distinction is not so much between a private sale and an
execution sale, as between a purchase of the equity of redemption and
a purchase of the entire interest of the mortgagor in the property
Mir Eusuff v. Panchamn, supra ; Mutty Lai v. Nanda Lai, 12 C.W.N.
745, 8 C.L.I. 92 ; Munga Lai v. Sagar Mai, supra. Inspite of the integrity
of the mortgage being broken by the mortgagee, one of several mortgagors
or a purchaser of the equitj' of redemption is entitled to redeem the
whole of. the m.ortgtged property, subject to the equities which other
persons may have and due provision being made for their rights
Periakaruppa v. Salyanarayanamoorthij A.I.R. 1937 Mad. 136, 168 I.C.
899. When,' however, the integrity of a mortgage is broken on account
of purchase by the mortgagee of the equity of redemption in a portion .of
the mortgaged property, the right of redemption of each of the mort-
gagors is confined to his own interest therein Abdul Wahib v. Raghti-
ndndan, A.I.R. 1945 All. 388, I.L.R. 1945 AU. 637. See also Puma y.
Gobinda, A.I.R. 1952 Pat. 101.
Shah V. Ismail, 42 All. 517 ; Sukhi v. Culam, 43 All. 469 (P.C.). See also
Bibijan v. Sochi Bewa, 31 Cal. .863 {S.B.); Mistri Lai v. Mittu Lai, 28 All.
28 ; Adipuranam v. Gopalasami, 31 Mad. 354. In Krishnaji v. Mdhadev,
25 Bom. 104, the mortgagor was allowed to redeem the property even
after its formal sale and before confirmation. This is now expressly pro-
vided in O. 34, r. 5 (1). See also .Raghunath v. Krtshnadas, A.I.R. 1.9^
Nag. 196, 171 I.C. 612. But after a final decree for sale has been passed,
76
[Sec. 60
The word decree" has been substituted for order" in para 2 of th'
section, for the following reason: As the old practice of passing orde
absolute in mortgagee-suits has been abolished by the enactment of 0. 34
in the C. P. Code, 1908, we propose, in secs. 60, 67 and 67A of the
Transfer of Property Act, to substitute the word 'decree* for the word
order wherever it occurs. Report of the Select Committee (1929).
The order (decree) of Court does not mean an order passed without
any trial or .ordinary hearing of the parties. Such an order does not extin-
guish the ri^t of redemption. Where a prior suit for redemption was
compromised, and the Court passed the order: "Compromised:
Dismissed with costs, held that this dismissal did not invoke that the
right of redemption was extinguished, and did not bar a subsequent sm
Sec. 66]
Under this section, even before its amendment in 1929, the integri!;.
of a mortgage is not broken except in the onh' case of .nequiriri,; by p-.
[Sec, 60
The words remaining due in this para are, to some extent, mislead-
ing and must not be taken too literally. The right of a mortgagee of
several properties to recover his money under the mortgage is, on his
purchasing the .equity of redemption in one of the. properties mortgaged
with him, extinguished pro rata, i.e., he can recover only a proportionate,
part of the amount due on the mortgage, that is to say, the portion of the
debt which bears the same relation to the whole amount of the debt as .
the value of the property not purchased bears to the value of the whole
properties comprised in the mortgage, unless it is found that it was to
the benefit of the mortgagee to keep his mortgagee rights alive or that he
declared his intention either expressly or by necessary implication, that
he would keep his subsequently acquired rights distinct from his prior
mortgagee-rights Anmagiri v. Radhakrishna, (1941) 2 M.L.J. 520, A.LR.
1942 Ma.d. 44.
The general rule under this clause is- that a mortgage in indivisible,
and a suit by a co-mortgagor to redeem only his portion of the properties
mortgaged is not maintainable Naga Rao v. Naga, 10 N.L.R. 72 ; Aughdre
Kumar v. Mahomed Miissa, 2 LC. 662 ; Jagabandhu v. Haladhar, 27 C.L.J.
110 ; Lola Ram Narain v. Lala Murlidhar, 5 P.L.J. 644, 1 P.L.T. 616, 58
LC. 129 ; Mian Mohammad v. Abdul Karim, A.LR. 1947 Pesh. 45. The
Court has no power to compel the mortgagee to submit to a piecemeal
redemption Mirza Qaiser Beg v. Sheo Shankar, A.LR. 1932 All, 85 (90),- 53
All. 3.91, 129 I.C. 708. A mortgage for' an entire sum is frona its very
purpose indivisible ; a division of such a mortgage is conceivable in theory,
and may be carried out in practice. But in order that a mortgage may
fully attain its end of securing satisfaction of the entire obligation in the
rank and with the efficiency which the law or the will of the -parties deter-
mined, it is essential that it should nqt suffer any dis-integrationKeellebej'
on Mortgage in Civil Law, pp. 11, 12 ; Huthasanam v. Paramesivaran, U
This section does not preclude the mortgagee himself from splitting
up the mortgage and pray for a decree for -sale of a portion only of the
mortgaged property. In that case the lessees are entitled to redeem o
payment of the proportionate part of the mortgage dues and are not bouna
SEC. 60]
The last para of this section does not apply to a decree which is not
for a lump sum, as in the case of maintenance charge. Thus, by purchas-
ing a portion of the property charged, the decree-holder does not split
up the claim which had not accrued on the date of the purchase Debendra
V.- Trinayani, A.I.R.. 1945 Pat. 278, 24 Pat. 245. But where a mortgagee
has obtained a foreclosure decree against the proprietary interest of the
malguzar mortgagor only, the provision of the last para of this section
is attracted and the occupancy tenant of the mortgagor, if he has a right
to redeem, can redeem his interest on paying a proportionate part of the
mortgage dues PaiuawA'Hnmr v. Jakdeo, A.LR. 1947 Nag. 210, I.L.R. 1947
Nag. 740.
[Sec. 60
whole mortgage Pafcfr Chand v. Babu Lai, 39 All. 719 (721) ; Sankar v.
Bhikaji, 53 Bom. 353 ; Baikmtha v. Mahesh, 22 C.W.N. 128 (129) (dissent-
ing from Girish v. Juramani, 5 C.W.N. 83) ; Pratap Chandra v. Pearu
Mohan, 22 C.W.N. 800 (802) ; Rugad Singh v. Sat Narain, in All. 178
(12) ; and this he can do even against the will of the-mortgagee FcWr
Chand v. Bahu Lai, supra ; Huthasanam v. Parameshwaram, 22 Mad. 209
(211) : Velayudam v. Almtgaran, 15 I.C. 605, 23 M.L.J. 475 ; Mustafa v.
Shadi Lai, 10 O.C. 81 (84). As observed by the Privy Council, each and
every one of the mortgagors who owns separate shares in certain mort-
gaged property is not merely interested in the payment of the mortgage-
money and the redemption of the estate, but has a right by payment of the
money to redeem the estate, seeking contribution from the others
Norendra v. Dwarka, 3 Cal. 397 (P.C.), 5 LA. 18 (27).
[Sec. 60
footing that the amount of the mortgage debt was Rs. 3000, whereas plain
tiffs 3 and 4 obtained decree in their half share on the basis of Rs UsS'
It was however held that the securily could not be split up and
the plaintiffs would be entitled to proceed against the entire mortgaeed
property for the realisation of the total decretal amount ffm/iifcesft- v
Sushi Chandra, A.I.R. 1957, Cal. 211.
The legal effect of the proviso to sec. 60 after the amendment of 1929
was considered by Kapur J. in Narain Singh v. Teza Singh, A.I,R. 1955
Punjab 96. There in 1945 one Ujagar Singh, mortgaged to Lehna Singh
86 kanals 12 marlas of land plus some other land for Rs. 2000. In 1949
the heirs of Lehna Singh transferred to Narain Singh for Rs. 1000 the
mortgagee rights in 86 kanals 12 marlas, because the other land was
allowed to be redeemed by Ujagar before that date for Rs. 1000. ^ 1950
Ujagar mortgaged 39 kanals 12 marlas out of 86 kanals 12 marlas to thd
plaintiff on receiving Rs, 2000. The plaintiff instituted a suit for declara-
tion that they were entitled to redeem the whole of 86 kanals Md
marlas of land. It was contended by the contesting defendants that the
heirs of Lehna Singh having allowed a portion of the mortgaged property
to be redeemed by the mortgagor there was a splitting up of the mort-
gage and that the plaintiffs were entitled to redeem only 39 kanals u
marlas of land. This contention was rejected and the suit was decreed.
His Lordships has held that there is no splitting up of the mortgage m
the foUowing cases: (1) Where the mortgagee allows redemption ot a
part of the mortgaged property and (2) where .there is a release of
or a share by the mortgagee ; and that only when mortgagee acquires
a share or part of the property mortgaged there will be a splitting up
Sec. 60]
entitled to redeem will be entitled to redeem his share only of the mort-
gaged property Mflufefrua: v. Sardarmal, A.I.R, 1952 Nag. 341 (F.B.). The
fact that the mortgagee releases a part of the mortgaged property does
not however give rise to the right of partial redemption De/ansingfe v
Darbarilal, A.I.R. 1949 Nag. 346, LL.R. 1949 Nag. 376. Where the mort-
gagee acquires a share of the mortgaged property, one of the co-mortgagors
can redeem the entire residue left inspite of the mortgagee's opposition
PaJa Singh v. Attar Singh. A.I.R. 1954 Punj. 81. The inference as to
release is appropriate where the purchase is made for an independent
consideration. But when the substance of the transaction is the purchase
of the equity of redemption there will be a splitting up of the mortgage
Ananthaijya v. Hengsu, A.I.R. 1956 Mad. 293. The mortgage security
is split up only where there is a person interested in a diare only of the
mortgaged property and- seeking to redeem his own share only pajdng a
proportionate part of the amount due, and a mortgator whose share the
mortgagee had acquired Ibid; Patel Kempegowda v. Channaveeriah,
A.I.R. 1958 Mys. 43- The mortgage-debt may be apportioned where
circumstances have happened, the efiect of which, in fact or in law, is to
create a severance of the security ; e.g,, where the mortgagee himself has
become the owner of a part of the equity of redemption or where by his
own conduct there has been a break up of the entire security R(yat
Kamini v. Satya Niranjan, 23 C.W.N. 824. The test is, whether there
has been a severance of the security at the instance or with the consent
of the mortgagee, and an apportionment will not be imposed upon the
mortgagee unless equitable considerations are established Debendm
Nath v. Mirza Abdul, 10 C.L.J. 150, 1 I.C. 264 (277). If a part of the
raortMged property be acquired by a sole mortgagee (or by all the mort-
gagees where there are more mortgagees than one), the integrity of the
mortgage is thereby broken up, and each of the owners of the remainder
of the property becomes entitled to redeem his own share upon payment
of a proportionate part of the amount due on the mortgage Kiidhai v.
Shea Dayal, 10 All. 570 ; Shiam Satan v. Banarsi, 20 A.L.J. 258, A.I.R.
1922 All. 192, 66 I.C. 866; Nilakant v. Siiresh, 12 Cal. 414 (P-C.) ;
Debendra v. Mirra Abdul, 10 C.L.J. 150, 1 I.C. 264 ; Ranghunath v- Sadhu
Satan, 5 P.L.T. 312, A.I.R. 1925 Pat. 31, 75 I.C. 821 ; Nand Kishore v.
Raja Hariraj, 20 All. 23 ; Mora v. Balaji, 13 Bom. 45. Thus, when a
mortgage is split up by the mortgagee buying up the equity of redemp-
tion from some of the. heirs of the ori^nal mortgagor, any one of the
remaining heirs is entitled to redeem his. share of the mortgaged property
on payment of a proportionate sum due on his share Mewa Ram v. Ganga
Ram. 17 A.L.J. 910, 52 I.C. 229. This rule equally applies whether the
mortgagee-decreeholder acquires a part of the mortgaged property before
a decree for sale or after it Sarju Kumar v. Thakur Prosad, 18 A.L.J. 690,
58 I.C. 743. This rule also enures to. the benefit of the purchaser of a
portion of the equity of redemption ; so that, when the mortgagee has
destroyed the indivisibility of the original contract, the purchaser of
the equity of redemption of a portion of the mortgaged property is entitled
to redeem that portion on payment of a proportionate ainount of the
mortgage-money Marana v. Pendycda, 3 Mad. 230 ; Mahabir v- Moham-
mad 38 All 103 ; Subramanyan v. Mandyan, 9 Mad. 453 : Jagannath v.
Jaipal, A.I.R. 1933 AIL 257 (F.B.), 142 I.C. 410. Conversely, where one
77
[ Sec. 60
Cal. 59, 86 I.C. 193. Where the integrity of the first mortgage was broken,
the first mortgagee becoming also the purchaser of the property, the second
(usufructuary) mortgagee could redeem only the portion mortgaged
to him and had no right to redeem all the properties purchased by the
first mortgagee Amir Chand v. Moti, A.I.R. 1931 Pat. 434, 134 I.C.
959. See also Ahmad v. Md. Qasim, A.I.R. 1926 All. 46, 90 I.C. 80.
Although die suit be one for possession, the Court can grant redemption
to prevent further litigation Amir Chand v. Moti', supra, at pp. 435, 436.
Where the rights of the mortgagors have vested partly in a prior mort-
gagee and partly in a subsequent mortgagee after a suit had been
brought by each of them to enforce his own mortgage without implead-
ing the other, neither the former can ho compelled to redeem the whole
nor can he compel the latter to give up his interest in the share which
' he has acquired. Each can redeem to the extent of the shares
But this rule does not apply where the mortgage is split up not by
the mortgagee, hut by the act of one of the mortgagors. Thus where
by the terms of a mortgage-deed, one of the four mortgagors was aUow-
ed to redeem separately his one-fourth share by paying one-fourth or
Sec. 60]
The rule in this section applies ivhen the mortgagee acquires the
share of a mortgagor i.e., a portion of the mortgaged ^^roperty. But
where the mortgagee purchases that tohole of the mortgaged propert}' in
execution of a. decree in a suit on his mortgage, without impleading a
purchaser of die equity of redemption in a portion of the property, there
is no splitting up of the mortgage, and the purchaser of the equity of
redemption is liable to redeem his portion of die mortgaged lands only
on payment of the entire decree-amount V enkat Reddy v. Kunfappa,
47 Mad. 551 (566). But see R. C. Sardar y, Tarubaja, 69 C.W.N. 688, -
where it has been held that if a mortgagee obtains a dree for
closure without impleading one of the co-mortgagors having 1/6 share,
the latter can by a subsequent suit redeem his 1/6 share by making a
deposit of the proportionate amount.
The rule in this section does not apply where a moitgagor mak^ a
deposit in Court of the whole mortgage-money under section 83. lae
owner of a share only of ' the mortgaged properties is entit e o epo
in Court the whole of the mortgage-debt and rede^ the whole
in spite of the fact that the mortgagee has purchased the eqmty
tion.in some of the mortgaged properties. In such case, the part owme
[ Sec. 60
than one) have acquired the share of a mortgagor. If, however, some
only of the mortgagees have purchased a share of a mortgagor; there is
no merger of interest, for the purchaser is not the sole mortgagee In
such a case, a co-mortgagor has no right to redeem his share of tlie mort-
pged property by payment of a proportionate part of the mortgage-debt
but is bound to pay the entire mortgage-debt-^Ma/itob Raj v. Sant Lai
5 All. 276'; Mohan Lai v. Farshadi Lai, 45 All. 46 (48), 74 I.C. 999,
A.I.R. 1924 All. 11 ; Subba Rao v. Sarvaraifudu, 47 Mad. 7 (19) jae-
mohany. Harbans, 1 O.W.N. 637, A.I.R. 1925 Oudh 609. The purchaser-
mortgagee is in no diflFerent position from an outsider so far as liis rights
conferred by his purchase are concerned. The mortgage remains one
and undivided, and if redeemed at all, can only be redeemed in its
entirety ./agmo/ian v. Harbans, (supra).. If a mortgagee releases a por-
tion of the mortgaged property by receiving the amount of money alleg-
ed to be due from such property, he does not thereby break the integrity
of the mortgage, nor does it entitle the mortgagor to redemption of a
portion only of tlie mortgaged property. Tlie integrity of tlie mortgage
can only be broken up in case the mortgagee or mortgagees- purchase a
part of the mortgaged property Ho/i Alt Jan v. Mafidvddin, A.LR. 1923
All; 499, 45 All. 524.
Where the mortgagee allows the mortgagor to pay off a portion of.
Sec. ^03
But this rule was not followed in some cases. Unis, in a Madras
case, where the mortgagee allowed the mortgagor to redeem a portion
of the mortgaged property, it was held that the mortgagee destroyed
the- indivisibility of the mortgage Suhramamjan v. Mandaijan, 9 Mad.
453 (454). The Bombay High Court held that an owner of a part of the
equity of redemption of mortgaged ijropertfes was entitled to redeem
tliat portion when the mortgagee had acted in such a way as to release
a portion of the properties from the mortgage-debt MaijOshankar v.
Burjorji, 27 Bom. L.R. 1149, A.I.R. 1926 Bom. 31 (32). So also, where
the three mortgagors made a partition of the property, by which each of
them became entided to a 1/3 undivided share, and two of the mortgag-
ors redeemed their two shares by paying 2/3 of the mortgage-money,
held that die other mortgagor must Mso be allowed to redeem his 1/3
share Lakshuman v. Madhav, 15 Bom. 186. See also Mahadaji v. Gan-
patshet, 15 Bom. 257. A Calcutta case expressed the view that if a por-
tion of the property was released by die mortgagee, the mortgage should
be treated as having been split up Hart Kissen v. Veliat, 30 Cal, 755
(757). A mortgagee can not release a part of the mortgaged
land and then seek to enforce his entire claim upon another
in which third parties have become to his knowledge interested
as assignees of -the equity of redempdon Pranbadav v. Bhagaban, A.I.R.
1934 Cal. 775, following Svrjeram v. Bahramdeo, 1 C.L.J. 337. The
mortgage-debt could be always split up by consent, and on such splitting
up, a mortgagee could sue one of the mortgagors for a proportionate part
of the mortgage-debt, provided the burden of the mortgagor did not
increase V. Lowe & Co. v. Pulin Bihari, 59 Cal. 1372, A.I-R. 1933 Cal.
.154 (162); Waleyatunnissa v. Chalakhi, 10 Pat. 341 ^ 132 I.C. 100, A.I-R.
1931 Pat. 164 (168). But this view has been disapproved of by the Legis-
lature, and the object of inserting the word only" in this para has been
thus stated by the Special Committee'.
tSEc. 60A
words except and 'where' with a vi'ew to get rid of the effect of
decision m 27 Bom. L.R. 1449. The only case, therefore, when the hi-
tegrity of a mortgage may be aUowed to be broken, apart
EC. ^1 1
Sections 60A and 60B have been added by section 23 of the Transfer
of Property Amendment Act (XX of 1929).
pertTes**' s absence of a
mortgaged. entitled to
Illustration.
(Omitted.)
[Sec. 61
Old Law Before the passing of the present Act, under the com-
mon law as recognised in the Cochin' State, the mortgagor seeking redemp-
tion was bound to redeem all subsisting mortgages in favour of the same
person in respect of the same properly simultaneously v.
Raman, A.I.R. 1952 T.C. 150.
to consolidate the two documents and claim the amount due thereunder,
Sec, 61]
the union of several mortgages in the mortgagee and that at the time
when he- claims that right. But this does not mean that the law applicable
in such cases is that which prevails at the date of the. suit. The right
accrues when the mortgages become combined in the mortgagee /hid.
intervened, and not a moment too soon, to put a stop to the flagrant
'injustice which was too often inflicted under the name of equity, and
now in this country as well as in England, a mortgagee in the absence
of a contract to the contrary, cannot consolidate, his securities Ghose's
Laio of Mortgage, 5th End., p. 429. Thus, where two mortgages were
executed with respect to six items of property, and a third mortgage was
executed with respect to the same six items and also two other items,
held that a decree which consolidated the amounts due under all the
three mortgage-bonds, and made all the mortgaged properties liable for
the consolidated amount, was contrary to the provisions of this section-
Such a consolidation impedes the right of redemption of the mortgagor
and is illegal Parmeshwar v. Raj Kish'ore, 3 Pat. 829 (837), A.I.R. 1925
Pat. 59, 80 I.C. 34.
A man may borrow money on the security of bis property, and both
the lender and borrower may agree that the property is capable of serving
as a security for further loans. In such circumstances if there is a
second loan on the security of the property, and the borrower repays one
of the loans, the lender has nothing to lose. per Mukerji J. in Lxillii v.
Ram Nandan. 52 All. 281 (F.B.), A.I.R. 1930 All. 136 (138), 124 I.C. 735.
The old section applied (as shown by the illustration and the marginal
note), to cases where different properties were mortgaged, and not where
the same property was mortgaged under several mortgages Balasnbramania
V. Sivagtirii, 21 M.L.J. 562, 11 I.C. 629; Dorasami v. Venkataseskayar,
25 Mad. 108 (115). Therefore, a mortgagor seeking to redeem a mortgage
on a property was not entitled to do so without paying the money due
under a separate mortgage or charge relating to the same property
Ramarayanimgar v, Maharaja of Venkatagiri, 50 Mad. 180 (P.C.), 31
C.W.N. 670, A.I.R. 1927 P.C. 32 (36) (overruling Ramarayanimgar v.
Maharaja, 44 Mad.- 301);' Meloth Kannan v. Kodath Kannaran, 131^
M.W.N. 231, 22 I.C. 609 ; Ram Ratan v. Aditya, 3 Luck. 459, 112 I.C. 481,
A;I.R. 1928 Oudh 273 (276). Even a mottgagor could not redeem one
mortgage on his property without at the same time paying off ano er
mortgage or charge on the same and other properties as weU-GnnguJ<m
V. Kirtanath, 33 All. 393 ; Tajjobibi v. Bhagivan, 16 All. 295 ; Ramara
78
[ Sec. 61
of }g?f ^ amendment
of 1929 the same property was mortgaged to the same mortgagee bSJ
Rai V. Ram -Birch, A.LR. 1922 All. 403, 70 I.C. 637. In Ganga Bai v.
Kirtanath, 33 All. 393, however, such a covenant was not given effect to.
But the circumstances of that case were peculiar ; the properties in the
two mortgages were partly identical and partly different; one of the
mortgagors of the first mortgage did^ not join in the second mortgage ;
and the person who brought the suit for redemption of the prior mortgage
was a purchaser of one of the properties mortgaged and had no interest
in the property comprised in the second mortgage.
Where the stipulation was that possession obtained under the first
mortgage would remain with the mortgagee till the second mortgage in Ms
favour was redeemed the Collector could not order that the possession be
handed over to the mortgagor without payment of the mortgage ^ebt
Gurditte Mai v. Mohaminad, A.LR. 1947 Lah. 278 (F.B.), I.L.R. 1947
Lah. 259.
Sec. 61 ] .
tidn that without payment of the two sums the property previously
mortgaged is not to be redeemed, the effect of the clause is to create a
further mortgage or the property is made security for the additional debt
Jeut Koeri.v. Mathura Koeri, A.LR. 1926 All. 171 24 ALT 125
90 I.C. 87. '
Where after the execution of a mortgage-bond in favour of the
mortgagee, the mortgagor takes further advances and executes a fresh
bond creating a charge on the property, and in that bond he stipulates
that he will not redeem the earlier mortgage without paying off the money
due under the subsequent bond, held that the mortgagor, according to
the terms of the contract, will not be entitled to redeem the earlier
mortgage without paying off the subsequent charge. The covenant in
the subsequent bond will not be treated as a clog on redemption Ran/tf
Khan v. Ramdhan, 31 All. 482 Brij Jjall v. Bhawani. 32 All. 651 ; Har
Prasad v. Ram Chandra, 44 All. 37 (42) (F.B.), A.I.R. 1922 All. 174;
lagannath v. faipal, 55 All. 359 (F.B.), A.I.R. 1933 All, 257 (258), 142 I.C.
410 ; Shib Narain v. Gajadhar, 48 All. 292, A.LR. 1926 All. 506, 92 I.C. 772 :
Lai Bahadur v. Rameshwar, 3 Luck. 113, A.I.R. 1927 Oudh 510 (511)
Ganpat v. Abdulji, A.I.R. 1937 Nag. 54, 169 I.C. 23 ; Ram Ratan v. Aditya,
3 Luck. 459, 112 I.C. 481, A.I.R. 1928 Oudh 273 (276), affirmed Aditya v.
Ram Ratan, 5 Luck. 365 (P.C.), 57 LA. 173, 34 C.W.N. 625 (627), 59
M.L.J. 342, 28 A.L.J. 646, 123 I.C. 191, A.I.R. 1930 P.C. 176 ; Janardan v.
Anant, 32 Bom. 386' (390) ; Pramatha v. Janaki, A.LR. 1937 Cal. 194, 41
C.W.N. 472, 171 LC. 747 ; Md. Khan v. Chandi Shah, A.LR. 1933 Lah.
8^, 147 LC. 193 ; Sultan v. Ladha Singh, A.I.R. 1926 Lah. 633, 96 LC.
844 ; Kanhaya v. Tulsi, A.LR. 1931 All. 197, 129 I.C. 550. Such a covenant
will be enforceable even against a subsequent transferee of the equity of
redemption Gaya Prasad v. Jagannath, supra. So also, where three
successive mortgages were specifically charged on the same land and there
was an express stipulation in the second mortgage that the first mortgage
should not be redeemed without discharging the Second mortgage, and
in the third mortgage there was a stipulation that the mortgagor would
pay the amount of that mortgage before discharging the earlier debts, held
that the mortgagor was not entitled to redeem the first mortgage without
at the same time discharging the second, and that the third mortgage must
be discharged before or simultaneously with the redemption of the first
Shib Narain v. Gajadhar, 48 All. 292 ; Punnu Ram v. Ghulam Hussain,
7 Lah. 297, 96 LC. 630, A.LR. 1926 Lah. 494.
t^EC. 6l
Sec. 61 ]
TRANSFER OF PROPERTY 621
debt, is not only to violate a homely English ioverb, but also to postulate
something that is not' true, namely, that redemption is not a right of the
mortgagor but a mere favour shown to him of Mortgage, 5th Edn.,
p, 242. The question as to whether the subsequent deed creates a further
mortgage or charge on the property or merely amounts to a simple bond
creating a personal liability, is to be decided with reference to the terms
of the deed. See I^Hu v. Ram Nandan, (supra) ; Aditya v. Ram Ratan,
5 Luck. 365 (P-C.), 34 C.W.N. 625 *(627); Kandhahja v. Ram Charitar,
(supra) ; Ashraf Ali v. Chandrapal, (supra) ; Gaya Prasad v. Rachpal, 9
O.L.J. 484, 70 i.C. 66, A.I.R. 1923 Oudh 24 ; Ramadhin v. Sitla, 17 O.C.
303, 25 I.C. 905. A stipulation by the mortgagors that they would not
mortgage or sell Hie property previously mortgaged till the money due on
the subsequently executed simple bond had been paid, has been held by
a Full Bench. of the Allahabad High Court to mean that the previously
mortgaged -property was made security for the payment of the money
subsequently borrowed and the bond was an agreement creating a charge
on the - property previously mortgaged Jannath v. Jaipal, A.I.R. 1933
All. 257 (F.B,), 142 LC. 410.
But if the prior debt is unsecured, and the subsequent debt secured,
and in that mortgage-bond he stipulates not to redeem the mortgage without
paying off the debt under the earlier simple bond, held that the covenant
will be enforced because the stipulation in respect of the earlier debt
constitutes a part of the transaction of the mortgage Hari v. Vishnu,
28 Bom. 349' (361) (F.B.). The prior debt on the simple money-bond may
not strictly speaking be a charge on the land, but the equity of redemption
is made conditional on the payment of both the debts ; and the mortgagor
cannot redeem the mortgage without paying off the prior dehtYashvant
v. Vithoba, 12 Bom. 231 (234). And the result is the same if the secured
and unsecured debts are contemporaneous. See Sundar v. Bapuji, 18
Bom, 755 (757). In this case, the covenant as to payment of the contem-
poraneous unsecured debt was enforced even thou^ the debt was barred
at the time of the suit for redemption of the mortgage.
[ Sec. 62
Similarly, where a property was mortgaged for Rs. 1,500 and the
mortgage-deed recited an earlier debt of Rs. 5,000 due on a previous
account and povided that if the mortgagor did not repay this Rs. 5,000
within two years from the date of the deed, he was not at liberty to
redeem the property unless both the debts of Rs. 1,500 and Rs. 5,000 were
paid, and the suit for redemption was brought after the expiry of 2 years,
held that the charge as to Rs. 5,000 took effect on the expiry of two years
from the date of the mortgage-deed ; that is, after the expirj^ of Wo years,
the property must be deemed to be mortgaged for Rs. 5,000 as well as
Rs. 1,500 ; but before that period the debt of Rs. 5,000 wp merely
personal ; and if the mortgagor had brought his suit for redemption before
that date, he could have redeemed the mortgage by paying Rs. 1,500 only
Hari v. Vishnu. 28 Bom, 349 (358, 360) (F.B.).
property
62 . In the case of a usu-
Right of fructuary mortgage,
usufructuary the mortgagor has a
mortgagor ^ ^ reCOVCr
to recover - , .
Sec. 62]
In clause (b) the italicised words have been substituted for the fol-
lowing reasons :
Clause (b) of the section is limited to a case where out of the rents
and profits of Ae mortgaged property the mortgagee is entitled to recover
only 'the interest due to him on his principal. The clause should also
be made applicable to cases where the rents and profits are to be appropri-
ated in payment of a part of the mortgage-money, i.e., in payment of
either interest in part or principal in part or both in part. To effect
this change, the' words principal money should be changed into the
balance of the mortgage-money . Report of the Special Committee.
[Sec. 62
X.c. 427 (429). Tbs ruling would now apply only to clause W i
presupposes a case in wbch there would hardly be any ne^d S"
rate accounts, but not to clause (b) which as now
a more elaborate accounting, except m cases where the rente an^mfi?
are to be taken in complete satisfaction of tlie interer ^ ^
365 (P.CO, M C.W.N. 625 (627), A.I.R. 1930 P.C. 176, 123 If- J"
this case the relevant sections of the T. P. Act were not specificaUy rrfer-
^d TL the transaction took place in 1881, prior to the Passing
Art, but the case was decided on general principles underlying the Ac
Sec. 62]
This clause provides for cases in whidi no term is fixed and the
Nvjiole of the mortgage-money is stipulated to be recovered out of the
79
626 TRANSFER OF PROPERTY
[Sec. 62
383. Clause (b) : ^If there is a balance left after satisfying the in-
terest or part of the mortgage-money, the mortgagee should pay the bal-
ance to Ae mortgagor ; if he does not pay it to the mortgagor; he is
bound to apply it in further reduction of the principal. But he is not
bound to accept the mortgage-amount from the mortgagor if he tenders
it before the expiry of' the term of the 'mortgage. See Narasimha v.
Seshayya, 48 M.L.J. 363, A.I.R. 1925 Mad. 825 (826), 90 I.C. 138. '
Sec. 63]
[Sec. 63
Sec. 63]
A building which has not been added but substituted for an existing
one is not an accession but an improvement Chhedi Lai v. Babu
Nandan, A.I.R. 1944 All. 204; I.L.R. 1944 All. 302. If the mortgagor hav- '
ing only a life interest constructs new structure after the execution of the
mortgage-deed the mortgagee is entitled to a mortgage decree in respect
of the new structure Atmukur Venkatasubhiah Chetty v. Thiruptira-
sundari AmmaV, A.I.R. 1965 Mad. 185.
Accession must take place during the mortgage ; For the purposes
of this section as well as of sec, 70, tlie accession to the mortgaged pro-
perly must take place before the mortgage becomes extinguished Kop-
niah Sivananjiah v. Sithay Qotindan^ 41 M.L.J, 490, A.I.R. 1921 Mad.
627, 70 I.C. 367. Where the usufnictuary mortgagee of a share in a
village took a mortgage by conditional sale of a holding of a tenant, and
after the expiry of the usufructuary mortgage got a decree for foreclo-
sure of tlie. holding, and in execution obtained possession thereof, held
that this mortgagor was entitled to take the accession upon payment, in
addition to the mortgage-money, of the costs of acquiring the holding
-^Ketki V. Dinabandhu, 10 C.L.J. 83, 3 I.C. 395 (396) ; Molmlall v,
Chaodhry Pulahdar, 14 C.P.L.R. 169.
385, Acquired accessions ; Tlie second para deals with acquired
accessions, i,e,, accessions made at the expense of the mortgagee. Tliese
are divided into two clauses (1) accessions capable of severance from the
principal ; the mortgagor according to Ins option may or may not redeem
them -along with tlie principal, but if he desires to take them, he must
pay to the mortgagee the expenses of acquiring them Khiidadad v.
Girdhari, 163 P.W.R. 1917, 42 I.C. 468 ; (2) accessions incapable of sever-
ance from the principal; these must be delivered by the mortgagee to
to the mortgagor along with the principal ; but the mortgagor is bound
to pay for them only when they are necessary for the preservation of the
principal property, or when tliey were made with his consent.
[ Sec. 63
On the otlier hand, the Calcutta Higli Court holds that. tliis clause
applies to all cases whether the- mortgagee makes the accessions (at his
expense) eitlier as mortgagee or in any 'other capacity. Tlius, where
the plaintiffs share in a melial was mortgaged to die co-proprietor or
the mehal, and the mortgagee purchased some of
of the mehal from the tenants and obtained possession thereof, held
on redemption of die mortgage the plaintiff was entided to get um
possession of the holdings to the extent of his sh^e m the toeM. oi
myinent to the mortgagee of the proportionate share of ^e
in^rred by him in acquiring them. This section apphes to all oases
Sec. 63 ]
I.C. 90. This is also the view held by the Nagpur Court Pyarelal v.
Where certain khoU lands were mortgaged with possession and the
mortgagee purchased khoti nibot lands in the village from the occupancy
tenants .without the permission of the khot and subsequently all the
rights in the equity of redemption were sold to the mortgagee, it was
held that whether the lands were to be regarded as khoti nisjjat or khoti
khasgi they must be treated as accretion to the mortgaged property and
the mortgagee as purchaser of the equity of redemption was entitled to
them Rondi/ v. Mahidev, A.I.R. 1932 Bom. 526, 139 I.C. 812.
T^NSFEft PROPERtV
tSEC. 6U
Sec. 63A]
This section closely follows the language of the preceding one, but
differs from it in this respect that while sec. 63 makes a distinction
y between accessions capable of separate enjoyment aird accessions not so
enjoyable, no such distinction is recognised in the present section as to
iinprovemenb. Further, the section says nothing about improvements
made ^vith Ae consent of the mortgagor.
Sub-section (1) lays down the general rule that ordinarily a mortga-
gee is not at liberty to effect improvements and charge the mortgagor
therewith. See Arunachella v. Sithayi, 19 Mad. 327 (329 ) ; fongi Ham
V. Sheoraf, 2 O.L^J. 338, 30 I.C. 234 (237). The object of the law is to
prevent the mortgagee from laying out large sums of money and thereby
increasing his debt to such an extent as to cripple the power of redemp-
tion. Tlie mortgagee has no right to lay out money in improving the
property which may be done in such a way as to make it utterly impos-
sible for the mortgagor with his means ever to redeem. This is called
improving a mortgagor out of his estate Sandon v. Hooper, 6 Beav.
246; Dnyanu v. Fakira, 45 Bom. 1301 (1305), 64 I.C. 16, A.I.R. 1921
Bom. 250. Thus, where the amount of improvements was five times the
^ mortgage-money, the mortgagees claim for the value of the improve-
ments was disallowed Romappa v. Yellappa, 52 Bom. 307, A.I.B,. 1928
Bom. 150 (152), 109 I.C. 532, ; Charan Dass v. Sliadiram, A.I.R. 1955
Pepsu, 87. Where a mortgagee-in-possession under a usufructuary mort-
gage effects improvements in the property knowing fully well tliat he was
the mortgagee and not the owner, the mortgagee is not entitled to. com-
pensation for the improvements in a suit for redemption by the mortga-
gor Ganpat v. Abdulji, A.I.R. 1937 Nag. 54, 169 I.C. 23.
80
[ Sec. 63A
T^e mere consent of the mortgagor to the imnrnvpmt v,.,-
would not make him hable; unless given under circumstances
it equivalent to a promise to re-imburse the cost to thp mn f
Arunachdla v. Sifhayi, 19 Mad. 327 (829). mortgagee-
[ EC. 63A
Baghti-
Sec. 64]
[ Sec, 65
Tliis section may be compared with illustration (a) of sec. 90, Indian
Trusts Act : A, the tenant for life of leasehold property, renews the
lease in his o\vn name and for his own benefit. A holds the renewed
lease for tlie benefit of all those. interested in the old lease. A similar
illustration is appended to sec. 3 of the Specific Relief Act. Tlie princi-
ple of this section is that if a trustee or a mortgagee obtains a lease dur-
ing tlie continuance of die trust or mortgage, the benefit of the lease
taken by the trustee or mortgagee enures to the benefit of the cestui que
trust or die mortgagor Baijnatli v. Harikishen, 6-C.W.N. 372. Therefore,
if the mortgagee obtains a renewal, the mortgagor has generally the be-
nefit of die new term ujion redemption ; because, the additional terra
comes from the old root subject to the same equity of redemption
Rdkestraw v. Bretcar, 2 P, Wms. 510. Tlie mortgagee is entitled to
recover the costs of the renewal and may add die costs to the principal
money j see sec. 72 (e).
(c)
id)
*****
Sec. 65]
\e)
[Sec, 65
391. Clause (a) Covenant for title : Compare sec, 55 (2), This
clause does not apply to a case where the mortgage was created prior to
the passing of this Act though one of the further charges was subsequent
to it Sahjid AbduUa v. Saiyid Basharat Hussain, 35 All. 48 (P.C.), 17
C.W,N. 233, 17 I.C. 737.
(1) Tlie interest which tlie mortgagor profess to transfer will have
to be construed in the light of section 8. The combined effect of that
section and this clause is that in the absence of a contract to the con-
trary the interest which the mortgagor professes to transfer must be deem-
ed to be all that tlie mortgagor ha^ which he shall be deemed to trans-
fer unreseivedly Chiranji Lai v. Bhagioan, 8 I.C, 826 (All.).
(2) Tlie potcer of transfer implies that the property is alienable, i.e,,
it does not fall within the category of non-transferable properties men-
tioned in section 6, and that the mortgagor is a person competent under
section 7 to transfer it.
Wliere it was found tliat the mortgagor had no title, but the mort-
gagee took die mortgage bona fide without notice of -the absence ot
title, the latter was awarded a decree on the mortgage against me ^o-
peity Venkata Narasimha v. Gvndu Sastndu, 9 M-L.T. 365, 3 I.C. 5tM.
All 802, X.I.R. 1929 All. 483 (484), 121 I.C. 111. Further R mortgagor
27 S. &c:
132 nor can lie urge that he had no title to oonvey CliwldW
1949 Nag. 208, l.L,B. 1948 Nag. 936. In the ahf uoe t
S ic. ihe qneslion of title is irrelevant In a mortgage su.t-rM P
Sec. 65]
Shanta Bai v. Narayanrao, A.I.R. 1949 Nag. 81, I.L.R. 1948 Nag. 290.
81
[Sec. 65
a charge under sec. 100. Hence a bona fide transferee for value \viHi
out nobce of such substituted property would be protected aeainct i.
a charge-Wu v. SeetharaLraju. snpr^. OveSV flSL
Manickajn, AM. 1936 Mad. lOll! 'The fact
not made a party to the partition proceedings makes no cffffrence
AirmcZ v- Sat^ Lai, A.I.R. 1937 Pat. 5&3 (566^16 Pat. ^2, 171 LC 715-
Dtwan CJwnd v. Mamk Chand, supra. The mortgagee can neither com-
pel a partition nor claim to be a party to the partition proceedings as
Sec. 65 ]
[ Sec. 65
Sec. 65 A]
this clause, because this clause deals only with tlie rights and liabilities
of the mortgagor and mortgagee as between ihemselxtes, and not with the
rights and liabilities as between the mortgagors lessor and the mort-
gagee Thethalan v. Eralpad, 40 Mad. 1111 (1117). The mortgage of a
leasehold gives rise to question of prioity of estate between the lessor
and the mortgagee. This subject has been fully dealt ^vith in Note 580
under sec, 108, sub-heading "Privity of estate.
396 A. Last para Covenants run with the land Tlie last para dec-
lares that the rights conferred by tliis section are not personal to die
mortgagee. TIius, in the case of an implied contract by the mortgagor
under clause (o) to pay the public charges in respect of the mortgaged
property, not only the mortgagee but 'any one claiming tlirou^i him is
entitled to the benefit of this covenant Srinivasa v. Gnanaprakasa, 30
Mad. 67 (71). The covenant for title implied by clause .(o.) can be
enforced not only by die mortgagee but also by a person purchasing die
interest of the mortgagee Ma Gun v. Mg. Lu Gale, A.I.R. 1925 Rang.
130, 3 Bur. L.J. 282, 85 I.C. 223.
{b) Every such lease shall reserve the best rent that
can reasonably be obtained, and no premium
shall be paid or promised and no rent shall be
payable in advance.
- wal.
{d) Every such lease shall take effect from a date not
later than six months from the date on which it
is made.
i Sec. 6SA
Sec. 65A]
Clauses (a) and (b) of sub-section (2) of this section have been taken
from Kiran Chandra v. Dutt and Co., 40 C.L.J. 500, 29 O.W.N. 94, 85
I.C. 522, A.I.R. 1925 Cal. 251 (252, 253), in which the following observa-
tions have been made : 'rire powers of a mortgagor to grant leases after
the execution of the mortgage are very limited. He may no doubt make
a lease conformable to usage in the ordinary course of management ; for
instance, he may create a tenancy from year to year in the case of
agricultural lands or from month to month in the case of houses ; but
it is well settled that a mortgagor cannot, after tire date of the mort-
gage, and in the absence of an express power in that behalf or the con-
currence of the mortgagee, create, except as stated above, a lease or a
tenancy which will bind the mortgagee, and if he purports to create
such a lease or tenancy, the mortgagee or his transferee may proceed to
eject the lessee or tenant. If that, is so, tlie payment of rent in advance
by virtue of a lease granted by the mortgagor after the execution of the
mortgage is not binding on tlie mortgagee. See also M. P. M. S. Firm
V. Ko Pyu, 10 Rang. 210, A.I.R. 1932 Rang. 113 (114), 138 I.C. 213 ; Ram
Ratan v. Sew Knmari, A.I.R. 1938 Cal. 823 (827) ; Chettijar Firm v.
Sein Hfaung, A.I.R. 1935 Rang. 420, 159 I.C. 1038. The law is also laid
dbwn by Mookeijee J. as follows : It caimot bq maintained that tlie
mortgagor has anything like a general authority to deal with or affect
the mortgaged property during his possession tliereof. The true position
tlius is that the mortgagor in possession may make a lease conformable
to usage in the ordinary course of management, for instance, he may cre.ate
a tenancy from year to year in the case of agricultural lands or from
montli to montli in the case of houses. But it is not competent to the
mortgagor to grant a lease on unusual terms, or to authorise its use in a
manner or for a purpose different from the mode in which he himself
had used it before he granted the mortgagee Modan Mohan v. Raj
Kishori, 21 C.W.N. 88 (92), 39 I.C. 182; followed in Anand Ram v.
Dhanpat, 1 P.L.J. 563 (569), 38 I.C. 37, Beni Prasad v. Qangoo, 7 Pat.
349, A.I.R. 1928 Pat. 372 (374), 110 I.C. 287; and Mathura v. MandiJ,
1 P.L.T. 392, 56 I.C. 805 (806). See also Tulshi Ram v. Muna Kaur,
A.I.R. 1937 Oudh 146, 12 Luck. 161, 162 I.C. 225. A mortgagor cannot
create a right in the tenant to hold tire land rent-free Rap Narain v.
Sheo Sugar, A.I.R. 1939 Pat. 258, 180 I.C. 105, or a perpetual lease Ram
Sahai v. Mahahir, A.I.R. 1943 Oudh 407, (1943) O.W.N. 320. In order
that a mortgagor may lease the mortgaged property, it is necessary that
the mortgagor must be in possession and tire lease must be the usual
mode of management of the property Moidunni v. Poofhari, A.I.R. 1933
Mad. 876 (878), 65 M.L.J. 826.
This section would not apply if the mortgage took place before it
was inserted into the Act, eveir if tire lease was actually granted after the
section was introduced Pundankakshudu v. Kondayya, (1940) 1 M.L.J.
601, A.I.R. 1940 Mad. 669, 51 M.L.W. 481.
64 ^
TRANSFER Of PROfERtV
[Sec. 65A
Before die enactment of this section the question whether the mort-
gagor in possession had power to grant lease had to be determined with
reference to the authority of the mortgagor as bailiff or agent of tire mort-
gagee to deal with the mortgaged property in the usual course of manage-
ment and not on the distinction between the English mortgage and a
simple mortgage or on consideration germane to sec. 66 'j&fmaks/ioi/a
Narayan v. Chohan Ram, A.I.R. 1952 S.C. 401. Tlie burden of proof in
such a case is however on the lessee ibid. In this case the lessee did
not allege that the permanent lease granted by the mortgagor was in his
usual course of management ; therefore it was held by the Supreme
Court that the lease could not prevail against die mortgagee. See in tiiis
connection Gobinda v. Sasadhar, A.I.R. 1947 Cal. 73, 51 C.W.N. 823
and MaUappa v. Shivappa, A.I.R. 1950 Bom. 71, 51 Bom, L.R. 820. In
the following cas^ it was held that, granting of a lease was not an act
of waste vsdthin the meaning of sec. 66 and was valid Ramlal v. Muham-
mad Irshad, 1890 A.W.N. 59 ; Tana Teena v. Mamakkantakadi, 8 L.B.R.
413, 34 I.C. 24 (25) ; Chotey Singh v. Baldeo, 2 O.W.N. 457, 12 O.L.J.
527, A.I.R. 1925 Oudh 542 (544), 88 I.C. 947. In a case decided under
secs. 66 and 68 it has been held by the Allahabad High Court tiiat, a
mortgagee in possession is entided to lease die mortgaged property per-
manently irrespective of its effect on die mortgagee provided that it is
not destructive or permanently injurious of die property so as to render
the mortgagees security insufficient and the purchaser of the property
in execution of the niortgage-decree cannot turn the lessee out AhWer
Singh V. Ram Chander, A.I.R. 1935 All. 511, 154 I.C. 1009. Thus, it
appears that the right to lease given to the mortgagor by this section be-
ing hedged in by the resti'ictions imposed tiiereiii are iianower than wliat
he enjoyed under sec. 66.
Clause ib) lays down that no rent shall be payable in advance; and
the fact that die lessee paid rent for 3 years in advance is no aiMwer to the
Zimeds suit for ejecdnent See M. P. M. S. Firm v. ^
Rang 210. A.I.R. 1932 Rang. 113 (114). The above Burma case (8 L.RR.
413)arid Rowther v. Uma, 34 I.C. 24 in which a grant of a lease jwth
receipt of rent in advance for the whole period -was upheld, are no long
good law.
in
for
a Madras
Sec. 66)
case that the mortgagor could not grant a renewal, as tlie effect of the
renewal was to materially diminish the security Moidunni Haji v. Mad-
havan, 65 M.L.J. 826, A.I.R. 1933 Mad. 876 (877).
Clause (e) lays down tliat in the case of buildings, the duration of
the lease shall not exceed tlu-ee years. In Rustomji v. Keshanji,26 Bom.
L.R. 1162, 98 I.C. 436, A.I.R. 1926 Bom. 567 (569), a lease of certain pre-
mises for 12 years was held to be invalid under sec 66. Similarly, a lease
of it building for 20 years \vitli a covenant for renewal was held to be
not binding on the mortgagee Man^lal v. Upendra, 57 Cal. 82, A.LR.
1930 Cal. 335 (338), 125 I.C. 661. So also, it was held that a pennanent
lease of the mortgaged property rendered tlie security insufficient within
the meaning of sec. 66^Bank of Upper India, v. Jaggan, -4 O.W.N. 228,
A.I.R. 1927 Oudh 148 (149), 100 I.C. 728; Manthura v. Jagmohan, 6
Luck. 546, A.I.R. 1931 Oudli 256, 132 I.C. 532. Tire lease of a house-
site by the mortgagor is invalid when it is not granted in tlie ordinary
course of management Ch^yar Firm v. Sein Htaung, A.I.R. 1935
Rang. 420, 159 I.C. 1038.
But although a lease may be for a period of more than three years,
still as between the mortgagor and his tenant, the tenancy will be valid
until the mortgagee chooses to exercise his paramount rights. Until a
suit for ejectment has been brought by the mortgagee, the tenant will
be estopped from disputing his landlords title on the ground of invalid-
ity of the lease Rustomji v. Keshavji, supra. But see Kamakshya v.
Ramzan, A.LR. 1945 Pat. 106, '23 Pat. 648, where it'has been held that
in such a case, it is not open to the mortgagee to eject the . lessee. Tlie
mortgagees right is merely to cause the mortgaged property sold- for the
mortgage-debt. A lease granted by a mortgagor under this section pen-
ding a suit by the mortgagee would be subject to the rules of Its pend-
ens M. Sathianesan v. M. Sankaran, A.I.R. 1957 Trav.-Co. 292. In the
case of a lease granted by the mortgagor prior to the enactment of sec.
65A, out of the ordinaiy course of management, during the pendency of
a suit for sale by the mortgagee, tlie lessee could apply for being joined
as a party and ask for oiiportimity to redeem. But if he allowed the
property to be sold in execution of the decree he lost his right of redemp-
tion Mangru Mahto v. Thakur Taraknathji Tarkeswcr Math, A.I.R.
1967 S.C. 1390.
82
[Sec. 66
ISO nq2l 175 IC. 279. The onus is not on the lessee The onij
test is to see whedier the mortgagors act impairs die security sO to
JendS it insufficient. If it does not, the act is witkn die mortgagors
competence and is binding on the mortgage, even if it amounts to d
Sec.
TftANSffift O? PftOPfiRTY 65 i
B was botli a mortgagee and lessee of a glass factory with its fixtiues,
fittings and tools belonging to A. C for satisfying a decree obtained
against A attached the factory and removed and sold part of its roofing:
held, that Bs rights as mortgagee and lessee jvere infringed by the action
of C which resulted in dimunition of tlie value of the premises. B was
therefore entitled to damages against C measured by the loss of value
of the mortgaged premises Ratti Ram v. Moti Lai, A.I.R. 1949 P.C. 68,
75 LA.- 160, I.L.R. 1948 All. 343.
236.
(d) Working new mines Clavering v. Clavering, 2 Eq. Gas. Abr. 757.
Acquiescence : ^If a mortgagee does not take steps in time, say for
two years, calling upon the mortgagor to furnish additional security, the
mortgagee would be deemed to have acquiesced in the diminished secur-
ity Prosanna v. Qirish, A.I.B. 1934 Cal. 149, 37 C.W.N. 1162, 149 I.C.
667.
Onus of proof: ^When the mortgagor does any act whidi is likely
to prove destructive or permanently injurious to the mortgaged property,
the onus lies on the mortgagor or iis representative to prove fliat the act
is lawful and valid and that die security has not been rendered insufBci-
ent Shagiwan Dei v. Secr^ary of State, 85 P.R. 1902, 124 P.L.R. 1902.
tEC. 67
Ifau^orize a mortgago^^"^
(n) to rf S ft public
( 6 )
,0 authorize a only to
mortgage.
Sec, 67]
(1) The word duel has been substituted for payable. For the reasons
stated in the notes under sec. 60, the word payable should be replaced by
the word due Report of the Special Committee. See Note 359 under
section 60,
(2) The word decree has been substituted for order in several places,
as the old practice of passing an order absolute has been abolished by the
enactment of O. 34, C. P, Code, under which a final decree is now passed
in a mortgage-suit. See Note 373 under sec. 60.
(3) Clause (a) has been redrafted. The old clause stood as follows :
(d) English mortgage: Sale only, and not foreclosure. Under the
old section the remedy was both by foreclosure and sale.
(e) Equitable mortgage:' Sale only and not foreclosure. There was
no express provision under the old section 59.
[ Sec. 67
19 . Where the prior and the subsequent mortgagees have in their res-
pective suits obtained decree and purchased the mortgaged property in
C^urt sale, the remedy of the subsequent mortgagee who is a later pur-
chaser is to redeem the prior mortgagee who however will have the right
to redeem the subsequent mortgagee retaining possession of the mortgaged
property Pi/K v. Varkki, A.I.R. 1951 Tr.-Coch. 36. If a puisne mortgagee
impleaded in a suit on a prior mortgage, fails to redeem that mortgage
and allows his property to be sold, his security ceases and he can no longer
claim to redeem the prior mortgage-^/wmsfter v. Lai Batuk, A.I.R 1953
All. 147.
Sec. 67]
3 W.L.R. 572.
[Sec, 6;
Sec.. 67]
83
658 TRANSFER OF PROPETY
I Sec. 67
^s, 46 Cal. 448 (454) ; Subbamma v. Narayya, 41. Mad. 259 (264) (FB)
But tms IS no longer good law ; because clause (d) of sec. 58 as now
amended, makes it clear that a usufructuary mortgagee does not cease to
be a usufructuary mortgagee by reason of the fact that possession has not
been delivered to him by the mortgagor; consequently, he is not entitled
to the remedy either of foreclosure or of sale, by virtue of clause (a) of
this section. See Note 342 under sec. 58.
Sec. 67]
interest on default, held that there was a contract to the contrary within
the meaning of this section, and a suit for interest was maintainable even
before the principal money became due. Failure to pay interest at the-
stipulated time would, in a mortgage prepared' in the most ordinary- form,
release the mortgagee from the necessity of waiting for the expiry of' the
term Seaton v. Twy f or d, .(li70) L.R. 11 Eq. 591. "Where a deed provided
that the mortgage-debt was to become payable at the expiration of 15
years, and that in the meantime interest was to be paid yearly, held that
the failure on the part of the mortgagor to pay the stipulated interest as
agreed upon would entitle the mortgagee to bring the mortgaged property
to sale before the expiry of the term of the mortgage Venkatarao v.
Mahableshwar, 26 Bom. 241 (245), following Seaton v. Twyford,\ (1870)
L.R. 11 Eq. 591. But where the mbrtgage-bond provided that in default
of payment of interest at 8 per cent, on the due dates interest at 9 per
cent, should be charged on the interest in arrears as well as on the prin-
cipal, it was held that the true intention of the parties \^as to postpone
the sale of the mortgaged property until the principal became due, and
to give the mortgagee, on default of payment of interest, only a right to the
enhanced rate of interest Kannu v. Natesa, 14 Mad, 477.
[ Sec. 67
Jyoti Prakash y. Mukti Prakash, A-LR. 1924 Cal. 485, 51 Cal. 150 81 IC
34. A security bond executed by a judgment-debtor for the purpose of
removing an attachment before judgment can also be enforced^ the
course of execution and a suit under this section is not necessart-
Rqendra v. Bipm, A.I.R. 1934 Cal. 64. 37 C.W.N. 973, 60 Cal. 1298 So
where a money-decree is ordered to be paid by instalments on the judol
ment-debtor executing a security bond hypothecating immoveable propertv
for the satisfaction of the decree and default is committed in payment of
the instalments, the hypothecated property can be sold in execution of the
decree and a fresh suit is not necessary Narottam v. Krishna Prasad
A.I.R. 1936 Pat. 289 (291), 15 Pat. 545, 162 I.C. 830. . '/
bound to file a fresh suit under this section for bringing ^e properhes
s^e-Aubhayessury v. Gonri 22 Cal. 859. When a charge
BC, 67 j
407A. Different kinds of mortgages : ^It is the intention of the parties '
which determines the nature of a mortgage. The incidents of mortgages of
various kinds which are laid down in this section are the normal incidents
that may be deemed to be included in the intentions of the parties where
there is no indication to the contrary- The Amending Act of 1929 did not
import any new principle Bishan Das v. Hand Ram, A.I.R. 1936 Pesh. 48,
161 I.C. 155.
A mortgagees suit for sale may comprise ttvo reliefs, one by way
of sale of the properties mortgaged, and the other by way of a personal
decree, against the mortgagor for what may remain due after the mortgaged
iEC. 67
All. 24, A.LR. 1939 All. 141 (151, 153), 1939 A.L.J. 1199.
Umitorfoni-The period of
is, under Art. 132 of the Limitation Act, 1908, twelve years from the
Sec. ^7]
t Sec. 6^
and paying them into Court for the benefit of the mortaaeee tha
would be the case if the mortgagor is damaginrorTaS or
proper care of the property, A simple mortgagee is not disentitled to
obtmn the appointment of a Receiver, if other circumstances are such
as to justify it, merely on the ground that no personal remedy subsists
to repay the mortgage-money, the- mortgage cannot fad within the deft
Sec. 67]
Mad. 259 (263) (F.B.) ; Subbaraya v. Subramanyam, A.LR. 1952 Mad. 856.
Sec. 68 only confers a right on the mortgagee to sue for the mortgage-
money in case the mortgagor fails to deliver possession of the property
or where a superior title is claimed by any person ibid. As there is no
covenant or agreement for payment in a usufructuary mortgage, the
mortgagee cannot compel payment of the mortgage-money by a suit for
sale Chathu v, Kunjan, 12 Mad. 109 (110) ; Luchmeshar v. Dookh Mochan,
24 Cal. 677 (681). The principle imderlying the statutory prohibition
of sale by a usufructuary mortgagee is that the mortgagee looks to the
rents and profits for satisfaction of his advance, and in as much as no
time is fixed for payment, there is no forfeitue. It is the forfeiture that
gives rise to the remedies of foreclosure and sale and in its absence the
mortgagee is not entitled to the remedies that spring out of it Mohan
Devi V. Talib Mehdi, A.LR. 1938 Lah. 145 (146). [In the old clause (a)
it was proyided that a usufructuary mortgagee was not entitled to bring
a suit for foreclosure or sale ; and in an early Madras case, these words
were interpreted to mean that this clause prohibited a usufructuary mort-
gagee from bringing a suit in which he prayed alternatively for a decree
for foreclosure or for sale ; but that there was nothing to prevent him
from bringing a suit for foreclosure or from bringing a suit for sale
Venkatasami v. Subramanya, 11 Mad. 88 (90). The language of the present
clause is perfectly clear and does not admit of such ingenious interpreta-
tion.] It has recently been held by the Patna High Court, hoiveyer, that
it is not a proper construction of this section to say that a usufructuary
mortgagee is excluded entirely from the operation of the section Raikimar
V. Surajdeo. A.I.R. 1938 Pat. 585, 19 P.L.T. 787, 177 I.C, 533.
But where the mortgagor makes a personal covenant to pay the money
on a certain date, the transaction ceases to be a purely usufructuary
mortgage, and becomes what is known as simple mortgage usufructuary,
i.e,, a combination of a simple and a usufructuarj' mortgage, and the
mortgagee is entitled to bring a suit for sale Ramaifija v. Ctiruva, 14 Mad.
232 (234) ; Sivakami v. Gopala, 17 Mad. 131 (133) (F.B.) ; Chathu v. Kunjan,
12 Mad. 109 (112) ; Udayana v. Senthivela, 19 Mad. 411 ; Kangayya v.
Kalimuthu, Tl Mad. 526 (527) (F.B.) ; Rangappa v. Thammayappa, 26
M.L.J. 514, 24 I.C. 372 ; Mahadaji v. Joti, 17'Bom. 425 ; Umda v. Umra
Begum, 11 All. 367; Jafar Hussain v. Ranjit Singh, 21 All- 4 (8);
Parashram v. Putlajirao, 34 Bom. 132 {YiS) ) . Dattambhat v. Krishnabhat,
34 Bom. 462 (466) ; lag Sahu v. Ram Sakhi, 1 Pat. 350 (355), A.r.R. 1922
Pat. 167 ; Sardar Singh v. Collector, lO O.C. 14 ; Ram Khilawan v. Ghtdam,
8 Luck. 190, A.LR. 1933 Oudh 35 (36), 141 I.C. 464 ; Parga7i Panday v.
Mahatam Mahto, 6 C.I;:J. 143 ; Fida Ali v. Ismailji, 6 N.L.R. 20, 5 LC- 701 ;
Bhabani v. Kadambini, A.I.R. 1929 Cal. 304, 33 C.W.N. 279, 119 I.C. 292 :
Ramachandra v. .Sarvajanavardhini Co., A.I.R. 1952 Mys. 125 ; Ramak-
kammal v. Sabbarathnam, A.LR. 1953 Mad. 13. In Kashi Ram v. Sardar
Singh, 28 All. 157 and Krishna v. Hari, 10 Bom. L.R, 615, it has, however,
been held that in order to entitle a usufructuary mortgagee to sue for
sale of the property, there must be not only a personal covenant to pa}'
the money but also express stipulation in the deed entitling the mort-.
gagee to recover the money by sale of the property. This proposition has
been re-affirmed in the recent Full Bench case of Kanhaiya v. Mt. Hamidan,
A.I.R. 1938 All. 418, 176 LC, 492. If the terms do not provide for sale,
84
pgee was merely given the right to sue for his money
tances, the mortgape can get a simple money decree only and not a decree
for sale /?cnn Lai v. Mt. Genda, A.I.R. 1942 All. 326, 1942 ALT 411
Where a usufructuary mortgagee leases back the mortgaged propertv to
the mortgagor, gets a decree for rent against him and thereafter sues him
on a covenant of repayment, the mortgagee can get a money decree onlv
after deducting the amount 'of the rent-decree ib/d. If a usufructuary
mortgage contains a covenant to pay on a certain date, coupled with a
further stipulation that if the money be not paid by the executant in
due time, then this bond will remain in force and intact (i.e the mort-
gagee will continue in possession) till the repayment of the money, with
all conditions set forth herein, held that this stipulation did not amount
to an absolute covenant to repay ; consequently, the mortgagee was not
entitled to sue for sale, upon the mortgagors failure to pay on the date
faedKamal Nayan v. Ram Nayan, 11 P,L.T. 74, 120 I.C. 308, A.I.R, 1930
Pat. 152 ; Damodar v. Chandapur Pujari, A.I.R. 1933 Mad. 613, 56 Mad.
892. A mere insertion of a personal covenant to pay the mortgage- debt
on demand would not alter the character of the mortgage and give the
mortgagee a ri^t to sell the mortgaged properly in the event of non-pay-
ment. The test in such cases is' the remedy provided in the deed for the
satisfaction of the mortgage-debtMd. Abdullah v. Md. lasin, A.I.R. 1933
Lah. 151, 141 LC. 377. It has been held in Peshwar that where the mort-
gagee was to remain in possession of the mortgaged properly for a fixed
period only, it- necessarily implies a personal covenant Saiftilla v. Chaman
Lai, A.I.R. 1936 Pesh. 43, 160 LC. 986.
Sfic. 6?]
TRaNSPM of PftOPEftTY 66 ?
Where the mortgage is by conditional sale, the only decree that can
be made is for foreclosure Venkatasami v. Subramanya, 11 Mad. 88 (89) :
Kalika v. Ajudhia. 51 All. 780, 1929 A.L.J. 448, A.I.R. 1929 All. 421 (428),
121 I.C. 211 ; Kunwarlal v. Rekhlal, A.I.R. 1950 Nag. 83, I.L.R. 1950 Nag.
321. In the case of a mortgage by conditional sale the right conferred
on the mortgagee is not to sue for money but to take steps to perfect
his title to the property Dau Balvoant Singh, v. Mt. Bindabai,. A.I.R. 1942
Nag. 88 (90), I.L.R. 1942 Nag. 357, 1942 N.L.J. 303, 200 I.C. 709. In such
a mortgage a mere promise to pay the money within a certain fixed period
does not per se import a personal liability, for such a covenant is entered
into in every form of mortgage, and the test in each case is the remed}
provided in the deed for satisfaction of the mortgage-debt Bhikam Lail v.
Janak Dulari, A.I.R. 1937 Oudh 517 (519), 171 I.C. 296.
Where a mortgagee was in possession and 'liable for the rent of the
mortgaged property for a certain period, in a suit upon the mortgage the
purchaser of the mortgaged property was not entitled to claim a set off
668 transfer or propetv
[ Sec. 6/
PX,T'2"ri9f'lc'Mf
The Receiver in a mortgage-suit holds the property for the person who
can eventually make out title thereto. His appointment prima facie is for
the benefit of the mortgagee. When a decree for foreclosure is passed
and any money in the hands of the Receiver representing the rents of the
mortgaged property would belong to the mortgagee Ibid.
SEC. 67]
[ Sec. 67 .
mortgaged proper^
^eth Banstram v. Naga Ayyar, 59 M.L.J. 928, A.LR. 1930 Mad. 985 l2
Katlasa Ayyar v. Sundaram Pattar. A.I.R. 1942 Mad. 205 f 207 i
(1941) 2 M.L.J. 986, 1941 M-W.N. 1055, In the case of purchase by one
co-mortgagee, without the consent of the other co-mortgagees, of the
equity of redemption, the former for the purpose of recovering his share
of the mortgage money can bring the entire mortgaged property to sale and
not merely his proportionate part of the mortgaged properly^Sfldwio v
Govmd, A.I.R. 1945 Bom, 351. I.L,R. 1945 Bom. 390. A co-mortgagee
suing to recover his individual share of the mortgage must ask the Court
to decide what is due on the mortgage as a whole and to fix a period of
redemption of the mortgaged property in its entirety. He must ask for a
preliminary decree in respect of the entire debt. There can be no redemp-
tion in part. Therefore the plaintiff cannot get his share until the mort-
gagor has paid into Court what he owes on the mortgage or the mortgagevi
properties have been sold Ibid, As to the Court-fee to be paid by the
plaintiff in such a case, see this case . Matt Lai v. Bara Burt, 46 C.W.N,
1015, per Mitter and Biswas, JJ. Jn this case their Lordships have laid
down what is to be stated in the preliminary and final decrees as well 'as
the procedure to be followed in sale of the mortgaged properties, and the
provision for a personal decree under O. 34, r. 6 of the C. P. Code. After
sale the purchaser will get the property free from the mortgage and the
rights of the co-mortgagees defendants would necessarily be transferred to
the surplus sale-proceeds Ibid,
Sec. 67]
t Sec. 67
30 L.W. 723, .928 M.W,N, 518, AXR. .928 Mad. 933 (935, 939), 1,2 r,c
ft= d'Ib Z S ff
aZVtTeSS^dTtLtr
Sec. 67A]
Where a person e.xecutes two mortgages, one after the other, in fav-
our of the same mortgagee then unless there is something in the second
deed to show a contrary intention, the creditor must be presumed to
have intended to keep the earlier security alive for his own protection,
and prima facie this section is applicable in such a case Daw Kin v.
Ko Ba Tin, A.I.R. 1939 Rang. 247, 1939 R.L.R. 207, 184 I.C. 284. But
if in such a case a suit on both the mortgages cannot be brought in the
same Court, this section does not apply Ibid following Fremsucli v.
Mangal Chand, 41 C.W.N. 854. ^Vhere objection is taken to the suit on
the ground that it was on only one of two mortgages held by the plaintiff
an amendment of the plaint may be allowed Prabhulal v. Godawari Bai,
A.I.R. 1953 Aj. 50 (2).
83
[Sec. 68
f f R S- F?m V yryt
The rule of this section is not applicable where the parties in tlie
two mortgage-deeds are not the same Ko Aung v. Ko ?o, supra ; The
Bank of Karaikudi v. Karaikudi. A.I.R. 1965 Mad. 537. In fact, a mort-
gagee cannot bring one suit in respect of mortgages of the same property
executed by two different persons. Such mortgages can not be joined
under Or. 1, r. 3, C. P. Code, as tlie right to relief arises out of different
acts. They cannot even be joined under Or, 1, r. 3, C. P.
Code, as the right to relief arises out of different acts. They
cannot even be joined under Or. 2, r. 3, as they are not
jointly liable on each mortgage Bha'iyalal v. Ramchandra, A.I.R. 1937
Nag. 99 (100), I.L.R. (1937) Nag. 349, 170 I.C. 106. In tins case the
property belonged to one B and after his death one mortgage in respect
of the property was axecuted by a person who claimed to be his adopt-
ed son and tire other mortgage by B's widow.
Upon the strict wording of the section its operation cannot perhaps
be confined only to mortgages upon the same property see Bhau Nana
V. Rccappa, supra.
money. mortgage-money in
Sec. 68]
[ Sec. 68
(b) and (c) of the old section; the italicised words in clause (d) the
proviso and sub-section (2) are new. The reasons are stated below in
proper places.
A Full Bench of the Madras Higli Court has laid down that the
words sue for the mortgage-money mean and include a suit for fore-
closure or sale under sec. 67. When' tlie mortgagee has become entitled
to sue for the mortgage-money under any clause of sec. 68, it means thal
the mortgage-money has become "payable; and consequently there can
be no reason for refusing to give effect to sec. 67 which allows of a suit
for foreclosure or sale at any time after the mortgage-money has become
payable Subhamma v. Narayana, 41 Mad. 259 (264) (F.B.). But this
proposition does not apply to a usufructuary mortgage. See this case
under Note 409 in sec. 67. But if the mortgage is a combination of a
simple and usufructuary mortgage, and the mortgagor fails to deliver
possession to the mortgagee, the latter can sue for the money under sec.
68, i.e., the money becomes payable ; and if the money becomes py-
able, a decree for sale can be made under sec. 67 Lai Narsini v-
4 Luck. 363 (P.C.), 33 C.W.N. 693 (699) 116 LC. ^I.R 1929 P.C.
139 ; foUowing in Ram KJuhwan v. Ghulam, 8 Luck. 1190, 141 I.C. 464,
A.I.R. 1933 Oudh 35 (36). But it is submitted that under the new clause (g)
of sec. 58, such a mortgage would be treated as an anoinaloiis 8^'
and the rights and liabilities of the parties would be determined by
terms of the mortgage (sec. 98). This section does not apply to a case
EC. 68 J
139 I.C. 61. Thus, where according to one clause of the mortgage-deed
the mortgagdr had jjower to repay fire mortgage-money during the period
of five years following the execution of the deed and according to
another clause the iriortgagees had tlie right to recall the mortgage-money
and to sue for foreclo'sure only in the event of the mortgagors default
in redeeming the mortgage on the expiry of five years: held that the
combined effect of the two clauses was that the mortgagor had neither
the right to repay the mortgage-money nor to redeem the mortgaged
property and the mortgagees had no right to call the mortgage-money
and to sue for foreclosure before the expiry of tlie five years Ihid.
Section 68 applies only where the claim is based on a valid mort-
gage Bhikhan Lai v. Janak Dulari, A.I.R. 1937 Oudh 517, 171 I.C. 296 ;
J'Owand v. Sawan, A.I.R. 1933 Lah. 836.
[Sec.
V. Kunlii-
It has been broadly stated in a number of cases tiiat every loan implies
a promise to pay, and tiiat an unqualified admission of indebtedness is
equivalent to an express covenant and creates a personal obligation and
that therefore in every mortgage there is a personal covenant to pay the
mortgage-debt, unless tiie contrary is e.Npressly stated or appear by
implication Kali Pershad v. Raye Kishori, 19 W.R. 281; Mtisahah
Zaman Khan v. IndyetuUah, 14 All. 513; Miller v. Rungamfh, 12 Cal.
389 ; Parhati Vi Qovind, 4 C.L.J. 246 ; Bhugivan v. Parmeshwari, 5
C.L.J. 287 ; fiwaiidas v. Janki, 18 N.L.R. 145, A.I.R. 1922 Nag. 98 ;
Seth Gopikishen v. Mankuerbai, 20 N.L.R. 46, A.I.R. 1924 Nag. 97. A
personal covenant is presumed in all mortgages of whatever form. Tlie
only difference that can^ise would be tiiat in certain forms of mortgages
(e.g,, usufructuary mortgages) the Court mi^it, in tiie absence of an
express covenant, demand a much more clearly irriplied covenant than
it might require in other cases Parashram v. Brij Mohan, 13 Lali. 250,
A.I.R. 1932 Lah. 164, 135 I.C. 33 ; Qudir v. Mehr Nvr, A.I.R. 1935 Lah.
Ip3, 16 Lah. 612, 158 I.C. 206. This view is taken from the English
N.L.B. 187 (F.B.), A.I.R. 1929' Nag. 254 (255), 119 I.C. 684 , Gooi
684;
mortgage
si Lluan ox#, xia * ,
Sec. ^8]
t Sec 68
M.B. 72. A mortgagor cannot avoid his liabihty to pay interest on mort
gage-amount on the ground that his suit for redeSiS. eX-
Puttananjamma v. P. M. Channahasamnna, A.LR. 1967 Mys. 41 .
term I shall pay the said Rs and redeem the lands Udayana v.
Senthiaelu, 19 Mad. 411; dr "It is settled tliat I shall pay the principal
amount to you in three instalments witliin tiie aforesaid period Ramya
V. Gtiruva, 14 Mad. 232 ; or the mortgagees shall be competent to
recover tiie amount in any way they like'Parashram v. Brij Mohan, 13
Lah. 259i A.I.R. 1932 Lah. 184, 135 I.C. 33. A usufructuaiy mortgage-
deed ran as follows : "I shall pay you the said mortgage-amount in the
ChiUrai Kalavadi of year 1883 and take back tliis deed of mortgage. If
I fail to pay the mortgage amount in die said Kalavadi, then you snail
receive tire money in the ChiUrai Kalavadi of whatever year I may pay
it deliver the said lands to ray possession and also give back tire bond,
held- that there was a sufficient covenant to pay in the fost clause, and
tliat the second clause did not limit the discretion of the mortgagor-
Sivakami v. Gopah, 17 Mad. 131 (133) {F.B.); Rangappa v. Thamrmy-
anpa, 26 M.L.J. 51i 24 I.C. 372 (per Seshagiri Iyer J.). But where
a usufructuaiy mortgage contained the clause: Having paid P"
X mSri tl 3 e mLh of Cbait 1297 we shall take back the bond
flifd the land Jteld that these words did not imply a personal rovenan
^ 2 &emoZ It was merely a provision for redempdon-Laohme^
*7 ^ ^ rinnkh Mochan 24 Cal. 677 (679); Damodara v. C/ionctepur, 56
rAlR S fd eis (615)'; L ^ V.
Sec. 68]
Wliere die mortgagee has the right to realise the rents of the mort-
gaged properties to satisfy interest and part of the principal and in
case of difficulty in realization to sell die mortgaged properties he may
cither sue the tenants or sue for the sale of the mortgaged properties
Buttokristo v. Gobindaram, A.I.R. 1939 Pat. 540, 182 I.C. 132; Ram-
chandra Naidu v. Hassina Bai, (1968) 1 Mad. L.J. 139. Wliere in a mort-
gage-deed there is a promise to repay and it is executed not for pay-
ment of Ihe iirincipal but to secure payment, of interest, there is no
objection to giving the plaintiff a money-decree for the amount of the
principal Mathura Singh v. Palakdhari Ra/, A.I.R. 1940 Pat. 512, 21
P.L.T. 770, 187 I.C. 484.
86
tEC. 68
fnd ^"'t^'ctSLZhaS;
n.ogt;.'JSe be "r IS
Under tiiis clause, the mortgagee must, prior to suit, call upon the
mortgagor to furnish odier security. He cannot, without demanding an
additional security, sue at once for die mortgage-moneyKtwier v. Pena
Karuppa, 42 Mad. 578, 36 M.L.J. 286; Kamalambal v. Purushottam,
A.I.R 1934 Mad. 644 (615), 152 I.C. 437, -A. usufructuary mortgagee,
if he does not take steps in time (in this case for 21 years) calling upon
the mortgagor to furnish additional security, cannot claim interest- on
Sec. 68]
Tlie right of personal recovery' conferred by clauses (c) and (d) e.\ists
independentiy of and is not taken away' by' any personal covenant to
repay contained in the mortgage-deed. Tlie mortgagee is entided to
sue the mortgagor whenever he is deprived of his security', in spite of
the fact diat a suit under a personal covenant contained in the mortgage-
deed is barred at that time Appasami v. Virappa, 29 Mad. 362.
[Sec. 68
N:g^T TS Ni^r^s"''-
Eif
Sec. 68]
[Sec. 68
up possession, the mortgagee has a right under this section to sue for
mortgage-money or to sue under sec. 67 for a decree for sale of the*mort-
gaged property Kfln/iaiVa v. Mt. Hamidan, A.I.R. 1938 All. 418 (F.B.)
176 I.C. 492; Lai NarsJiingh v. Md. Yakub, A.I.R. 1929 PC 139 4
Luck. 368, 33 C.W.N. 693, 56 I.A. 299, 116 I.C. 414.
1969 Mys.-20.'
Before a mortgagee brings an action under this clause for the mort-
gage-money he must prove his mortgage. If it cannot be tendwed m
fvfdence for want of valid ^-^gisfration, then Sage camot j
I.C. 825.
f^ir^suT^ -0^ He
i 461.
Sec. 68]
But the mortgagee cannot sue for the money unless he is actually
out of possession. Thus, the mere Court-sale of the property in execu-
tion of a decree against the mortgagor cannot give the mortgagee a
right to sue (assuming such to exist) unless the purchaser dispossessed
him Janki v. Sheomangal, 1881 A.W.N. 59. So also, the mortgagee,can-
not sue for the money where the dispossession is due to his own default.
Thus, a usufructuary mortgagee who fails to make a defence to a suit
by a subsequent mortgagee which would have preserved the securityl is
not entitled to- sue for the mortgage-monev Diinnia Lai v. Noivrafan, 2
P.L.J. 490, 41 I.C. 806 ; ChitkaU v. Mathura, 3 C.L.J. 220.
The remedy provided in this clause is an alternative remedy and does
not debar the mortgagee from bringing a suit for possession ^ankata v.
Jagat Narain, 2 O.G. 24 j Linga Reddi v. Shama Rao, 17 Mad. 469 ;
Thakur Chowdhury v. Manup Mahton, 16 I.C. 735. The Allahabad High
Court has held that if tlie mortgagor fails to give possession of a portion
of the mortgaged property, the remedy of the mortgagee is to sue for
possession and mesne profits ^Gor/ Singh v. Bechu Singh, 1932 A.L.J.
1092, A.I.R. 1933 All. 97 (98), 142 I.C. 779.
688
TRANSFER OF PROPERTY
.[Sec. 68
rs:
A.I.R. 1923 All 584. WJiere a mortgage-deed provided that on. default
ot parent of interest the mortgagee would be given possession, tlien
the taiiure of the mortgagor to give possession, on tlie interest f allin g into
arrears, would entitle the mortgagee to sue for the amount due Samcana
y. Chinnammal, 15 Mad. 65. This clause is wide enough to include every
instance of failure by a mortgagor to secure a mortgagee in undisturbed
possession, at any time during the period for which the mortgagee was
entitled to remain in possession. The subsequent dispossession of the
mortgagee after possession has been delivered to him is a failure on tiie
part of tlie mortgagor to secure him in undisturbed possession Hiralal
V. Ghasita, 16 All. 318 (F.B.) ; Jainandan v. Baijnath, 2 P.L.T. 229, 63
I.C. 297 (300),- Pargan Panday v. Mahatam, 6 C.L.J. 143. Where the
mortgagee granted a lease for a fixed term to his mortgagor with an
option to renew on fulfilment of certain conditions, but the mortgagor,
on the expiiy of the term failed to fulfil such conditions and also refused
to give up possession, the mortgagee was held entitled to a money-decree
for the amount due under tlie mortgage Hiralal v. Gimita, 16 All. 318.
Wliere a usufructuary mortgagee in possession comes to know of a decree
on a prior unregistered mortgage for the sale of the mortgaged property
the mortgagee can sue for money even after himself purchasing the pro-
perty in execution 'Ahmadullah v. Solar Baksh, 27 AU. 488 (491). A
usufnictuary mortgagee can sue for the mortgage-money on dispossession
by a co-sharer of the mortgagor who obtained the mortgaged property
on partition TUak Singh v. Jalai Singh, 11 C.L.J. 136, 5 I.C. 130. The
mortgagee has a cause of action under this clause when the mortgagor,
on being called upon to give additional or substituted security, entered
into occupation and deprived the mortgagee of the possession Pargaa
Pandey v. Mahatam MahtP, 6 C.L.J. 143. Where tlie mortgagee is dispos-
.sesSed by a stranger claiming adversely to the mortgagor, who fails to
defend his title and restore the mortgagee to possession, the latter is entit-
led to recover the mortgage-money Mflwng Po v. Maung Kyauk, 2 Bur.
L.J. 47, A.I.R. 1924 Rang. 143, 79 LC. 815.
Sec. 68 ]
is due to the mortgagees own default Bharat Ram v. Beni Dutt, A.I.R.
1936 Oudh 263, 161 LC. 821. A provision in a mortgage-deed malting the
mortgagor liable to pay in the event of the mortgagee being , dispossessed
applies only when the mortgagees possession is interfered with and is
not applicable to the case where the mortgagor has failed to deliver
possession initially iCewi v. Musafir, A.I.R. 1937 All. 711 (713), (1937)
A.L.J. 815, 171 LC. 825. '
' Thus, if the tenants of the mortgaged property who had to pay rent
to the mortgagee wrongfully refused to do so, and, if any one of .theiri
with whom the mortgagor was not in collusion disturbed the possession
of the mortgagee, the mortgagor could not be made liable for the acts
of such third persons Nakchedi Ram v. Ram Charitar, 19 All'. 191 (193).
Therefore, where the possession of the mortgagee has been disturbed by
a person without title, the mortgagee is entitled to sue' the trespasser for
declaration of title and recovery of possession without' suing the mortgagor
for the mortgage-money Bechu Sahu v. Arjun, 3 iP.L.J.' 162, 43 I.C. 917.
Where the usufructuary mortgagee is deprived of the mortgaged property
by a third party claiming under a purchase from the mortgagor, the
mortgagees right is only to bring a suit against that person to recover
the possession of which he has been deprived. He cannot sue the mort-
gagor for the mortgage-money, for the mortgagor ig at perfect liberty to
sell his* equity of redemption Jhabbu v. Girdhari, 6 All. 298 (302) ; Gokul
V. Shrimal, 6' Bom.L.R. 288. Sinularly, if the mortgagee is deprived of
the possession of the mortgaged property by reason of a creditor of the
mortgagor obtaining a decree against the mortgagor and bringing to sale
the mortgagors equity of redemption in execution of that decree, the
mortgagee is not entitled to sue the mortgagor for the mortgage-money
Gopalasami v. Arunachella, 15 Mad. 304 (306). But a person claiming
adversely to the mortgagor is not a person claiming without title ; and
therefore if the mortgagee is dispo^essed by .such person, the mortgagor
is bound to defend the mortgagees possession. If he fails to do so, he
must repay the mortgage-money Maung Po Kin v. Mawng Kyaukye,
2 .Bur.L.J. 47, A.I.R. 1924 .Rang. 193, 79 LC. 815. Where a mortgagee
87
[ Sec. 68
.Leaving clause (d) out of consideration, the general rule is that the
liability of the mortgagor to be sued for the mortgage-money under the
circumstances mentioned in this section attaches to the mortgagors
representatives also. Therefore, clause (c) of this section applies also to
the heir of the mortgagor; and such heir is liable to pay the mortgage-
money under clause (c) when he commits waste to the prejudice of the
' security /fumfcn'sAna v. Ckenga Aiyer, 27 M.L.]..494, 33 LC. 321. But
where a mortgagee bringing a suit imder sec. 67 for sale of the mortgaged
property impleading not only the sons of the mortgagors but also the
subsequent transferee from them, entered into a compromise with the
latter under which after accepting a certain sum of money from him, the
mortgagee discharged him from the suit and agreed to give up the remedy'
against the mortgaged property, he could not. after realizing the amount
turn round and claim the balance personally from the mortgagors sons
relying on the personal covenant Mt, Boota v. Gur Prasad, A.LR. 1937
Oudh 20 (23, 25), 12 i.uck. 313, 164 LC. 817.
A personal covenant does' not run with the land, no personal decree
can be passed against a purchaser of the equity of redemption at
p. 23,
under sub-section (2) the suit must be a suit by the mortgagee for to
mortgage-inoney in his capacity as a mortgagee. If the mortgagor eats
personal liability by an independent transaction such as a
other independent transaction completely dissociated from lie m
aL not come within the scope of. snb.^Bon W
the defendant cannot pray for stay of suit under sub-section < ty
Sec. 69]
TRANSFER OF PROPERTY 691
Pat. 235.
[Sec. 69
k * ic
k ic -k
This section has been adapted from time to time by the Government
of India (Adaptation of Indian Laws) Order,' 1937 by A.L.O. 1948 and by
A.L.O. 1950. '
425A. Application: ^This Act does not apply to the Punjab, and
therefore in that province there is nothing to prevent the parties from
making a' stipulation in a mortgage-deed, allowing sale without the inter-
vention of Court, and such stipulation is unfettered by the restrictions
of this section Kanhaiya Lai v. National Bank of India Ltd., 4 Lah. 284
(P.C.), 75 I.C. 7, A.I.R. 1923 P.C. 114.
426. Object and scope of section : ^This section has been enacted to
set at rest the conflict of decisions which existed prior to the passing of
this Act regarding the mortgagees power to sell the mortgaged property
without the intervention of the Court.
Sec. 69]
[ Sec, 69
A mortgagor must file a suit for redemption and offer to pay the
mortgage-debt after the due date has expired, if he wants the relief of
injunction restraining the . mortgagee, from exercising the power of sale
Miilraj V. Nainhial, A.I.R. 1942 Bom. 46 (48), 43 Bom.LR. 1034. He cannot
get this relief unless he pays the mortgage amount to the mortgagee .or
tenders the same to him Babamiya v. fehangir, A.I.R. 1941 Bom. 339
(341), 43 Bom.L-,R, 553. But if the mortgagee exercised the power of sale
in a wrong and improper manner contrary to fbe terms of the contract,
the mortgagor can bring a suit for such injunction /birf. The equitable
relief by way of injunction cannot be refused merely because the mortgagor
was unable to pay in the past and might be unable to pay in the future.
Ibid at p. 344.
Sec. 69]
Pichai Moideen v. Chatturbhuj, A.I.R. 1933 Mad. 736 (741), 65 M.L.J. 491,
145 I.C. 1023 ; Haddingtott Island Quarry Co. v. Alden Wesley, (1941)
A.C. 722.
This section does not offend Article 14 of the Constitution nor does .
it offend Art. 19(l)(f) Narashnhachariar v. Egmore Benefit Society, A.I.R.
1955 Mad. 1357
The mortgagee must give three inonths notice before sale, and this
period cannot be curtailed by agreement Babamiya v. Jehangfr, A.I.R.
[Sec. 69
Although the money is due and should be claimed within the period
of limitation which commences on the date of the bond, the power of
sale is not to be exercised unless and until the statutory notice has been
^venKamalambal v. Purushattam, A.I.R. 1934 Mad. 644, 152 I.C. 437.
The mere fact of a long delay having taken place between the maturitj'
of the notice and the actual sale does not make a fresh notice necessary
even when the delay is nearly two, three or four years Major v. Ward,
5 Hare 598 ; Muncherji v. Noor MahomedbKoy, 17 Bom. 711 ; Metters v.
Broion, 33 L.J. Ch. 97.
Where the mortgagor has asslgied his interest of which the mortgagee
is aware, the notice must be served on the assignee ; but if the assignment
has taken place' after a notice has already been served on the mortgagor,
no fresh notice on the assignee is necessary Muncherji v. Noor Mahomed'
bhoy, supra.
A first mortgagee exercising power of sale under sec. 69, is not required
to give any notice of the sale to the second mortgagee, though under
sec. 59-A the second mortgagee may be regarded as a person deriving
title from the mortgagor Gurusinamtaft v. Ramakrishna, I.LR. (1964) 1
Mad. 735.;
429.' Sale for arrears of interest Under clause (b) the power of sale
can be exercised even if there is no default of paymeiit of principal monpy
Firm of A. C. Kundu v, Rookanand, 11 Buir.LT. 147, 43 I.C. 921. [TOs
view does not, however, appear to be correct as the power of sale arises
in default of payment of the mortgage-money see sub-section (1) ,* Clause
fo) or (b) of sub-section,(2) seems to be an additional condition precedent!
But if there is a covenant in the mortgage-deed that the power of sale is no
to be exercised unless default is made in the payment of the principal sum
or any part thereof on the day appointed for payment, the power cannot be
exercised unless there has been a default in the payment of Ae princi^l,
and the fact that interest has remained unpaid for 3 months. will not entit e
the Sagee to sell the property-/arp Teza & Co. v. Peerbhoy, 23
BomS. 1241, 64 I.C. 634, A.I.R. 1921 Bom. 421.
Sec. 69]
432. 'Grounds for impeaching the sale : If the property -is purchased
by the mortgagee himself benami, the sale is void Vallabhdas v. Pran-
shankar, 30 Boin.L.R. 1519, A.I.R. 1929 Bom. 24 (26), 113 I.C. 313. Where
a mortgagee puts up the mortgaged property to sale, imder a power given
him by the mortgage-deed, he cannot sell it to himself, either alone or
with others, nor to a trustee for himself ^Halsburys Laws of England,
Vol. 21, p. 257. If a sale is. held before the expiry of the three months
from the date of notice as provided in clause (a) of sub-section (2), the
sale is not liable to be set aside, but the mortgagors remedy lies only by
\^ay of damages Madras Deposit and Benefit Society v. Passanha, 11 Mad.
201. A mortgage was executed in favour of M to secure a loan of
Rs. 1,500, and it conferred a power of sale on the mortgagee. M trans-
ferred the mortgage to D. Afterwards D made a new advance of Rs. 800
to the mortgagor and secured it by an equitable mortgage by deposit of
88
[Sec, 69
S.e. 1296.
Sec. 69A]
{4) The receiver shall have power to demand and recover all
[Sec. 69A
{6) The receiver shall be entitled to retain out of any monev
received by him, for his remuneration and in satisfaction of 2
costs, charges and expenses incurred by him as receiver a cZ
mission at such rate not exceeding five p*er cent, on the pj-o?v
amount of all money received as is specified in his appointment
and, if no rate is so specified, then at the rate of five per cent' oil
that gross amount, or at such other rate as the Court thinks -fit
to allow, on application made by him for that purpose: ^ ^
and shall pay the residue, if any, of the money received by him
to the person who, but for the possession of the receiver, would
have been entitled to receive the income, of which he is appomted
receiver, or who is otherwise entitled to the mortgaged property.
SEC. 69A]
Sub-sec. (1) : ^This clause does not give the plaintiff an unqualified
right to have a Receiver appointed in the circumstances mentioned in the
clause. It would be for the Court to -deal with the situation on its merits
per Panckridge, J. in In re Renuka Bose, Sub-non. Kameshwar v. Amtli,
A.I.R. 1938 Cal. 93 (95), 42 C.W.N. 266, 175 LC. 908. In the case of
English mortgages a Receiver can be appointed in execution in cases where
Sub-Rule (2) of Order 40, Rule 1, C. P. Code, would operate to prevent
such an appointment /hid. The Court will not appoint a Receiver in
execution of. a mortgage-decree unless the circumstances are such as to
make the sale of the properties a matter of serious difficulty Zh/d.
433 A. Courts power to appoint receiver : ^The Court has under the
provisions of the Act an implied power to appoint a receiver subject to
restrictions imposed on the power of such a receiver under Or. 40, r. 1.
C. 'P. Code. Receivers can be appointed by the Court in execution of
a final decree for sale, Amamath v. Abhoy Kiitnar, A.I.R. 1949 Pat. 24,
27 Pat. 534. As to the directions to be given by the Court to such a
receiver, see this case.
[ Sec. 70
other debt before the dues of the mortgagee are satisfied nor dope =
sec. 69A for the appointment of a receiver that the applicant is not entitled
to any mortgage right over the disputed property, being a finding in a
summary procedure, does not operate as res judicata in a subsequent
mortgage suit by the mortgagee Venkatasubbiah v. Thirupurastmdari
A.I.R. 1965 Mad. 185.
* .Illustrations.
Cal. 803. ^ .
Scope: This section regulates the. rights of the mortgagor and fte
mortgagee inter se, and of course applies to their representatives. Third
parties who have nothing to do with the security- and between whom and
the mortgagor and the mortgagee there is no privity of contract are not
affected by the provisions of this section,' If a stranger, ^^ider a bona fide
but mistaken belief that-he has an absolute title to a land, which belongs
to somebody else, puts up a building.uflon.it, without any knowledge to
the land is mortgaged, the mortgagee- cannot claim the- building, against
Sec. 70]
this stranger third party ; but the latter will be entitled to remove the '
materials Nannu Mai .v. Rant Chandef, infra. There is no reason to
restrict the scope of the section to accessions made by the mortgagor
personally. The representatives of the mortgagee an'd the mortgagor would
be governed equally by the rule, it being immaterial whether they are
merely heirs or subsequent transferees Chettyar Finn v. Sein Htaimg,
A.I.R. 1935 Rang. 420 (422), 159 LC. 1038-
2 M.L.J. 520.
[Sec. 70
y. George, A.I.R. 1950 Tr.-Coch, 78. Where the land containing a binldino
IS at first mortgaged, and machiners^ is subsequently planted h the buil/
ng for permanent use, such machinery is an accession to the mortcaeed
property R M. P M. Chetti/ar Firm v. Siemens Id., 11 Rang. 322, A.IR^
1933 Rang, 195. Improvements, e.g., electric installation effected on die
mortgaged properly, which are in the nature of fixtures and immoveable
are accessions to the mortgaged property and are liable for the morteaae
charges Punjab & Sind Bank v. Kishen Singh, A.I.R. 1935 Lah. 350 16
881, 156 LC. 795. ' But where the property mortgaged included a rice^
mill and various parts of machinery pertaining to the engine or other huller
which .was intended to be set up with the help of the engine and the
schedule referred to all samans necessary to fit up the mill and the
puller and all accessories, and for sometime the concern worked only as a
huller but later on the mortgagors decided to work as a sheller also with
the power derived from the engine and connected the sheller system ivith'
the huller by a belt and the two could be separated by taking away the
belt : it was held that the machinery pertaining to the sheller system was
not comprised in the mortgage security and the principles of this section
did not apply Satyanan/anamurthi v. Gangayya, (1939) 1 M.L.J. 692,
A.I.R; 1939 Mad. 684, 1939 M.W.N. 383. A theatre erected on a lease-
hold land after the execution of the mortgage thereof, would be included
in it, unless there was a contract to the contrary. The fact that the land
mortgaged is a lease-hold is immaterial, for this Act makes no distinction
between ,free-hold and lease-hold property Mocieodf v. Kissan, 30 Bom.
250. As a rule, buildings erected on the mortgaged land will be treated
as an accession to the mortgaged property. But if a building is erected
merely for temporary use, there being no intention that it should be
attached to the land even slightly, the mortgagee will acquire no interest
in it ^Jones on Mortgage, 433 ; Nannu Mai v. Ram Chander, 53 All. 334
(F.B.), A.I.R. 1931 All. 277. A semi-pucca house built on the mor^ged
land is however an accession to the land Chettyap Firm v. Sein Ttaung,
A.I.R. 1935 Rang. -420, 159 I.C. 1038 ; see also Abdul Qayum v. Mt. Turi,
A.I.R. 1941 Pesh. 49. Where an undivided share, in a property is mortgaged
and in partition the mortgagor is allotted a specific property as substituted
security, the improvement effected and new buildings constructed on
such allotted property by the mortgagor or his transferee must be treated
as accession and are available for satisfaction of' the mortgage-debt Amar
V. Bhagwan. A.I.R. 1933' Lah. 771, 14 Lah. 749. The mortgage of the
entire taluka B assessed to a certain revenue was held to comprise an
alluvial mahal appertaining to the taluka, although it has been separate y
assessed-Ganpat v. Saddat Alt, 2 All. 787. Where accretion to the original
holding by clearing new land is considerable, the clearing is not however
-accretion within the meaning of this section Tnif Gyi y. Maung Yan,
A.I.R. 1933 Rang. 81, 146 LC. 674. So Government waste lands, adjomin^
the mortgaged property, which are brought under cultivation, o no-
ZoZ sublet I L mortgage and secs. 63 and 70 bye no dH^cabon
to such extention of cultivation-nS. R. & C. Firm v. Ko P. Sm, A. . .
Rang. 127, 162 LC. 383. .
Sec. 70]
reformed lands adversely to them, and though his title did not extend to
the whole, he mortgaged the entire Touzi, but later on after another
diluvion the mouza was again formed into thrice as big as the old one
actually mortgaged and recorded as such in the settlement record: held
that by his. possession the mortgagor added the reformed land to the
mortgage-security and as such the whole of the enlarged area must go to
the mortgagee as security Saila Bala v. Stvarna Moyee, A.I.R. 1939 Cal.
275 (277), 68 C.L.J. 528, 181 I.C. 867. But if the interest of the recorded
persons is that of licensees or tenants-at-will, there is no accession to the
mortgaged property if the mortgagee acquires the interest by buying those
persons out and the landlord on redemption is entitled to the possession of
the plots in their original condition, because he can bring about the
disappearance of 'these persons without any costs Gaya Prasad v. Ram
Prasad, A.I.R. 1939 Pat. 358, 179 LC. 923.
89
[SEa 71
^xAred Pickering v. Bowels, 1 Br. S' J;:' the old one Rflfcestrota v.
was not to, commence till after fteexpira ^ na^re
Sec. 72]
Rights of as is
mortgageo ncc6ssa.ry
in posses-
sion.
it * ft * it it
[Sec 72
property from being sold for arrears of revenue had an additional charge
on the property for the sums so paid by him, although he was not a mort-
gagee "in possession" Rakhohari v. Biprodas, 31 Cal. 975 ; Upendra y.
Tara Prasanna, 30 Cal. 794. The Bombay High Court also held that this
section could not be taken to imply that a mortgagee not in possession
had no similar right to charge the mortgaged property for payment made
by him in relation to the security and to add the amount to the original
loan Nadershaw v. Shirin Bai, 25 Bom.L.R. 839 (843), A.I.R- 1924 Bom,
264. So also, in an old Privy Council case it was held that a mortgagee,
who was not a mortgagee in possession, had a right to tack to the mortgage
the amount of revenue paid by him to save the estate Nagendra Chunder
V. Kaminee, 11 M.I.A. 241 (259).
These words have therefore been omitted from the present section.
t Sec. 72
T iC 5, Ai.R.iSarpc^i"
Clause (a) omitted ; Clause (a) relating to expenses for the manage-
ment of the property and the collection of rents and profits has been
transferred to clause (/i) of sec 76. \
Dur Naiaf Ali. 13 All. 195 ; Imdad Hasan v. Badri Prosad, 20 All. 401
(408); rL Semk v. Naik. 45 ^ 388
Sec. ? 2-1
.The right of the mortgagee imder this clause will be subject to the
obligation imposed upon him by sec. 76 (c). This section imposes an
obligation to pay the revenue and Government charges when they, can
be paid out of the income. If they can be so paid, the mortgagee cannot
recover them under this section as a lien upon the property. It is only
when they cannot be paid and the mortgagee has paid them out of his
own pocket that he can recover them as a lien under this clause Farzand
AH V. Kaniz Fatima, 22 O.C. 270, 54 I.C. 264.
The word sale in this clause is a sale ejusdem generis with destruc-
tion and forfeiture, that is, a sale by which the mortgagees security is
likely to be imperilled. It does not, therefore, contemplate a sale merely
of the equity of redemption. This section includes only payments made
to save tihe security itself Venkata Narasimha v. Kuppa, 40 M.L.J. 524,
63 I.C. 24 (per Ramesma J. ; Spencer, J. contra) ; Hardeo v. Deputy Com-
missioner, 1 Luck. 367, A.I.R. 1926 Oudh 281 (286) ; Rajendra Prosad v.
Bahuria, 1 P.L.J. 589, 38 I.C. 232; Sheo Dulare v. Batasha, 16 O.C. 48,
19 I.C. 744. In other words, a sale which does not affect the interest
of the mortgagee is not covered by this section Gaya Prosad v. Gur Dayal,
22 O.C. 32, 51 I.C. 549. In Allahabad, however, a sale merely of the
equity of redemption is not permitted where the property is subject to a
usufructuary mortgage, but the entire property is sold, and therefore a
usufructuary mortgagee paying off a decree for sale of the proi)erty can
be said to have saved his security from sale, and is entitled to tadc the
amount so paid to his mortgage-money Abdul Qayymu v. Saddruddin,
27 All. 403. Where a prior mortgagee deposited money under O. 21 r.
89 to set aside a sale made at the instance of a puisne mortgagee, he must
be allowed to add the amount to the mortgage-money, because the sale
proclamation piurported to sell not merely the equity of redemption but
the entire property Jagannath v. Jagjiwan, 28 O.C. 221, A.I.R. 1925
Oudh 429 (431).
t&c. 72
i. f ,^k s
AJ.R. 1924 Bom. 264, 87 LC. 129 ; see also Sir Md i/za
Ah, A.I.R. 1941 Oudh 498 (501). 1941 0.^\^N. 768, 19410 615 m4^
Setteyya v. MuUlai, A-LR. 1955 Andhra 274. mere the mortsagors
impeached (e.g. by tenants) the costs incurred by the mortgagee in desad-
mg such title constitute a charge upon the propertj^ mortgaged PaW
Salieb V. Pokree Beary, 21 Mad. 32. '\\Tiere the mortgagee had to teVa
criminal proceedings against persons disputing mortgagors tide and setting
up the title of a stranger, he could recover the costs from the morteacor
Venkataswami v. Muthusami, 34 MX.J. 177, 45 LC. 949. Bui -rrhere a
mortgagee with knowledge that a third person had an interest in the mort-
gaged property accepted a mortgage of the property, he cannot claim from
the mortgagor the costs incurred by him in the litigation for opposing die
claim of that person Rmn Ditto Md v. Karm Devi, 190 PX.R. 1912 17
I.C. 243.
TLR 19^ Nag! 366. Thus, where the mortgagee has spent ^
Sec.
and obtaining possession of the patni under sec. 13 of the Bengal Patni
Regulation, 1819, can under this section, add the subsequent payments
made by him for head rents of the yatni, to his original deposit Midnapur
Zemindary Co. v. Saradindu, A-LR. 1948 Cal. 250, 52 C.W.N. 724. So
also, where the ' mortgagee had to institute criminal proceedings against
the tenants who had cut oS and carried away the crops on the land assert-
ing the title of a stranger as owner, he was entitled to recover the expenses
of the prosecution by bringing a suit against the mortgagor or his heir
personally Venkatasami v. Muthusami, 34 M.L.J. 177, 45 I.C. 949. The
mortgagee can elect either to sue for the money separately or to add it
to the mortgage-money under this section. Consequently when he has
obtained a personal decree for such sum, he cannot add it again to the
mortgage-debt Imdad Hasan v. Badri Prosad, 20 All. 401 (408). If he
relinquishes his lien for the sum spent, he cannot afterwards enforce it;
but he is not precluded from bringing a suit to recover the money personally
from the mortgagor. Thus, where the mortgagor deposited in Court
under sec. 83 the mortgage-money only but not the money paid by the
mortgagee for Government revenue, and the latter accepted the deposit
and gave up possession of the property, held that he could' not afterwards
sue for the recovery of the amount by sale of the mortgaged property,
but he might bring a simple money suit for the amount Anandi Ram v.
Dur Najaf Ali, 13 All. 195.
Under the English law, the expenses cannot be recovered from the
mortgagor personally, by a separate suit, except where there is an express
agreement by the mortgagor to that effect. The mortgagee can only add
the money to the mortgage amount .'parte Femngs, 25 Ch. D. 338 ;
Lacon v. Merlins, 3 Atk. 1. The same "view has been taken in Sheo Dularf
V. Batasha, 16 O.C. 48, 19 I.C. 744 ; Jagennath v. Jagjiwan, 12 O.L.J. 289, and
Nadershaw v. Shirinbai, 25 Bom. L.R. 839, A.I.R. 1924 Bom. 264, 87 I.C.
129. But see Bhuneswari Devi v. Sheogovind Loll Missir, A.I.R. 1963 Pat,
185 where it has been laid down that a separate suit for reimbursement
under sec. 69 of the Contract Act has not been barred by this section.
449. Interest ; ^All money spent under this section by the mort-
gagee shall carry interest at the same rate as the principal, and where no
such rate is fixed, at 9 per cent, per annum. The interest shall be calculat-
ed from the time the expense was incurred Quarrel v. Beckford, 1
Maddock 281 ; Gaya Prasad v. Gur Dayal, 22 O.C. 32, 51 I.C. 549. The
interest shall be simple and not compoimd Kishori Mohun v. Ganga
Babu, 23 Cal. 228 (P.C.). See also Sakharam v. Ram Chandra, A.I.R. 1951
Bom. 19, I.L.R. 1951 Bom. 209. No interest is allowed on money spent
on improvements Ibid; Bhabhanbai v. Kanii Ravji, A.I.R. 1950 Kutch
90. Where the mortgagee is in possession but the mortgage is not a
usufructuary one the interest on the cost of improvement will have to be
calculated Ibid. A mortgagee is, in the absence of a contract to the
contrary, entitled to interest on the money paid in respect of the Govern-
90
[Sec.
Insurance : ^The last two paras of the section are taken from sec.
101 (1) () of the English Law of Property Act, 1925.
Sec. n ]
tEC.
I. fj
Bipin Behari, AJ.R. 1938 Pat. 176, 16 Pat. 299, 174 LC 474 ti,. .
sale, m execution of a rent-decree under sec. 152, Oudh Rent
^ under-propnetary holding which has been mortg^ed by f
debtor passed only the interest of the judgment debtor, i.e. his efe ^
redemption ; that is, the holding is not sold free from incumbrance-s^
consequently this section has no applicatiQn-A/rotam v.
Where a Zamindar mortgages his zamindary with his sir lands, and by
losing his Zemindary rights becomes an exproprietary tenant in respect
of the sir lands, the usufructuary mortgage does not become ineffectaal
and takes effect as a mortgage of the ex-proprietary ti^tsShamsher v
Lad Batuk, A.LR. 1953 All. 147.
This section applies also where the lien instead of being actually
destroyed is in jeopardy. Thus, where the properly is sold with power
to avoid all incumbrances, -as in a rent-sale under sec. 167 of the Bengal
Tenancy Act, the mortgagee may abandon his lien upon the mortgaged
property and claim to realise the demands from the surplus sale-proceeds
(even though the purchaser has not yet avoided the incumbrance)~JViw
Chand v. Asutosh, 9 C.W.N. 117 (118). Whether the-property is sold with
or without the power to annul incumbrances, in either case the mortgagee
has a right to claim pa3mient out of the surplus sale-proceeds. The mort-
gagees right under this section is not affected by anything contained in
secs. 159, 161-169 of the Bengal Tenancy Act~Gobind Sahai v. Sibdut,
33 Cal. 878 (880).
The remedy of the mortgagee is not confined only to the surplus sale-
proceeds, So, where a property is sold for arrears of rent with power to
annul all incumbrances, then so long as the incumbrances are not y^idly
annulled under sec. 167, Bengal Tenancy Act, the mortgagee has a rigt to
proceed against the property in the hands of the
Chandra v. Jagabandhu, A.I.R. 1929 Cal, 392 (394), 113 I.C. 904.
Sec, 73 ]
that the rule in this section would equally apply if the security was other-
- wise destroyed, e.g., if the 'property was taken under the Land Acquisition
Act. In such a case the mortgagees right in the land so acquired was trans-
ferred to the compensation money and he could lay claim to the said
money. Viraraghava v. Krishnasami, 6 Mad. 344 ; Jotoni Chowdhurani
V. Amar Krishna, 13 C.W.N. 350, 1 I.C. 164 ; Venkatarama v. Esumsa, 33
Mad. 429 ; Prag Din v. Nankau, 7 O.W.N. 217, A.LR. 1930 Oudh 292
(294), 123 I.C. 56. Thus, were during the pendency of a suit by the
mortgagee in which he obtained a preliminary decree, a part of the mort-
gaged property was compulsorily acquired under the Land Acquisition Act,
the mortgagee was held to be entitled to an injunction restraining the
mortgagor from taking the purchase money out of the hands of the Land
Acquisition CoUectovAsutosh v. Babu Lai, 5 P.LJ. 650, 59 I.C. 513, 2
P.LT. 110. (Contra Basa Mai v. Tajammal, 16 All. 78). Where a charge
is created by a decree other than a compromise decree, the decree holder
can claim like a simple mortgagee payment out of the amount due to the
judgment-debtor as compensation Shah Safitil Alam v. Syed Shah
Mohammad Aminul Alam, A.I.R. 1969 Pat 162 ; Nirmal Sundari v.
Mrinalini, 63 C.W.N. 869.
The new sub-section (2) gives effect to this view ; see Girdhar Lai v.
Alay Hasan, A.LR. 1938 All. 221 (227) (F.B.), (1938) A.L.J. 313, 174 I.C. 70.
A mortgagee can bring a suit to enforce his security as against the
compensation money withdrawn by the mortgagor provided that he brings
his suit within 12 years of the cause of action as prescribed by Art. 132
of the Limitation Act. Sec. 68 is inapplicable to such a case Girdhar Lai
V. Alay Hasan, supra, at p. 226. Where, however, only a portion of the
mortgaged property is acquired and the mortgagee brings a suit after 6
years but within 12 years of the cause of action for sale of the mortgaged
property and for a simple money-decree for the compensation money, the
proper decree to be passed is a decree for sale of the available mortgaged
property under O. 34, r. 4, with a direction that in' the event of the non-
realization of the entire mortgage-debt by sale the mortgagee will be
entitled to a simple money-decree for an amount not in excess of the
amount withdrawn Ibid, at p. 227. The West Bengal Estates Acquisition
Act is an enactment providing for the compulsoiy acquisition of immovable
property as mentioned in sec. 73 (2) Abdul Khaleque v. Medaswar Hosain,
A.LR. 1967 Cal. 56.
In some cases it was held tiiat if the mortgaged property was taken
under the Land Acquisition Act, the property was to be considered as
destroyed within the meaning of sec. 68, and the mortgagees remedy was
to require another security from the mortgagor, in default of which, he
was to sue for the mortgage-money Sajjada v. Janki, 20 O.C. 256, 42 I.C,
793 ; Prakash v. Hasan Banu, 42 Cal. 1146 (1152).
453. Mortgagees remedy : In the old section it was said that the
mortgagee had a "charge" on the surplus sale-proceeds; in the present
section the word charge has been omitted, and it is provided that the
mortgagee can claim payment out of the sale-proceeds.
[Sec. 73
The new section ^ves to the mortgagee rights asain^t tiiP eui
proceeds. If the sale is of the whole estate, then the rights given under ftis
Sec, 73]
Where the mortgaged property has been sold for arrears of revenue,
the mortgagee will be entitled to the surplus sale-proceeds not only in the
hands of the Collector, but also in the hands of certain money-decree
holders of the mortgagor who have drawn out the sale-proceeds from the
Collectorate Gosto Behary v, Shib Nath, 20 Cal, 241 (244).
[Sec. 76
the liability of being sued in case the mortgagee finds any difficultv in
getting himself paid. The unsecured creditors are not entitled to draw
any portion of the sale-proceeds, even though they leave enough in the
hands of the Collector Gosto Behary v. Shib Nath, 20 Cal 241 (244)
Where a puisne mortgagee, not a party to a suit by the prior" mortigee
intervenes at the stage of the sale and the security is sold subject to the
puisne mortgage, the puisne mortgagee cannot claim payment out of the
surplus sale proceeds fayaben v. Bhanumati, A.I.R. 1969 Guj. 222.
74-75. [Omitted.']
Sec. 76]
91
722 TRANSFER OF PROPERTY
[Sec. 76
mortgagor whm
the latter failed to pay the money on the date, held that this secS
Sec. 76]
the mortgagor, possession can be retained by such person against any one
including the landlord till the dues under his mortgage or charge are paid
Greet v. Gangaraj, A.I.R. 1937 Cal. 129 (138, 139), I.L.R. (1937) 1 Cal. 203,
170 I.C. 214.
[Sec. 76
to SpfloJ ta Of 0 d
the managing the lands ; and he is not in any sense dependent upon
after the mortgage has been redeemed. But the lease cannot continu
JSec. ? 6 ]
apply the income of any year to the purchase of subordinate tenures for
the purpose of enhancing the value of the security Mfdnapur Zemindary
Co. V. Saradindu, A.LR. 1948 Cal. 250, 52 C.W.N. 724. A mortgagee in
possession of a shop can let it out and lie appertaining room on a monthly,
tenancy, and the tenant does not become a trespasser after redemption
of the mortgage Hardei v. 'Wahid Khan, A.I.R. 1954 All." 16. But where
a mortgagee in possession was not authorised to change the incidents of
the bhaoli holding, a commutation of the bhaoli rent into nagdi and its,
amalgamation with other lands would not be binding on the mortgagor
after redemption //laffci v. Bachti, A.I.R. 1950 Pat. 246, 29 Pat. 180.
Where the mortgagor allows the mortgagee to let the mortgaged premises
on hire he cannot make vacant possession as the condition precedent for
the tender of the mortgage money Abdul Hamid v. Manilal, 1968 M.P.L.T.
451.
[Sec. ?6
Sec. 76]
467. Clause (c) ^Payment of revenue : ^Even before the Act a mort-
gagee in possession was bound to manage- the property as a person with
ordinary prudence would manage as if it vere his own, and unless there
was an agreement to the contrary he was bound to pay out of the income
of the properly the Government revenue and such charges of a public
nature as might accrue due in respect of the property and be payable by
the person in possession of the rente and profits, and he was not entitled
to charge such paymients against his mortgagor in the.accoimts Mirza
Abid Hussain v. Mt. Kaniz, A.LR. 1924 P.C. 102 (106), 46 All. 269, 51 LA.
157, 29 C.W.N. 214, 80 I.C. 1019 ; Rameshtoar v. Naramdeshwar, A.LR.
1940 Pat. 627. .But where under the terms of the mortgage-deed as well
as those of a lease of the mortgaged properties taken from the mortgagee
by the mortgagor the Government revenue was payable by the latter, but
had actually to be paid by the mortgagee, he . is entitled to add the samel
for the purpose of ascertaining his total dues under the mortgage Sahib
Chandra v. Lachmi Narain, A.LR. 1929 P.C. 243 (245), 51 All. 686, 56 LA.
339, 33 C.W.N. 1091, 119 LC. 612. This clause is the counterpart ofi
clause (c) of section 65. In the absence of a contract to the contrary, the
mortgagee in possession must pay revenue and other public charges in
respect of the mortgaged property, and he is the person primarily respon-
sible for payment of the same. He has no right to appropriate the income
without paying- the revenue Md, Hadi v. Parbati, 25 O.C. 2, A.LR. 1922
Oudh 91, 68 I.C. 549 ; Kannye v. Nistarmi, 10 Cal. 443 ; Kundanmal v.
Kashibai, 26 Bom. 363 ; Vithal v. Sriram, 29 Bom. 391, 7 Bom. L.R. 313.
A Kanom deed could not be read as embodying a contract to the contrary
to the provisions of this section and where the revenue payable to^ the
Government was increased, the kanomdar and not the jenmi was liablci
to pay the enhanced revenue Sankunni v. Tavazi, A.LR. 1943 Mad. 627,
(1943) 2 M.L,]. 127. Where at the time of the execution of the mortgage,
no revenue was assessed on the land, but it was subsequently assessed, the
mortgagee in possession was bound to pay the revenue Md. Hadi v.
Parbati, (supra). If owing to the default of the mortgagee in paying the*
revenue, the properly is sold away, the mortgagor would not lose his right
of redemption Kalappa v. Shivayya, 20 Bora. 492 (494) ; Lakshmaya v.
Appadu, 7 Mad. Ill (112). Where the mortgaged property is sold for
arrears of rent due to the mortgagees default and is purchased by the
mortgagee himself, the mortgagor is entitled in equity to redeem the
mortgage /atfcanm v. Shea Kumar, A.LR. 1927 All. 747 (748), 103 LC.
370. This decision has been distinguished by Harris, C.J. and Agarwala, J.
TRANSFER OF.PROFfiRtV
[ Sec. 76
of fte Patna Hi^ Court in a case, where the landlord was the Durch
at the rent sale, but later on it came into the hands of the mortgaeee anJ
the mortgagor claimed redemption, on the ground that the Stv j
redemption had for ever been extinguished and did not reVive whe^tJ!
mortgagee eventually obtained the property FeAiHa v Babn Lai 1R Uf
133, AiR. 1939 Pat. 382, 183 I,C 374. Wte on dei
to pay the revenue, the mortgagor pays it in order to avert the forfeiture
or sale of the property, he may take credit for the amount when the
accounts are adjusted and sue him every year in order to force him to
make regular payment /ai/ft Rai v. Govind. 6 All. 303 ; Hari v. Sridhar
10 N.L.R. 9, 23 I.C. 131. If the mortgagee fails to pay the revenue and the
mortgagor pays it, he is entitled to be reimbursed not only for the money
expended .but also for the interest, thereon by way of damages Krishan v
Ambu Kuruv. 51 M.L.J. 633, A.I.R. 1927 Mad. 59, 98 I.C. 802, even where
at the date, of the mortgagors, suit for .-.recovery of the .amount, a prelimi-
nary decree, had been passed in his -suit for redemption against the mort-
gagee and R . final decree was passed-, later on, because the mortgage-deed
subsisted at the. date of the mortgagors suit for recovery of the amount
Duraiswanii v. V.enkata Reddy, A.I.R. 1940 Mad. 283, 50 M.L.W. 889. In
such a .case the .mortgagee will be debited with the loss caused to the
mortgagor and the; compensation. will be allowed for the whole period of
the accounting-r-Misri, Ld v, Gajodhar, A.I.R. 1943 Oudh 433, (1943)
O.W.N. 3.47. But unless .the mortgagee has actually collected rents or
profits for a period prior to his getting into possession or unless he is so
authorized to.- do,; the mortgagor must pay the revenue for period prior to
the possession; of. the mortgagee Jagat v. Sheonarain, A.I.R. 1938 Pat, 196
(198), 174 I.C. 1001. . . ,
The mortgagee, however is not bound, in the absence of an express
contfacjt, to pay enha7iced revenue if the enhancement is made subsequently
.to his mortgage. Such enhancement must be paid by the mortgagor
Krishnier v, 'Arrappulli, 14 M.L.J. 488 ; Panigattan v. Raman Nair, 17
M.L.j. 517 i.Thippa v. Krishnaswami, 9 M,L.T. 206, 8 I.C. 845 ; Panambatta
V. Kalathipodkil, 16 M.L.T, 317, 25 LC-. 641 ; Hari v. Sridhar. 10 N.L.R. 9.
(But see contra Tuppari Nufnbu'dri v. Chinna Pari Kutti, 18 M.L.J, 31 :
Nathuwath y. ' Kolli Vallapil; 22 M.L.J. 151, 12 LC. 140; Nanu Nair
Ashta'Mbdrjtk. 2^ M.L.7. 772; 29 LC. 386; Vesteva v. Mahabala,
SEC.:?63
lord which are not actually paid by him Prosanm v. Girish, A.I.R. 1934
Cal. 149 (150), 37 C.W.N. 1162, 149 LC. 667. So also, in case of enhanced
revenue, if the mortgagee pays it out of his own funds, he will be entitled
to tack the aipount to his mortgage-money fCojnayya v. Devapa, 22 Bom.
440 ; Bohra Thakur Das v. Collector, 28 All. 593.
This clause does not apply where there is an express contract to the
contrary, e.g., where the deed of mortgage distinctly provides that the
Government revenue shall be paid by the mortgagor. In such a case the
mortgagee will not be bound to pay the revenue, and' if the properly is sold
on account of the reyenue falling into arrears, the sale cannot be set aside
Ooppath Naramparambath v. Koya Kutti, 29 LC. 344. So also in the
case of enhanced revenue, although the decisions are not consistent as
to which party is liable to pay it in the absence of any express contract (see
supra), there can be no question that if the mortgagor expressly undertook
the liability to pay the enhanced revenue, he must pay it, and cannot at the
time of redemption claim the difierence between the original and the
enhanced rate that he had to pay Akbar Khan v. Kali Bhan, 39 LC.
437 (Oudh). .
This section deals with the relative ri^ts and duties of the mortgagor
92
[ Sec. 76
and mortgagee and a third party, e.g., the landlord cannot recover
for the Port of Calcutta, LL.R. (1938) I' Cal. 21, 41 C WN 114^.? "^
Even where no money was left with the mortgagee to pay the arrears
of rent, the mortgagee is boimd to pay the rent during the continuance of
the mortgage and in case of default he cannot take advantage of it and pur-
chase the property in the name of a benamidar Narain v. Mahant, A.I.R.
1952 Pat. 421. See also Bira Naik Mahanta Sidhakamal, A-I.R. 1951 Or.
300, I.L.R. (1949) 1 Cut. 21.
468. Clause (d)'; Repairs ; ^Under this clause, his. duty to make
the repairs lies to &e extent of ,tiie surplus rents and profits in his hands
Rickards v. Morgan, (1753) 4 Y. & C. 570 Appx. It is a paramount
duty of the mortgagee to m^e the necessary repairs out of the surplus
profits, and the Court will not accept the excuse that, to do so would
diminish his interest or profits Devi v. faru, 15 Mad. 290 (291). If
he fails to make the necessary repairs, the amount of the loss cau^d to the
mortgagor by such non-repair is an item which must be considered in
determining the accounts in settlement of the mortgage at the time 01
redemption Shiva Devi v. Jam, supra. The duty, of the mortgagee to
make repairs arises only if he is in actual possession of the pro^rty,
therefore where the' mortgagee instead of taking possession leased the
property to the mortgagor, held that not having been in possession he was
not liable for damages for neglecting to keep the house in repair Baqua
Ali v. Nisar Husain, 1885 A,W.N. 262,
EC.
repair, it is not concerned with the question of priorities dealt with by sec.
76(h) ; hence there is no conflict between sec. 76(d) and sec. 76(h) Anand-
ram Jivraj v. Premraj Mukunddas, A-I-R. 1968 S.C. 250. Mortgagee is not
bound to repair if there is no surplus after deducting interest and public
chaxg&sLaxmiatmna v. Narasimha. 11 Law Report, 767.
Under this section a possessory mortgagee is entitled to make cons-
tructions on the land independently of any contract, provided it does not
amount to waste. The amount spent on such construction is recoverable
as mortg^e-money at the time of redemption Rukmangal v. Mt. Durga,
A.I.R. 1946 Oudh 101, 21 Luck. 43. But see Venkatashiah v. Venkata-
krishnah, A.LR. 1958. Mys.. 20 where it has been held that the money
so spent cannot be recovered.
The mortgagee is prevented by this clause from doing any act likely
to destroy' or injure the property. Thus, he cannot cut down any trees
which already existed on the property when it was mortgaged ; but the
removal of trees planted by the mortgagee himself is not an act destructive
or permanently injurious to the property Ratnchandra v. Shripati, 50
Bom. 692, A.I.R. 1929 Bom. 595 (596), 99 LC. 400 ; Krishna v. Srinivasa,
20 Mad. 124 (127, 128). Cutting of timber and clearing the ground for
purposes of improvement will not constitute waste. If the trees have
existed before possession was made over to the mortgagee the mortgagor
will have the right to value the trees cut Chandi v. Thomman, A.I.R.
1951 Tr.-Coch. 109. The Babul tree when cut down does not grow again
from the trunk. Having regard to its uses it is "timber and the cutting
of it by the mortgagee amounts to an act of waste Ram Kumar v. Krishna
Copal, A.I.R. 1946 Oudh 106, 21 Luck. 48. There is however no prohi-
bition in this clause against taking the wood of a fallen tree which fell
from natural causes. Such wood is part of the profits of the property and
a mortgagee in possession is entitled to take the profits Durga v. Ganga,
A.LR. 1932 All. 500, (1932) A.L.J. 493. It the land is not agricultural
land, it cannot be said that the utilify of the land has been injured by the
tree-roots or stumps remaining on the land after the removal of the trees
planted by the mortgagee Ratnchandra v. Shripati, (supra). The mort-
gagees act of cutting bamboo-clumps planted by the mortgagor amounts
to waste, unless the bamboos were of a mature age and ripe for cutting.
The cutting of bamboo of a particular class may amount to sayer produce
like the cutting of jungle, and does not constitute an act of waste Mahabir
V. Sheoshankar, 112 LC. 434, A.I.R. 1929 Oudh 124. But while the mort-
gagee is forbidden to commit ruinous acts, he is not liable for the losses
caused by accident or vis major, e.g,, loss of the mortgaged premises by
accidental fire. In such cases, the mortgagee is not only not liable for
the loss, but is, on the other hand, entitled to get an additional security
from the mortgagor and in default to recover the mortgage-money (sec.
68) Venkataswara v. Kesava Chetti, 2 Mad. 187. The. mortgagee is liable
for the timber value of the trees Aat fall during his possession due to
natural causes if he neglects to give notice to the mortgagor asking the
latter to remove the trees Nani Kunjukrishna v. Padmanava Pillai, A.I.R.
t Sec. ?6
money. .
Under section 72, the mortgagee can insure -the mortgaged prmses
for an amount not exceeding two-thirds of the
this duty when he receives two-thirds only of the value of the property,
is a puzzle for which I do not pretend to be able to give you any solution.
The fact that a similar provision is found in the English Coveyancing
Act, from which this section is borrowed almost word for word, may
account for its finding a place in the Indian Act, but cannot help us in
solving the difficulty Ghoses Law of Mortgage (5th Edn.), pp. 575-576.
This clause does not apply where the insurance was made neither by
the mortgagor nor by the mortgagee but by the Receiver appointed by
the Court in the mortgage-suit. If in such a case the property is destroyed
by fire before it was brought to sale in execution of the mortgage-decree,
and the Receiver obtained a large sum of money under the policy, held
that the money received by the Receiver was not subject to the terms of
the mortgage-deed, inasmuch as the insurance was kept oil foot by the
Court through the Receiver as a matter of protection for the benefit of
all persons who were parties to the mortgage-suit, and not by the mort-
gagor or mortgagee in accordance with their contract in the mortgage-deed.
The Court had ample discretion in directing in what manner the money
so received should be laid out, and the mortgagor could not claim that it
should be laid out in restoring the premises that had been destroyed or
damaged by fire Seth Dooly Chand v. Raineshwar Singh, 40 I.C. 623
(Cal.).
[Sec. 76
A T-R 1941 Oudh 84 1941 O.L.R. 13. If foe mortgagee refuses or neg
fe"Lvert 4 accounts, foe Court must take foe best evidence
Sec. 76]
available and decide upon it. The general presumption will no doubt
be against the mortgagee, but tliis would not justify &e Court in accept-
ing without examination any evidence which may be ofEered by the mort-
gagor Ghoses Lato of Mortgage, 5th Edn., p. 598 ; Muhammed v. Uttam-
chand, 63 I.C. 598 (600) ; Allah Yar v. Thdkur Das, 24 P.L.R. 1918, 44
I.C. 9 ; Gholam Nuzuf v. Emantim, 9 W.K. 275.
[Sec. 76
fbr SSL
Sec. 76]
472. Clause (h) : ^Under this clause the mortgagee is bound to apply
the rents and profits, after deducting the expenses herein mentioned, in
discharge of the interest, and in reduction of the principal money if pos-
sible. The rule has been thus stated: Tlie gross receipts, whether they
arise from the rents or fiom accidental payments, are Ascertained at the
end of each year, and after deducting die necessary outlay on account
of revenue, expenses of collection and preservation of the estate, the
balance goes to reduce, either in whole or in part, the interest and if
tiiere is a surplus over, it goes to die reduction of theprindpal money,
the account being closed at the end -of each year" Ghoses Law of
Mortgage, 5th Edn., p. 594; Muhammad,- v. Uttam Chand, 63 I.C. 598
(Lali.) ; ' Jaiiit Rai v. Gobind, 6 All. 303. If the mortgage-debt is fully
paid off out of the usufruct, and die mortgagee thereafter continues to
remain in possession and to receive the profits, he is said to avail him-
self of another mans money for his own use and benefit, and ought to be
charged with interest from the time at which the mortgage-debt was
satisfied Bhat/alal v.Mahomed Hakim, 51 I.C. 294 (Nag.). Tlie Allaha-
bad High Court holds that no interest is payable on the surplus money
found with die mortgagee after the satisfaction of the mortgage, till the
date of the institution of the suit for redemption. But after the institu-
tion of the suit such interest is payable by the mortgagee. Tlie institu-
tion of the suit is really a notice to the mortgagee calling upon him to
hand over the surplus money. From that date the mortgagor will be
93
ISec. 76
^ ^ c),
Tlie mortgagees will be debited not only with the profits actuaHy
received by them, but also wudi the profits which they could have real-
ised but for negligence and carelessness. Even though there fe a stipu-
lation in the mortgage-deed that if the profits of the mortgaged
be found to be insufficient to cover the interest, the mortgagor shau pj
the deficiency, such stipulation can apply only to the case "Jere
profits of the property have decreased and not to tlie case whae die m
Uees oiving to tliir own drfanlt have failed to P'f ^
nSm Dei V Sfier Singh, 1929 A.L.J. 217, A.I.B. 1929 AE 260 (285), 114
I.C. 876.
Sit acts rightly in making the account on the principle laid down m
. Sec. 76]
clause. But the sub-mortgagees are not liable to account on the basis of
the original zarpeshgi deed, because there is no privity of contract bet-
ween them and the original mortgagor and the decree for payment of
money cannot properly be made against them, though the mortgagors
decree for recovej-y of possession AviU of course be valid against them
Bacilli Lai v. Jang Bahadur, A.I.R. 1939 Pat. 427 (428), 180 I.C. 795.
[Sec. 76
Sec. 76]
7 (26, 27) A.I.R. 1923 Mad. 533, 44 M.L.J. 534, 72 I.C. 292.
Tlie word expenses. /in' this clause should riot be restricted to what
has to be spent for the management and collection of rents and profits.
The mortgagee is not entiled to the credit for pubh'c taxes which he
paid after the amount due under the decree was tendered by the
mortgagor Rajagopala v. Pandithan, A.I.R. 1946 Mad. 464, (1946) 1
M.L.J. 392. Where the mortgagor brings a suit for redemption and
accounts on the ground that the debt has been satisfied out of the profits.
[Sec. 76
iy52 Fat. 155. The word receipts in sec. 76(i) does not
Mortgagee Uable for loss : -Tlie last para makes the mortgaBee
hable for loss occasioned by failure on his part to perfom any J K
duties imposed upon him by this section. If a portion of the morteaS
propeiiy is lost owing to some default on his part, and he is theiefoe
unable to put the mortgagor in possession of that portion at the time of
redemption, the mortgagee will be debited with die value of the knd
in taking the mortgage-accounts Gopcla Jfejion v. Narauana 5 LW
539, 40 I.C. 70.
Wliere the mortgagee in possession obtained .a decree against tiie
lessee of the mortgaged property but failed to execute it, he must mdce
good to the mortgagor tlie loss caused by such failure alAough the leasa
had been eflFected by the mortgagor Chflndra v. Dwarke, A.I.R. 1936 Lah!
42 (44), 161 I.C, 984, Tlie stipulation in a mortgage-deed that if the
profits be found to be insufficient, the mortgagor shall pay the deficiency
in interest from year to year, does not apply to a case where die profits
have not in fact decreased, but the mortgagees have owing to dieir own
default failed to recover them Mt. Ratan Dei v. Sher Singh, A.I.R. 1929
All. 260 (263), 114 I.C. 876.
Tlie last para enables tlie mortgagor to set off any loss suffered by
him owing to die mortgagees default in the same suit ; a separate suit
for such account is not necessary Shiva Devi v. Jaru, 15 Mad. 290 (291).
The question must be dealt widi in die suit itself and must not be lett
to be determined in execution Gopala Menon v. Narayana, supra.
Tlie last para provides ivith only a cumulative remedy and is not
intended to operate as a bar to any other remedy which the mort^^r
may have under the law Sitxi Chidambara v. KamaMn, m Mad. a
(73). Thusi where the mortgaged property has been sold away owing
to die mortgagees default in payment of a^ears or revenue, the mort-
gagor may either at die time of passing of the decree for pdemp
ask that the mortgagee be debited with die loss imder the las p
sec. 16, or he may bring a separate suit fof compensation for 10
land Sio Chidambara v. Kamatchi, supra. So also, where th ^
gagee causes loss to- the mortgaged property m his ^
dEC. 11]
the loss when tjiking . accounts at the time of redemption. Tlic word
may in tlie last para of this section has not the force of must Mahabir
V. Sheo Shankar, A.I.R. 1929 Oudh 124 (125), 112 LC. 434.
Under the last paragraph the mortgagee is liable to account not only
for the income but also for tire corpus Chen Sankar Lai v. UnifechBank
of India Ltd., A.I.R. 1955 Cal. 569. A mortgagee is not entitled to
deduct the cost of cultivation of the mortgaged land under sec. 76 (i)
Narain Prasad Singh v. Radha Kant Prasad Singh, A.I.R. 1967 Pat. 5.
77. Nothing in section 76, clauses (6), {d), (g) and (/i),
Receipts in lieu of applies to cases where there is a contract
between the mortgagee and the mortgagor
that the receipts from the mortgaged property shall, so long
as the mortgagee is in possession of the property, be taken in
lieu of interest on the principal money, or in lieu of such in-
terest and defined portions of the principal
'47S. Scope of section : This section refers only to clauses (6), (d),
(g) and (h) but omits clause (c) of sec. 76 which makes it obligatory upon
the mortgagee to pay the Government revenue, etc. Misri Lai v. Gajdhar,
A.I.R. 1943 Oudh 433, (1943) 0;W.N. 347. Where the entire receipts
from the mortgaged property are not appropriated by.him in lieu of interest
or of interest and defined portion of the principal, the mortgagee is not
entitled to the benefit of this section Rameshwar v. Rama Asrey, A.I.R.
1942 Oudh 499, (1942) O.W.N. 556.
[Sec. ^7
1941 Oudh 380. 1941 O.W.N. 687, 1941 OX.R 46? {94 S
Clauses (g) and (h) of sec. 76 are absolute in their terms anH a.-
qualified by any contract to the contrary. The liability of a mortEaL"^
possession to render accounts and give credit to the mortgaeor^S Ml
receipts after deduction of expenses is absolute, and the mortgagee cann.
contract himself out of it unless he can bring himself strictly within I
exception provided by the present , section Mf. Faridmessa v Sir Mrf
Ej 0 s Rasool, infra. In this case it was held that the mortgage-deed did
not come within the exception provided by this section as the interest on
the principal plus interest up to the date when the mortgagee took posses
sion was more than the income of the property, and the provision in the
deed depriving -the mortgagor of his right to account, it was held, could
not confer any advantage upon the mortgagee in derogation of sec. 76.
This section only comes in where the mortgagor is from the outset
safe from being confronted at the time of redemption with a demand
for anything more than the principal sum advanced. -It does not cover
the case in which only a part of the interest is to be paid out of the
usufruct Katnala Prasad v. Bamdeo, A.I.R. 1935 Pat. 148 (149), 155 I.C.
22 ; Mf. Faridunnissa v. Sir Md. Ejas Raspol, A.I.R. 1942 Oudh 203, (1941)
0. W.N. 1378, 198 I.C, 234. See in this connection Thakan v. Rampartap,
A.I.R. 1950 Pat. 201 and Sundaram v. Matinadiar, A.I.R. 1947 Mad. 197 ;
1, L.R, 1947 Mad. 411. Where the terms of the usufructuary mortgage
were that the mortgagees were to receive the profits in lieu of interest,
to pay to the mortgagors nothing but malikana and that they were not
accountable to the mortgagors otherwise, held that the mortgagees were
not bound to account to the mortgagors and that the mortgagors were
entitled to redemption on payment of the principal money after deducting
the malikana for the years for which it was not paid by the mortgagees
.Bekari Lai v. Siblal, 46 All. 633, A.I.R. 1924 All. 591, 82 LC. 25. Where a
katkobala provided that the lands were to be kept in kat for 9 years, that
during the time the mortgagees will be entitled, on paying the rent to the^
landlord, to appropriate the profits in lieu of the annual rent payable, and'
that on the expiry of 9 years the mortgagor would redeem the katkobala
after paying the entire amount due for principal and interest, it was held
that the plaintiff could redeem only upon payment of the principal and
interest, and he was not entitled to an account of the rents and profits
received by the mortgagees from the land Osman Ali v. Faijian, 53 C.L.J.
380, 134 I.C. 95. Where the sub-mortgagee in possession was, after pay-
' ment of Government revenue yearly, out of the profits, to appropriate the
balance- in payment of interest, the sub-mortgagor was not entitled to ask
for an account Mo/imqoc/ Ali v. Ali Mirza, A.I.R. 1934 Oudh 220 (222),
148 I.C. 903. In a mortgage with possession it was stipulated that the
mortgagee should absorb the income towards interest and in case the
income fell short of the amount of interest accrued due, the mortgagor
should make good the balance ; and in case of failure to pay the infere,st
agreed the mortgage-amount was to carry compound interest at a higher
rate The income fell short, but the mortgagee failed to inform the mort-
gagor of the shortage: held that the mortgagee ^^s "t etitl^ to ch^
impound interest Chcmcfra v. Dwarka, A.I.R. 1936 Lah. 42 (44), 161 I.C.
94
4^7, A.LR. 1929 Pat -571 (573), 120 I.C. 768 ; Mahomed hhafy^'
Narain, supra ; Faujmal v. Motilal (1968) 1 Andh. L.T. 341. ^ ''
Where the mortgage deed provided that the mortgagee was to remiin
m possession in lieu of principal and interest, he was exempt from keeninp
accounts under this section of the profits realized by him durine the
m suit under sec. 4 of the U. P. Encumbered Estates Act 25 of 1934_
Ram Pattan v. Murli Dhar, A.LR. 1946 Oudh 83, 21 Luck. 184.
' Priority.
Sec. 78 ]
tion to the general rule Dharatii v. Pramgtha, A.I.R. 1936 -Cal. 283 (284),
40 C.W.N. 648, 63 Cal. 880, 165 I.C. 332. In a suit by a subsequent mort-
. gagee for declaration that the prior mortgage was sham and without con-
sideration, the question may be gone into ; but the onus is on him to show
that the prior mortgage was bogus and created with intent to defraud
him Venkatappa v- Brahmayya, A.I.R. 1953 Mad. 1000. There is no dis-
tinction, between legal and equitable mortgages in this country , as in
English law /mpericjf Bank v. U Rai Cyaw, 50 I.A. 283, 51 Cal. 86, 1
Rang. 637 ; Webb v. Macpherson, 30 LA. 238, 31 Cal. 57 ; Gokul Das v.
Eastern Mortgagee & Agency Co., 33 Cal. 410, 10 C.W.N. 276, 4 C.L.J. 102
Ram Kinkar v. Satya Charon, A.LR. 1939 P.C. 14, 43 C.W.N. 281.
This section has no application and cannot be used to defeat the rights
of a person who has obtained indefeasible title to the property, as by con-
tinuous posssesion or prescription Nallamuthi v. Baitha Naickan, 23
Mad. 37.
[Sec. 78
Sec. 78]
Madras case that gross neglect of itself and apart from fraud is a reason
for postponement of the prior mortgagee Shan Maun Mull v. Madras
Building Co., 15 Mad. 268 (275). So also, it has been held in a Calcutta
case that this section makes fraud, misrepresentation and gross negligence
quite disjunctive ; one cannot be defined in term of the other or others.
They are three different kinds of conduct and are in no way co-cxtensive.
It is not necessary that there should be fraud or something indicating
fraud to bring a case within the category of gross negligence Naiida Lai
V. Abdul Aziz, 43 Cal. 1052 (1080), 34 I.C. 115 ; Cowasji v. Tyabji, 23
S.L.R. 97, A.I.R. 1928 Sind 179 (183), 112 I.C. 722. In Damodara v. Soma-
sundara, 12 Mad. 429 (431) and Monindra Chandra v. Troyhicko, 2 C.W.N.
750 (753), the English cases were followed and gross negligence was inter-
preted as neglect amounting to fraudulent intention. But the ruling in
Monindra v. TrOylucko, 2 C.W.N. 750 has been disapproved of in the
recent case of Lloyds Bank v. P. E. Guzdar & Co., 56 Cal. 868, A.I.R. 1930
Cal. 22 (29), 121 I.C. 625. It has been held by the Lahore High Court also
that neglect is something different from fraud ; it may include honest
inadvertence. Neglect is to be determined in every case on its own facts
and no precedent can serve as a safe guide in this matter Mt. Chulam
Fatima v. Mt. Gopal Devi, A.I.R. 1940 Lah. 269, 190 I.C. 599 ; on appeal
Gopal Devi v. Ghulam Fatima, A.I.R. 1943 Lah. 113, 45 P.L.R. 143-
In a more recent English case it has been observed that a party may
be guilty of negligence, but it is not essential that he should be guilty of
fraud Oliver v. Hinton, [1899] 2 Ch. 264.
[Sec. 78
The mere fact that a prior mortgagee who was entitled to possession
did not tdk6 possession or that he omitted to record the prior mortgage-
deed in the revenue papers, did not show such gross negligence on his part
as to deprive him of his priority Mtrftesft v. Daulat, 30 P.L.R. 128, A.I.R.
1929 Lah. 314, 118 I.C. 655. So also, the mere fact that the prior mort-
gagee did not have his mortgage registered till after the execution of
the second mortgage, did not show any gross neglect on his part, if it
was registered within the four months time allowed by the Registration
Act. Thus, if the prior mortgage was executed on the 20th March, and
was presented for registration on 22nd June, and in the meantime a second
mortgage was created on the 7th June and registered on the following
day, the prior mortgage could not be postponed to the subsequent mort-
gage, if there is nothing to show that the prior mortgagee induced the
second mortgagee to advance money Swrendm v. Haridas, 60 Cal. 225,
A.LR. 1933 Cal. 398 (400), 144 I.C. 196. An act or omissio.n on the part
of the prior mortgagee which has enabled the mortgagor to deal with the
property as if it was not encumbered would be gross neglect within the
^ meaning of this section. Though failure to secure the title-deeds or delay-
in registration each standing by itself may not be evidence of negligence,
yet both circumstances taken together coupled with some conduct on
the iiiortgagees part which would have the effect of inducing a subsequent
mortgagee to advance money on the faith that the property was not
encumbered, may be evidence of gross negligence Samarapuri v. Jnon-
gavelu, A.I.R. 1938 Mad. 87, 46 M.L.W. 778. Negligence consists in omit-
ting to do something .which a reasonable man would do or the doing o
something which a reasonable man would not do, in either case causing
unintentionally some mischief to a third party. Gross negligence is a
relative term and means the absence of care that was requisite
the circumstances. In determining the degree which would satiji
test of grossness, the test to be adopted is that rt must f care
880, 165 I.C. 332 ; Rangappa v. Imamuddin. A.I.R. 1934 Nag. 29 (311,
N.L.R. 196.
Sec. 781
140 I.c. 662, where' the second mortgagee was infinitely more negligent
in not calling for an important document of the mortgagors title than
the prior mortgagee who was merely negligent in not calling for an
original document of title and in being satisfied with a certified copy of it
on the mortgagors representation that the original had been lost.
[Sec. 78
Mutha V. Samt 8 Mad. 200 (202). Where the prior mortgagee Sta
the important document of title, and omitted to obtain possession of a
document m respect of a portion of the property, his conduct did not
amount to gross negligence Chettihr Firm v. Chettiar Firm, 7 Rang
A.I.R. 1929 Rang. 65 (66), 116 LC. 475.
But the Court will impute fraud or gross or wilful negligence to the
mortgagee if he omits all inquiry as to the deeds Hewitt v. Loosemore,
supra. If it appears from the conduct of the prior mortgagee that there
was no bo 7 ia fide inquiry for the title-deeds or reasonable excuse for their
non-production, the Court will certainly impute gross and wilful negli-
gence to the prior, mortgagee and will therefore postpone him to the secona
mortgagee. Thus, a prior mortgagee who allows the title-deeds, for nearly
4 years after his mortgage, to be in .the possession of the mortgagor and
gives no reasonable explanation of their being so in his possession, is guilty
of gross neglect under this sectionShan Maun Mull v. Madras Building
Co., 15 Mad. 268 (274), affirming Madras Building Co.
Sec. 78 ]
took the ordinary precautions that .any person advancing money on the
security of the deeds should know of his mortgage, such as sending some
, person with the deeds, insisting that they should be inspected in his
presence, or otherwise. He would therefore lose his priority Mf/dws
Hindu Union Bank v. V enkatarangiah, 12 Mad. 424 (428). G mortgaged
' certain title-deeds of immoveable property with the defendant Bank
to secure an over 'draft. Subsequent to this deposit, representing that the
' litle-deeds were required to be shown to an intending purchaser, G.
obtained possession of the same' and mortgaged them to the plaintiff Bank
giving them to understand that the property was free from any encum-
brance. On the fact of prior encumbrance being discovered, the plaintiff
Bank applied for a decree on the mortgage and for prior charge. Held that
the defendant Bank (prior- mortgagee) was guilty of gross negligence in
parting with the possession of the title-deeds, and lost its priority. The
prudent and normal practice of the defendant Bank (who held an equitable'
mortgage which was not registered), when the mortgagor applied that the
title-deeds might be shown to an intending purchaser, was not to allow
the mortgagor to have possession of the title-deeds, but to hand over
the title-deeds to the Banks solicitors in order that the solicitors should
arrange with the solicitors of the purchaser for the examination of the
documents. This would have been a prudent and safe course for a Bank
to follow in Calcutta, where mortgages are created by deposit of title-
deeds, and such mortgages are not usually registered. In departing from
_ this usual and prudent course the defendant Bank was guilty of gross
negligence, and consequently its mortgage must be postponed to that of
the plaintiff Bank Lloyds Bank v. P. E. Guzdar & Co., 56 Cal. 868, A.I.R.
1930 Cal. 22 (25, 26), 121. 1.C. 625. 'Where the prior mortgagee, at the
request of the mortgagors returned to them the title-deeds to enable
them to raise money to pay off his mortgage, and the mortgagors agreed to
raise the money in five days, but after the five days the mortgagee did
not take any active steps to get back the title-deeds, held that this con-
duct amounted to gross negligence, and disentitled him to claim priority
over a subsequent mortgagee Damodar y.'Somasundara, 12 Mad. 429
(432, 433) ; Cowasji & Co. v. Tyabji, 23 S.L.R. 97, A.I.R. 1928 Sind 179
(184), 112 I.C. 722. The vendor sold a property to the vendee, but the -
latter being unable to' pay the greater portion of the purchase-money gave
a mortgage of the property to the vendor but did not deliver the title-
deeds. Moreover in the sale-deed it was stated that the whole purchase-
money had been paid in cash. The vendee afterwards gave a second
mortgage of the property by deposit of title-deeds. Held that the prior
mortgagee (vendor) was guilty of gross negligence in not taking delivery
of the title-deeds. His neglect to recover the title-deeds when he had
full notice that the vendee was impecunious and a bad paymaster, was gross
and culpable negligence and was rendered more so by a deliberate sup-
pression of the existence of the mortgage in the sale-deed and suggestion
that the purchase-money was paid in cash Nanda Lai v. Abdul Aziz, 43
Cal. 1052 (1083), 34 I.C. 115. These cases are illustrations of^ the' well-
known maxim of law: "He who trusts most shall suffer most."
Where the mortgagor deposits all title-deeds showing his title, but does
not deposit other material deeds, the mortgagee cannot be held guilty of
any gross neglect so as to postpone him to a subsequent mortgagee Rallt
95
[Sk. 78
In some other cases it has been held that since mortgages by deposit
of title-deeds cannot be effected in moffiiSil places, it is a common practice
in the mofussil to leave the title-deeds in the possession of the mortgagor,
and since the existence of a system of registration has caused mortgagees
in general to attach little importance to the possession of title-deeds, the
failure of the prior mortgagee to obtain possession of them should not
necessarily be imputed to him as gross negligence Rangasami v. Annan-
}? 2 alai, 31 Mad. 7 (10) (following Agrn Bank v. Barry, L.R. 7 H,L. 135);
Monindra Chandra v. Troylucko, 2 C.W.N. 750 (752, 754). See also
Balmakundas v. Moti Narayan, 18 Bom. 444 (447).
The definition of notice has now been amended, and under the new
Explanation 1 added to section 3, registration amounts to nature And so
the Calcutta High Court has expressed an opinion way f
obiter) that where the prior mortgagee has surrendered the title-deeds
Sec. 79]
the mortgagor, but the prior mortgage has been registered, and a later
pros^ctiye encumbrancer by searching the register would thus be in a
position, if he made reasonable enquiry, to discover its existence, the Court
would be slow to hold that the prior mortgagee had been guilty of gross
neglect or that the action of the prior mortgagee in'failing to retain posses-
sion of the title-deeds had in any direct way caused or induced the later
encumbrancer to advance money on the security of the property Lloyds
Bank v. P. E. Guzdar & Co., 56 Cal. 868, A.I.R-. 1930 Cal. 22 (29) 121 I.C.
625. These remarks would, however, apply to cases of gross negligence,
but not where the prior mortgagee has been guilty of fraud or misrepre-
sentation ; in such cases, he cannot evade the penally of this section by
saying that his mortgage which is registered must at all events have
priority over the mortgage created in favour of a subsequent mortgagee
who must be deemed to have had notice of the first mortgage by reason
of its registration. Fraud or misrepresentation wo.uld certainly operate
as estoppel,
Illustration.
481. Scope of the section This section forms an exception to the rule
stated in sec. 80 (now 93), under which a mortgagee making a further
advance does not in respect of that advance acquire any priority as against
an intermediate mortgagee. Under this section, the intermediate mort-
gagee having notice of the prior mortgage is postponed so far as regards
further advance? which are subsequently made on the security of that
mortgage, provided it expresses the maximum to be secured thereby
an'd that maximum is not exceeded ^Shephard and Brown, 7th Ed., p. 337 ;
[Sec. 79
Sec. 79]
TfiAtlSftR OF PftOPERtY 75?
usual cash credit system and for the repayment of all advances in this
account the shop of the debtor is made collateral security subject to a
maximum principal' sum, the charge on the shop is not limited to the first
advance, but it is to include all advances in the account Kesari Mai v
Tansukh Rat, A.I.R. 1934 Lah. 765, 153 I.C. 1064. Where a mortgage is
- executed by way of continuing security for the payment of all debts due
and thereafter mayTie due by the mortgagor, and a subsequent mortgagee
takes the mortgage of the same property with knowledge of the prior
mortgage and the prior mortgagee does not thereafter make any advances,
he is entitled to priority not only in respect of the principal sum but also
interest accruing on it Allahabad Bank v. Bemres Bank, A.LR. 1938 All.
473, (1938) A.L.J. 658.
[Sec. 81
80.
* *
* *
This section has been omitted here but re-enacted as sec. 93,
securities. tO One
Sec. 81 J
TfiANSPEll OF PROPERTY 75 9
leave Blackacre, so that fl, the other creditor, may follow it, and obtain
payment of his debt out of it ; in other words, if two estates, Whiteacre
and Blackacre, are mortgaged to one'person, and subsequently one of them,
Blackacre, is mortgaged to another person, then unless Blackacre is
sufficient to pay both charges, the first mortgagee will be compelled to take
satisfaction out of Whiteacre, in order to leave to the second mortgagee
Blackacre, upon which alone he can go. per Cotton, L.J. in Webb v.
Smith, 30 Ch. D. 192 (200). In such a case the first mortgagee has no
right to exhaust a security which is the sole fund for pa)mient of the second
mortgagee iomrence y. Galsworthy, 3 Jur. -(N.S.) 24, Where the subse-
quent mortgagees T^ho had foreclosed a property which was included in
an earlier mortgage of several other properties to the prior mortgagees,
applied for an order for the exclusion of the property from the sale pro-
ceedings held in execution of the decree of the prior mortgagees, held
that the Court had power, in appropriate circumstances, to make such
order under secs. 56 and 81 Tara Prosanna v. Nilmbni, 41 Cal. 418 (422).
The object of this section is to protect the subsequent mortgagee from the
risk of the properties mortgaged to him being sold to satisfy the dues
of a prior mortgagee who has the additional security of some other pro-
perties also Rajkeshwar v. Md. Khaliltd Rahman, 3 Pat. 522 (530), A.I.R.
1924 Pat. 459, 78 I.C. 796.
This section does not apply to the N. W. F. Province, but its principles
are applicable as principles of justice, equity and good conscience. Equity
demands that the mortgagee should not be permitted to unequally distri-
bute the mortgage-money on two different properties and to release one
lightly and burden the other more than it normally should be. A pro rata
share should be reovered from the property which has been proceeded
against, if the mortgagee has released another property which was also
liable for the security AA c/kI Quyum v. Mt. Turi, A.I.R. 1941 Pesh. 49.
Like section 56 this section provides for marshalling when there are two
properties only. It is also restricted to a case when the second mortgagee
intends to marshall the securities. It does not provide for the case of
more than two properties nor for the case where the property has been
mortgaged more than twice and a mortgagee subsequent to the second
mortgagee desires to marshall the prior securities. We propose to widen
the scope of the section by providing that it should apply to cases wherd
760
traKsfer of property
[Sec. si
thCTe are more than two properties and to all subsequent mortoagee^
generally. Report of the Special Committee. * ^
M^shalling implies the existence of two sets of properties one of'
which is subject to both the mortgages and the other is subject to only the
earlier mortgage. Where at the time the doctrine is sought to be invoked
there are no two items of properties liable to be sold but only one item
the other haying been released by the mortgagee, the doctrine cannot
be applied Muthammof, in re, A.I.R. 1938 Mad. 503, 47 M.L.W. 261. But
it has been held^ by the Calcutta High Court that a mortgagee after relin-
quishing his claim on a portion of the mortgaged property cannot throw
the whole burden of the mortgage-debt on the remainder of the property
Ml/xktakeshi v. Ramani Mohan, A.I.R. 1927 Cal. 195, 98 I.C. 504
[following Surjram v. Bahranideo. 1 C.L.J. 337 and not following Perumal
V. Raman, 40 Mad. 968 (F.B.)]. See also Chettyar Firm v. Chettuai*
Firm. A.I.R. 1937 Rang. 220 (223), 171 I.C. 168.
The benefit of this section can be claimed not only by the subsequent
mortgagee but also by a purchaser of the property in execution of the
mortgage-decree obtained by the subsequent mortgagee (whether that
purchaser be a third person or the subsequent mortgagee himself)
Rajkeshwar v. Md. Khalilul Rahmat], 3 Pat. 522 (531), A.I.R. 1924 Pat.
459, 78 I.C. 796 ; Inderdawan v. Govind LaU, 23 Cal. 790 ; Lakhmidas v.
Jamnadas, 22 Bom. 304 (F.B.). But see Nanbat v. Mahadeo, A.I.R. 1929
All. 309 (311), 51 All. 606, 116 I.C. 82; Madhusudan v. Jogesh Chandra.
42 C.W.N. 502 and Sengava v. Perumal, A.I.R. 1937 Mad, 965 (966), 46
M.L.W. 555.
B prayed under this section that the property Y should be sold first.
Sec. 81]
See Note 320 under sec. 56 ante. Where four properties are mortgaged
and three of them are in Pakistan, marshalling cannot be done as it
would prejudice the rights of the mortgagee Jain Singh Rai v. Harnum-
das, A.I.R. 1964 All. 381.
488. Notice Old Law : The old section contained the woids
"who has not notice of the former mortgage" so that the second mort-
gagee could claim the benefit of marshalling under this section
only when he had no notice of the earlier incumbrance Sesha Ayyar
V. Krishna, 24 Mad. 96 (106) ; Kishan Chand ' v. Ramsukh Das,
86 tP.R. 1916, 33 I.C. 815 ; Lakshmana v. Sankara Moorthy, 25 M.L.J.
245, 18 LC. 199 (202) ; Punjab & Sind Bank v. Amir Chand, AJ.R. 1930
Lah. 731, 11 Lah. 694, 125 I.C. 631 ; Sengava v. Perumal, A.LR. 1937 Mad.
965 (966, 967), 46 M.L.W. 555 ; Ramaswamy v. Madura Mills, (1916) 1
M.W.N. 265, 34 LC. 338 ; Naubat v. Mahadeo, 51 All. 606, 27 A.L.J, 419,
A.LR. 1929 All. 309 (311), 116 LC. 297. In order that the rule of
marshalling could apply, it has to be shown that the second mortgagee
obtained no notice either before or at the time of completion of his
mortgage. And so there was nothing in this section to destroy the right
of marshalling when the second mortgagee got the notice subsequent to
the execution of his xpprtgsigelnderdawn v. Gobind Loll, 23 Cal. 790.
The real question was whether the second mortgagee was aware of the
prior mortgage at the time when he took his own mortgage ; the fact that
he came to know of the existence of the prior mortgage at the time he
96
[Sec. 8i
It should be noted that in places in which this Act did not formerly
apply the doctrine of marshalling was applied even though the subsequent
mortgagee had notice of the prior incumbrance Dma v. Nathn, 26 Bom
538 (542); Chunilal v. Fulchand. 18 Bom. 160 {17\) { Lakshmidas v.
Jamnadgs, 22 Bom. 304 (314). Those cases were decided with reference
to the English law under which the question of notice is immaterial
and marshalling can be claimed inspite of it. See Flint v. Howard, (1893)
2 Ch. 54 (73).
Sec. 81 ]
of-the security Thanmal v. Nathu, A.I.R. 1928 Mad, 500, 51 Mad. 648.
110 LC. 54. The Oudh Chief Court has applied this principle to a charge
in the case of Parshadi v. Brij Mohan, A.I.R. 1936 Oudh 52 (54), ll Luck.
575, 159 I.C. 117.
The Calcutta and Rangoon High Courts have on the other hand
taken a contrary view. It has been held that the words but not so as to
prejudice the ri^ts of the prior mortgagee in this section do not entitle
the prior mortgagee to have the properties mortgaged to him to be sold
in any order he may prefer ; for the whole object of sec. 81 is to enable
the subsequent mortgagee to call upon the prior mortgagee to exercise
his ri^ts, so far as they can be satisfied as against the properties which
are not the subject-matter of the subsequent mortgagees charge
Annapurna v. Ram Ranjan, 40 C.W.N. 1173 ; see also Ram Sabad v.
Subiah, A.I.R. 1935 Rang. 139 (142), 156 I.C. 318 ; where it has further
been held that the right cannot of course be exercised against the prior
mortgagee so as to prejudice his right, but it cannot be said that his
rights are prejudiced when he has deliberately released a part of his
security which might have been readily available to him. The Allahabad
High Court has also held that where any portion of the mortgaged,
property has not been absorbed to satisfy the prior lien, it is not open,
to a mortgagee from either caprice, collusion or negligence to releases
portions of his mortgage-security and to throw the entire burden upon the
remaining property Mttrli v. Sheo Dot. A.I.R. 1931 All. 625 (627), (1931)
A.L.J. 349. On this point also the Madras High Court has recently held
that, the prior mortgagee has the undoubted right of releasing any portion
of his security and the subsequent mortgagee cannot claim rhe right]
of marshalling Muthammal, in re, A.I.R. 1938 Mad. 503 (504), 47 Jvl.L.W.
261. The view taken by the Madras High Court does not seem to be the
correct view. For an able discussion of this question and the relevant
case law on the point see A.I.R. '1938 Journal, p. 98.
[Sec. 82
Sec. 82]
gaged to secure another debt, and, the former debt is paid out
of the former property, each property is, in the absence of a
contract to the contrary, liable to contribute rateably to the
latter debt after deducting the amount of the former debt from
the value of the property out of which it has been paid.
to that debt; being valued for that purpose, after deducting from each
estate any other incumbrances by which it is affected ^Fisher or Nlort-
gage, 6th Edn., p. 688. The reason given for this principle is tliat "the
law requires equality ; ' one shall not bear the burthen in case of the
rest per Eyre, C.B. in Dering v. Earl of Winchelsea, (17S7) 2 W. &
T.L.C. (7th Edn.), p. 535, cited in 26 All. 407 (436). It also lays down
that parties who were equally bound with another to satisfy a debt and
who are relieved by that other from the burden of the debt should con-
tribute rateably towards tlie satisfaction of the debt Ibn Hasan v. Brrj-
bhukhan, 26 All. 407 (416). No extraneous principle to modify the liabi-
lity to contribution imposed by this section can be introduced Isri Prasad
V. /flgai! Prasad, A.I.R. 1937 Pat. 628 (629), 16 Pat. 557, 172 I.C. 187;
Pmhi V. Hardeo, A.I.R. 1936 Oudh 169, 159 I.C. 1049.
[Sec. 82
co-mortgaprs not only when his property has been sold, but also when
he saves his own property and the property of die co-mortgagors S
f wimse property equally with the property of the claimant, has been
sold at the mstance of the mortgagee, because it has already contribut-
proportion of the debt Z&n Hasan v. Brijbhukhan, 26 All. 407
(411) ; Han Raj v. Ahmadrud^din, 19 All. 545.
^ere the property of one of the mortgagors has been sold, but the
sale has not satisfied the entire mortgage-decree, he cannot claim con-
tribution in respect of tlie excess realised from liis propeityr over and
above its rateable proportion of the debt. A claim for contribution can-
not arise until the whole of the mortgage-debt has been satisfied Jbn
Hasan v. Brijbhukhan, 26 All. 407 (426, 427) (F.B.). But where the whole
of tlie mortgage-money has been realised by the sale of the properties
of some of tlie mortgagors, one of tliem can bring a suit for contribution
against those co-mortgagors whose property lias not been sold, although
the mortgage-debt has not been wholly satisfied by the sale of the plain-
tiflEs property alone Mu/iammad Yahia v. Rashiduddin, 31 All. 63 (66) ;
Muhammad Main v. Bharat,-,! O.W.N. 401, A.I.R. 1930 Oudh 260 (263),
125 I.C. 402.
Sec. 82]
peities are liable to contiibute rateably under this section, tlie question
ot rateable contribution is one of adjustment of equities between tlip
V. Shrihari, A.I.R. 1949 Nag. 155, I.L.R. 1948 Nag.
Both sec. 43 Contract Act and iiie present section deal n>itli the
question of contribution. Wliere the question ai-ises out of a mortgage
this section must exclude sec. 43 on the principle tliat die general law is
excluded by the special la\v~Kedar Mai v. Hari Lai, A.I.R. 1952 S.C. 47.
Having regard to the difference in language in secs. 82 and 92, it is not
necessary tiiat die whole of the common mortgage should be paid off
before a claim for contribution can be advanced by a peKon who has
been made to pay more towards the common mortgage Manjappa v.
Pacha, A.I.R. 1947 Mad. 276, (1946) 2 M.L.J. 276. A co-mortgagor who
paid the whole mortgage debt may under tliis section sue for contribution
and he may be subrogated to the rights oF die mortgagee under sec. 92.
He also acquire a charge under secs. 82 and 100Rameswar v. Ramnath,
A.I.R. 1950 Pat. 174, 28 Pat. 955. See also Gopinath v. Raghubans,
A.I.R. 1949 Pat. 522, 30 P.L.T. 277; Ayyappan Raman v. Kunju-Vakki.
A.I.R. 1958 Ker. 386. Tlie obligation under sec. 82 is not personal
Ramesicar v. Ramnath, supra.
As the present Act is not in force in die Punjab, secs. 82, 92 and 100
do not in terms apply there. Tlie principles underlying tiiose sections
are however applicable as rules of justice, equity and good conscience
Ganeshi Lfil v. Joti Parshad, A.LR. 1949 E.P. 254.
97
[Sec. 82
Sec. 82]
Thus, although all the properties may be originally equally liable for the
mortgage-debt, this liability may be altered by mortgage-decree or by an
arrangement made between tlie parties by which the burden of the debt
may be thrown primarily on some of the properties, and the other pro-
perties may be made liable only if the debt is not realised ijy the sale
of the first-named properties Satyakripal v. Gopikishore, 6 C.W.N. 5S3 ;
see also Indurii v. Kakarala, (1940) 2 M.L.J. 484, 1941 Mad. 66, 1940
M.W.N. 1002. IVluere a mortgaged property is sold in two portions to
two purchasers, one of whom purchases without notice of the mortgage
and witli a covenant against incumbrances, and the other person pur-
chases with an express undertaking to pay off the entire mortgage, the
latter purchaser, if he discharge the entire incumbrance, is not entitled
to obtain contribution from the otlicr purchaser Kamaia v. Chaiurbhuj,
8 Pat, 585, A.I.R. 1929 Pat, 664 (676), 120 I.C. 17, A mortgaged proper-
ties X and Y to B. Subsequently, A sold property X to C and out of the
consideration left sufficient money with the vendee to redeem Bs mort-
gage. Afterwards the property Y was sold in execution of a decree against
A and was purchased by D. C failed to redeem B s mortgage, and B
brought -a suit on his mortgage and got a decree ; C paid the decretal
amount and sued D for contribution. Held that C was entitled to con-
tribution as against D. D was not entitled to enforce tire agreement be-
tween C and A to redeem Bs mortgage, being a stranger to the agree-
ment. The auction sale to D gave rise to no covenant attaching to the
property which could pass upon a sale of that property Charan Singh
V, Ganeshi Lai, 24 A.L.J. 401, 94 I.C. 1048, A.I.R. 1926 All. 352, affirmed
by the Privy Council in Ganeshi Lai v. Charan Singh, 52 AIL 358 (P.C.).
1930 A.L.J. 753, 24 C.W.N. 661 (868), 124 I.C. 911, A.I.R. 1930 P.C. 18_3.
See also Mohamed Inamulla v. Aisha Bibi, 24 A.L.J. 714, 96 I.C. 765 ;
Sonaji V. Krishna. Rao, 27 N.L.R. 258, A.I.R. 1931 Nag. 172. In the case
of Ganeshi Lai v. Charan Singh, supra, the purchaser purchased tire pro-
perty subject to the mortgage and paid the price on that footing and the
ben^t of the contract betrveen A and C did not pass to him, the pur-
chaser being no party to the contract (see pp. 184 and 185 of A.I.R. 1931
P.C. p, 183), But had the purchaser purchased the property from
the mortgagor free from incumbrance the position would have been
different, tiiat is, he would not be liable to contribute as the benefit of
tlie mortgagors contract would have passed to the purchaser, and it
would have been a "contract to the contrary within the meaning of this
section see Isri Prasad v. Jagat Prasad, A.I.R. 1937 Pat. 628 (630), 16 Pat.
, 557, 172 I.C. 187 and Ganeshi Lai v. Charan Singh, supra, at p. 185. But
see R. Ananthyya Holla v. Tliimaju, A.I.R. 1956 Mad. 293 where it
has been held that the contract runs with the land.
[Sec. 82
Sec. 82]
tiar, A.I.B. 1955 Mad. 557. P, the purchaser of a part of a property with
two encumbrances, viz., a decree debt in favour of K and a mortgage
debt in favour of M, agreed to discharge both the debts. P did not dis-
charge the mortgage of M and to discharge the decree debt of K exe-
cuted another mortgage in favour of K. In execution of Ks mortgage
decree die portion sold to P was purchased by K. Ms assignee in exe-
cution of the decree on Ms mortgage threatened to put to sale the
unsold portion in hands of the vendor, ivho paid off the decretal amount
and tliereafter sued K and the heirs of P to recover the amount so paid ;
Held that the vendor was entitled to recover the entire amount from K
because P, whose interest was acquired by K agreed to pay off the mort-
gage of M Ummit\i Amma v. Koshy lype, A.I.R. 1967 Ker. 77.
494. First para : ^This para has been amended in order to apply the
rule of contribution where a mortgaged property is subsequently sub-
divided.
Tlie words shares in are intended to make it clear that this para
applies to ciises where property is owned by several owners but has not
been physically partitioned Report of the Select Committee (1929).
In other words, the rule of contribution applies not only where seve-
ral properties are mortgaged and the owner of one of them is compelled
to satisfy the whole mortgage-debt, but it also applies where only one
property held by several co-owners is mortgaged and the portion of one
co-owner is made to satisfy the mortgage.
TRANSFER OF PROPERTY
[Sec. 82
aQtually due, the other co-mortgagors can claim possession of tlieh share
y paying Ae proportionate share of the amount actually paid JGa?iBs/it '
Lai V. 7o#i Parshad, A.I.R. 1949 E.P. 254. See in this conne^tiorTSS-
war V. Devendra^ A.I,K. 1944 Pat. 179, 22 Pat, 637.
Where the original mortgagor died and the property came into tlie
iiands ot his representatives, and one of them satisfied the entire mort- '
gage-decree obtained by the mortgagee, it was held under the old section
f j contribution against the other representatives did not
taU under tliis section, as there ivas but one property mortgaged iVcimt)
Jahanara y, Mlrza Shujauddin, 9 G.W.N. 865 ,(867). Tliis is no longer
good law in view of the above amendment.
Sec. il]
for the, full amount of the decrees: held, the result of the whole amount
of the rent charge having been notified in the sale proclamation was
not that the whole liability passed to tire property auction-purchased so,
as to relieve the other property from liability. The rent-decree should
be deemed to have been satisfied to the extent of one-half. But if the
\yhole charge was enforced against either of the properties, the holder
of that property would have the right of contribution to the extent of
half against the holder of the other property Prabhu Ram v. Kamesh-
war, 19 Pat. 524, A.I.R. 1940 Pat. 420, 21 P.L.T. 227.
[Sec. 82
nan, 15 C.W.N. 800 (803), 6 I.C. 842 ; Sabir v, Rirasat, 1929 A.L.J. 1162
A.I.R. 1929 All. 696 (697) ; Gian Singh v. Atma Ram, 34 P.LR 532*
A.I.R. 1933 Lah. 374 ; Murli v. Sheo Dat, A.I.R. 1931 All. 625 (627), 1931
A.L.J. 349. For the application of the doctrine of contribution it is
immaterial whether the payment in respect of which conbihution is
claimed has been made voluntarily to avert a legal process or has been
enforced by sale of the claimants propertv Afd. Mian v, Bharat Sinsli
A.I.R. 1930 Oudh 260 (264), 5 Luck. 727, i25 LC. 402.
Sec. 82]
[Sec. 82
The Legislature has adopted the Allahabad view and amended the
section accordingly. There is some difference of opinion as to whetlTer
for the purposes of contribution the value of 'the different properties or
the portions of one property should be calculated as at the date of die
original mortgage or at the date of the subsequent transfer. In
some cases it has been held that valuation is to be made as at the
date of the mortgage irrespective of the price that may have been paid
by the purchaser {see 12 C.W.N. 107, 745; 27 AU. 549). In a Bombay
case, however, the valuation at the date of the sale was adopted (I.L.R.
26 Bom. 88). We propose to provide that the value taken shall be the
value as at the date of the original mortgage. This- rule has the sup-
port of the Judicial Committee who, in assessing contribution to a decree
for mean profits, assessed liability at the date of tiie decree (31 Cal; 597,
L.R. 31 I.A. 94) Report of the Special Committee.
Sec. 82]
\Vliete at the date of tlie mortgage, tliere was no house on the site
but a building had only been begun, and the mortgage-deed described
the property as a house with five rooms, kitchen etc. held, under tlie
special circumstances of tlie case tliat the value of the house, Uiough
not existing at tlie date of the mortgage, must he considered in deter-
mining the proportionate amounts to be charged on the various mort-
gaged properties Ntjauiiglebin Co-operative Bank, supra.
The word incumbrance in tlie old section has been replaced by the
words mortgage or charge". Incumbrance was nowhere defined in this
Act, and in Aziz Ahmad v. Chhoie Lai, 50 All. 569, 109 l.C. 38, A.I.R.
1928 All. 241 (246), it was interpreted as having a larger meaning than
a mere mortgage ; it might mean any claim, lien or liability, so as to
include, say, a permanent lease carved out of a mortgaged property. The
words amount of any other incumbrance did not necessarily mean the
proportionate mortgage-money according to the rule of contribution.
496. Para 2 : ^It is not the law that this section applies only where
the mortgages are made by the same person. It says that at the time
when one of the properties is sold and this section is sought to be invok-
ed, the. two properties should be owned by the same person Chunilal
V. Srinivasa, A.I.R. 1944 Mad. 276, 1944 M.W.N. 49.- The obligation
[Sec. 82
under. tHs section is not personal but is attached to tlie properties. Tlie
owner thereof has the option either to pay his rateable share to let it be
realised from the properties Gopjnoth v. Raghubans, A.I.R. 1949 pat.
522, SO P.L.T, 277 ; Cheeru Elayachi v. Seemon Chacko, A.I.R. 1966 Ker.
I39. Any reduction of the liability of the mortgage by the appropriatioii
of the rateable value fixed under this section would not enure to the bene-
fit of the mortgagor Sathirafu v. Venkata Rao, A.I.R. 1953 Mad. 873.
Where tliere is no fraud the purchase by the mortgagee of some of the
mortgaged properties discharges that part- of the mortgage debt which
bears the same ratio to the whole mortgage-debt as the value of the items
purchased bears to the value of the entire mortgaged properties Rog/i-
avachariar v. Kandaswami, A.I.R. 1947 Mad. 277, (1947) 1 M.L.J. 105,
See in this connection Pandurang v. Shrihari, A.I.R. 1949 Nag. 155 I L R
1948 Nag. 595.
The word second 'has been replaced by the word subsequent . 'Tliis
is consequential to a similar amendment made in sec. 81 (Report of the
Special Committee).
Sec. 82]
TRANSFER OF PROPERTY 781
member, a charge is created over the property of the former for such
amount paid by the latter and be can enforce the charge against a pur-
chaser of the formers property who has actual or constructive notice of
the covenant >Abdvl v. Abdul, A.I.R. 1933 Mad. 715,' 65 M.L.J. 390. Tire
liability to contribute to the common .burden attaches to the properties
subject to that burden, and not personally to the owners of these proper-
ties. Consequently, these properties are made securitj for the payment
of the amount of re-imbursement, and a charge is created on them as
defined in sec. 100 Ibn Hasan v. Brijbhvkhan, 26 All. 407 (443, 444) ;
Bhagtoan Das v. Karam Husain, 33 All. 708 (716) (F.B.)'; Danappa v. Yatn-
nappa, 26 Bom. 379 ; Sesha v. Krishna, 24 Mad. 96 (107) ; Har Prasad
V. Raghitnandan, 31 All. 166 (168) ; Sabir v. Rirasat, 1929 A.L.J. 1162,
A.I.II. 1929 All. 695 (698) ; Muhammad Mian v. Bharat, 7 O.W.N. 401,
A.I.R. 1930 Oudh 260 (263), 125 I.C. 402. A contrary view lias been
taken in Nawab Jahanara v. Mirza Shujauddin, 9 C.W.N. 865 (867).
Both before'' the amendment in 1929 and now the liability to contribute
is a liability which is imposed upon the land and therefore is not a per-
sonal liability Narayanan v. Nallammal, A.I.R. 1942 Mad. 685 (F.B.),
(1942) 2 M.L.J. 525. Since the liability to contribvite is not a personal
liability, but is made a charge on the other properties which have not
discharged their own share of the debt, a purchaser of a portion of such
properties is liable .to contribute rateably Mumammad Mian v. Bharat,
supra.
But where the sale of the property of one of the co-mortgagdrs has
not satisfied the entire mortgage-debt, he has no right to claim contribu-
tion, and consequently has no charge on the properties of the other co-
mortgagors in respect of the excess realised by sie of his property over
and above its rateable share of the debt Ibn Hasan v. Brijbhukhan, 26
All. 407 (432, 433) (F.B.). But if^the properties of some of the mortga-
gors are sold and the mortgage is fully paid off by the sales, one of tire
mortgagors can maintain a suit for contribution, and can claim a charge
on the other properties, although tire mortgage has not been satisfied
by sale of his property aloire Bhagwan Das v. Karam Husain, 33 All.
VOfi (716, 717) (F.B.), following Muhammad Yahiya v. Rashiduddin, 31
All. 65.
Limitation : For a suit for contribution under this section tire per-
iod of limitatioir is 12 years from the date of payment and not from the
date when the original mortgage money became payable Rameswar v.
Ramnaih, A.I.R. 1950 Pat. 174. 28 Pat. 955. A co-mortgagor by paying
the mortgage-money acquires independently of sec. 95 a charge under
secs. 82 and 100 in regard to the amount paid by him in respect of the
mortgage over their shares. Consequently, the period of limitation for
a suit by one of several heirs of a mortgagor by one of the several subse-
quent transferees of the mortgaged property who has paid the entire
mortgage-decree for contribution against the other heirs or transferees
in which the sale of tlie defendants share in the mortgaged
property is sought, is 12 years under Art. 132 of the Limitation Act, from
782 TRANSFER OF PROPERTY
[Sec. S3
the date of payment and not from the date when the original mortEaae
Deposit in Court.
not enjoy, of pa}dng the amount of their debt into Court and so relieving
themselves of any further liability Debendro v. Sana, 26 All. 291.
498. Deposit; The deposit under this section must be made uncon-
ditionally. Where the mortgagor says that the money should not be paid
unless the mortgagee produces certain deeds, it is not a valid deposit
Nanu V. Manchee, 14 Mad. 49. "Where the mortgagor deposited the amount
in Court but did not admit that the plaintiff was the person entitled to
the money, and prayed that the amount should be paid to the plaintiff if
it was proved to the satisfaction of the Court that he was the person entitled
to recover the mortgage-debt, held that the tender into Court amounted
to a conditional tender and not therefore valid in \swAnandrao v.
Durgabai, 22 Bom. 761. But a deposit made under this section is good
when made in good faith for being taken over by the mortgagees, although
the mortgagors in their application purported to reserve their rights to dis-
pute whether the mortgagees were entitled to the entire amount deposited
Salik Ram v. Ashiq Hussain, 4 O.C. 35^. That is, a tender made under
protest reserving the right of the debtor to dispute the amount due (and
not the title of the creditor to receive the amount) is a good tender, if it
does not impose, any condition on the creditor Greenwood v. Sutcliffe,
(1892) 1 Ch. 1. A deposit accompanied by a petition that the money mi^t
be retained in Court until the disposal of certain objection made by the
mortgagor, is not a valid tender Goluckmonee v. Nubungo, W.R. Special
Number (F."B.) 14. But a deposit accompanied with a demand for a regis-
tered receipt (to which the mortgagee agrees) and the restoration of certain
title-deeds, is not a conditional deposit, and is therefore valid Kora Naya
V. Ramappa, 17 Mad. 267. But a condition requiring a return of certain
ddeuments to which the mortgagor is not entitled, attached to a deposit
[Sec. 83
under this section, vitiates thfe tender In re Achath Sankaran, 29 I.C 586
This section does not contemplate a conditional deposit ; but if the deposit
IS considered valid, it cannot be treated as if the condition attached did
not exist. Hence a mortgagee is entitled to accept the money deposited
subject to the condition imposed by the moTigagorDhanukdhari v Tethan
Singh, A.I.R. 1940 Pat. 18, 184 I.C. 225.
This section shows that just as the right to make the deposit is optional
with the mortgagor, so it is optional with the mortgagee to accept it in
satisfaction of his dues. It is only when the mortgagee has done so thd
deposit becomes effective for the purpose of extingdishing the liability
of the one party and the ri^t of the other. The mortgagee is not bound,
to accept the deposit, and if, and so far as, that is not done, the mortgage
necessarily subsists Hargy Krishna v. Sashi Bhusan, A.I.R. 1941 Cal. 18
{per Biswas, J.). The words "as hereinafter provided in sec. 67, ante,
make it perfectly clear that a deposit under sec. 83, in so far as it is con-
templated in sec. 67 must mean a deposit which has been accepted and
acted on by the mortgagee in terms of sec, 83 and not a mere deposit
irrespective of how it is disposed of Ibid,
Sec. 83 ]
Tender : ^Mere readiness to pay the debt is not sufficient. The mort-
gagor must deposit the money in Court Gopiram v. Shankar, A.I.R. 1950
M. B. 72. The mortgagee is not entitled to refuse tender of the mortgage
amount made by the purchaser of the equity of redemption on the ground
that the purchaser has not paid the full price to the mortgagor Venkatd
Perumal v. Ratnasabha, A.I.R. 1953 Mad. 821. The mortgagee \s'as deem-
ed to have waived the actual production of the mone}' when he insisted
at he would not accept it and denied the mortgagors right to redeem
before expiry of 3 years. Hence there was a legal tender in this case
Bhagwat v. Ganga Din. A.I.R. 1947 All. 68. I.L.R. 1947 All. 25. Sec also
Narain v. Rikhob, A.I.R. 1952 Raf. 72.
99
[Sec. 83
redemption after the expiry of the stipulated date (21st March 1905) and
was entitled to deposit the money on any day after that date, without
waiting for a further period of five years according to the stipulation con-
tained in the deed. The deposit was therefore not premature, in the lipht
of the Privy Council ruling. ^
Under this section the question of good faith cannot arise when it
is duty of the mortgagor to deposit the money to the credit of the real
mortgagees Ganeshi Lai v, Rohini, supra. But if there is a dispute
among the co-mortgagees as to who is entitled to receive the money and
give a valid discharge, and the dispute is of such a nature that it cannot!
be determined by a layman, the mortgagor can deposit the money and ask
the Court to decide and pay the amount to the person who may be
entitled. But where there is no such dispute, the mortgagor cannot make
any such prayer Ottur v. Velia, A.LR. 1926 Mad. 10^7, 97 LC. 735.
The expression mortgagee, in this section includes the legal -representa-
[ Sec. 83
Where the original mortgagee died and there was a dispute as to the
persons entitled to the money, the mortgagor could deposit it to the
credit pf all the persons claiming the money Rcwn Sumran v. Sahibzada,
1885 A.W.N. 328. But if the payment is made only to one of the heirs
of the mortgagee, it cannot amount to a valid discharge SiWran? v.
Sridhar, 27 Bom. 292. Where there were two mortgagees, and the amount
was deposited to the credit of the two mortgagees, but one of them was
dead (or alleged to be dead, not being heard of for more than 7 years), the
Court should consider whether the surviving mortgagee was alone com-
petent to withdraw the money Balbhaddar v. Bitto, 51 All. 1016, A.LR.
1929 All. 754 (755), 118 I.C. 188. Where there was nothing in the mort-
gage-deed to indicate that the mortgagees advanced the money otherwise
than in their individual capacities and where after the death of one of
the mortgagees the mortgagor made a depo'sit of the full amount due to
the account of the surviving mortgagee and to that of the estate of the
deceased mortgagee expressly or by necessary implication, impleading his
sons and heirs, and it was subsequently found that one of the sons had
no right to any part of the mortgage-money, interest ceased to run from
the date of the deposit (or possibly from the time when the notice under
this section had been served on those entitled to recover the money. On
fhe other hand, if the deposit was made to the accoxmt of certain persons
named and not to the estate of the deceased mortgagee in such a way
that only the persons named would recover the amount deposited, interest
would not cease to run if some of the persons named were not entitled
to the money Ram Gopal v. Lachman, A.I.R. 1938 All. 423 (426) (F.B.),
176 I.C. 509, (1938) A.L.J. 617.
minus' (the greater includes the less) Wade s Case, (1601) 5 Coke s R p.
n4 BaZJav. Benode, 29 C.L.J. 256, 51 LC. 13 ; Subramama v. Nara-
yamiwami, 34 M.L.}. 439, 45 LC. 638. But if the amount deposited is
Sec. 83 ]
less than the amount due, the mortgagee is at liberty to ignore it, and it
will not have the effect of stopping interest under sec. 84, even though
the deficiency is due to a bona fide mistake Gouri Sankar v. Abu Jafar,
34 I.C. 690 (692), 3 O.LJ. 204. A deposit is held to be insufficient, even
if there is a very small deficiency (e.g., by Rs, 2 only and even though the
deficiency is due to a miscalculation on the part of the pleaders clerk,
and not on the part of the mortgagor himself. In such a case, interest
will not cease to run Debi Prasad v. Kedar, 19 A.L.J. 582, 63 I.C. 563
(564). In one case, a deposit falling short by only nine pies owing to a
bona -fide mistake of calculation was held to be insufficient Siibbai v.
Palani, 30 M.L.J. 607, 34 I.C. 825 (826). But in some cases it has been
said that if the mortgagor tenders an insufficient amount in the bona fide
belief that it is the whole amount due, the tender is not wholly ineffectual
but is valid pro tanto Haji Abdul v, Haji Noor, 16 Bom. 141 (147) ; and
the mortgagee is entitled to claim interest only on the portion of the
amount due which is not covered by the deposit Haji Abdul v. Haji
Noor, supra. See also Narsingh v. Achaibar, 36 All. 36 (39). If, however,
the mortgagor making the deposit knew that it was less than what was
due and admitted it, then of course the deposit of a less amount than
what was due was wholly ineffectual Haji Abdul v. Haji Noor, 16 Bom.
141 (149) : Dixon v. Clarke, 5 C.B. 365 ; Henwood v. Oliber, (1841) 1 Q.B.
409. An unconditional tender (deposit) of a sum which turns out in the
end to be less than what is really due may be valid pro tanto if there is
a dispute as to the amount due, but a tender of only part of what is
admittedly due is of no avail. Thou^ a tender of a smaller amount than
that of which an indivisible and entire claim consists may be invalid as
a tender, there is nothing to prevent the creditor from accepting tlie
amount tendered in part-payment, and his doing so will not preclude him
from afterwards claiming the residue of the amount, provided that the
debtor did not make it a condition of his tender that it be accepted in
discharge of the whole Digambar v. Harendra, 14 C.W.N. 617 (625), 11
C.L-.J. 226, 5 I.C. 165, following Bowen v. Owen, (1845) 11 Q.B. 130, 75
R.R. 306.
[Sec. 83
him. If the mortgagor refused to pay the amount, the mortgagee might
be entitled to refuse to accept the amount ; but he cannot refuse to
accept the deposit on the' ground that the initial deposit was short
Kushal Singh v. Ram Kishun, A.LR. 1937 All. 706 (708), (1937) A.L.J.
757, 171 I.C. 813. The interest to be deposited is the original rate of
interest stipulated in the bond, not the enhanced or penal rate of interest
stipulated to be paid in case of default in paying the money in due time.
This section does not require the deposit of an amount calculated in
accordance with the penal provision of a bond Ayyakutti v. Periyaswami,
39 Mad. 579, 30 I.C. 497. Tara Chand v. Narayan. 18 N.L.R. 47, A.LR.
1922 Nag. 199 (200), 65 I.C. 174 ; Ram Rao v. Gopala, 28 N.L.R. 149, A.I.R.
1932 Nag. 169. 'V^ere the provision of enhanced interest was found to
be penal, the mortgagee was entitled to claim only a reasonable compen-
sation in lieu of interest. It was open to the Court to accept the amount
calculated at the original compound interest less 6 pies (by which the
amount of deposit fell short) as being reasonable compensation
Narayanaswami v. Ramaswami, (1939) M.L.!- 324, A.I.R. 1939 Mad. 503,
1939 M.W.N. 455 rel}ang on Subramania v. Narayanaswami, 34 M.L.J. 439,
45 I.C. 638 {de minimus non curat lex).
If any interest remains due, the deposit of the principal money alone
is not a valid deposit. But if the mortgage is usufructuary and the amount
of interest due has to be calculated by taking accounts of the profits
under sec. 76, then until the mortgagee in possession gives accounts, the
deposit of the principal money only is a valid deposit, and the interest
will cease to run thereafter. But the mortgagee will be entitled to be
paid the balance of interest preceding the deposit after accounting for
the profits received by him-rBhavani Charon v. Kadambini, 33 C.W.N.
279 (281), A.I.R. 1929 Cal. 304, 119 LC. 292.
The deposit must also include such other sums which the mortgagee
is entitled to add to the mortgage-money (sec. 72). This section speaks of
the amount remaining due on the mortgage" and not merely mortgage-
money" as referred to in sec. 60. The expression "amount remaining the
on the mortgage is a very wide one and covers any just allowance or
costs which can be tacked on under the ordinary law of mortgage
Naderihaw v. Shirinbai, 25 Bom. L.R. 839, A.LR. 1924 Bom. 264 (26Q,
87 LC. 129. Thus, where the mortgagees in possession have paid the
Government revenue for the mortgagor, they are entitled to treat it as
part of the mortgage-money (under sec. 72), and to insist on its being
deposited along with the actual mortgage-amount deposited under this
section Anandi Ram v. Dur Najaf Ali, 13 All. 195. But money paid by
the mortgagee to avert a sale for arrears of rent under sec. 171 of the
Bengal Tenancy Act does not become a part of the mortgage-money and
the mortgagor is not bound to deposit it also under this section
Manmatha v. Sarat, 21 C.L.J. 429, 29 LC. 929. So' also, the mortgagee is
not entitled to claim that the compensation' or interest which is due to
him by the mortgagor on' account of the latters failure to ^ve possession
should be deposited along with the mortgage-money under this section
Allah Baksh v. Sada Baksh, 8 All. 182 ; nor is the mortgagor bound to deposit
the mesne profits to which the mortgagee may have been entitled owing
to his being kept -out of possession by the wrongful act of the mortgagor.
Sec. 83]
504. Notice : ^Until the mortgagee gets the notice under this sec-
tion or the knowledge of the deposit, he has the right to sue to enforce
his security. Hence where the mortgagor paid money into Court one day
previous to the institution of the suit by the mortgagee, but the notice
was not served on the latter before he filed his plaint, and he was unaware
of the deposit at the time of filing it, held that he was liiot precluded from
[Sec. 83
Deposit made under this section will operate as a valid tender of the
mortgage money only when the notice of the deposit is given to the mort-
gagee Janaki v. Mathiri, A.I.R. 1952 Tr.-Coch. 236.
505. Deposit made after suit : A deposit under this section is in-
valid if made after the institution of a suit by the mortgagee for the
recovery of the money due under the mortgage Brij Gopal v. Masuda
Begam, A.I.R. 1935 Oudh 93 (94), 10 Luck. 350, 153 I.C. 378 ; RajakrishncT
Menon v. Sundaran Pillai, 1963 Ker. L.T. 1031. The fact that the deposit
was made before the mortgagor received notice of the institution of the
suit, does not make any difference Thiagaraja y.- Ramaswami, 35 M.L.J.
605, 48 I.C. 693. Even assuming that deposit could be made after the
institution of the suit, it must include the costs incurred by the mort-
gagee in filing the suit Ibid, followed in Bala Chengiah v. Subbayya,
A.I.R. 1939 Mad. 200 (202), 1939 M.W.N. 76, 183 I.C. 871, where the
deposit had been made by the mortgagor after the mortgagee had filed a
suit on the mortgage with a 4 annas Court-fee stamp and before the
deficit Court-fee had been paid. But a deposit made after the mortgagee
brings a suit to recover possession according to the terms of the mortgage-
deed is not invalid, and the mortgagor can be allowed to redeem Ram
Dayal v. Arjun Singh, 50 I.C. 332 (Oudh)-
Sec. 83]
72 l.C. 292; Narayan v. Kishun, A.I.R. 1934 Pat. 622, 153 I.C, 1035.
Institution of a suit for the redemption of a usufructuary mortgage cannot
be regarded as tender of the mortgage money ; hence on deposit in Court
100
.lSec. 8J
after the preliminary decree mesne profits can be awarded only from the
date of deposit and not from the date of the institution of the suit
Rajballan Lai v. Ram Autar Rout, AJ-R. 1962 Pat. 203.
507 . Mortgagees right to receive the money ; ^As soon as the mort-
gagor deposits the money into Court, it is no longer his, and the mortgagee
is entitled to draw the money from the Court. The mortgagor cannot
object to it Motavengattil v. Kezatath, 25 I.C. 369. The mortgagee's
right to receive the money depends upon the compliance of certain
formalities prescribed in this section, viz., the presenting of a verified
petition, stating the amount due on his mortgage and his willingness to
accept the sum deposited in full discharge of his debt, and the depositing
of the mortgage-deed and other documents connected with the property
in Court. (See para 2 of this section). If the mortgagee does not comply
with these formalities and refuses to accept the amount, claiming a larger
sum than that deposited, the money stands to the credit of the mortgagor,
by whom it can be withdrawn at any time, and the Court has no
jurisdiction to allo'w it to be attached by the creditors of the mortgagee
Dal Singh v. Pitam Singh, 25 All. 179. Where a subsequent mortgagee
deposited the mortgage-amount to the credit of the prior mortgagee who
did not take any notice of such payment; in a suit by the former to
enforce his mortgage it was contended that the subsequent mortgagee
was entitled to interest on this amount: held that the money so deposited
remained the property of the plaintiff and the defendant (prior mortgage),
was not liable to pay interest on that amount Ahammad v. Surya Kumar,
42 C.W.N. 1177. H the mortgagee refuses to accept the deposit in full
satisfaction, then the mortgagor can withdraw the money in view of
sec. 84. The mere fact of maldng a deposit or tender does not merge
the money in the mortgaged property and the money does not cease to
be the property of the mortgagor Gupteswar v. Radha Mohan, infra ;
Ahammad v. Surya Kumar, 42 C.W.N. 1177. If,' on the other hand, the
mortgagee complies with fte above formalities, the money deposited by-
the mortgagor becomes the property of the mortgagee so as to be liable
to be attached by the latter's creditors Mothiar v. Ahmatty, 29 Mad. 232.
Sec. 83 1
TRANSPER OF PROPERTY 795
a laraer sum than that deposited. Thus, where a deposit having been
made under this section, the mortgagee refused to accept the money,
claiming a larger sum, and after a redemption decree was passed against
him he filed an appeal similarly claiming a larger amount, but during thq
Pendency of the appeal, applied for and withdrew the . deposit-amount,
held that the mortgagee must be deemed to have received the money in
lull discharge of the mortgage-claim, and he had no right to prosecute
- the appeal in which he claimed a larger amount Dal Singh v. Pitam Stngh,
25 AH. 179. So also, where upon a deposit' made by the mortgagor, the
mortg^ee informed the Court that the amount deposited was insufficient,
and requested the Court to require .the mortgagor to deposit the balance
of the' amount due, but after several months the money was somehow or
other drawn out by the mortgagees agent, held that the money so, drawn
out must be held to have been drawn out in full discharge of the mort-
gagors liability; that the section provided that the money lodged in
full discharge" of a liability could only be drawn out by a creditor in full
discharge of that liability, and that it could not be assumed that the
agent drew out the money in part satisfaction of the mortgagors liability
Ram Chandra v. Keshobati, 36 Cal. 840 (P.C.). But where some money
was deposited under this section for payment to a mortgagee, and on
objection being raised by the mortgagees as to the insufficiency of the
amount, the mortgagor agreed to pay the balance which was found due
from him, and at the request of the pleader for the mortgagor the Court
paid the money deposited to the mortgagees and endorsed payment on
the back of the deed and returned it to the mortgagees ; held that thel
mortgagees did not take the money in full discharge of tilie mortgage as
provided by this section. Since the mortgagor himself admitted that the
amount was not in full discharge of the debt, and thus waived one of the
conditions implied by this section, he could permit the mortgagee to
withdraw the money without prejudice to the latters claim for a larger
amount ffartfoyaf v. Prithi Singh, 32 All. 142. Acceptance by a prior
mortgagee of a deposit made by the subsequent mortgagee in full satisfac-
tion of the mortgage-debt precludes the prior mortgagee from contending
that the payment was made on behalf of the mortgagor and that para 1 of
sec. 92 did not apply Balkrishna v. Shankareppa, A.I.R. 1942 Bom.
227, 44 Bom. L.R. 415.
It has been stated before that the deposit under this section should
include the sums spent by the mortgagee in possession under sec. 72 and
which he can add to the mortgage-money under this section, e.g.. Govern-
ment revenue paid by the mortgagee to save the estate from sale If,
however, the mortgagor deposits only the principal and interest, .without
depositing the amount of revenue, and the mortgagee accepts the deposit-
money, ^ves up possession and returns the moragage-deed, the mortgage
mnrtf ^^^^suished, and the mortgagee has no longer any lien on the
ffie to recover
the amoimt by sale of the properly. He can only bring a simple monev
This section does not authorise the Court to take any security bond
trom any party on making payment to him of the money deposited Rahia
Koeri v. Nanhaki, supra- The mortgagee after accepting the money deposit-
ed cannot later claim damages on the ground that he was not given
possession of the mortgaged property Ditiari Singh v. Bijendra Singh,
A.I.R. 1963 Pat. 324.
Cessation of interest
Sec. 84]
509. Tender See Note 367 under sec. 60, and Note 498 under the
heading Tender.
tender-SAeoraten v. Behari-
s^g him to refram from filing suit and promising to pay by a fixed date
pay and informing that the amount is ready, does hot of itself
[Sec. 84
But actual production of the money is not necessary where the mort-
gagee refuses to accept it. In such a case, the readiness of the mortgagor
to pay would be equivalent to sufficient tender. Actual production of
mo.iey may be dispensed with by the express declaration or equivalent act
of the creditor if the tender be otherwise sufficient ; so that if the debtor
says that he has the sum ready in his pocket (stating the amount) and
brought it for the purpose of satisfying the demand, or being in the house,
offers to go and fetch it from another part of the house, but the creditor*
desires him not to trouble himself to produce or fetch the money as he
will not take it, or if the creditor and communicating personally with the
debtor refuses to authorise his agent to take the money, or to take it him-
self, the tender wll be good. ^Fisher on Mortgage, 5th Edn., p. 719.
Where the mortgagor had in his Bank the full amount which was due to
the mortgagee, and went with his cheque-book ready to give the mortgagee
a cheque, or to cash the cheque at once if the mortgagee wanted cash,
but the mortgagee prevented him from doing so by refusing to have any
dealings with him, held that there was a valid tender, and interest would
cease to run Venkatai'ama v. Gopalakrishta, 52 Mad. 322, 56 M.L.J. 255,
A.I.R. 1929 Mad. 230 (231), 116 I.C. 844. In a Privy Council case it has
been held that if a mortgagee unequivocally refuses a proposed pajunent
of the amount due, the mortgagor is hot bound to make a formal tender of
it, and the mortgagee cannot recover interest accruing subsequently, even
if he proves that the mortgagor had not the tnoney or the control of it
Chalikani Venkatarayanim v, Zamindar of Tuni, 46 Mad. 108 (116) (P.C.),
28 C.W.N. 25, 71 I.C. 1035, A.I.R. 1923 P.C. 26. The practice of the
Courts is not to require a party to make a formal tender where from the
facts stated in the bill or from the evidence it appears that the tender
would have been a mere form and that the party to whom it was made
would have refused to accept the money per Wigram, V, C. in Hunter
V. Daniel, (1845) 4 Hare 420. See also Bhagawantrilayiia v. Venkadhoya,
A.I.R. 1941 Mad. 484 (F.B.), 1941 M.W.N. 460, 53 M.L.W. 647. Specific
objection to a tender amormts to an implied waiver of any other objection
there may be, consequently the refusal of a tender, not because the amount
tendered is short, but because the mortgagee considered that he was entitl-
ed to wait until the date fixed for payment in the mortgage-deed, which
meant more interest for him, amounts to a waiver of any objection to the
amount being short Ibid. Where the principal and interest in a mort-
gage*bond was payable .jay a. fixed date,, the word .byt meant on -or
Sec. 84]
before the fixed date Where a valid tender of the entire amount
was made, and a request was made that the mortgagee should accept what
was just on accounts being taken, but the mortgagee not merely disputed
the accounts but refused to make any account and rushed to Court, held
that his conduct was such as not to entitle him to any interest accruing
after the date of tender Joti Lai v- Fateh Bahadur, A.I.R. 1929 Pat. 397
(399).
The Madras High Court has said that a tender in order to be effectual
to stop running of interest must be followed by deposit in Court when the
creditor sues for the money, because it is the best way in which he can
prove his ability and willingness to pay Arunachallam v. Govindaswami,
55 Mad. 548, A.I.R. 1932 Mad. 109 (111), 135 I.C. 907. This view was
also taken by the Bombay Hi^ Court in Haji Abdul v. Hajt Noor, 16
Bom. 141, and by the Calcutta High Court in Rakhal v. Baikuntha, 32
C.W.N. 1082 A.I.R. 1928 Cal. 874. But there is nothing in sec. 84 to
support this proposition and the Calcutta High Court refused
to accede to this view in Gajendra v. Ska Nath, A.I.R. 1926 Cal.
310, 90 I.C. 637. The Rangoon High Court is also of opinion that if the'
mortgagor asks the mortgagee to accept the mortgage-money, and the
mortgagee refuses to accept it, there is a valid tender, and no interest
is chargeable thereafter, and a subsequent mortgagee seeking to redeem
a prior mortgage can t^e advantage of the tender made by the mortgagor
to the prior mortgagee, and so would not be liable to pay any interest
for the .period subsequent to the date of such tender Chettyar Firm v.
Chettyar Firm, A.I.R. 1930 Rang. 255 (257), 127 I.C. 594.
2 vS^ i-terest-
[Sec. 84
A mortgagee who refuses a valid tender does so at his risk, and the
risk which he incurs is twofold, namely: in the' first place, he has to
account for all the receipts from the mortgaged property from the date
of the tender (section 76, clause i), and in the second place, interest ceases
to run on the principal money from the date of tender Satyabadi v.
Harabati, 34 Cal. 223 (228). A mortgagee-in-possession who has refused
to give any accounts under sec. 76, cannot refuse the tender made by the
mortgagor on the ground that it is less than the amount due Ramlal v.
Narayanarao, A.I.R. 1927 Nag. 138, 99 I.C. 630.
The interest on the principal money ceases when the mortgagor has
duly made a deposit of all that is due on the mortgage. If at first he had
deposited an inadequate amount, and subsequently made a further deposit
paying off all that was due, interest would cease only from the latter date
Deo Dat v. Ram Autar, 8 All. 502. The tender or deposit of a less amount,
even if made under a bona fide mistake does not stop the running of interest
Gaurishankar v. Abu Jafar, 3 O.L.J. 204, 34 I.C. 690 ; Siibbai v. Palani, 30
M.L.J. 607, 34 I.C. 825. But see Ramgopal v. Lachman, A.I.R.T938 All.
423 (426) (F.B.), (1938) A.L,J. 617, 176 I.C. 509. In two earlier cases of
Bombay and Allahabad High Courts, however, a deficient deposit made
under the bona fide belief that if was the whole amount due, was held to
be valid pro tanto and the interest also ceased pro tanto Haji Abdul- v.
Haji Noor, 16 Bom. 141 ; Narasingha v. Acchaibar, 36 All. 36. See also
Bhabani v. Kadambini, A.I.R. 1929 Cal. 304 (306), 33 C.W.N. 279, 119 LC.
292." Where it has been held that the deposit by a purchaser who could
not have known whether any interest was due was a valid deposit and
interest ceased to run from the'date of the deposit. But where a mortgagor
brought into Court the whole sum found due by the' Court of first, instance,
SEC. 841
This is clearly laid down in the new proviso. A Full Bench of the
Madras High Court had dissented from the above view and had observed:
. The only question properly arising was whether the mortgagor, notwith-
^anding his wiftdrawal, remained ready and willing -to pay throu^out.
The better opinion seems to be that the fact of the tender (deposit) raises
me presumption ftat the debtor continued ready and willing to pay, and
mat flie burden is cast upon the creditor to show that the debtor was
eimer not willing to pay or not able to pay because he had utilized the
101
[Sec. 84
511. Mortgagor has done all that has to be done The Le^slature
has drawn a distinction between the case of a tender and the case of a
deposit as to the date from which interest shall cease to run. In the case
of a tender, interest shall cease from the date of the tender ; but in the
case of a deposit, the interest only ceases when the mortgagor has done
all that has to be done by him to enable the mortgagee to take the amount
out of Court ; that is to say, he must do something more than make a
deposit Pandurang v. Mahadaji, 27 Bom. 23 (27). But neither this
section nor sec. 83 states expressly what are all the things that the
mortgagor has to do KriShrv^ami v. Ramasami, 35 Mad. 44 (45).
Sec. 91]
Service of notice ; ^The amendment made at the end of the 1st para
requires that notice of the deposit- should be served on the mortgagee.
It was formerly held that when the mortgagor deposited m Court the
amount due upon the mortgage and paid batta for the notice with the
proper address of the mortgagee, he had done all that had to be done by
him, and interest ceased to run thereafter Subbai v. Paldni, 30 M.L.j.
607, 34 I.C. 825, and the fact that the notice was not actually served on
the mortgagee till after a long time, was no fault of the mortgagor ;
because the duty of getting thp service of notice effected on the mortgagee
was not part of the duty of the mortgagor. As soon as he applied for
the issue 'of notice to the mortgagee, and gave the correct address, he
had done all that could be done to enable the mortgagee to take the money
out of Court, and interest ceased to run therefrom Pandft Jiva Ram v.
Thakurain Khem Koer, 70 I.C. 811, A.T.R. 1923 All. 24. But this view is
no longer correct. Under the present section notice must be actually
served upon the mortgagee, before interest will cease to run.
Redemption.
[Sec. 91
Sec. 91 ]
I.C. 678.
In a suit for redemption tlie mortgagor can, to his claim for redemp-
tion, join a claim for rent paid by him to the mortgagees use Subedar
Mian v. Sheo Shankar, A.I.R. 1940 Pat. 579, 189 I.C. 109.
t Sec. 91
fixed for redemption by the trial Court and the appeal by the mortgagee
is dismissed, the mortgagor is not entitled to a direction from the appell-
ate Court for taking further accounts Ibid.
Sec. 91]
[Sec. 91
under the law a landlord is given a first charge on the holding of his ten-
ant for rent, the prior encumbrancers have a subsequent right of suit
Shamzav v. Kamalnayan, A.I.R. 1948 Nag. 316, I.L.R. 1947 Nag. 912.
The purchaser of certain mortgaged property paying off the mortgage
had suflScient interest within the meaning of this section though he was
found to have acquired no title on account of a prior sale deed, though
registered after his purchase Ramakrishna v. Venhatasami, A.I.R. 1945
Mad. 175, (1945) 1 M.L.J. 154. See also Perumal v. Suppiah, A.I.R. 1945
Mad. 500, (1945) 1 M.L.J. 341.
Sec. 91 ]
A.I.R. 1932 All. 356, (1932) A.L.J. 289, 136 I.C. 8^10. The purdiaser in
execution of a mortgage-decree acquires not only the interest of the
mortgagee, but also the equity of redemption of the mortgagor, and he
is entitled to redeem other mortgages in the same property created by
the mortgagor Mt. Aziiimnissa v. Komal Singh, A.I.R. 1930 Pat. 579
(581), 9 Pat. 930. The purchaser cannot redeem upon payment t)f the
amount decreed in the mortgage-suit, he must pay the amount to be
found due under the original mortgage-bond giving deduction for die pro-
fits made by the mortgagee auction-purchaser from the date of taking
possession of the property Ib/d at p. 584. A vendee is entitled to
redeem as the purdiaser of a widows interest in the properties mortga-
ged in the absence of proof that the widow had no interest to convey
Rangayya v. Basana, A.I.R. 1926 Mad. 594, 94 I.C. 639. An assignee of
subsequent mortgagee is entitled to redeem the prior mortgage by pay-
ing the amount due under it to the purchaser of the property under the
decree based on the prior mortgage Mt. Sheoratan v. Kamta Prasad,
102
[Sec. 91
A.I.R. 1932 PRt. 270 (271), 11 Pat. 415, 139 I.C. 78. A prior simple mort-
gagee having obtained a decree for sale against the mortgagor has an
interest in the mortgaged property and in die right to redeem under this
section in spite of the dismissal of his suit against a subsequent mortgagee
=-^heo Prasad v. Prakash Rani, A.I.R. 1938 Oudh 10, (1937) O.W.N. 1118,
171 I.C. 434.
513. Persons having interest in or charge on property : It is a gene-
ral principle that no person is entided to redeem unless he can show a
title to the estate of the mortgagor. The person claiming redemption
must prove that he has an interest in it Dam Dihal v. Maharaja of Vizi-
\inagram, 30 AH. 488. A person claiming to be die heir of the original
mortgagor is not entitled to redeem unless he is the heir according- to the
law of inheritance applicable to the property. Tlius, the brothers and
nephews are not heirs to an occupancy holding under sec. 9 of the U. P.
Tenancy Act, 1881, if they did not share in the culdvation jointly with the
deceased, and they cannot redeem die mortgage of the holding created
by the deceased Ram Singh v. Baldeo, 1932 A.L.J. 605, A.I.R. 1932 All.
643 (647). This clause refers to a person having an interest in or
charge upon the property which is affected by the mortgage, and a raiyati
interest is not such an interest. Consequently the purchaser of a raiyati
interest in die mortgaged property is not entided to redeem it Girish
Chandra V. Juramani, 5 C.W.N. 83. Clauses {a) and (b) of sec. 91 do not
cover the interest in property held by a tenant or yearly lessee to whom
it is given for cultivation ; such a tenant or lessee has no right to redeem
the property Kalu Singh v. Hansraj, 78 I.C. 47, A.I.R. 1925 Oudh 270
(271). But the permanent lessee of the mortgagor has tha right to redeem
rRaghunandan v. Ambika, 29 All. 679; Shankar v, Hukumchand^ 14
N.L.R. 117, 47 I.C. 99; Sakharam v. Pandurang, A.I.R. 1953 Bom. 315,
55 Bom. L.R. 286. But permanent lessees on the land prior to die mort-
gage are not affected by it ibid. An auction purchaser of an agricul-
tural holding in a sale in execution of a rent decree found to be void
has been held to be entided to redeem die mortgage on such, holding
Saraf v. Jamvna, A.I.R. 1945 Pat. 289, 24 Pat. 263. The Nagpur Court
is of opinion that even a lessee for a term of years is a person having an
interest in the property and is entided to redeem Pannalal v. Rajaram,
23 N.L.R. 128, A.I.R. 1926 Nag. 496, 96 I.C. 973; Ghulam Nabi v. Kan-
liai, 16 N.L.R. 180, 50 I.C. 511; Sheoram v. Jamnabai, 19 N.L.R. 18,
A.I.R. 1923 Nag. 273. The lessor of the mortgagor can redeem if enforce-
ment is sought against leasehold rights Piarelal KJiuman v. Bhagwati
Prasad, A.I.R. 1969 Madh. Pra. 35. A mortgagor is entitled to redeem
a sub-mortgage Easwari PiUai v. jKrfe/ina PiUai, A'.I.R. 1969 .Ker. 73.
But where the lease is granted by the mortgagor in the ordinary course
of management and is thus binding on the mortgagee, the lessees interest
not being jeopardised by the mortgage, he is not entided to redeem
it Patoankumar v. Jagdeo, A.I.R. 1947 Nag. 210, I.L.R. 1947 Nag. 740.
Where however the lease executed by the mortgagor is void and wholly
inoperative, the lessee has no right to redeem Kamakshya v. Ramzan,
A.I.R. 1945 Pat. 106, 23 Pat. 648. .Where a lease is binding on the mortr
gagor, ' whether- it -is so on the mortgagee or not, he is still a necessary
party to the mortgagees suit, and if he is not made a party, his .right
Sec. 91 ]
Where tliere are several mortgagors each and every one of the mort-
gagors is interested, in the payment of the mortgage-money and the
redemption of the motgaged estate, and each and every one of them has
a right by payment of the money to redeem the entire estate, seeking
contribution from oiO^eTs^orender v. Dwarka Lai, 3. Cal. 397 (P.C.);
Pearce v. Morris, L.R. 5 Ch. 227. Under this section, the smallest inter-
est in the equity of redemption will entitle a person to redeem, and he
is .entitled (and bound) to redeem the whole property. So, an owner of
a portion of the equity of redemption is entitled to redeem the entire
property S/jflnfccr v. Bhikaii, 53 Bom. 353, 116 I.C. 225, A.I.R. 1929 Bom.
139. (141); Fakir. Chand v. Bobu Lot, 39.' All. 719,(721) ; Rugad Smgh
V. Sast Narain, 27 All. 178 (182) ; Baikuntha v. Mahesh, 22 C.W.N.' 128
(129), 41 I.C. 77 ; Pratap Chandra v. Peary Mohan, 22 C.W.N.' 800' (802),
48 I.C. 669 ; Huthasanam v. Parameshtoaran, 22 Mad. 209 (211). A per-
son who has purchased a portion of the equity of redemption is -entitled
to sue for redemption of the whole mortgage Nainappa v. Chidambaram,
[Sec. 91
Under Malabar law, except in' very special circumstances where the
ICamavan is' proved to be guilty of gross' misconduct and collusion, it
is not competent to the j'unior members' of a tarwad to sue for redemp-
Sec. 91 ]
tion of a Kanom granted by their Kamavan Soopi v. Mariyoma, 43 Mad.
' 393. But see Neelkanta v. Sivarama, 1958 Ker. L.J. 72.
A person having an inchoate right may not redeem until the comple-
tion of his title but if a person whose title is to some extent imperfert
seeks to redeem, and is able to prove a perfect title at the hearing of his
case, he should have a right to redemption Krishnaji v. Ganesh, 6 Bom.
139 ; Tukaram v. Satvaji, 5 Bom. 206 (207).
[Sec. 91
Sec, 92]
Subrogation.
[Sec, 92
Thus, the present section is more comprehensive than the old section
which applied only to the case of a subsequent mortgagee redeeming a
prior mortgage.
Since the above observations were made by the present editor in the
last edition, Thomas, C.J. and Radha .Krishna J. of the Oudh Chief
Court have held that the amended sec. 92 is retrospective in its opera-
Sec. 92]
tion Krishna Gopal v. Abdul Latif, 15 Luck. 175, A.I.R. 1940 Oudli 97
(101), 1939 O.W. N. /1045 ; Brij BhuWian v. Bhagwan Dali, A.I.R. 1943
Oudh 449 (F.B.) ; so also the Bombay High Court has held in Vishnu
Balkrishna v. Shankarajjpa, A.I.R. 1942 Bom. 227, 44 Bom. L.R. 415. A
Full Bench of the Patna High Court has also taken the same view, Man-
ohar Lall, J. dissenting, in Tika Sao v. Hari Lai, 19 Pat. 752, 21 P.L.T.
453, A.I.R. 1940 Pat. 385 overrulmg Jagdeo v. Mflhahir, supra. The Alla-
habad High Court has again held Aat those sections of the Act which
are not dealt with in the sections enumerated in sec. 63 of the Amend-
ing Act 20 of 1929 have retrospective effect at least where no action was
pending on 1st April; 1930, and sec. 92 is not one of the sections enumer-
ated in sec. 63 and hence has retrospective effect Chuni Lai v. Lakshmi
Chand, I.L.R. 1940 All. 212, 1940 A.L.J. 234 A.I.R. 1940 All. 237. Ben-
net and Verma JJ. of the same High Court have also held that this sec-
tion is retrospective Mangal Sen vJ Kewal Ram, A.I.R. 1940 All. 75, 187
I.C. 274. Qiriously enough, the same learned Judges have held in
Munna, Lai v. Chatan Prakash, I.L.R. 1940 All. 79, A.I.R. 1940 All. 65,
1939 A.L.J. 1099 that the amended sec. 84 is not retrospective, althou^
that section is not enumerated in sec. 63 mentioned above. For a general
discussion of the question see Note lA ante.
103
[Sec. 92
under para 1 if he is one of the persons, other than the mortgagor enu-
merated in sec. 91. But where the person does not himself redeem the
mortgage, i.e., does not himself pay the money out of his o\vn pocket
in excess of his contractual liability, but advances mon^ to a mortgagor,
and the money is utilized for payment of a prior mortgage, whether the
money is actually paid through the hands of the mortgagor or is left
for such payment in the hands of the person advancing the money and
it is then paid to the prior mortgagee tiurou^ the hands of that person,
the latter acquires the right of subrogation under para 3 only if "die mort-
gagor has by a registered instrument agreed that he shall be so subrogat-
ed VisJmv EalkrisJma v. Shanhareppa, A.I.R. 1942 Bom. 227 (229), 44
Bom. L.R. 415.
The expression the same rights may have in the first para
Sec, 92 ]
and has been for the first time introduced by the Amendment Act of'
1929. The equitable doctrine of subrogation, however, existed in India
nrinr to 1st April, 1930 Bank of Chettinad v. Maung Aye, A.I.R. 1938
Hane 306 (311) (F.B .) ; Pramatha v. Janaki, A-I.R. 1937 Cal. 194 (199),
41 C.W.N. 472, 171 I.C. 747 ; Malireddi v. Gopala, A.I.R. 1924 P.C, 36,
47 Mad. 190, 79 I.C, 592.
Secs. 74 and 75 of the Act were based upon the principle of sub-
rogation. Where the prior mortgagee got a decree upon his mortgage
and the puisne mortgagee deposited in Court the decretal amount, he
was entitled to claim the riglit of subrogation under sec. 74^hamsuddih
V. Haidar Alt, A.I.R. 1945 Cal. 194, 49 C.W.N. 104.
The essence of subrogation is that the party who pays off a mortgage,
he becomes clothed with all the rights of the mortgagee. It is some-
times called an equitable assignment. The principle underlying subroga-
tion is that the mortgage or charge is not extinguished but is kept alive
and its benefit is transferred to the subrogee. It is not a new charge
created by operation of law ibid; Rp^tatfendracharya v. Vaman, A.I.R.
.1943 Bom,'- 191, 45 Bom. L.R. 293j Nachappa v. Samiappa, A.I.R. 1947
Mad. 18, (1946) 2 M.L.J. 35. Besides the right of subrogation under this-
section, the subrogee has a right of re-imbursement under sec 69 or sec. 70,
Contract Act and it would be governed not by Art,. 120 but by Art. 61
Limitation Act Perutnal v. Suppiah, A.I.R. 1945 Mad. 500, (1945) 1
M.L.J. 341. A subrogee has the right to split up the mortgage and
distribute the liability to different items of property in the possession
of different subsequent transferees Babu Lai v. Baudhyachal, A.I.Sl. 1943
Pat. 305, 22 -Pat. 187.
[Sec. 92
who has paid ofE Hire Singh v. Jai Siingh, A.I.II. 1937 All. 588 (591) (F.B.),
I.L.R. (1937) AH. 880, (1937) A.L.J. 840, 171 I.C. 153. See also Kfimlapmi
Devi V. Jogeshvoar Dayol, 18 Pat. 342, A.I.R. 1939 Pal. 375 (377), 1939
P.W.N. 8.
Under tliis section a person can be substituted for the prior mort-
gagee and ^^ill have the same rights of foreclosure or sale against the
subsequent mortgagee as the prior mortgagee would have had. The
limitation for tliis is that applicable to the original incumbrance and
does not depend on the date of payment of the person subrogating
Totaram v. Hartsh Chandra, A.I.R. 1937 Nag. 402 (406). See also
Sibanand v. Jdgmohan, A.I.R. 1922 Pat. 499, 1 Pat. 780, 68 I.G. 707;
Kotappa V. Raghavayya, A.I.R. 1927 Mad. 631, 50 Mad. 626, 102 I.C.
3i6; Md. Ibrahim v. Amhika, 39 Cal. 527 (P.C.), 39 LA. 68, 16-C.W.N. 505,
14 I.C. 496.
Sec. 92]
the persons claiming such right have full rights to enforce th^. earlier
bonds even against property not covered by the bond in their favour
J-mc Sao V. Han Lai, A.I.R. 1941 Pat. 276, 19 Pat. 752 (F.B.), A.I.R.
1940 Pat. 385 (F.B.), 21 P.L.T. 453.
[Sec. 92
Sc. 52 j
But the case is otherwise if there is no such intention, and tlie mere
fact of paying off a subsequent mortgage by the prior mortgagee at the
request of the mortgagor does not create an equitable charge in favour
of the prior mortgagee Isap v. Umedraji, A.I.R. 1938 Bom. 115 (118), 39
Bom. L.R. 1309, 174 I.C. 188. See also Matadin v. Kazim, 13 All. 432
(F.B.).
[Sec. 92
mortgagee redeeming a prior mortgage stands in his shoes and is bound
by a grant or disposition made by him even to a mortgagor Amar
Clvand v. Sardar Singh, A.I.R. 1925 Nag. 90 (95). Where a subsequent
mortgagee seeks to redeem a prior mortgage, it is necessary that the prior
mortgage must be subsisting at the time. If both mortgages
are usufructuary, the two cannot subsist at one and the, same
time, and no question of redemption of the prior mortgage-
arises, So also, this section does not come into operation where
the language of the second mortgage clearly shows that the intention
of the parties was to extinguish the prior mortgage by the execution of
the second Koopmia v. Chidambaram, 19 Mad. 105 (107); or where
it is clear that the first mortgage has been extinguished and satisfied
out of the money raised by the second Wilayet Hussain v. Karam
Hussain, 12 O.C. 185, 3 I.C. 590. A second mortgagees right to redeem
the prior mortgage is in its nature a right -to consolidate the two secu-
rities into one as against the mortgagor and to hold them together
until they are redeemed, and there can be no right to consolidate when
the first security ceases to exist by payment or by a Court-sale which
extinguished the first mortgage Perumal v. Kaveri, 16 Mad. 121.
Where a puisne mortgagee redeems a prior mortgage and brings- a
suit against the mortgagor (agriculturist) to recover the money paid
by him for redemption of the prior mortgage, the suit is one on the
basis of a loan as defined in sec. 2 (9) U. P. Debt Redemption Act and
the agriculturist mortgagor would be entitled to claim the benefits of
sec. 9 of that Act, as he would have been if the prior mortgagee had
himself brought a suit on his mortgage Ishwar Dayal v. Cyan Singh
A.I.R. 1948 All. 331 (F.B.), 1948 A.L.J. 350.
104
826 TRANStER OF PROPEftlV
[EC. $2
at the time when the subsequent mortgagee redeemed that mortgage, the
subsequent mortgagee could claim to recover liis money not by sale of
the entire property which existed at the date of the first mortgage, but
only sucli property wliich existed at tire time of his redemption. In other
words, he cannot acquire any liiglier riglit thair that of the prior mort-
gagee whom he redeems Md. Mohmud v. Kalyan Dos, 18 All. 189.
If the subsequent mortgagee redeems more property than given to him '
by the terms of his own mortgage-deed, he is entitled to retain possession
of it in subrogation to tire rights of the mortgagee redeemed by him till
a projrortionate amouirt is paid to liim by those interested in the property
other than that to which he is entitled under his own mortgage-deed
Raghunandaii v. Ajodhya. 1931 A.L.J. 214, A.I.R. 1930 All. 869 (871), 129
I.C. 378.
Where the puisne mortgagee is not made a party to tlie prior mort-
gagees suit for sale, the former can eitlier proceed against the mortgaged
property in the hands of the pui'chaser in execution of the prior mort-
gagees decree or against the surplus sale proceeds KrishnastiMmi v.
Thirumahi, A.I.R. 1926 Mad. 101 (102, 104), 90 I.C. 410. Where a puisne
mortgagee is not made a pai^ to the prior mortgagees suit, the former
can redeem tlie prior mortgage on die basis of the mortgage and inde-
pendently of the mortgage-decree /agesioar v. Sridhar, A.I.R. 1928 Pat.
589 (592).
Sec. 921
A puisne mortgagee paying off a prior mortgagee does not get any
new charge in respect of that payment. The language of sec. 74 makes it
clear that the second mortgagee is, by redemption of the prior mortgage,
to acquire no other right dian that possessed by the first mortgagee. In
effect,' there is deemed to be a transfer of the first mortgage to the sec-
ond mortgagee. Tlie law secures to the latter which he might have
acquired by a conveyance. But there is no question in this case of
creating a new charge on the property Perianna v. Afflrudafnai/flgan, 22
Mad. 332 (335).
Tlie remedy provided in this section is not the only remedy open to
a subsequent mortgagee paying off a prior mortgage ; he can also bring
a suit under sec 69, Contract Act Durga Charan v. Ambica Charan, 54
Cal. 424, A.I.R. 1927 Cal. 393 (394), 45 C.L.J. 191.
TRANSFER OF PROFERTV
[Sec. 91
tlie payment made by the puisne mortgagee). In otlier words, the second
mortgagee who disdiarge tlie prior mortgage and tlie decree obtained
on tliat mortgage is not an assignee of the mortgage or of the decree,
and it not entitled to work out his rights by executing the decree (under
the provisions, of sec, 47, C. P. Code) but has to bring a fresh suit for
the purpose of obtaining a new decree Gopi Narain v. Bansidhar, 27
All. 32-5 (332, 333) (P.C.), (reversing Bansidhar v. Gaya Prasad, 24 All.
179); Shib Lai v. Munni Lai, 44 AU. 67 (70); KoUappa v. Ra^tavayya,
supra; Aravamadhu v. Abiramamlli, A.I.R. 1934 Mad. 353 (35.5), 66
M.L.J, 566, 150 I.C. 930. A distinction should be made between a prior
mortgage as such and a prior mortgage-decree,- if a prior mortgage is no
longer alive as a mortgage but has suffered a change into a decree for
sale, and cannot therefore be enforced as a mortgage by the prior mort-
gagee, it cannot be deemed ahve as a mortgage and enforceable as such
by the puisne mortgagee who has paid it off in the shape of a decree-debt.
In such a case the puisne mortgagee is subrogated not to its original
form as a mortgage-charge but to the decree-charge held by the prior
mortgagee, i:e., the right to hold tlie property, to sale to satisfy the decree-
debt. Tlie payment of the decree by the puisne mortgagee cannot
reverse the process of conversion it has passed and revive it again as a
mortgage. But the puisne mortgagee can enforce his remedy only by
b ringin g a fresh suit, and not by executing the decree from the point at
wliich the prior mortgagee left off. That decree has -been alreadf/
satisfied, and no one can execute a satisfied decree Parvati- Ammal v.
Venkafarama, 47 M.L.J. 316, A.I.R. 1925 Mad. 80 (82, 84), 81 I.C. 771.
Where a puisne mortgagee has, in execution of a decree on his mortgage,
purchased the mortgaged properties and subsequently, pending an ap-
plication by the mortgagor to set aside the sale, pays off a prior mort-
gagee-decree-holder, he is entitled, if the sale is set aside, lo enforce prior
mortgage against the properties secured by it Sibanand v.
Jagmohan, 1 Pat. 780 (784), 3 P.L.T. 533, A.I.R. 1922 Pat. 499,
68 I.C. 707. "Wliere a puisne mortgagee purchases the mort-
gaged property in execution of the decree on a prior mortgage, the
latter is extinguished. At any rate, tlie puisne mortgagee is. subrogated
to the position of the prior mortgagee whose security he might if he
chose, enforce, but there is no conresponding riglit to redeem in die
mortgagor. Rights of the puisne mortgagee-purchaser in such a case is
not limited or regulated by this section Kalipada v. Basanta, A.I.R. 1932
Cal. 126 (133), 59 Cal. 117, 35 C.W.N. 877, 138 I.C. 177. A puisne
mortgagee who discharges a jjrior mortgage under a term of the puisne
mortgage has no. valid claim of subrogation is resirect of the prior mort-
gage unless there is a registered agreement to that effect Bangaru- Ammal
V. M. V. Kvppuswami Chettiar, A.LR. 1963 Mad. 211.
SEC. 92]
bad High Court in Alam Ali v. Beni Charan, A.I.R. 1936 All. 33 (43) (F.B.),
(1933) A.LJ. 1294, 160 I.C. 541 has held (Ganga Nath, J. dissenting) that
the payment of a mortgage-decree confers upon the person who pays
it ofl a statutory right which is not identical with the right of an assignee
of the mortgage itself, but is an acquisition of a fresh charge enforceable
within 'the period of limitation applicable to such a suit. Tlierefore, a
subsequent mortgagee who pays off the decretal amount of a prior mort-
gage and redeems it acquires tlie rights of the mortgagee-decree-holder
to recover his money by enforcement of the fresh charge \vitliin 12 years
of redemption under Art. 132, Limitation Act. See also Miinna Lai v.
Chunni Lai, A.I.R. 1945 All. 239 (F.B.), I.L.R. 1945 All. 733 (overruling
Hira Singh v. Jai Singh, A.I.R. 1945 Cal. 194, 49 C-W.N. 104; Parvati v.
Vehkatarama, A.I.R. 1925 Mad. 80, 47- M.L.J. 316) Bahulal v. Bindhachal,
A.I.R. 1943 Pat. 305, 22 Pat. 187. But see contra Balchand v. Ratan-
ciiand, A.I.R. 1942 Nag. Ill, I.L.R. 1942 Nag. 393.
Where a person is not a surety for the mortgage debt, but the secu-
rity is given by fte principal debtor by way of additional security, this
section does not apply BJuishayya v. Sunjanarayana, A.I.R. 1944 Mad.
195, 1.L.R. 1944 Mad. 340.
[Sec. 92
sale of such property the same rights as the mortgagee had against the
mortgagor iCisften Gopal v. Abdul Latif, 15 Luck. 175, A.LR. 1940 Oudh
97 (101), 1939 O.W.N. 1045.
The fact that one co-mortgagor redeems the entire estate and is in
possession of it, does not entitle him to hold it adversely to the other
co-mortgagors, even though he had been in exclusive possession of the
entire estate prior to redemption. Like a mortgagee, he is only entitled
to a charge on the property Chandbhai v. Hasanbhai, 46 Bom. 213 (215),
A,I.R. 1922 Bom, 150, 64 I.C. 205. But if the mortgage is a usufructuary
one, and the amount is satisfied out of the usufruct, one co-mortgagor
cannot take possession of the entire property from the mortgagee, but is
entitled to recover only his individual share. If, however, he gefs posses-
sion of the entire property, he is then deemed to hold the shai;es of thd
others adversely to them, and not subject to a charge (for since he had
to pay nothing, he cannot have any charge) Gobardhan v. Sujan.16 All.
254. If a purely usufructuary mortgage is redeemed by one co-mortgagor
by paying the money out of his own pocket,- instead of being redeemed
out of the usufruct, the redeeming co-mortgagor has no doubt a charge
Sec, 92]
on the property, but he cannot in enforcing the charge sell the shares of
the co-mortgagors, since there is no personal ' covenant in the original
mortgage. His only right is to retain possession until payment to him
Mamola v. Kedctr, 22 LC. 918 (Oudh). The original mortgagee under the
usufructuary mortgage had no right of sale (sec. 67) and there is no reason
why the redeeming co-mortgagor should be placed in a better position
than the mortgagee, and be allowed to bring the property to sale.
[Sec. '92
A co-mortgagor who redeems the entire mortgage and stands in' the
position of a mortgagee breaks the integrity of the mortgage thereby, because
he may be deemed a mortgagee who has acquired the share of a mortgagor
(z'.e., his own share), within the meaning of sec. 60. Consequently, he
cannot compel the other co-mortgagors to redeem the whole property in
solidum, but he must split up his claim into a claim against each, and can
only insist upon each of. them to redeem only his own share of the mort-
gaged property. See Umar Ali v. Asmatali, 58 Cal. 1167 (F.B.), 35 C.W.N.
409 (422). This is also evident from the words proportion" and his share"
occurring in sec. 95. See also Ghulam Maula v. Bamo, 4 O.C. 273. In
this respect the position of a redeeming co-mortgagor stands different from
that of a puisne mortgagee paying off a mortgage-debt. The latter is
entitled to proceed against all the mortgagors jointly, and not against'
each of the mortgagors for the proportionate share of debt due by each
of them Tabarak Ali v. Dalip Narain, 8 P.L.T. 255, 98 I.C. 968, A.I.R.
1927 Pat. 117 (121) ; on appeal, 9 P.L.T. 313, A.I.F. 1927 Pat. 379 (381), 103
I.C. 703.
S17A. Other persons ; This section lays down that all persons who
are referred to in sec. 91 can, upon redeeming the mortgaged property,
claim the right of subrogation. And so, a person having an interest in the
mortgaged property can, upon redemption, claim the right. Thus, where
a member of a Malabar tarward paid off a mortgage of the tarward pro-
perty created by a previous Karnavan, held that as he was not a mere volun-
teer nor even a stranger, but was a member of the tarward, and, as such'
having an interest in the property and a ri^t to protect it, he was entitled
to be subrogated to the rights of the niortgagee Nangunni Kovillamma v.
Nedungadi, 31 L.W. 165, A.I.R. 1929 Mad. 860 (862). The mortgagee from
a separated member of a tarwad is a person interested in a mortgage created
before partition, and on redemption of the prior mortgage binding on the
tarwad he becomes subrogated to the rights of the mortgagee whom he has
redeemed Krishnan Nair v. Dakshayani Amma, (1955) 1 M.L.J. 223.
Sec. 92]
502 (504)', Rcnn v. Gtilab, A.I.R. 1933 Nag. 241, 144 I.C. 736 ; Giidiram v.
Punamchcntd, A.I.R. 1933 Nag. 171, 144 I.C. 326;Umed v. Babu Ram,
air 193'! AU. 1035 (1036), (1934) A.L.J. 887, 150 LC- 937. See Ganga
v'm. Hardei, A.I.R. 1932 All. 32, (1931) A.L.J. 601, 133 I.C. 536. In such
cases, the purchaser can only claim contribution of the proportionate amount
of debt which the suit propefly bears to the rest of the property Draviat?i
V. Ramahja, A.I.R, 1935 Mad. 390 (393), 15? I.C. 837, 68 M.L.J. 362. Where
land burdened wiifli prior and subsequent mortgages is purchased by a person
for full price and free from any encumbrance and he is 'subsequently com-
pelled to discharge the prior mortgage when it is disclosed to him, he is
subrogated to the rights of the prior mortgagee as against the subsequent
mortgagee v. Amrut Rao, LL.R. 1939 Nag. 690, A.I.R. 1939
Nag. 217 (219), 1939 N.L.J. 366 relying on Gokaldas v. Piirammail, 11 LA.
126, 10 Cal. 1035 (P.C.) and Malireddi v. Gopalakrishnayya, 51 LA. 140, 47
Mad. 190 (P.C.), A.LR. 1924 P.C, 36. In such a case the transferee must
show that the mortgagor in the prior mortgage was the mortgagor of the sub-
sequent mortgage and that the properties mortgaged were the same and
that the payment had been made by or on behalf of himself Saradindu v.
Jahar Lai, 46 C.W.N. 33, A.I.R. 1942 Cal. 153 (164), 74 C.L.J. 61. Accord-
ing to the terms of a subsequent mortgage, the mortgagee was given a
right to redeem a prior mortgage bn payment of a certain sum out of
the mortgage-money. Subsequently, the equity of redemption was transfer-
red to another person who redeemed the prior mortgage. The subsequent
- mortgagee thereupon instituted a-suit for possession by redemption: held,
the suit did not lie and the rule of . subrogation was not applicable to the
case Har Dial v. Gurditta Ram, A.LR. 1940 Lah. 201, 42 P.LR. 139, 188
LC. 608.
Plaintiff who had a simple money-decree against the mortgagor caused
the mortgaged property to be put to sale and purchased the equity of
redemption. Subsequently a second mortgagee got a decree on his mort-
gage and. applied for final decree for sale. Plaintiff paid off the decretal
amount and afterwards brought a suit on the second mortgage to recover
the amoimt which he had paid to the mortgagees joining the second mort-
gagee, the mortgagor and the third mortgagee as defendants and based
his claim' under this section on the ground that by paying off the decree
of the second mortgagee he was suborgated to the position of that mort-
'gagee: Held, (1) the plaintiff was not entitled to bring the suit on the
second mortgage as it had already been the subject of a decree ; (2) the
plaintiff having purchased the equity of redemption was in the position
of a mortgagor within sec. 59A and was not entitled to the right of subro-
gation under sec. 92 ; (3) merely joining the original mortgagor as defendant
did not satisfy the requirements of sec. 92 -as none of the defendants did
actually possess the equity of redemption Piarey Ldl v. Dinanath, LL.R.
,1939 All. 185, A.LR. 1939 AU. 190 (192, 193), 1939 A.L.J. 228. See in this
connection Shankerrao v. Vinayak, A.LR. 1951 Nag. 307, LL.R. 1950 Nag.
806 ; Balkrishna v. Rangnath, A.I.R. 1951 Nag. 171. But see Narayan v.
Parameshwappg, A.LR. 1942 Bom. 98, 44 Bom. L.R. 20 where it has been
held that in providing that besides the mortgagor the following persons
are entitled to redeem and including among those persons such persons
as derive title from the mortgagor, -sec. 91 clearlydistinguishes beriveen the
mortgagor and persons deriving' title from the mortgagor ; and in saying
105
[Sec. 92
that any of the persons mentioned in sec. 91 other than the mortgagor are
entitled to subrogation, sec. 92 obviously repeats the distinction and so
provides an exception to the general rule laid down in sec. 59A; hence an
auction-purchaser under a money-decree who pays off a prior mortgage
is entitled to subrogation against a subsequent mortgagee.
A decree for sale does not extinguish the equity of redemption until
the sale is confirmed (see the amended r. 8 of O. 34, C. P. C.). Therefore,
if a person who is interested in the mortgaged property pays into Court the
decretal amount before a sale is held, he is entitled to be subrogated to
the rights of the mortgagee-decree-holder UngftuMat/i v. Krishnarao, A.I,R.
1937 Nag. 196, 171 I.C. 612. So a purchaser from the judgment-debtor of
property which has been actually sold in execution of a puisne mortgagee's
decree can, before confirmation of the sale by reason of discharge of the
prior mortgage on that property, claim to be subrogated to the rights of
the prior mortgagee as against the Court auction-purchaser Venkata-
c/ialam v. Alagarswami, A.I.R. 1936 Mad. 264, 43 M.L.W. 342, 162 I.C.
34.
This para la]^ down the rule of what is called conventional subroga-
tion, which takes place when a third party, who has no interest to protect,
SEC. 92]
Paras 1 and 3 of this section are mutually exclusive ; para 1 refers to.
a person redeeming property' and para 3 to a person who advances money
with which a mortgage is redeemed. Para 1 deals with subrogation arising
by operation of law, while para 3 deals with subrogation by agreement
Hira Singh v. Jai Singh, A.I.R. 1937 All. 588 (595) (F.B.), I.L.R. (1937)
All. 880, (1937) A.L.J. 840, 171 I.C. 153 ; Lakshmi v.'Shankara, A.I.R. 193,6
Mad 171 (174) (F.B.), 43 M.L.W. 23 ; Subbarayadu v. Lakshminarasamma,
(1939) 2 M.L.J. 533, A.LR. 1939 Mad- 949, 1939 M.W.N. 819.
Para 3 does not cut down para 1. A lender might well have a statutory
right of subrogation under para 1 as falling within the class delimited by
sec. 9\Taibai v. Wasudeorao, A.I.R. 1930 Nag. 372 (376) (F.B.), 172 I.C.
[Sec. 92
The mere fact that money is borrowed and is used for the purpose of
paying off a previous charge does not entitle the lender to the benefit
of the discharged security. The right to the benefit depends upon the
existence of an agreement between the borrower and lender in which it is
provided that the subsequent lender must be substituted for the earlier
creditor Gwfeffn Lai v. Aziz Fatima, 41 All. 372, 50 I.C. 375 ; Ram Halt
Sec. ^2]
V Pokhar 7 Luck. 237, 134 LC. 1093, A.LR. 1932 Oudh 54 ; Bhola Nath
v' Maharani, A.I.R. 1936 Oudh 280 (284), 162 I.C. 362. Where a prior
mortgage is redeemed partly by the mortgagor and partly by the vendees of
the mortgaged property in terms of covenants in the sale-deed without any
registered agreement, providing that the vendees should be subrogated
to the rights of the prior mortgagee who was paid off, the vendees as against
the puisne mortgagee are not entitled to the rights of subrogation under
this section Lffw Singh v. Jai Singh, supra, at pp. 589, 598, A purchaser
with whom is left part of the consideration of the sale for paying off a
mortgage, but in whose favour there is no express agreement of subrogation
in writing registered, is not entitled to claim subrogation as against a later
mortgagee under this amended section Taibai v. Wasudeorao, supra.
Such is the case also with a mortgagee who advances money to the mort-
gagor for paying off a previous mortgage Lakshmi v. Shankara, supra, at
p. 172. Even before the amendment, it was held that where a person pay-
ing off a prior mortgage purchases a portion of the morgaged properly
in consideration of the amount so paid by him, the lien acquired by such
payment is extinguished and cannot be used by such purchaser as a shield
against a subsequent mortgagee Benga Srinivasa v. Ganaprakasa, 30 Mad.
67.
I Sec. 92
gagor Gobinda Chandra v. Porsa Nath, A.I.R. 1926 Cal. 231, 89 I.C. 116,
following the English case of Rutler v. Rice, (1910) 2 Ch. 277. See also
Govinda v. Murugesa, A.I.R. 1931 Mad. 720, 135 I.C. 529- But this view
is not correct and has been disapproved of in Adari Sanyasi v. Nookalamma,
54 Mad. 708,' A.I.R. 1931 Mad. 592 (596) and Vellayiidhan v. Nallathambi,
A.I.R. 1928 Mad. 541 (542). Subrogation will arise only in those cases
where the party claiming it advanced the money to pay a debt which in
the event of default by the debtor he would be bound to pay or where he
had some interest to protect, or where he advanced the money under an
agreement, made either with the debtor or creditor, that he would be
subrogated to the rights and remedies of the creditor Narayana Kiitti v.
Pechiammal, 36 Mad. 426 (432), citing Wilkins v. Gibson, 113 Georgia 31.
A purchaser of the mortgaged property who has paid off mortgages on
the property, is entitled, after the sale is found to be invalid, to stand in
the shoes of the mortgagee whom he has paid off. He is not 'a mere volun-
teer, because when he discharged the mortgages he did so by virtue of his
claim as a purchaser and had an interest to protect Naziniddin v. Ahmad
Husain, 25 A.L.J. 20 (P.C.), A.I.R. 1926 P.C. 109 (110), 31 C.W.N, 538,
97 I.C. 543 ; Chama Swami v. Padala Anandii, 31 Mad. 439 (442), 18 M.L.J.
306 ; Syamalarayudu v. Subbarayudu, 21 Mad. 143 ; Ammani Ammal v.
Ramaswami, 37 M.L.J. 113, 51 I.C. 57 (60). But in a recent case, the ,
Calcutta High Court has held that a person holding an invalid mortgage
with the money advanced on which a prior mortgage is paid is not entitled
to be subrogated to the position of such prior mortgagee Padma Lochan
V. Ajmaddin, (1938) 42 C.W.N. 1106. A distinction in some cases has,
however, been made between a person in possession and one who is not in
possession. Thus, a purchaser of land who, while in possession of the
land pays off an encumbrance on it, is entitled, when his purchase is found
invalid, to stand in the shoes of the mortgagee whom he has paid off
Mt. Nathibai v. Wgilaji, A.I.R. 1937 Nag. 330 (333), I.L.R. (1937) Nag. Ill,
169 I.C. 675 ; Dwarka v. Ali Mahammad, A.I.R. 1930 Oudh 397 (399), 127
I.C. 17. So, a purchaser whose sale-deed was found to be invalid redeem--
ing a usufructuary mortgage and getting possession was held to be entitled
to be paid the amount of the usufructuary mortgage before he could be
ejected from the land by the prior purchaser but whose sale-deed was
subsequently registered Chotey Lai v. Sudershan, A.I.R. 1937 All. 119
(120), I.L.R. 1937 All. 208, 167 I.C. 648. But at the same time it was held
in this case that the purchaser who had also discharged a simple mortgage
on the property was not entitled to use such pa}Tnent as a shield and resist
the prior purchasers claim for possession until he (the subsequent pur-
chaser) has been paid the amount of the simple mortgage paid by him
[relying on Bijai Saran v. Bageshwari Prasad, A.I.R. 1929 P.C. 288, (1930)
A.L.J. 531, 51 C.L.J. 70, 120 I.C. 650] for the simple reason that his mort-
gage did not entitle him to be in possession. The Madras High Court
has recently held that if a person who has a title void ah initio and no other
interest in the property .discharges a prior mortgage, he is in the position
of a mere volunteer and cannot claim to be subrogated. Mere possession
also is not sufficient to. support a claim of subrogation unless that posses-
sion is accompanied by some interest in the property which the person
in possession is entitled to protect. This, however, may possibly be quali-
fied if the discharge of the prior encumbrance was necessaiy to prevent
Sec. 91 ]
[Sec. 92 -
Sec. 92]
All. 489 (491)i which makes no distinction between a case where the
subsequent mortgagee pays ofE the prior mortgage of his own accord or
pays it off out of the money left in his hands by the mortgagor. But in a
recent Full Bench case of the same High Court it has been held that
where a subsequent mortgagee or vendee pays off a prior mortgage out
of his own funds and is thus out of pocket in excess of the amount of
the mortgage-money or the sale-consideration which had been fixed by the
deed, he is certainly entitled to the right of subrogation. But the money
with which the subsequent mortgagee or the vendee pays the first mort-
gage, may be the property of the mortgagor and so no subrogation should
be allowed as -the subsequent mortgagee or vendee in making the pay-
ment is acting only as an agent of the mortgagor Hira Singh v. Jai Singh,
A.I.R. 1937 All. 588 (594) (F.B.) I.L.R. (1937), All. 880, (1937) A.L.I. 840,
171 I.C. 153. See also Karam Chand v. Ram Singh, A.I.R. 1937 Lah. 665,
39 P.L.R. 899 ; Mukaram v. Md. Hossein, A.I.R. 1936 Cal. 42 (43), 62 Cal.
677, 161 I.C. 48. Such a. purchaser is not entitled to subrogation under
para 1 ; but he may be so entitled under para 3 if the mortgagor by a
re^stered instrument agreed that he should be subrogated Bansidhar v.
Karloo Mandar, A.I.R. 1938 Pat 532 (533), 19 P.L.T. 500, 176 I.C. 655.
106
i Sec. 92
were paid. The fourth mortgage was not a comprehensive mortgage of
properties of the prior three mortgages. Subsequently, the mortgagor
executed a mortgage in favour o P charging all the properties in the
four prior mortgages with certain other properties with the object of satis-
fying the debt on the four prior mortgages. It was provided in this mort-
gage-deed that P would be subrogated to the rights of B on payment off
of debts on all or any of the prior mortgages. The mortgagor with this
money actually paid to B all debts due on the first three mortgages before
the right to sue on the fourth mortgage accrued to B. B brou^t a suit
on the fourth mortgage: held that P was entitled to be subrogated to
rights of B under the first three mortgages ranking in priority to the
mortgage thereon of B under the terms of the present section 92, or if
sec. 92 was not applicable (as the mortgage was executed in 1927), then
under the pre-existing law Janaki Nath v. Pramatha Nath, A.I.R. 1940
P.C. 38, 67 I.A. 82, LL.R. (1940) 1 Cal. 291, 44 C.W.N. 361.
[Sec. 03
SEC. 94]
Tlie words except in the case provided for by section 79" mean
except where the mortgage expresses a maximum to be secured tliereby.
If no maximum is fixe,d, the case falls under the latter part of this section
and the prior mortgagee, making a subsequent advance to the mort-
gagor whether with or without notice of an intermediate mortgage,
does not acquire any priority over die intermediate mortgage in respect
of his security for such subsequent advance Imperial Bank of India
V. 17. Rai Gtjaw Tim & Co., Ltd., 51 Cal. 86 (98) (P.C.), 1 Rang. 637,
A.I.R. 1923 P.C. 211, 28 C.W.N. 470, 76 I.C. 910. Tlie word subse-
quent from the context must mean sulisequent to the interaiediate mort-
gage, so in the sense of the section an advance when made after another
mortgage is granted becomes a subsequent advance Ibid.
521. Tliis section only relates to the rights of the second mort-
gagee as against the subsequent mortgagees, and does not define his
rights as against the mortgagor, which have to be gathered from die
other provisions of the Act Kanti Ram v. Kutubiiddin, 22 Cal. 33
(38, 42).
[Sec. 95
Md. Jaman v. Akali Mudiani, A.I.R. 1943 Cal, 577, 47 C.W,N. 682.
A puisne mortgagee can realize his right to the jus possessendi without
redeeming the prior mortgage ibid. Where there are prior and puisne
mortgages on the same property and suits are instituted by the prior
and puisne mortgagees, each not impleading the other, the purchaser
at the Court sale in execution of tlie decree obtained by the prior mort-
gagee cannot redeem the purchaser at the Court sale in execution of
the decree obtained by the puisne mortgagee Shanmugam Nadar v.
Sivan Pilai, A.I.R. 1967 Mad. 41S.
Sec. 95]
not include the case of a' redeeming co-mortgagor but was concerned
only with the subsequent mortgagee redeeming a prior mortgage. Umar
Ali v. Asmatali, 58 Cal. 1167 (F.B.), 35 C.W.N. 409 (419), 130 I.C. 889.
'fhe old section 95 has been elaborately analysed and explained in this
case.
Eadi and every one of the mortgagors who owns separate shares
in the mortgaged ' property is entitled to redeem the whole estate by
payment of the whole mortgage-debt; and seek contribution from tlie
others Narender v. Dtcarka, 5 I.A. 18 (27), 3 Cal. 397 (P.C.).
The word mortgagor includes persons deriving title from the mort-
gagor (sec. 59A); consequefitly, a purchaser of the equity of redemption
of one of the mortgagors can redeem tlie whole mortgage Dha1ce$tvar
V Harihar, 21 CL.J. 104, 27 I.C. 780 (783); Ramchandra v. Narayam-
stcami, 51 Mad. 810, 112 I.C. 6. A.I.R. 1928 Mad. 950 (951); MoJvan v.
Kashinath, 3 N.L.R. 92. So also, one of tlie representatives of the
original mortgagor can do so Mamola v. Kedar Nath, 22 I.C. 918 (919)
(Oudh).
All. 110, where the mortgage was satisfied by a co-owner of the pro-
perty after decree.
Under the present Rule 5 of Order 34, the mortgagor can redeem
even after sale, and before the confirmation of the sale.
Payment need not be made in Court: ^If the money is paid out
of Court, and the decree-holder accepts it, and certifies the payment,
the requirements of this section are fulfilled Tukarama v. Arjuna, 54
I.C. 904 (Nag.).
Sec. 97]
the judgment-debtor for setting aside lire sale of the mortgaged property
is not an expense properly incurred in redeeming the mortgage Damo-
darasami v. Govkx^raiiilu, A.I.R. 1943 Mad, 629 (F.B.), (1943) 1 M.L.J.
291. So also tlie compensation which a mortgagor has to pay to die
auction-purchaser on the sale of the mortgaged property being set aside
under O. 21, r. 89 C. P. Code is not an expense properly incurred ibid.
107
850 TRANSFER OF PROPERTY
[Sec. 98
Anomalous Mortgages.
SEC. 98]
in the Act is not afiEected by this section Ganga Prasad v. Dulari Saren,
A.I.R. 1937 Pat. 345 (347), 170 I.C. 134.
It has' been held that the provisions of sec. 60 are imperative and
the ri^t of redemption cannot be lost even in the ease of an. anomalous
mortgage Chellakutti v. Veragappa, A.I.R. 1925 Mad. 366, 82 I.C. 809.
But in a FuU Bench case of the Madras High Com-t Wallis, C. J. and
Sheshagiri Ayyar, J. Avere of opinion that sec. 60 does not apply in the
case of an anomalous mortgage when there is a contract or local usage
to the contrary Kahdula v. Padmanobhudu, 43. Mad. 589 (F.B.).
[Sec. 98
It was held in certain Madras cases that since the rights of the parties
are governed by the term of the contract, any covenant agreed between
the parties in a deed of anomalous mortgage must be enforced, even
tliough it amounted to a clog on redemption Kiittikat v. Ktinhikava-
mma, 1918 M.W.N. 235, 43 I.C. 989 ; Hakeem Patte v. Sheikh Davood,
39 Mad. 1010 ; Kandvla Venkiah v. Donga Pallaya, 43 Mad. 589 (598,
609) (F.B.), 57 I.C. 724. But this view has now been overruled by a
Privy Council case. In this case, the mortgage-deed provided tliat the
property was mortgaged for five years, that tire mortgagor was to redeem
at the end of the term, and that if he did not do so, the mortgagee was
to have the option of taking possession for a period of twelve years. If
the mortgagee took possession, the mortgagor would not be entitled to
redeem within 12 years. Hie mortgage-debt not having been paid at
the end of five years, the mortgagee took possession ; in tlie same year
the mortgagor sued to redeem. The mortgagee contended that since he
elected to take possession, the mortgagor was not, entitled to redeem till
Sec. 16o1
after the expiry of twelve years. Held tliat even if it were an anomal-
ous mortgage in which the rights and liabilities of the parties are deter-
mined by the agreement entered into between them, stiU such agreement
cannot defeat the statutory right of rdemption conferred by section 60.
That section is unqualified in its terms and is not controlled by the pro-
visions of sec. 98, and it lays down that a mortgagor has a right of
redemption as soon as tlie principal money has become due. In tlie
present case tlie mortgage is stated to be for five years, which means that
the principal money becomes due after 5 years, and the mortgagors right
of redemption consequently accrued after the expiry of that period. This
right cannot be defeated or postponed for 12 years by reason of the
mortgagee taking possession. In other words, an agreement creating a
clog on redemption cannot be enforced even in an anomalous mortgage
Mtihammad Sher Khan v. Raja Seth Stoami Dcj/aZ, 44 All. 185 (P.C.),
25 O.C. 8, 66 I.C: 853, A.I.R. 1922 P.C. 17. If the suit for the sale of a
property subject to a usufructuary mortgage containing also a stipula-
tion for the sale of property is dismissed the mortgagees .right to possess
is not thereby extinguished Bharoselal v. Danjao, 1961 Jab. L.J. 1207.
Where the stipulation in the deed entails great hardship on the parties
and amounts to a penalty, it will be relieved against by the Court. See
Kottal Uppi V. Edamlath, 6 M.H.C.II, 258. Assuming that die Court has
jurisdiction to grant relief against penalty, the Court has no jurisdiction
to re-open a final deci'ee for foreclosure for die purpose of extending
the time for foreclosure on equitable grounds Awfffr Singh v. Md. Ejaz
Rasool, A.I.R. 1950 P.C. 88, 54 C.W.N. 313, 77 I.A. 53.
Charges.
[Ec. ioO
SeC. 1001
The first part of this section deals with substantive rights and the
second with the manner in which they are to be enforced. The latter
portion does not govern the former; hence as agreement which clearly
falls within the definition of charge cannot be invalidated altogether simply
because it contains provisions which offend against the procedure law
as laid down in the later portion of the section Renukabai v. Bheosan
Hapsaji, A.I.R. 1939 Nag. 132, 1939 N.L.j. 129, 185 I.C. 33.
(7) In the case of a charge the property need not be specific. A charge
differs from a mortgage not only in form but in substance. For instance
a plea of purchase for value without notice may be good against a charge,
but not against a mortgage Bapurao v. Narayan, A.LR. 1950 Nag. 117,
I.L.R. 1949 Nag. 802.
Sec. 106 3
(F.B.).
'
Charge and lien distinguished : (1) The main distinction between the
two terms is that a charge may be created by act of parties or by opera-
tion of law, whereas a lien can arise only by operation of law. A lien
answering to the. tacita hypotheca of the Civil Law, is a right conferred '
by law, and not by contract, upon one man to retain possession of or have
a charge upon property real or personal belonging to another, until certaini
demands are satisfied. But in some works the word lien is used to
include not only lien arising by operation of law, but also charges or
hypothecations arising out of contract ; as where one agrees to give another
a lien on property." ^Fisher on Mortgage, 5th End., p. 2.
108
S5 fRANSKR OF PROPERTY
[EC. 100
Sec. 106 j
[Sec. IflO
and it can neither sue nor take the property nor assign it Mehdi AH v.
Chunni Lai, 1929 A.L.J. 902, A.I.R. 1929 All. 834 (836), 119 I.C. 81 ; see
also Raj Raghubir v. Jai Indra, 46 LA. 228, 42 All. 158 ; Akshoy Zamindarij
V. Ram Nath, 40 C.W.N. 1281.
Sec. 100 ]
was to be paid in easy instalments and stipulated that the debtor would
not alienate a specified money until the satisfaction of the debt, field that
the property was made security for the pasmient of the debt, as the
stipulation intended to preserve the property intact so as to be available
for realisation of the amount. Consequently, a charge was created on
the property Narain v. Murli Dhar, 6 O.W.N. 903, A.I.R. 1929 Oudh 539
(540), 121 I.C. 81. Jawahir v. Indomati, 36 AH. 201 (per Richards, C.J.) ;
Royzuddi v. Kali Nath, 33 CaL 985. Defendants borrowed money from
the plaintiff for starting a factory. An agreement was entered into which
provided that in certain events the properties of the factory would be
liable for certain moneys and that in certain other contingencies the lender
would be at liberty to recover a certain amount from the machinery of thd
factory or from the borrowers. A promissory note was also passed ui
favour of the plaintiff. Held that the agreement amounted to an equitable
charge on the property (factory) Amratlal v. Keshavlal, 28 Bom.L.R. 939,
A.I.R. 1926 Bom. 495, 98 I.C. 606. Where a mortgagee, after executing
a mortgage for a village executed a further document in which he recited,
"I shall first pay off this debt, including principal and interest, and there-
after I can redeem the mortgaged village, having paid up the mortgage-
money. Without the ipa 3 mient of tills debt, I cannot redeem the mort-
gaged village. Held that the intention of the executant was that the
debt created b}"^ this document was a further charge on the village
Adiuja V. Ram Ratan, 5 5Luck. 365 (P.C.), 57 I.A. 173, 34 C.W.N. 625
(627), 123 I.C. 191. A.I.R. 1930 P.C. 176, 59 M.L.J. 342, 28 A.L.J, 646;
Janardan v. Anant, 32 Bom. 386 (390). By a document one J admitted
liability in respect of which he undertook to execute a charge-bond over
a specific share and rights in a village together with the sir land. J further
had undertaken to get sanction for tiie transfer of sir and not to assign
certain property until the above were carried out: Held that the last
undertaking was to segregate the property so that it would be answer-
able in the hands of J" should he fail to give the charge-bond, and that made
the property a security for the payment of money, and a charge was thus
created by the deed T>au Bhairoprasad v. Jugal Fra'sad, A.LR. 1941 Nag.
102, 1940 N.L.J. 651. A document statiiig I have willingly fixed an annual
allowance of Rs. 100 in cash in perpetuity ,out of the profits of the said
village for my eldest brother creates a valid charge Kanhai Lai v.
Muhammad Hussain, 5 AH. 11. A will devising immoveable properties
and directing the devisee to pay certain debts of the testator from these
properties creates a charge on them in respect of those debts Girish
Chunder v. Anundamoiji, 15 Cal .66 (P.C.). An agreement called a sanad
and attested by witnesses, by which a Hindu agrees to pay to his sister,
and after her death, to her daughter, a fixed sum every, three years out
of the proceeds of an estate inherited by him from his maternal grand-
mother, creates a valid charge on the produce of the estate, and tiie heir
of the grantor takes it subject to this charge Chalamanna v. Subbama,
7 Mad. 23. Similarly, where an allowance had been enjoyed for more
than three quarters of a century and had been received during all' that time
out of certain lands, with the acquiescence of the successive owners
thereof, it implied a valid grant of the allowance in perpetuity and that
^^as charged on those lands Manavikrama v. Copalan, 30 Mad. 203.
Where P, a partner, under a consent decree in a suit for, divorce, agrees
. I Sec. 100
to pay his unmarried daughter Rs. 250 per month and thereafter there is
a further agreement between P, his daughter and the other partners that
the said sum is to be paid out of the remuneration and profits payable to
P from the firm a charge is created in favour of the daughter on the
remuneration and profits payable to P Commissioner of Income-tax v.
C. N. Patuck. (1969) 1 LT.J. 14.
Sec. 100]
[Sec. lOO;
(b) Where several properties are liable for the payment of an annuity
and the owner of one of such properties has discharged the whole liability,
he acquires thereby a charge on the other properties Yakub v. 'Kishen,
28 All. 743.
(c) Section 228 of the Calcutta Municipal Act makes the consolidated
rate as it accrues from time to time a charge on the property Akhoy v.
Corporation of Calcutta, 42 Cal. 625, 27 I.C. 261. See also A. M. A.
Firm v. Marudachalam, A.I.R. 1948 Mad. 412, (1948) 1 M.L.J. 284;
Nawalkishore v. Municipal Board, A.I.R. 1943 All. 115 (F.B.), I.L.R. 1943
All. 458 ; Har Chara7i v. Agra Municipal Board, A.I.R. 1952 All. 315. A
municipality cannot enforce its charge on a property on account of arrears
of tax in the hands of a bona fide purchaser for value at a court sale
without notice of the charge Hafi Abdul Gafur v. Ahmedabad Muni-
cipal Corporation, (1967) 8 Guj. L.R. 65.
if) A co-sharer who pays the entire arrears of rent under the Madras
Estates Land Act is entitled to a charge on the other co-sharers portion
of the holding Vyraperumal v. Alagappa, A.I.R. 1932 Mad. 189, 55 Mad.
468, 135 I.C. 609 ; Mariam v. Narayanan Thrathar Nambooripada, A.I.R-
1965 Ker. 55.
(k) Where a person 'pays money for the purpose of restoring the
property to its owner, he has a lien on the property known as a salvage
]\enKunja v. Bhagabat, A.I.R. 1953 Or. 103, 17- Cut.L.T. 157. Cash
Sec. 100]
109
[Sec. 100
Nath Sen v. Santa Sila Devi. A.LR. 1968 Cal. 336 ; Ra]dh Bomfhadevara
V. Rao Janardhana, A.I.R. 1959 Andh. Pra. 622 (F.B.). But see Raichand
V. Basappa, A.LR. 1941 Bom. 71, 42 Bom.L.R. 1113 where it has been
held that the principles underlsdng Or. 34 of the C. P. Code may and ought
to be applied by analogy to charges created by a decree, unless the terms
of the decree make it clear that the remedy of recovering the decretal
amount from the property charged was not given in lieu of the personal
remedy, but in addition to it. Where a decree declares a charge on
certain properties, the parties to the decree as well as their privies are
bound and one effect of this is that the questions of notice does not
ordinarily arise Ghasiram v. Kundanlal, supra. In a charge created by
a decree there is no privity of estate between the charge-holder and the
judgment-debtor and consequently the latter can deal with the property
and a bona fide transferee from him without notice will be protected
Goswami v. Ramchandra, A.I.R. 1944 Nag. 1, I.L.R. 1943 Nag. 713.
There is no difference in principle between a charge created by a decred
and one created by the act of parties or by operation of law ibid. Where
a charge-decree is merely declaratory and thus incapable of execution,
the bona fide purchaser for value without notice takes free of the charge,
the reason being that the legal estate prevails over a mere equity except
when the legal owner takes with notice Ibid, at p. 171 ; Manmolian Das
V. Bahauddin, A.I.R. 1957 All. 575.
Sec. 100]
[Sec. 100
would not be a charge on the plaint properties, the direction that the
amount could be realised from the properties of the defendants family
could not amount to a charge on those properties Sankararu v.
Dakshayani, A.I.R. 1953 Tr.-Coch. 193.
-Sec. 166]
500, A.LR. 1928 Rang. 278 (280), 113 I.C. 801. A co-sharer paying off
the amount of the rent decree and the auction purchasers fees, and getting
a sale.set aside under sec. 174 of the Bengal Tenancy Act, does not acquire
a charge on the shares of the -defaulting co-tenants Gopi v. Ishur, 22 Cal.
800. Where one of the two persons having a joint holding from a
mittadar, paid the whole of the mittadars due for certain years, such
payment did not create a charge on the \a.n6.Thanikachella v. Stidachella,
15 Mad. 258.
Where a mortgagee has paid the revenue and land tax in respect of
the mortgaged property, 'this section can have no application unless the
mortgagee elects to have the money spent by him added to the mortgage-
principal Murray v. M. S. M. Firm, A.I.R. 1936 Rang. 47 (48), 161 I.C. 626.
[Sec. 100
TRANSFER OF PROPERTY 87 I
Sec. 1063
The expenses incurred by the trustee are a first chai'ge or hen upon
the corpus of the estate Ex paite James, 1 Dow & Cl. 272; Re Esdiall
Coal Co,, 35 Beav. 449; but the Court of Law will not order tlie trustees
hen to be realised by giving a decree for foreclosure or sale, for it would
have the effect of destroying the trust estate. The proper course for
such realisation is to dehver ilie deeds into his custody, and to' issue a
prohibition against any disposition of die property widiout previous dis-
charge of thq trustees hen Darke v. Williamson, 25 Beav. 622.
CoB^tr action : A proviso excepts out of the earlier part of the sec-
tion sometliing wliich but for the proviso would be within it. Para 2
limits tire operation of para 1, and tiie word charge must have reference
to the charge mentioned in para 1. Mahesh v. Mt. Mundar, A.I.R. 1951
All. 141 (F.B.), 1951 A.L.J. 39. But see Raichand Qulabchand v. Daitaray
Shankar Mote, A.I.R. 1964 Bom. 1. Tlie words transfer for consideration
are used in a wider sense and include both a transfer by act of parties
and one by operation of law' or in execution of a decrep, thus including
an auction-jjurchaser in a Court sale Nawal Kishore v. Municipal Board,
A.I.R. 1943 AU. 115 (F-B.), I.L.R. 1943 All. 453 overruling Indra Narain
V. Md. Ismail, A.I.R. 1939 All. 687, I.L.R. 1939 All. 885. See also Raj-
kishore v. Sultan Jehan, A.I.R. 1953 fat. 58; Sheo Narain v. Lakhan, A.I.R.
194^ Pat. 434, 24 Pat. 345
Akbar Khany A.I.R, 1937 Pesh. 76 (78), 170 I.C, 136. In an AUahabad
case it was held that if. the charge was created by a decree of Court, ^t
could be enforced against a bona fide transferee for value without notice
Maine v. Bachchi, 28 All, 655 (659).
This section must be read along witli sec. 52. Hence, where during
the pendency of a suit by a Hindu widow for maintenance against her
husbands coparceners and for a charge on the family proi^erty the co-
parceners executed a mortgage on that property, tlie mortgage \vbuld be
affected by the diarge granted in tire widows suit, even if the mortgagee
took the mortgage without notice of the suit Rajagopala v. Kesava,
A.I.R. 1945 Mad. 126, I.L.R. 1945 Mad. 726. But if a charge is not sIiotoi
in the proclamation for sale under Or. 21, r. 66 tlie charge cannot be
enforced against the auction-purchaser Laxmi Deoi v. Mvkand, A.I.R.
1965 S.C. 834. .Where an auction-purchaser purchases a property with-
out notice of a charge created on such property by a maintenance decree,
the auction-purchaser is hit by lis pendens and the property in the hands
of the auction-purcliaser will be liable for discharge of the maintenance
decree Bela Dibya v. Ramkishore Mohanty A.I.R. 1969 Orissa 114.
Either under this section or under the more, general rule of law, the
burden is on die transferee to establish that he is a bona fide transferee
for value without notice Renukabai v. Bheosan Hapsaji, A.I.R. 1939
Nag. 132, 1939 N.L.J. 129, 185 I.C. 83.
[Sec, lOi
Sec. 1011
Thus, under the old section, 'extinguishment was the mle, and
keeping alive was the exception (although this rule was rarely followed).
Under the new section, keeping alive is the rule.
In this amended section the legislature has adopted the simple rule
that the existence of a subsequent incumbrance prevents merger. But
it did not amend or alter thq old law of the union of estates which occurr-
ed when the mortgagee acquired the rights of the mortgagor or tlie
purchaser of the equity of redemption acquired the rights of the mort-
gagee-^Deoichand v.Chiirtaman, A.I.R. 1945 Bom. 116, 46 Bom. L.R.
763. When a charge is extinguished by the purchase of the property
by the charge-holder at the prior mortgagees auction sale, what is ex-
' tinguished is not merley the' security but the debt itse]ibid.
876 T^SFEft OF
tEc. ioi
Sec. 101]
536. Principle of keeping alive*: ^In the earlier part of tlie old
section it was stated that when a mortgagee acquired the equity of
redemption in his security, tliq general rule teas that the mortgage teas
extinguished, and tlie onus was tlirown on the mortgagee to prove that
it was to his interest to keep tlie charge alive and that was his intention
at the time of the transaction Bal Rewa v. Vali Mohamed, 46 Bom.
1009 (1014), 70 I.C. 912, A.I.R. 1922 Bom. 211; Darshan Singh v. Ar/wn,
1 Luck. 560, 3 O.W.N. 741, A.I.R. 1926 Oudh 606 (607), 98 I.C. 28.
But in spite of the express words of the earlier part of tlie section,
and in spite of the rule laid down in Toulmin v. Steere, 3 Mer. 310, on
which it was based, it was held in a majority of cases tliat in such cir-
cumstances the Court would presume that it was to the benefit of the
mortgagee to keep the charge alive and that the mortgagee intended to
keep it alive. That is, the Courts laid more stress on the latter part of
the section than on the earlier part.
In Toulmin v. Steere, 3 Mer. 310, it was laid down tliat tlie purchaser
of an equity of redemption who paid off a prior mortgage out of the
purchase-money and had taken a conveyance of tlie estate from tlie
mortgagee, could not set up that mortgage as against a subsequent mort-
gagee who had taken subject to die prior mortgage. But this inflexible
rule, being based on no intelligible principle, was never followed in
India, and has been adversely commented on in several cases, even in
England. See Monks v. Whitely, [1911] 2 Ch. 488 [per Parker, J.). It
has been observed by the Judicial Committee and the Indian High
Courts that the question to be asked in each case would be 'What was
the intention of the party paying off the charge? He had a right to
extinguish it, and a' right to keep it alive. Wliat was his intention? If
there is no express evidence of it, what intention should be ascribed to
him? The ordinary rule is that a man having a right to act in eitlier
of two ways shall be presumed to have acted according to his interest
Gokaldas v. Puranmal, 10 Cal. 1035 (P.C.); Mdhesh Lai v. Mohant
Bawan Das, 9 Cal. 961 (977) (P.C.) ; Ibrahim Hossein v. Ambica Prosad, 39
Cal. 527 (P.C.); Thorne v. Cann^ (1895) A.C. 11 (19); Ayyareddi v. Gopala-
krishnayya, 47 Mad. 190 (195) (F.C.): Mehr Singh v. Amar Nath, 7, Lah.
212, 94 I.C. 152; Fakiraya v, Godigaya, 26 Bom. 88; Dinobandhu v.
Jogmaya, 29 Cal. 154 (P.C.); Jamiunnissa v. Pitambardos, 11 A.L.J. 127,
18 I.C.' 704. Hari Narayan v. Hari Prasad, 12 A.L.J. 470, 23 I.C. 827;
Mdhalakshmammal v. Sriman Madhwa, 35 Mad. 642; Shankar v. Sadasio,
38 Bom. 24 (31); Gauri Sanker v. Bahadur, 6 P.L.T. 385, A.I.R. 1925 Pat.
605 (607); Baij Nath v. Dafeep Narain, 1 P.L.T. 582, 58 I.C. 489;
Tiruvengadan. v. Safapafhi, 49 M.L.J, 361, A.I.R. 1925 Mad. 1217, 90 I.C.
767; Baldeo v. ' Dy. Commissioner, 10 O.L.J. 112, A.I.R. 1924 Oudh 1
[Sec. 101
Sec. 101]
[Sec.. 101
The principle of this section applies not only where the mortgaged
property is purchased by the prior mortgagee or charge-holder, but also
extends to cases where tire property is purchased by a third person. And
so, where tire mortgaged properties are sold to a third persoir, and the
sale-proceeds are .devoted to paying off prior incumbrances, and the
circumstances at the time of tire sale are such tliat it is for the benefit
of the purchaser that the mortgages involved in the jnirchase should
not be extinguished, it must be held that they enure for the benefit of
tire purchaser, and that he will be entitled to jrriority over puisne mort-
gagees Natchiappa v. Ko Tha, 6 Rang. 488, A.I.R. 1928 Rang. 287 (288),
113 I.C. 809; Nanguimi KotAllamma v. Nediingudi, 31 L.W. 165, A.I.R.
Sec. 101]
1929 Mad. 860 (861); Ram Lai v. Bhagat Ram, A.I.R. 1940 Lah. 247,
190 I.C. 673. But where an outsider having no interest to protect deli-
berately with his eyes open purchases in order to enable the owner and
the charge-holder to extinguish the charge between them, the stranger
purchaser is not entitled to keep the charge alive as against subsequent
encumbrances Nemasao v. Madhorao, A.I.R. 1942 Nag. 33. 1941 N.L.J.
634.
111
[Sec. 101
Sec. 101]
that tliere being no covenant by the mortgagor to pay the third mortgage,
the payments made to tlie second mortgagee \vere to be regarded as
purchases pro tanto of the second mortgage, not as a discharge of it,
the fact that the third mortgage did not include tlie crops not being
material; and that accordingly the respondents were entitled to keep
the second incumbrance alive for their own benefit, and thus obtain prio-
rity over tlie third mortgagee Ayyareddi v. GopalahrUthna, 47 Mad. 190
(195) (P.C.), 46 M.L.J. 164, A.I.R. 1924 P.C. 36, 79 I.C. 592.
[Sec. 102
Sec. 103
&c. 164 j
already a guardian of the property of the minor mortgagee; but die fact
a certain person had appeared as next-friend of die minor in a previous
litigation between the same parties, does not dispense ividi the necessity
of appointing a guardian under diis section because die proceedings
under this section cannot be called a continuation of the previous suit
Shivnath v. Manolvar, 16 O.G. 261, 22 I.C. 245.
the powers conferred on the High Court by sec, 122 of the Code, and
not under this Act.
In the same Madras case, it has been held that this section must be
read subject to sec. 15 of the Charter Act (24 and 25 Viet, c. 104) which
provides that the Hi^ Court shall have power to make and issue gene-
ral rules for regulating the practice and proceedings of all Courts sub-
ject to its appdlate jurisdiction Ibid. That is, the rules framed under
this section would not be binding upon the High Court in the exercise
of its ordinal jurisdiction in suits on mortgages. And so it has also been
held in a Calcutta case tliat the practice and procedure on the Original
Side of the High Court in suits on mortgages differ altogether from the
practice and procedure in force in the Courts outside Calcutta, Hie
practice on the Original Side of the High Court is based partly on the
rules of the old Courts of Equity in England, partly on die present prac-
tice in the Courts in England and partly on its own rules, and
is not governed by the pro\'isions of the Transfer of Property Act. In the
Courts outside Calcutta, the practice and procedure has been, and must
be, governed by this Act Mackintosh v. Watkins, 1 C.L.J. 31.
CHAPTER V.
541A. Tliis Act codifies for the first time the law relating to landlord
and tenant. Prior to the passing of this Act, the Hindu law was held
to be strictly apph'cable to a tenancy created by express contract between
Hindus see Russick Lad v. Lokenath, 5 Cal. 6S8; and tiie English rules
regarding the relation of landlord and tenant were applied whenever no
precise rule regarding the subject was to be found in Hindu law or other
laws Tara Chand v. Ram Gobind., 4 Cal. 778.
Sec. 105 ]
Before die Act lease meant that if the owner of land consented by
deed tliat another person should occupy tlie land for a certain time, there
was a lease Nagindra v. P-urna, 39 C.W.N..98.
(i) There must he a lessor, who is able to make the lease. If any
lease is granted by one against whom a decree for recovery of possession
on declaration of title has been passed, the lessee gets no title Rentala,
Lachaiah v. Chimmapudi Subrahmanyam, A.I.R. 1967 S.C. 1793.
(vi) There must be acceptance of' the thing demised and of tlie estate
by the lessee Woodfalls Landlord and Tenant, 16 Edn., pp. 134, 135.
112
[Sec. i05
Sec. 165 i
whenever the landlord wanted he could get the land vacated. In a suit
by the landlord for possession of the plot and recovery of ground rent,
held (1) that the kirayanarna could not operate as a lease, nor as a license;
(2) but it was perfectly legal, and having been executed by the tenant
he was bound by its terms Ganga Sahai v. Badrul Mam, A.I.R. 1942
All. 330, .(1942) A.L.J, 386. If possession is given under a transaction
purporting to be a sublease, the transaction being illegal, such possession
is not of a licensee but of a trespasser Jasivantlal Jagjiwandas v. Westrex
Company, I.L.R. (1959) Bom. 1482.
Sec. 105]
[Sec. 105
Grants Rules, the relationslaip of landlord and tenant should come- into
existence on the signing of a new lease at the expiry of the existing lease.
Such an agreement is valid, although not reduced to writing Syriam
Land Co. v. Rodriquez, A.I.R. 1938 Rang. 220 ((222). The pl^tifB
mote to tihe defendant : I do hereby agree to take by our personal
your letter all terms wiU be settled on agreement : held tliat the
Sec. 105]
Where the document did not create an interest in land it was not a
lease but a license coupled with a grant giving exclusive right to cultivate
and collect lac Samarthmal v. Sunderbai, A.I.R. 1952 Nag. 825. Where
a person has a licence to enter on the land, not. for the piurpose of enjoy-
ing the land, but for removing sometliing from it, namely, a part of the
produce of the soil he is not a lessee but a grantee of a profit a prandret
Shantabai v. State of Bombay, A.I.R. 1958 S.C. 532. Wlien by a deed
the right to rear and pluck fruits for some years from the forests of certain
villages is granted no interest in land is created thereby Manohar -Lal
Rameswardas v. State of M. P., A.LR. 1959 Madh. Pra. 120. Where a
[Sec. 105
Kabuliat executed by one party only provided for payment certain rent
every month in lieu of occupation of the house, it was not a lease, but
a license Dau Dayal v. Brej Mohan, A.I.R. 1952 AH'. 344. Where a
house belonging to a bank was allowed to be occupied by its manager
wthout payment of rent, so long as he occupied the post, the occupa-
tion was as a licensee Corporation of Calcutta v. Allahabad Bank, A.I.R.
1949 Cal. 109. See in this connection Governor General v. Corpn. of
Calcutta, A.I.R. 1948 Cal. 8, 51 C.W.N. 517. Where a MunicipaUly by
an instrument granted for 3 years a right to collect fees from the butchers
at its slaughter house,' it was a license and not a lease Gopaldas v.
Municipality, Hyderabad, A.I.R. 1949 Sind 1. Where the defendant by
an agreement obtained the right to enjoy the toddy yield from a cocoa-
nut garden, but had no right in the land, it was held that he was a
licensee and not a lessee of the garden Venngopala v. Thirunovakka-
rasu, A.I.R. 1948 Mad. 148, (1948) 2 M.L.J. 155. But where tlie docu-
ment was styled as a lease in perpetuity granted for the nistar of cholla
grass land in occupancy right stating a yearly rent and that inspite of this
the lessor will be entitled to take away wood for fuel and to every other
kind of nistar, it was held that tlie transaction was a lease and not a
license Baldeo v. Bfitcaram, A.I.R. 1950 Nag. 107, 1.L.R. 1950 Nag. 218. If
the stall holders in a market are not allowed to remain in occupation of the
stalls beyond the closing hour and pay rent for each day of occupation
they are licensees M. N. Clulnvala v. Fida Hussaui Saheb, A.I.R. 1965
S.C. 6ip. Tlie right to collect cocoanut during the period of its growth
amounts to a lease Arumugha Vettian v. Angamuthu Nattar, I.L.R.
(1965) 2 Mad. 518. If a divorced wife is allowed to reside in tire house
to look after the issue of marriage she is a licensee and not a tenant*
Bai Hanifa Jusab v. Memin Dadu, A.I.R. 1964 Guj. 44. A right to tap
palm trees for making toddy is a lease Sheikh Jan Mahomed v. Umanath
Misra, A.I.R. 1962 Pat. 440. A document whereby a tenant agrees to
give certain premises to B for five years with an option to renew for
another five years and the document is registered as an agreement and
not as a lease, it creates a license and not a lease zSm. Mina Ghosh v.
Daulatram Arora, A.I.R. 1967 Cal. 633- If an employee is given a
personal privilege to stay in a house for the greater convenience of liis
work he is a licensee even if the employer reserves the right of charging
fee for such occupation. A person in exclusive possession is not neces-
sarily a tenant B. M. Lall v. Dunlop Rubber Co., A.I.R. 1968 S.C. 175;
Narayanan Namboodiri v. Appukutty Nair, A.I.R. 1969 Ker. 34. 'Where
after a suit for ejectment has been decreed by a trial court a compro-
mise is arrived at in the appellate court whereby the tenant is allowed to
remain in occupation for another five years on payment of rent month
by month, the landlord reserving the right to execute the decree on the
tenants failure to pay rent for three consecutive months, the compromise
creates a license and not a lease Ronchada Ramamurthy v. Gopinath
Naik, A.I.R. 1968 S.C. 919. See also Associated Hotels of India ltd. v.
Sardar RanjH Singh, A.I.R. 1968 S.C. 933 where tests have been laid
down for ascertaining whether the occupier is a licensee or a tenaiit.
Where residential right is given to a person in respect of a house belong-
ing to a Society- on condition that tire Society shall have the right to
have the house vacated if the occupants fails to keep the house neat
and .clean or violates the rules of the Society, the occupant is a licensee
Sec. 105]
113
0. W.N. 586, 189 I.G. 488; see also Ramdhani v. Scoff, A.I.R. 1925 Pat.
256, 6 P.L.T. 577, 85 I.C. 77; Ram Kishun v. Bibi Sohila, A.I.R. 1933 Pat.
561, 14 P.L.T. 685, 145 I.C. 567 and Janki v. Kanhaiya, A.I.R. 1936 Oudli
102, 1935 O.W.N. 1238, 159 I.G. 316. Wliere a tenant who has no right
to alienate his right of residence without the permission of the owner
of the site, sells it without such permission and the owner of the site
takes rent from the purchaser and there is no written document to wit-
ness the new tenancy, the purchaser is a tenant-at will Abdul Ghafur
V. Jeta Mai, A.I.R. i942 Pesh. 74. The distinction between a tenancy-
at-wiU and a tenancy from month to month has been pointed out in
Shio Nath v. Ram Bharosey Lai, A.I.R. 1969 AH. 333.
Where a rent note provided that after 11 months the landlord could
at his will give the lessee a months notice to vacate and vice versa, it
was held that the lessee was a tenant-at-wiU at the time .of his death
Raman v. Blwgwan, A.I.R. 1950 All. 583, 1951 A.L.J. 179. See also
Thacker v. Bhatia, A.I.R. 1952 Kutch 13.
[Sec. 105
Abdul Razak v. Seth Nandlal, A.I.R. 1938 Nag. 506 (509), (1938) N.L.J.
317. But it has been held by Nasim Ali, J. that a grant made for an
indefinite period enures, generally speaking, for the life-time of the
grantee and such a grant passes no perpetual or heritable interest in the
absence of words to that effect or in the absence of it appearing from
the object of the grant, the circumstances under which it was created
and the subsequent conduct of the parties that a perpetual grant was
intended Chandi Charan v. Ashutosh, 40 C.W.N. 52. His Lordship has
further held that a lease which is silent as to the duration of its terms
would not be a lease within the meaning of this section Anioor Ali v.
Jamini Lai, 43 C.W.N. 797, A.I.R. 1940 Cal. 89, I.L.R. (1939) 2 Cal. 254.
Sec. 1o5]
mouiasi does Nowsingh v. Rom Naroin, 30 Cal. 883 (892) j Tulshi Per-
slwd V. Narain, 12 CnI. 117 (130) (P!C.) ; Agin Bindh v. Mohan Btkram,
30 Cal. 29 (31) ; Beni Pershad v. Ditdh Nath, 27 Cal. 156 (165) (P.C.).
The words istimrari niokarari do not per se convey an estate of inherit-
ance, but an istimrari mokarari patta, notwithstanding the absence of
words indicative or lieritability (as ba farzandan, nasJan bad naslan, or
al-aulal) may be perpetual grant, if the other terms of tlie instrument,
the circumstances under wliich it was made or the subsequent conduct
of the parties show such an intention with sufficient certainty Ram
Narain v. Chota Nagpur Banking Association, 43 Cal. 332, 36 I C. 321 ;
Tulshi Pershad v. Ram Narain, 12 Cal. 167 (P.C.); Narsingh v. Ram
Narain, 30 Cal. 883 (893). A bayam saswatham patta is a lease of a
permanent character Rama Itjcnger v. Anga Guruswami, 35 M.L.J. 129,
46 I.C. 62. A mirasidar is a permanent tenant Ramchandra v. Sidu,
1888 P.J. 30. Mourasi tenures are permanent -tenures because the word
"mourasi meaning a succession from generation to generation conveys
the idea of permanency Giribala v. Kedar Nath, A.I.R. 1929 Cal. 454
(456), 56 Cal. 180, 117 I.C. 534. The term mulgeni when used in a
tenure denotes its permanent character Nagapatja v. Anantaya, 1891
P.J. 248 ; Vnhamma v. Vaikunta, 17 Mad. 218. The Mukaddami tenure
in the United Provinces does not create any permanent or heritable interest
in the lessee Bhagtvati v. Hanuman, 23 All. 67. Tire words patni ten-
ure imply a tenancy of a permanent and heritable character Tarini v.
Watson, 3 B.L.R. (A.C.) 437 j Modhu Sudan v. Rooke, 25 Cal. 13. A
lease for five years stated that at tire expiration of the term the lessee
was to take a fresh settlement under a fresh kabuUyat, and it further
stipulated that the lessee was not to make a gift, sale or mortgage of the
tenure to any body. Held that as tliere were no words of inheritance
in the lease, the tenure could not be presumed to be heritable or per-
manent, and that the tenancy at the end of the five years was for an in-
definite period and not in perpetuity /agadiso v. Bisioeswar, 41 I.C.
227 (230) (Cal.). A lease in which no period is specifically mentioned
is not necessarily .i perpetual lease Chandi CharOn v. Ashutosh, 40
C.W.N. 52. A lease for five years with a condition tlial after that period
the lessee should hold the property as long as he pleased on die same
terms, is a lease merely for the life of the lessee Higgins v. Nobin, 11
C.W.N. 809.
[Sec. 105
incidence of the tenancy. At most it can be said that if there has been
an instance of such estojrpel see Forbes v. Ralli, A.I.R. 1925 P.C. 146
(149), 4 Pat. 707, 52 I.A. 178, 30 C.W.N. 49 87 I.C. 318. mere a Muk-
tear took a bemeadi lease in a municijral town for building a basha,
erection of corrugated iron sheds \vith pucca plinths and a pucca com-
poimd wall was not inconsistent with tire lease being for his life-time
and erection of such structures being within his rights, donsent to the
erection did not import an intention on the part of the lessor to grant a
permanent lease or attract the doctrine of estoppel by acquiescence as
a bar to ejectment Chandi Charan v. Ashutosh, 40 G.W-.N. 52. Where
a lease is gi-anted for the construction of a house with merely a titled
or thatched roof and not a pucca roof, the mere fact that the lessee has
constructed a pucca structure without interference by tlie lessor will not
estop tile lessor from contending tliat the lease is not a permanent one
Ram Lai v. Bibi Zohra, 20 Pat. 115, A.I.R. 1941 Pat. 228 relying on
Beni Ram- v. Kundan. Lai, 26 i.A. 58, 21 All. 496, 3 C.W.N. 502 (P.C.).
The mere fact that tiie tenant erected, some valuable structures on the
land including a pucca wall and a pucca building at the connivance or
Sec. lOsl
with the consent of the landlord would not in itself be sufiEcient ground
for holding that the tenancy was a permanent one Giridhari v. Pur-
nendti, A.I.R. 1939 Cal. 291, 68 C.L.J. 481, 182 I.C. 8. A lease for an
unlimited period in favour of the lessee, her heirs, administrators and
assignees at a stipulated yearly rental, for a period of ten years, to be
liable thereafter to equitable adjustment as may be determined from time
to time, according to the market rate prevailing at tire time is a perpetual
lease Moperaji Kumar Irfan Rasul Khan v. 17. P. Govt., I.L.R. (1960)
2 All. 71.
[Sec; 105
ceediiig cannot by the mere lapse of six or twelve years convert what
was an occupancy or tenant title into that of an under proprietor Amar
Krishna v.. Nazir Hasan, A.I.R. 1939 Oudh 257, 14 Luck. 723, 1939 O.W.N.
825; Narayana Narasimh Desk Pande v. Kashiraya Sen, A.I.R. 1961 Mys.
35. .S imilar ly if a landlord serves a notice to quit on a tenant and in- >
stead of taking further steps to evict liim accepts rent horn him for a
period of more than 12 years, tlie tenant cannot in a subsequent suit
for ejectment take the plea that he has acquired a riglit to remain in
occupation by adverse possession ^Chagganlal v. Indm K&sjt, supra.
An oral permanent lease acted upon for more than 12 years creates a
jjermanent lease by adverse possession Abdul Ghafoor v. Lola Kunj
Behari, A.I.R. 1957 All. 346.
A mere long and continuous possession for a time so long that the
memory of man runnetli not to the contiury is by itself insufficient to
raise a presumption of jiermanency Naraijan v. Dowlota, 15 Bom. 647;
Nahanchand v. Modi Kekhushru, 31 Bom. 185; Kamal v. Nandalal, A.I.R.
1929 Cal. 37, 56 Cal. 738, 33 C.W.N. 211, 116 I.C. 378 ; Subramamja v.
Subramanya, A.I.R. 1929 P.C. 156, 52 Mad. 549, 56 LA. 248, 33 C.W.N. 734.
116 I.C. 601. Mere long possession of homestead land is not sufficient to
justify the presumption of a permanent grant, and before such a presump-
tion can be made, there must be something more, viz., that either tlie
land was let for the eretion of pucca buildings, or that the landlord stood
by while tlie tenant erected permanent buildings or effected substantial
improvements on die land Nabii v. Cholim, 25 Cal. 896 (908); Secretary
of State V. Rajendra Prasad, A.I.R. 1937 Pat. 391, 170 I.C. 316; Atmakuri
Rajeswar Rao v. Joinadha Patro, 34 Cut. L.T. 1131. A distinction should
he drawn between easR.s in which the origin of the tenancy cannot be
traced, and cases in which tlie origin of the tenancy is known. Where the
origin of the tenancy is known and die terms thereof were put in "writing
at the inception of die tenancy, die tenancy is not a pennanent one; Ram
Lai v. Bibi Zohra, 20 Pat. 115, A.I.R. 1941 Pat. 228 relying on Secvetary
of State V. Luchmesicar Singh, 16 I.A. 6, 16 Cal. 233. Wliere the origin
of the tenancy and the circumstances attending its creation are not knoini,
evidence of fhe mode of dealing with the land demised and of die acts .
and conduct of the parties generally is an evidence to prove the nature
of the tenancy Ismail Khan v. Jaigun, 27 Cal. 570 (582); Syed Ali v.
Manik, 27 C.W.N. 969. Li such a case, the facts of long possession of a
land by the tenants and their ancestors at an unaltered rate of rent, and
Sec. 105l
114
[Sec. 105
the conduct of the parties and the surrounding circumstances the Court
can make a presumption of permanency Tirtha Naik v. Lai Sadananda,
A.I.R. 1952 Or. 99. Where the defendant was in possession for a very
long time under a claim that he was a rent-free tenant under the plaintiff
and the record of rights support his claim, the presumption of lost grant
arose Manohar v. Charu, A.I.R. 1951 Cal. 285. See also Kumud v.
Province of Bengal, A.I.R. 1947 Cal. 209, 81 C.L.J. 274. The presumption
of lost grant of permanent tenancy is equally applicable to agricultural
land Dinabandhu v. Gopinath, A.I.R. 1948 Pat. 12, 13 Cut. L.T. 10. A
presumption of an origin in some lawful title may in certain circumstances
be made in cases of long and quiet enjoyment, but it cannot be made
where there is sufficient evidence of the nature of the grant and the
persons to whom it was made Satyanarayana v. Venkatapayya, A.I.R.
1953 S.C. 195. There can be no presumption of a lost grant in favour of
a fluctuating and unascertainable body of persons constituting the in-
habitants of a village. Such right can only be acquired by custom Braja
Sundar v. Mani Behara, A.I.R. 1952 S.C. 247, 1951 S.C.J. 363, 30 Pat.
871. Where no custom is pleaded, the Court cannot hold that the right
of tenancy has been acquired by prescription Sahabu v. Hari Ram, A.I.R.
Service tenure : Where the holder of a service tenure did not pro-
duce any sa7iad nor proved otherwise that the grant was of estate burden-
ed with certain services, but merely contended that the land had been
allowed to devolve from father to son and that the tenure was created
many years ago and that the Zamindar did not avail himself of the services
but allowed her to hold on, it was held that there was no justification
for holding that the grant was of a permanent heritable character Hari
Shankar v. Chandu Urain, A.I.R. 1939 Pat. 362, 1939 P.W.N- 99, 183 I.C.
80, following Radha Prasad v. Budhu Dashad, 22 Cal. 938. Where the
holder of a service tenure refuses to perform the services on the ground
that no services can be demanded from her, such tenant is liable to be
ejected without notice to quit. Ibid following Hurrogobind v. Ramrutno,
4 Cal. 67.
But see Radha Gobinda feu v. Shyam Ray feu, A.I.R. 1949 Cal. 208,
52 C.W.N. 319 where it has been held that the inability or unwillingness
of the holder of the service tenure to perform the services does not entitle
the grantor to put an end to the tenure, in the absence of a provision to
that effect in the agreement. At any rate the tenant would be entitled to
a reasonable notice before he can be evicted. Whether the notice is
reasonable or not is a question of fact Rudra Narayan v. Chmtaram,
A-I.R. 1951 Ass. 86, I.L.R. (1951) 3 Ass. 171 ; Balarami v. Diivvivu Joya
Singh, A.I.R. 1957 Andhra Pra; 477.
Sec. 105 3
[Sec. 105
If trees are sold for being cut and removed within a reasonable time,
it is a sale of moveable property ; on the other hand if during a certain
period of transfer the transferee is entitled to appropriate the produce,
it is a lease of immoveable property Dan Singh v. Janki Saran, A.I.R. 1948
AM. 386. 1949 A.L.J. 46. But a right merety to cut and 'remove trees
and not to enjoj* the produce of the trees, is not an interest in immoveable
propertj Mof/zwru v. Jadubir, 28 AM. 277 (278). A tree patta differs
from an ordinar)' ryotwari patta in being more in the nature of a lease'
which was tiie original meaning of the word patta Secretary of State v.
Hussain Saheb, A.I.R. 1940 Mad. 783, (1940) 2 M.L.J. 13, 1940 M.W.N. 573.
A lease of a right to take juice from fruits from palmjTa trees and to
cut such leaves which are necessary to be cut in drawing juice, is not,
however, a lease of immoveable property and does not require registra-
tion A'afesa V. Thangavelu, 38 Mad. 883 (885). But in a later case tiie
same High Court has held that the ri^t to tap. cocoanut trees for getting
Sec. 105]
[Sec. 105
lessor, was entirely absent in it. The agreement was nothing but an
agreement between co-sharers as to the method of distribution of profits.
Instead of dividing the profits each year, it was agreed that each. party
should take the profits for six years in turn Sita Ram v. Sarjii Prosad,
25 O.C. 39, A.I.R. 1929 Oudh 201, 68 I.C. 333.
Sec. 105]
[Sec. 106
551. Agricultural lease ; ^Although this section speaks of. leases for
agricultural purposes, stiU such leases have been expressly exempted
from the provisidns of tliis Act by sec. 117, infra. Tlie presumption of
this section should not be applied to agricultiural tenancies. Tlie reason
is that agricultural tenants hold lands for an unlimited period subject to
the performance of the obligations incident to the tenure. Any presump-
tion such as is warranted by this section if made in the case of agricultural
tenancies would be incompatible with the ordinary local conditions
Cheekati v. Ranasooru, 23 Mad. 318; Venkata v. Dandamudi, 20 Mad. 299;
Narayana v. Orr, 12 M.L.J. 447; Venkatachala v. Ranganatha, 24 M.L.J.
571, 20 I.C. 374; Moore v. Makhan Singh, 53 I.C. 180 (Pat); Veeranna
V. Annasami, 21 M.L.J. 845, 12 I.G. 1; Mahomed Ayejuddin v. Prodyat
Kumar, 25 G.W.N. 13, 61 I.C. 503.
But although by virtue of sec. 117, tlie present section does not apply
to agricultural leases, the rules in tliis section being founded on reason
and equity apply, and a notice giving a reasonable time to the tenant
to vacate is sufficient Brahmayya v. Sundarampia, A.I.R. 1948 Mad. 275
Sec. 106]
(F.B.), I.L.R. 1948 Mad. 757; Narayanan v. Maunadier, A.I.R. 1949 Mad.
127, (1949) 2 M.L.J. 559; Bapmjija v. Venhataratmm, A.I.R. 1953 Mad.
S84; Veriigopala v. ThirunavukhaTasti, A.I.R. 1949 Mad. 148, (1948) 2
M.L.J. 155. It has been held by the Nagpur High Court that where such
a lease is invalid for want of registration, tlie relation of tire parties will
be governed by sec. 106 and tlie tenant will be one from year to year
KarimuUaJdian v. Bhanupratap Singh, A.I.R. 1949 Nag. 265, I.L.R.^ 1948
Nag. 978.
For tire meaning of the word agricirltural' see under section 117.
115
[Sec. 106
Sec. 105 does not say that the period of a lease should be certain
on the date of the lease. Tlie period of the lease can be express or im-
plied by law or .usage. Normally in die absence of a 'written lease a
presumption of annual tenancy may be drawn from the fact that rent is
payable annually Hcmidc Khatoon v. Shibamnda, A.I.R. 1954 Ass. 58.
But where the agreement of lease for residential purpose is not in- vwrit-
ing, the stipulation as to payment of annual rent is a condition of an in-
operative lease and sec. 106 comes into play. Consequently, the tenancy
would be from month to month and fifteen days notice expiring with
the end of the month of the tenancy would be su&cient Ibid.
The only leases recognized by sec. 105 are leases for a cert^ time,
periodical leases and leases in perpetuity. Where, therefore, the status
of a person does not fall under any of these hea^ he caimot be a lessee,
and hence he cannot insist upon a notice to quit as contemplated by
this section -Mcr Gyi v. Maung Tet, A.I.R. 1934 Rang. 291, 151 I.C. 971.
This section does not apply to the case of a lease for a fixed term when
Sec. 106]
the term expires Bishon Saritp v. Abdul Satnod, A.I.R. 1931 All, 649 (650),
(1931) A.L.J. 666; Bansidliar v. Bam Charan, A.I.R. 1940 Oudh 401, 1940
O.W.N, 586, 189 I.C. 488. On the expiry of the period the tenant is only
a tenant at su&erahce and is not entitled to any notice to quit Kuadem
Lai V. Deep Chand. A.I.R. 1933 All. 756 (758), 146 I.C. 762. In the case
of a tenant-at-will also no formal notice to quit is necessary Ram
Krishna v. Bibi Sohila, A.I.R. 1933 Pat. 561 (562), 145 I.C. 567.
This section has no application -to a notice under sec. 108 (e) avoid-
ing the Ifease on the ground of destruction of the lease-hold property by
iiTesistible force. Such a notice talces effect immediately on service
Datnoda Coal Co. v. Hurmook Martoari, 19 C.W.N. 1019, 81 I.C. 677.
In case of utbandl holding, the riglits to occupy the land does not
enure beyond a particular season or a particular year, and the tenancy
not .being a lease from year to year, this section has no application
Surendra v, Baidtja Nath, 60 Cal, 681, 37 C.W.N. 835.
The principle of Ihis section has been applied to the Punjab. Thus,
where there was a condition in the lease that the landlord would give one
months notice if he wanted to have the premises vacated, l^ld that it
did not mean that noitce could be given at any time but that the rule of
this section should be applied and the notice must be one expiring with
the end of a month of the tenancy C/iim//nZ v. Chunilal, 79 I.C. 957,
A.I.R. 1923 Lab, 659 (distinguishing 56 I.C. 7). In the case of a monthly
tenancy in the Punjab, in the absence of a specific contract, the lessee
is entitled to at lease 15 days notice ending with the month of the tenancy
Rattan v. Krishna Kaur, A.I.R. 1933 Lah. 135, 141 I.C.' 400.
Even though a case does not come strictly within this section, still the
principle of this section in regard to the giving of notice may be applied
to the case Kishori Mohun v. Nund Kumar, 24 Cal. 720 (723).
[Sec, 106
Sec. i06j
period of eleven months only, the lease is not from year to year even
though it was for a manufacturing- purpose Radha Balldbh. v. Ramchand,
A.I.R. 1955 All. 679. Where a deed of lease, admissible in evidence but
mcapable of creating a lease, contains a contract to the contrary as to
the service of the notice to quit, any notice in accordance with, die con-
tract to die contrary is valid in law Lai Chand v. Radlifl Ballabhj A.I.R.
1959 Raj. 240.
There was an agreement for a yearly lease wliich could not be used
in evidence for want of registration, but tliere were subsequent letters,
one from the landlord stating that the lessee would be a monthly tenant
after 1st July, 1933 and that die tenancy would be terminable by eidier
party on 15 days notice expiring with the end of a calendar month, and
a reply from the lessee stating that he would remain as an ordinary
tenant from die 1st of July, 1933, "subject to the termination by giving
you 15 days notice in writing. Tlie lessor gave 15 days notice ending
widi the month. Tlie lessee contended that his was the yearly lease
of an agricultural or manufacturing tenant under this section, and then
even as a monthly tenant his tenancy could not be terminated on tiie
last day of a month as his original tenancy had commenced either on a
12di or a 1st: Held by the Privy Council (i) that assuming diat the
tenancy was for an agricultural or a manufacturing purpose, tliere was a
"contract to the contrary constituted by the tivo letters ; (ii) diat reading
the two letters together the second was an acceptance of the first, aldiough
die term "ordinary was used for a mondily, and aldiough nq reference
was made to die landlords right to give notice which ivas a right under
the ordinary laWr jPra/iaZffdrfff v. Commissioners for the Port{ of Caloutte,
A.I.R. 1938 P.C. 11, 43 C.W.N. 309. Unless there is some indication to
the contrary die term "ordinary tenant would in Calcutta mean mondily
tenant, even diough there be no reference to payments of monthly rent
and such a tenancy would be terminable on 15 days notice expiring iritli
the end of the month of the tenancy Ibid.
' Tlie landlord can avail himself- of die statutoiy period of the notice
even though the period of notice has been made by agreement longer
than the statutory peripd in the case of the tenant Sister, Louise v
Jatindra Nath Mondal, A.I.R, 1957 Cal. .475.
tEC. l06
Local law to the contrary"; -Wlieire the local law provides for six
months' notice in place of fifteen days notice, it does not relieve the
landlord from complying with the requirements of this section that tlie
notice must expire with the end of lie month of the tenancy Vishtoa
Nath V. Bishen Dass, A.I.R. 1953 J. & K. 15. The Bombay tenancy Act
displaces the presumption arising under the present section Jagannath v.
Vacant, A.I.R. 1953 Bom. 332, 55 Bom. L.R. 341.
"Usage to hje contrary : iln an old case, viz., Nocoor Das v. Jewraj,
12 Beng. L.R. 263, it was held that in Calcutta a months notice was
necessary to determine a tenancy from month to month. This has, how-
ever, been dissented from recently by Macnair, J. in Prafvlla v. Nandalal,
39 C.W.N. 1069, where it has been held that in Nocoor Das v. leicarj,
no prevailing custom in Calcutta was proved or even asserted which
rendered a months notice obligatory; so 15 days notice under the pro-
visions of this section is quite sufficient to terminate a monthly tenancy
in Calcutta.
Sec. 106]
a tenant has an interest for one year certain wiUi a growing interest
during every year thereafltei' v. Horkhu^ supjra. Where)
it is alleged that a monthly rent is paid' in respect of a tenancy for
residential purposes and there is no allegation of a tenancy-at-will, it is
a monthly tenancy Chhoti Dei v. Gdngadbor, A.I.R. 1953 Or. 245, 19
Cut. L.T. 29. Where even tliough the parties intended to create a
permanent lease, no operative lease came into existence but the defendant
remained in possession on pajonent of rent, the tenancy should be deemed
to be from month to month Dufgesh Nondini Devi v. Aolad Shajfc/i,
A.I.R. 1955 Cal. 502.
When tlie tenant holds no written 'or registered lease and the land
is let for Other than agricultural or manufacturing purposes, the tenant
has only a monthly tenancy of the land terminable by fifteen days notice,
even though the rent appears to have been payable annually Debendra
v. Syama Prosanna, 11 C.W.N. 1124 1 'Sheikh Aldoo v. Emanon, 44 Cal. 403,
33 I.C. 889 i Mangel Singh v. Atra, 3 Lah. L.J. 222, 60 I.G. 226 ; Sarat
Chandra Chandra v. Jadab Chandra^ 44 Cal. 214 ; Anwar Ali v. Jamini Lai,
I.L.R. (1939) 2 Cal. 254, A.I.R. 1939 Cal. 89, 43 C.W.N. 797. See also
China V. Kripashankar, A.I.R. 1941 Pat. 488, 194 I.C. 300 ; 'Surya Kumar
Manji v. Trilochan Nath, 59 C.W.N. 526, A.I.R. 1955 Cal. 495. Similarly
when a shop is taken on lease for manufacturning purpose without any
registered instrument it is lease from year to year terminable on six
months notice Balwant Singh v. Murari Lai, A.I.R. 1965 All. 187. If
a usufructuary , mortgagee leases back on monthly rent to tlie mortgagor
who executes an unregistered Kerayanama, a tenancy from month to
month is created on acceptance of rent Ganpat Turi v. Mohammad Asraf
Ali, A.I.R. 1961 Pat. 183. The mere fact that the rent of a holding or
_ dvvelling house is payable in one sum yearly is not sufficient to make
the tenancy a tenancy from year to year Mohendra v. Nareadra, 50 I.C.
' 918 (Cal.) ; Biseswar v. Pitambar, 51 I.C. 44 (Cal .) ; Durgi Nikarini v.
Gohardhan, 19 C.W.N. 525 (530), 24 I.C. 183. Where a co-sharer got
an oral lease of a tank frorp the joint owners on an annual rent, no period
being fixed and had been in possession for 15 years on payment of rent,
the tenancy was held to be from month to month Adinath v. Krishna
Chandra, 47 C.W.N. 127. The mere payment of rent, annually would
not make tlie tenancy on annual tenancy, if there are clear indication
to show that the rent is calculated on a montlily basis Nanakram Das
V. Nagarmal, A.I.R. 1956 Orissa 95.
A lease of land, which did not specify any period, provided tiiat
the tenant should enjoy and possess the land after building a bashahari
upon it. Held, that as no period was fixed, the lease ^vas a lease from
montii to month Moliim v. Anil Bandhu, IS C.W.N. 513, 1 I.C. 66, 9
TRANSFER OF P^OFMtV
[EC, 1(36
C.L.J. S62. Where rent has all along been paid for one or more fuU
years commencing from the 1st of Baisakh and there is nothing in the
lease to indicate that it shall commence from the date of execution, the
lease commences from tlie 1st of BaisaHi Tirtlia Nath v. Ishwar
BamUngadeba, 61 C.W.N. 170.
In view of the provisions of this section tlie lease of land for the
purpose of putting up a permanent construction, that is, for building
purposes cannot be deemed to be a permanent lease. Such a lease in the
absence of a contract or local usage to the contrary must be deemed to
be a lease from month to month Bajrang Sahai v. Mt. Mulia, A.I.II. 1941
All. 399, 1941 A.L.J. 557. See also Ram Lai v. Bibi Zohra, A.I.II. 1939
Pat. 296, 182 I.C. 618 ; Shanmugjia v. Ananthidkrishnaswarm, A.I.R. 1939
Mad. 247, 1939 M.W.N. 1236, 48 M.L.W. 894; TiHJia Nath v.
Bamalingadeoa, 61 C.W.N. 170. Where a lease is created verbally after
the commencement of tlie T. P. Act it cannot be regarded as a permanent
lease simply because the tenant has been in possession for a long time
and has constructed substantial building, because the doctrine of lost
grant cannot apply to such a lease Ambika Deci v. Sachifa Nandan
Prasad, A.I.R. 1960 Pat. 289. Wliere the lessee is allowed to construct
building on the land leased and the lease is found to be one from month
to mondi, it is unjust for tlie lessor to claim the structure to be demolished.
He should give tlie lessee a notice to quit Jadiinandan v. Mi. Maho,
A.I.R. 1939 Pat. 428, 185 I.C. 284. Tliere can be an agreement to pay
rent annually in a tenancy from month to month Gussainram v.
Mohammad Siddiqu, 1966 All. L.J. 414. ^
Where a certain property was let out .by Goveniment for building
purposes without any mention of or agreement about tlie dmution of the
term, the tenancy was a tenancy-at-will which became converted by pay-
ment of rent into a tenancy from year to year Secretary of State v. Sarat,
A.I.R. 1937 Pat. 399 (406), 171 I.C. 461. If a registered lease is granted
by tlie Administrator of a superseded municipalitj^, who had no such
power to grant such lease, and permission is granted subsequently by die
Municipal Committee regularly constituted to construct buildings, then
a tenancy on the terms contained in the lease deed is created by the
acceptance 'of tiie stipulated rent from the lessee Hitkarini SabJia,
Jabalpur v. Corporation of the City of Jabalpur, A.I.R. 1961 Madh. Pra.
324.
Sec, 10^ i
116
[Sec. 106
Where the tenant, repudiated the title of the landlord and set up
the title of a third party, the landlord could bring an ejectment suit with-
out giving any previous notice to quit, since the tenant forfeited his
tenancy by denying the landlords title-HAnandamoyi v. Lakshmi Chandra,
33 Cal. 339; Haidri Begum v. Nathu, 17 All. 45; Ramayana Prasad v. Mt.
C. Gulabohier, A.I.R. 1967 Pat. 35. But under clause (g) of section 111
as now amended, the lessor must give notice of his intention to determine
the tenancy.
A tenant holding over, after expiry of his lease, without his landlords
consent is a tenant on sufferance. No question of notice arises in
his case Hasanali v. Dara Sah, A.I.R. 1949 Nag. 282, I.L.R. 1949 Nag.
922; Ramzan v. Ghani, A.I.R. 1952 J. & K, 35.
Sec. 1663
under sec. 106 is required for die termination of tlie lease Fazihuz,za-
man v. Amoar, 1932 A.L.J. 126, A.I.R. 1932 All. 314, 139 I.C. 828; Gokul
Chand v. Sliib Charan, 9 A.L.J. 574- 13 I.C. 59; Bishen Sarup v. Abdul
Samad, 1931 A.L.J. 666, A.r.R. 1931 All. 649 (650).
If the tenancy is one from month to month, and the tenant is entitled
to 15 days notice, a six months notice requiring him to quit at die
end of the year is not invalid. In fact it is more than sufficient
Debendra v. Syama Prasanna, 11 C.W.N. 1124 (1126). But where the
tenancy is a yearly tenancy, it is terminable only by six months' notice,
and any notice which falls short of this period is not sufficient Kis/wrl
Mohun V. Nund Kumar, supra. A notice which gives less tlian 15 days
notice to a monthly tenant is invalid, and cannot determine tire tenancy
Farzand All v, Matilal, 2 P.L.T. 282, 62 1.0. 421 (422).
[Sec. 106
for the decree-holdei' to proceed imder O. 21, r. 97, C. P. Code Shfekh
Yusuf V. Jijotish, A.I.R. 1932 Cal. 241, 35 C.W.N. 1132, 59 Cal. 739, 137
I.C. 139; see also Ra7n Kissen v. B/n/rfl/, 50 Cal. 419; Green v. Herring,
(1905) 1 K.B. 152; Minet v. Johnson, 63 L.T. 507.
The notice must designate the date on which die tenant is to vacate.
A notice to quit at die expiration of die cuirent year to yoiu tenancy,
which shall expue after the end of one-half yeai* from die service of the
notice (Doe d. Digby v. Steel, 3 Camp. 117) or simply a notice to quit
at the e3q)iration of the present years tenancy (Deo d. Gorst v. Timothy,
2 Car. & K. 351) or a notice at tlie expiration of the current year {peo
di Baker v. Wombwell, 2 Camp. 559) are valid notices. See also latindra
v. Mfitei; A.I.R. 1953 Cal. 352, 88; C.L'.J. 118; Ismail v. Julekhabai, A.I.R.
1944 Bom. 181, 1.L.R. 1944 Bom. 361; v. SabUri v.Jalikha, A.I.R. 1947 Cal.
244, 52 C.W.N. 13; Bawa Singh v. Kundan Lai, 1952 Piinj. 422; Ananta v.
Osimuddin,^Al.B.. 1952 Ass. 132; Mohan Lai v. Kunwar Sen, A.I.R. 1953
All. 598, 1951 A.L.J. 702. But a notice to quit generally without, referring
to some distinct time would be invalid Goode v. Howells, 4 M. & W.
199. By the notice the tenant was asked to vacate within the 30th April
and deliver possession on 1st of May. Tlie notice was held to be valid
Nibaran v. Abinash, 60 C.W.N. SOS; Hirjibhai v. Balarambhai, A.I.R.
1956 Nag. 125; Fanchoo Singh v. Bala Sahai, A.I.R. 1958 Raj. 306; Riyasat
Alt Khan v. Mirza Wahid Beg, A.I.R. 1966 All. 165.
[Sec, 106
Kalappa, A.LR. 1950 Mys. 63. A typed copy of the notice served on
tire tenant is invalid Hira Lol v. Dy. Comr., A.I.R. 1951 All, 483. Where
a- tenant under a year to year tenancy terminable by 6 months' notice
on either side subleased a part of the premises to a man on 12th
December, 1937 for 1 year 4 months from 31st December, 1937 to 30tli,
April, 1939 and on 26th January, 1938 gave notice to tlie -landlord to
tei-minate tlie lease as on 15th May, 1938, it was held that the notice
being dated less than 6 montlis before 15th May, 1938 was inefiFectual
Gooderham & Worts Ltd. v. Chandian Broadcasting Corpn., A.I.R. 1949
P.C. 90. Wliere in the notice there is no allegation as to when the
tenancy commenced or what the month of the tenancy is, the notice is
invalid Gulam Mohammood v. Amrmni Ammal, (1960) 2 Mad. L.T. 351.
Onus : ^It is for the plaintiff in a suit for ejectment of a tenant upon
notice to quit to prove the sufficiency of notice by proving the date of
the commencement of the tenancy. In order to prove tliat the notice
legally determined the lease, he must show that the notice served upon
the tenant eiqiired dther with the end of the year or the month
of the tenancy; In the absence of evidence to show when the year or
the month of the tenancy commenced, the plaintiffs suit must fail
Mozam Shaikh v. Annada Prasad, 46 C..W.N. 366, A.I.R. 1942 Cal. 341,
75 C.L.J. 444. Where the notice to quit gives more than 15 days time
but there is some doubt as to the actual date of receipt the notice is to
be regarded as good if tlie averment in the plaint tliat file cause of action
arose on the date of the notice is not specifically denied in die written
statement Sm- Bhagwati Devi v. Surendrajit Singh, A.I.R. 1959 Pat. 257.
a decaree for ejectment. Tlie notice does not amount to an offer to renew
the tenancy at an enhanced rate of rent Shdnkcr Lai v. Babu Ram, 43
All. 330 (332) (following Abparn v. Bellman, supra). See also Sahjf
Hussain v. Sirajul Haq, A.I.R. 1951 All. 853, 19ol A.L.J. 192. Tlie
Bombay High Court has also taken this later view in Vaman'v. Khanderao,
A.I.R. 1935 Bom. 247, 37 Bom. L.R. 376, 156 I.C. 1620. Tlie Patna High
Court holds that a notice of ejectment is quite distinct from a notice
of enhancement; in the former case the lease is determined by the notice
and thereafter the lessee becomes a trespasser. If in the notice an
alternative term enhancing the rent from the date mentioned in it is pro-
posed on which the defendant is required to vacate the premises, the
continuance of the tenant to hold over implies an acceptance of tire
term proposed Farzand Ali v. Motilal, 2 P.L.T. 282, 62 I.C. 421 (422).
See also Madaa Mohan v. Ram Lai, A.I.R. 1934 All. 115 (117), (1934)
A.L.J, 421, 153 I.C. 432 where the same view has been taken. For a
contrary view see Md. Noor v. AsJiiq Beg, A.I.R. 1983 Oudli 465, 145
I.C. 647. Demand for arrears of rent and termination of the tenancy
can be made by the same notice Mushtaq Husain v. Mahomed Saddiq,
1967 All. L.J^ 764. But a notice asking the tenant to pay rent by the
end of a particular month and also to vacate on the expiry of the period
of the notice, preceded by a number of similar notices, cannot be treated
as a notice to terminate ihe tenancy Sunder Lai v. Ram Krishan, A.bR.
1960 All. 544. A notice to quit with a demand for enhanced rent if
the tenant stays is not sufficient to terminate the tenancy because it
amounts to an offer of a ft-esh tenancy Mohammad Ninave v. Neela-
candan, A.I.R. 1960 Ker. 216.
[Sec. 106
Chidda Ram'v. Nam Mai, A..I.R. 1965 All. 823. If the notice to quit
gives option to the tenant either to vacate on tiie date mentioned or on
a later date the notice is good Gurdit Singh v. Tiata Iron & Steel Co.
Ltd., A.I.R. 1965 Pat. 311. Notice terminating tenancy and demanding
arrears of rent is not invalid Ahmad Ali, v. Jamal Uddin, A.T.R. 1963
AU. 581. A notice only demanding possession does not terminate the
tenancy Ibid.
Sec. 106]
117
[Sec. 106
was served on the 31st December 1915 (11th Fous) directing the tenant
to vacate on the 31st January 1916 (12th MagJi). Held that the notice
was invalid. The notice in order to be valid ought to have directed
the tenant to vacate on the 26th day of a month, tlie day on which every
month expired according to the terms of the tenancy Sheoti Bibi v.
Jagaimath, 18 A.L.J. 854, 57 I.C. 593. A notice to vacate on 31st July,
tenancy commencing from 1st day of an English calendar month, is valid
Tolaram v. Ayaldas, A.I.R. 19^ Madh. Pra. 140; but see Chhaganlal
M^ganlal v. Cldioganlal Mannalal, 1961 Jab. L.J. 1175.
If a tenancy commences from the 14th Pous, the year of the tenancy
must be calculated as commencing from 14th Pous and ending with
the 13th Pous of the next year. A notice calling upon the tenant to
quit in Ashar is bad ; see Kishori Mohun v. Niiiid Kumar, 24 Cal. 720
(724). But if it appears that although the tenancy was created from
the middle of a Bengali month {e.g., 19th Chait), still the rent has all
along been paid according to the ordinary Bengali year calculated as
commencing from 1st Baisakh and ending with 30th Chait. held tliat the
year of the tenancy in this particular case must be calculated according
to the ordinary Bengali year, and a six months' notice given on the 23rd
Aswin requiring the tenant to quit on the last day of Chait is a valid
notice Ismail v. Jaigun, 27 Cal. 570 (577). When the tenants entry
takes place in the middle of a calendar month and rent is payable from
the date of entry, but the jMrties agree that the rent should be payable
at tlie end of the calendar month, the reasonable inference is that they
intended that the monthly tenanej' should coincide with the calendar
month. In such cases, the fifteen days notice to quit must be so given
as to expire with the end of the etdendar month, unless the intention
of the parties appears to the contrary Arunachella v. Ramiah, 30 Mad.
109 (111, 112). When the tenancy is according to the Hindi calendar,
a notice to quit under sec. 106 must be given according to that calendar
Sheobux Singh v. Paras Rarn, I.L. 9, (1959) 9 Raj. 1157.
If the notice is insuflScient (on the ground diat it requires the tenant
to vacate before the end of the year of the tenancy), a suit based upon
such notice must fail, and die Court cannot even pass a dectee to the
effect that the tenant must quit at the end of the year Hemangini v.
Srigobinda, 29 Cal. 203 (206), dissenting from Ram Lai v. Dina Nath,
23 Cal. 200.
Sec. 106 ]
Klian V. Jaigun, 27 Cal. 570 (578). But a noHce requiring the tenant to
quit on the last day at noon is bad, because the tenant is not bound to
vacate before midnight Page v. More, (1850) 15 Q.B. 684.
But a notice giving a longer time by a few hours is not bad. Tlius,
if the notice issued on tlie 15tli September asked the tenant to quit on
the forenoon of the 1st October, it was not bad by being too long by a
few 'hours Gnanaprakasam v. Vaz, 60 M.L.J. 293, A.I.R. 1931 Mad.
352 (855). Wliere the tenancy is for 11 months commencing on 20.4.49
and the tenant remains in occupation even after the term on pajnnent
of rent, a notice asking the tenant to quit on 21.1.54 is valid Vishnu
Ganeshi v. Laxminarayan, A.I.R. 1959 Madh. Pra. 293. tVIiere a tenancy
commences on the 2nd day of a month, a notice determining the tenancy
from the 1st day of the month is valid Medhao Rao v. Bhagtoandas,
A.I.R. 1961 Madh. Pra. 138.
Wliere the tenancy was from 10th of one month to 9tli of the ne.xt
month tile landlord asked the tenant to vacate after 10.5.46. A second
notice was given in these terms : ...I call upon you to definitely vacate
...by 10.10.47... you are further required to pay Rs. 1245 as aiTears of
rent upto 10.5.46 and Rs. 23,310 as damages till 10.10.47. Tlie first
notice was held to be invalid and the second notice was held to be a
vah'd notice under sec. Ill (Ii) Ram Chandra v. Lola Dulichand, A.I.R.
1958 All. 729. If the tenant is asked to vacate before the e.xpiry of the
last date of the month the notice is valid Mir Abdul Honan v. Anil Ch.
Dey, I.L.R. (1961) Cut. 122; Madhab Rao v. Bhagtcan Das, A.I.R. 1961
Madh. Pr. 138.
[Sec. 106
fourteen clear dayS;, tlie notice to quit was held to be bad Subadini v.
Durga Chamn, 28 Cal. 118, 4 C.W.N. 790. In otlier words, the day on
wliich the notice is given is excluded from calculation. See sec. 110.
But tlie day on which tlie notice is to expire is not to be excluded. And,
therefore, a notice served on the 16th Baisakh calling on the tenant to
quit on the 31st is a good notice, as it gives 15 clear days time (the 31st
Baisakli not being excluded from calculation) Gobinda v. Dwarka^ 19
C.W.N. 489 (493), 26 I.C. 962. Hie date on which the notice is received
is included in computing the period of 15 days Mt. Natho v. Sital
Prasad Sahu, A.I.R. 1969 Pat. 310. In the case of a monthly tenancy
according to the English calendar tlie notice asking the tenant to quit
by the morning of 1.10.49 was held to be valid Bharat Sahu v. Gadadhar
Ramanuj Das, A.I.R. 1956 Orissa 128.
Sec. iodj
tenunt is asked to deposit rent under the Rent Control Apt according to
English calendar, the notice to quit must be given according to the
Indian calendar A.I.R. 1963 S.C. 120.
A lease for 7 years commenced on 1st Baisakh 1318, but tliere was
an express stipulation in the lease that the time limited by the lease was
up to the end of 1324. Tire lessor served a notice on tlie lessee to
vacate tire land by the end of the month of Asar: held that the notice
was valid. In view of tlie express agreement the lease lasted only up
to the last day of 1324 and not up to the 1st Baisakh of 1325 under sec.
110. The term of the lease haying expired on the last day of 1324, the
monthly tenancy began fromTst Baisakh, 1325 Deb Das v. Abdul Gani,
A.I.R. 1938 Cal. 358 (359), 42 C.W.N. 443, 67 C.L.J. 291.
558. Who can give notice ; The notice may be given by either the
lessor himself or his agent. Tims, in the case of notice given by a land-
lord, it is sufficient if it is given at the instance of the landlord, and
signed by his agent, and it is not necessary that it should be signed
by the landlord himself iMohendra v. Bisicanath, 29 Cal. 231; Gobinda
V. Dwarka, 19 C.W.N. 489 (493). Gorrtez v. Ram Kumar, A.I.R. 1934
Cal. 127, 149 I.C. 559, 58 C.L.J. 133. See also Md. Nural Hvda v.
Kekabhoy, A.I.R. . 19.53 Nag. 251. An agreement of tenancy provided
as follows: "The tenancy may be determined by three months notice.
...If determined by the council (landlords), shallTie by a written notice
signed by the valuer of the council... The notice to quit by the land-
lords was signed, J.E.J.T. valuer and agent of the. ..council (Landlords).
Tlie valuers name was written by his assistant. There was no indication
that the assistant was acting on behalf of the valuer or with bis authority.
HeM tlie notice was validly signed London County Council v. Vitamins
Ltd., London (1955) 2 All. E.R. 229. A joint' notice to quit by the land-
[Sec, 106
Sec. 1o6]
559. Service of notice : ^This section does not require that tire
notice should be delivered to the tenant personally by tlie landlord or
his agent, or that it should be given direct to the tenant. Anyhow if
the notice is delivered by some one to tlie tenant, the requirements of
this section are complied widi. If, therefore, notice is given in the first
instance to the solicitor of the tenant, and is then . conveyed by him
through a relative or servant to the tenant, it is suflBcient Bhojabhai v.
Hayem Samuel, 22 Bom. 754.
Under this section, the notice may be seri'ed on one of the family
or servants of die tenant. If the notice has once been delivered to the
addressees relative or servant, it becomes immaterial \vhether die ad-
dressee actually receives it or not Doe de Neville v. Dunbar, N. & M.
10; see also Manzoor AU v. IM Devi, A.I.R. 1951 AU. 396; 1951 A.L.J.
154; Ghulam Md. v. Lakshmibux, A.I.R. 1951 Raj. 88. 'IVhen once you
constitute your servant as your agent for that general purpose, service
on that agent is service on you: he represents you for that purpose he
is your alter ego, and service upon him becomes an effective sendee
upon 3 murself. Therefore die fact that the agent who receive.d the notice
Sec, 106
put it into the fire would liberate entirely the person who delivered the
notice, but it would not hberate the receiver of the notice when once
the agency was established; it would not avail him as a mode of escap-
ing from the consequences of his having employed such an agent per
Lord Hatherley, L.C. in Tahlvam v. Nicholson, 5 App. Cas. 561 (568, 569).
But it .should be noted that such service on the relative or servant must
be made by delivery at the residence of the tenant. A service on a
mans wife at a place otlier than liis residence is not sufiicient service
Doe de Blair v. Street, 2 A. & E. 328. If a Hindu taking a lease of shop
in his iDersonal capacity dies leaving several heirs a notice to quit served
on one or more of tlie heirs is valid in law, provided the notice is in-
tended to be a notice to all the heirs Mst. Rarnuha^ v. liyaram Shartna,
A.I.H. 1964 Bom. 96. A notice to quit sei-ved on one of tlie joint tenants
is sufiicient and suit for ejectment against one of the tenants is also good
Kunj Manji v. Trustee of the Port of Bombaij, A.I.R. 1963 S.C. 468. In
the case of tenants-in-common, there is only unity of possession and not
of title or interest; hence to determine such a tenancy notice must be
issued to all the tenants V. Konnappan v. Ktinniyil Manikkam, A.I.R.
1968 Ker. 229.
SEC. i06l
provided it is proved that tlie post-peon delivered the letter either per-
son^ly to the party or to one of his family or to his servant Stibadiiii
V. Durga Charan, 28) Cal. 118 ; Harihar v, Bflmshashi, 46 Cal. 458 (P.C.) ;
Bodardoza v. Ajijuddin, A.I.R. 1929 CaL 651 (653), 57 Cal. 10, 33 C.W.N.
559, 120 I.C. 455; Saibalini Saha v. Snehalata Bose, 65 C.W.N. 690.
This is now expressly provided by the amendment made in the second
para. When a notice by registered post comes back with the remark
refused the notice must be deemed to have been properly served with-
out formal proof of refusal by the postman Saibalini v. Snehalata, 65
C.W.N. 690 ; 71 C.W.N. 282. When an acknowledgment comes back
signed by some person on behalf of the addressee, the service is good
Radharani v. Angurbala, 65 C.W.N, 1119.
118
[Sec. 106
notice is dated 16th of a month does not show that it must have been
posted on that date Gobmda v. Dwarka, 19 C.W.N. 489 (495), 26 l.C.
962. For instance, if the notice is dated 16th of a month calling upon
the tenant to vacate on the 31st day of the month, but the notice is post-
ed (as evidenced by tlie post mark) on the 17th, the notice is prima
facie insufllcient.
(2) If the notice sent by registered letter comes back to the sender
tlirough the Dead Letter Office, that fact does not justify the presump-
tion that it has been refused by the tenant ; for it may well be that it
has been returned by the Post Office because the addressee has not
been found ; much less is there a presumption that the cover has been
tendered to the addressee on a particular date Gobmda v. Dwarka, 19
C.W.N. 489 (498).
(3) The date of the post mark of the post office of destination does
not necessarily show that the letter was tendered to the addressee on
the same date, especially if it is registered letter which is delivered by
the post office only between specified working hours. Therefore, if a
notice sent by registered post on the 16th of a month (calling upon the
tenant to vacate on the 31st) readies the post office of destination on
the same day (16th) as evidenced by the post mark of that post office,
that does not conclusively prove that the letter was tendered to the
addressee on the 16th. And in die absence of such proof, the notice
would be -insufficient Gobinda v. Dwarka, 19 C.W.N. 489 (495).
Sec. 107]
560. This section, like sections 54 and 59, must be read as supple-
mental to the Registration Act. (See sec. 4 and Notes thereunder). The
effect of this section is to abolish optional registration in respect of leases
mentioned in the second para of the section. Such leases may be effected
by simple, delivery of possession without any written instrument ; but if
they are in writing and no possession is delivered, they must be registered
{O'Leary v. Maung On Going, 4 Bur. L-T. 197, 11 I.C. 863) unless there is
any Government Notification sanctioning the creation of such leases by
unregistered writing only. And so, an unregistered lease for a term of less
than one year is- invalid if possession is not delivered to the lessee-^GuZab
Khan v. Lai Muhammad, 96 I.C. 410, A.I.R. 1926 Oudh 609. A lease for
a period less than one year if made" in writing (and not by an oral agree-
ment accompanied with delivery of possession) must be registered under
[Sec. i07
The last para has been added by the Amendment Act VI of 1904, '
because of the Madras High Court decision in Vairanandan v. Miyakan
Rowther, 21 Mad. 109 where it was held that leases falling under sec. 107
of the T. P. Act were compulsorily registrable notwithstanding the Govern-
ment Notification issued under the proviso to sec. 17 (tf) of the Registra-
tion Act.
Oral lease : An oral lease being invalid under this section cannot be
lelied upon regarding the period of the 'tenancy Sengayyam v. Rasii,
A.I.R. 1952 Mad. 863.
Sec. 107]
It was formerly held that as this section refers to leases, i.e., actual
transfer of property, and not to an agreement to grant a lease, such an
agreement, if made ordlly was valid ; and if in pursuance of such agree-
ment the intended lessee had taken possession, though the requisite docu-
ment' had not been executed, the position would be the same as if the
document had been executed, provided that specific performance could be
obtained between the same parties in the same Court and at the same
time as the subsequent legal question fell to be determined Baranashi v.
Papat Velji, 25 C.W.N. 220, 63 I.C. 118 (124) ; Chunilal v. Gopiram, 45
C.L.J. 32, 100 I.C. 404, A.I.R. 1927 Cal. 275 (277). But then came the
judgment of the Privy Council in Ariff v. Jadunath, 58 Cal. 1235, 35 C.W.N.
550, A.I.R. 1931 P.C. 79, 131 I.C. 762, which repudiated the doctrine of
part performance, on the ground that in view of the provisions of sec.' 107,
the verbal agreement alone could not create a lease in favour of the so-called
lessee, in the absence of a registered instrument, and that the English
doctrine of part performance could not be invoked to override or nullify
the statutory requirement of a registered document. The result is that in
view of the authoritative decision of the Privy Council, the doctrine of
part performance cannot be invoked in cases in which the new sec. 53A
did not apply.
This section, i.e., sec. 27A, overrules the case of Sanjib Chandra
Sanyal v. Santosh Kumar Lahiri, 49 Cal. 507, 26 C.W.N. 329, A.LR. 1922
Cal. 436, 69 I.C. 877, in which it was held that if the lessee took posses-
sion under an unregistered agreement of lease, he could not sue for speci-
fic performance, because he- could not prove the agreement, it being un-
registered. Under the present law, it is sufficient for a suit for specific
performance if the document containing the contract of lease is in writing
signed by the parties, and the lessee has taken possession.
This section only lays down how a lease is to be made and not how
an agreement to lease can be made Radhabai v. Nayadu, A.I.R. 1951 Nag.
285, I.L.R. 1950 Nag. 799. A written agreement to lease not creating a
present demise need not be signed both by the lessor and the lessee. Such
a writing, where it is a term exceeding one year, would however require
registration ibid. Where before preparing the instrument of transfer the
parties prepared a draft lease, the contract itself was reduced to writing
and the document served as a protection under sec. 53A of this Act
Ibid.
[Sec. 107
564. Lease for a term of one year or exceeding one year : A lease
of house property for a definite period of one year only can be established
by proof of an oral agreement accompanied by delivery of possession Md.
Farooq v. Mt. Masjide Begam, A.I.R. 1942 Oudh 408, (1942) O.W.N. 357,
200 I.C. 593. A lease for one year certain with an expression on the
tenants part of readiness to hold the land longer at the same rent, if the
landlord should so desire it, does not create in the tenant any interest
exceeding one year Apu Budgavdo v. NorJtari, 3 Bom. 21. See also Boyd
V. Kreig, -17 Cal. 548 and Jagjivandas v. Norayan, 8 Bom. 493. So also, a
lease under which the lessor agrees to let his premises for a period of one
year and also agrees not to increase the rent nor to have the premises
vacated for further two years if the said tenant wish to occupy it for that
period is not lease for a term exceeding one year and is not therefore
compulsorily^ registrable Beni Menahim v. Pebologo, 8 Bom. L.R. 580.
The reason is that if in a document in which a term of one year is speci-
fically prescribed, any subsequent words are used for the coatinuance of
possession, they are to be considered to appertain to the future consent
of the parties, and cannot in any way affect the actual term fixed Apu
Budgavdo v. Narhari, 3 Bom. 21. All leases of immoveable property for
more than a year must be in writing and registered Battersby v. DeCruz,
63 Cal. 31 ; Bashir v. Nederlandsche Handel, A.I.R. 1937 Rang. 180, 171
I.C. 643. Where a building is leased out for an indefinite period for carrj^-
ing on business at a rent to be settled on the basis of percentage of profits
earned after fifteen months, the lease is one for a period .exceeding one
year, it is compulsorily registrable and it does not attract sec. 106 T. P.
Act Delhi Motor Co. v. Basrurkar, U.A., A.I.R. 1968 S.C. 794.
A lease for so long as the lessee continues to pay the stipulated rent
is a lease not limited to one year Sheo Cholam v. Budreenath, 4 N.W.P.
36. Where the lease of a rice mill is executed for one month with a con-
dition that if there is paddy unmilled at the expiry of the lease, a fixed
monthly rent every month will be paid for 5 years, the lease is a lease
for over one year and requires registration U Min Sin v. Ko Kye,- A.I.R.
1941 Rang. 117.
A lease of immoveable property, for the life of the leasee is a lease for
a term exceeding one year and must be registered Parsotam-v. Nana, 18
Bom. 109 ; Wazir v. Ram Prasad, 59 I.C. 893 (Pat.).
Sec. 107]
Though a Hindi Sambat year is more than one year calculated accord-
ing to the English calendar, a lease for one'Sambat year is not compulsorily
registrable Moti Ram v. Seth Lakshmi Chand, A.I.R. 1924 Nag. 216.
Where under an oral agreement for a lease of 3 years the lessee was
given posssession and rent was taken from him, only the formal execution
of the deed was to be done later, it was held that the oral agreement
amounted to a lease and required a registered document Mopurappa v.
Ramaswami, A.I.R. 1934 Mad 760, 152 LC. 538.
A verbal lease for more than a year is valid for one year, if it is
accompanied by delivery of possession. Hence the tenant who continues
to be in possession beyond one year is holding over and the landlord
is entitled to claim rent under sec. 116 Aziz v. Alauddin, A.I.R. 1933
Pat. 485, 144 I.C. 788 ^Anand v. Taiyab. A.I.R. 1943 All. 279. But where
a term of an oral agreement to lease of residential premises was that the
tenant should occupy the premises at least for one year and thereafter
the tenancy would terminate by one months notice on either side, it was
held that the lease was for a period exceeding one year. Such a lease
could only be made by a registered instrument, and there was no valid
lease for one 3rear Ram v. Lalit, A.I.R. 1947 Cal. 351. An agreement
to lease though void for want of registration as a transfer of property
may yet be valid, regarded as an agreement Chandulal v. Keshavlal,
A.I.R. 1936 Bom. 246 (249), 163 I.C. 579.
. [Sec. 107
fore a lease thereof for any term exceeding one year can be created only
by a registered instrument Thakttr v. Jagdambika Pratap, A.LR. 1942
Oudh 93, (1941) O.W.N. 1065, 196 I.C. 694. Consequently, in the absence
of a registered instrument the lessor can succeed only on the basis of use
and occupation Ibid.
565. Failure to give possession : ^The first para of this section lays
down that certain leases (e.g., a lease reserving a yearly rent) can be
made only by a registered instrument, and in such leases delivery
of possession is_ not necessary for the vesting of the interest
in the lessee. The lessee inspite of the fact that he has not
obtained possession, holds the position of a lessee, and can maintain
an action against the lessor for mesne profits as damages for
keeping the lessee out of possession Razia Begum v. Md. Baud,
6 Pat. 94, A.I.R. 1926 Pat. 508 (511), 96 I.C. 558. In England, however,
livery of seisin is necessary to complete the title of the lessee, and he is
not regarded as a tenant before actual entry ; consequently, he cannot
maintain any .action of the nature referred to above. This doctrine of
English common law ought not to be applied in India Razia Begum v.
Md. Baud, supra.
As to the lessors duty to give possession to the lessee, see Note 573
under sec. 108.
Sec. 107]
Where the lessees admit the lease but plead that the lease-deed is
inadmissible in evidence for want of registration, the Court is fully entitled
to go behind the lease and determine its validity V Mm Sin v. Ka Kye,
A.I.R. 1941 Rang. 117. Where the lessees admit a lease, but only one
of them pleads that the lease-deed is inadmissible for want of registration
and the lease is found to be invalid, it is invalid against all the lessees
Ibid. But see Baldeoprasad v. Dasrathilal, A.I.R. 1955 Nag. 27 where it has
been held that a lease from year to year or reserving annual rent cannot
be proved except by a registered instrument; all other evidence is shut
out including admission of the landlord Baldeoprasad v. Dasrathilal,
A.I.R. 1955 Nag. 27 ; Sudhir Kumar v. Dhirendra Nath, A.I.R. 1957
Cal. 625.
The effect of this section and sec. 17 (d) of the Registration Act is,
however, to exclude from evidence all unregistered leases which have been
reduced to writing. A rent note purporting to grant lease for 11 months
which is not registered is not admissible in evidence to prove the period for
which the lease was granted and the rent due under it ^Mf. Nasiban v.
[Sec, 107
Md. Sayed, A.I.R. 1936 Nag. 174 (175), 164 I.C. 557. Where the agree-
ment or kabuliyat by which a tenancy was created is not registered and
no patta in respect of the tenancy is produced, the kabuliyat is inadmissible
for the purpose of proving that the tenancy is permanent Ram Lai v.
Bibi Zohra, A.I.R, 1939 Pat. 296, 182 I.C. 618.
EC. 1 ( 57 ]
568. Third para, Kabuliyat : ^The third para which has been newly
added lays down that both the patta and the kabuliyat must be executed by
the lessor and the lessee respectively ; in the absence of a patta, a mere
kabuliyat executed by the lessee is of no avail. Prior to this amendment
there was difference of opinion on this point, which will be evident from
the under-noted cases.
It was held by the Allahabad High Court as well as'Oudh and Nagpur
Courts that where the plaintiff agreed to give the defendant a lease .of the
land for five years, and the defendant executed a registered kabidiyat .to'
[Sec, W
the effect, but no patta was written or registered, held that the transaction
did not amount to a lease ; in the absence of a deed of lease executed by
the lessor, a kabuliyat executed by the lessee, even thou^ registered and
accepted by the lessor, was not equivalent to a lease for the purpose of
this A.c.tKedar Nath v. Shankar Lai, 46 All. 303 (309), 78 LC. 934, A.I.R.
1924 All. 514 ; Sheo Karan v. Maharaja Parbhu Narain, 31 All. 276 (F.B.) ;
Raj Kuar v. Nabi Buksh, 9 O.C. 396 ; Nand Lai v. Hanumgn, 26 All. 368 ;
Kashi Gir v. Jogendranath, 27 All. 136 ; Ahmed Khan v. Sadasheo, 80 I.C.
736, A.I.R. 1925 Nag. 121 (122) ; Safdar Ali v. Ambika, A.I.R. 1930 All. 678
(681), (1930) A.L.J. 1385, 130 I.C. 8 ; A. P. Bagchi v. Mrs. Morgan, A.I.R.
1937 All. 36 (38), 166 I.C. 897 ; Md. Hasan v. Buddhu, A.I.R. 1938 All.
32, 172 I.C. 973. Where there was an unregistered patta as well as a
registered kabuliyat, held that the patta being unregistered was ineffective
to constitute a lease, and that the kabuliyat alone, though registered, did
not create a lease Sikandar v. Bahadur, 27 All. 462. The Rangoon High
Court, following the Allahabad view likewise held that since according to
the definition ^ven in section 105, a lease was a transfer of a right to enjoy
property, a kabuliyat executed by the lessee could not be termed a lease,
because it did not Wansfer any right in the property ; it was merely an
agreement to cultivate and pay rent U Tha Nyo v. Mg. Kyaw Tha, 3
Rang. 379, 90 LC. 693, A.I.R. 1925 Rang. 273, 4 Bur. L.J. 99 ; Mg. Ba v.
Htoon, 5 Rang. 95, 102 I.C. 105, A.LR. 1927 Rang. 169. The same view
has been taken by the Patna High Court' Ramkrishna v. Jainandan, A.LR.
1935 Pat. 291 (F.B.), 14 Pat. 672, 157 LC. 98. A Kabuliyat cannot form the
basis for a claim for rent Jagannath v. Amarendra Nath, A.LR. 1957 Cal.
479. But the landlord is entitled to recover compensation for use and
occupation Ramnarain Passi v. Sukhi Tewary, A.I.R. 1957 Pat. 24. A
patta executed by the landlord was sufficient for the purpose of creating
a lease before the amendment of 1929 Bastacolla Colliery Co. Ltd. v.
Bandhu Beldar, A.LR. 1960 Pat. 344 (F.B.). A lease for an indefinite
period on payment of yearly rent cannot be created by a unilateral regis-
tered Kabuliyat. On acceptance of rent by the landlord the executant
becomes a periodic tenant under sec. 106 Chandra Nath Mukherjee v.
Chulai Pashi, A.LR. 1960 Cal. 40 ; Jagannath Mahaprabhu v. Saunti Lenka,
I.L.R. (1959) Cut. 296. A forfeiture clause in a Kabuliyat is admissible in
evidence Chandra Nath Mukherjee v. Chulai Pashi, A.LR. 1960 Cal. 40.
The Calcutta and Madras (Full Bench) rulings arc now rendered
obsolete by this new third para of sec. 107,
Such a document is, however, admissible against the executant himself '
and would entitle the owner to eject the person in occupation Md. Hasan
V. Buddhu, supra. Although a patta is not a title-deed, it is a document
of title to which great weight is generally given both by the possessor and
by the Government. The latter cannot say that the pattadar is not entitled
to the land nor the tress granted under the patta, nor can the pattadar
say that he is not holding from the Government Secretary of State v.
Hussain Sahib. A.I.R. 1940 Mad. 783, (1940) 2 M.L.J. 13, 1940 M.W.N.
573, 191 I.C. 631. Though a Kabuliyat cannot operate as a valid lease, it
can be used for explaining the plaint Jagannatk v. Amarendra Nath,
A.I.R. 1957 Cal. 479.
A lease from year to year or for a term exceeding one year not execut-
ed in the manner specified in the third para of this section is invalid and
the invalidity cannot be cured by construing it as a lease for one year
made .by oral agreement accompamed by delivery of possession and there-
after to be a case of holding over imder sec. 116 Hari Prasad v. Abdul,
A.I.R. 1951 Pat. 160. See also Sant Bux v. Ali Raza, A.I.R. 1946 Oudh
129, 21 Luck. 194. A Kabuliyat alone cannot create a lease Shiv Dutt v.
Chasita, A.I.R. 1953 All. 499. Where the landlord accepts the Kabuliyat
and receives rent as provided therein, the lessee cannot be denied the
status of the tenant Asa Ram v. Mst. Ram Kali, A.I.R. 1958 S.C. 183.
Payment and acceptance of rent can create a ^tenancy Tulum
[Sec. 10?
Dhari Rai v. Devi Rai, A.I.R. 1965 Pat- 279. A deed of Bharapatra by
which the executant states that he is a tenant at a particular rent for a
.period of 3 years is -not however a lease and is not covered by the third
para so as to be excluded from evidence Birendra v, Sukiimar, A.I.R.
1952 Cal. 352. A rent-deed executed by the tenant, if not registered, can
be relied upon to establish the relation existing between the parties
Mohan Lai v. Gauda Singh, A-I.R. 1943 Lah. 127 (F.B.). A lease for more
than one year cannot be created by a unilateral Kabuliyat even though it
be registered one and even though it be accepted by the landlord orally or
by writing unregistered Dip Narain Singh v. Kanai Lai Goswami, 64
C.W.N. 293. A Kabuliyat is not a lease within sec. 105 Ibid. Where
the lessee remained in possession for 12 years under a Kabuliyat, the lessee
acquired the title which the agreement, if accompanied by a registered
lease would have conferred upon him Ibid.
Where the lessor alone executed a patta and the lessee alone executed
a Kabuliyat, no valid lease is created Budhan v. Ramanugrah, A.I.R. 1947
Pat. 78, 13 B.R. 332. Terms of contract embodied in a Kabuliyat cannot
be proved either by the Kabuliyat or by any other evidence Hiralal
Rewani v. Bastacolla Colliery Co, Ltd., A.I.R. 1957 Pat. 331. If a person
executes a registered Kabuliyat purporting to take a settlement of some
land for 10 years for building purposes and pays rent only for the first two
years, he is neither a tenant for ten years not for one year but he is a tenant
from month to month Ram Kumar v. Jagdish Chandra, A.I.R. 1952 S.C.
23. If a Kabuliyat for three years is unregistered, a monthly tenancy is
created Lalchand v. Radha Ballabh, A.I.R. 1959 Raj. 240.
Sec. iOSl
the executant of the Kabuliyat not signed by the landlord can sue the tres-
passer even if he subsequent to the lease intended to build a house on the
demised lanADassain Nonia v. Ramdeo Prasad, A.I.R. 1957 Pat. 692.
It is not necessary under the Crown Grants Act that the grant should
be evidenced by a writing signed by or on behalf of the Crown. All that
is required is that in point of fact the transaction has the effect of a
grant by or by the authority of the Crown. So a lease executed by the
lessee alone and accepted and acted upon by the Government operates
as a grant by the Crown. Hence para 3 of sec. 107 of the present Act
does not apply to the lease Mamndra v. Amiiya, A.I.R. 1951 Cal. 361,
55 C.W.N. 171. A license given by Government to prospect minerals in
land is not required to be registered, as it is in the nature of a Crown
grant Rangaswamz v. Nimbaker, A.I.R. 1946 Mad. 180, (1945) 2 M.L.J.
400. See also Ramnarayan v. State of M. P., A.I.R. 1962 Madh Pra 93
(F.B.).
120 -
use, of which the former is and the latter is not aware and which
the latter could not with ordinary care discover :
Sec. 108]
( o ) the lessee may use the property and its products (if
any) as a person of ordinary prudence would use them if they
were his own ; but he must not use, or permit another to use,
the property for a purpose other than that for which it was
leased, or fell or sell timber, puU down or damage buildings
[Sec. 108
572. Clause (a) Material defects ; Compare notes under sec. 55,
cl. (a). A defect in the lessors title cannot be said to be a material defect
in the property within the meaning of this clause Syed Mukhtar v.
Rani Sunder, 17 C.W.N. 960 (963), 19 I.C. 815.
The landlord is bound to disclosq the defects wliich e.xist at tlie time
of granting the lease ; it is not necessary that he should apprise the ten-
ant of any subsequent deterioration of the demised property rendering
it unfit for occupation Sarson. v. Roberts, (1895) 2 Q.B. 395 (399).
Sec. 108 ]
The lessee suing to get possession must prove both title of his lessor
and his own title under the lease Bithal Dass v. Mt. Iqbalunnissa,
A.I.R. 1940 Oudli 425, 1940 O.W.N. 842, 190 I.C. 444. One of the joint
lessors or lessees cannot enforce the covenant of a lease Jaduaandcn v.
Mt. Maho, A.I.R. 1939 Pat. 428, 185 I.C. 284.
[Sec, 108
I.A. 160 does not lay down that if the rent is a lump sum rent, then in
all cases of failme to give possession of any part, there cRn be a suspen-
sion of rent Where there is no dispossession, but an original
failure of making over possession of a small portion of the demised
land, and the tenant has paid the full rent for a long period there should
be abatement but no suspension of rent Dhirendra v. RarriUil, (1938)
42 C.W.N. 1030 ; Manohar Lai Seal v. M/s. Bengal, A.I.R. 1958 Pat. 457.
If the tenant denies that he has ever got possession of the subjects
let, the identity of which is not disputed, the landlord cannot claim rent
widiout proving not only that die tenant is in possession but that such
possession is referable to the lease. Wliere, however, the tenant has
already paid rent die onus is on the tenant to prove that certain subjects,
of which he did not get possession are within the subjects let Jogesh
Chandra Emdad, 59 Cal. 1012 (P.C.), 36 C.W.N. 221 (229), A.I.R. 1932
P.C. 28, 136 I.C. 398.
Sec, 108]
S74. Clause (c) Covenant for quiet enjoyment : Under this clause
the so-called covenant for quiet enjoyment is deemed to be a part of the
contract and to be read into the contiact ; whereas under section 55, it is
not a part of the contract, but merely a statutory obligation Ramparikha
V. Mt. Ramihari, A.I.R. 1937 Pat. 44 (47), 15 Pat. 753, 166 I.C. 599. The
present section, read with secs. 18 and 25 of the Specific Relief Act
reveals that the question of a transferor's title is as material in a lease
as in a sale, although when the lessee sues for recovering his premium
from the lessor, tlie burden of proving the lessor's defective title lies on
the lessee Vinayake Rao v. Bhondu, A.I.R. 1942 Nag. 103 (105), I.L.R.
1942 Nag. 349, 202 I.C, 9. Where the lessor has no title to the land and
a stranger does not allow the lessee to have possession of the leased pro-
perty, the lessee is entitled to a refund of the premium paid to the les-
sor ibid.
Tliough this section is not in force in the Punjab, yet the principle
relating to covenant for quiet enjoyment is of universal application.
Where a lessor covenants to indemnify the lessee against aU persons,
this is but a covenant to indemnify against lawful title Keshav v. Slier
Singh, A.I.R. 1937 Lah. 930 j see also Ayyanna v. Gangayija, A.I.R. 1933
Mad. 465, 144 I.C. 16; VOskuri v. Vedangi, A.I.R. 1933 Mad. 465, 144
I.C, 16, where the principle was applied in tlie case of a contract by a
Receiver, The covenant for quiet enjoyment contemplated by this
clause extends only to the disturbance of the lessees possession by tlie
lessor or by persons claiming under him or by his landlord, but not to
disturbance by a trespasser Srinivasa v. Rffngaswami, 1 L.W. 858, 25
I.C. 812 ; Syed Muklrtar v. Rani Sundar, 17 C.W.N. 960 ; Udai v. Kat-
yani, 49 Cal. 948, 35 C.L.J. 292 ; Douzelle v. Girdharee, 23 W.R. 121 ;
Dharam Narain v. Labh Singh, 60 I.C. 477 (Lah.) ; Surendra v. Bhudar,
A.I.R. 1938 Cal. 690 (691),' 67 C.L.J. 136; Vaskuri v. Vedangi, A.I.R. 1933
Mad. 465, 144 I.C. 16. The implied covenant protects the lessee against
all disturbances by the lessor whether lawful or not ; but as against other
Sec. 108]
TRANSFER OF PROPERTY 961
mount title. Therefore, where the lessor knowing that he had no title
gave a lease, but in consequence of his want of title failed to secure pos-
session to the lessee or failed to secure him undisturbed possession, the
lessee being ejected by the true owner of the land, held that the lessor
failed to cany out the obligation imposed by this clause and was not
entitled to recover rent Motilal v. Yar Mohammad, 47 All. 63, A,I.R.
1925 All. 275, 85 I.C. 756. Tayawa v. Gutshidappa, supra. If a tenant
has been evicted against his will or forced to attorn to a person holding
title paramount, he would be freed from his liability Narcyanaewami
v. Lakshmi Narasimha, A.I.R. 1939 Mad. 220 (222, 223), 1939 M.W.N.
98, 48 M.L.W. 759, relying on Bilas v. Desraj, 42 I.A. 202 37 All. 557.
But if the person claiming title has no registered deed on which his title
rests, the tenant is liable to pay rent to his lessor ilVcrai/fliiasioami v.
Lakshmi Narashimha, supra, at p. 224. Where a tenant is dispossessed
in execution of a dea'ee by a person having paramount title, the land-
lord cannot obviously claim any rent without restoring possession, since
every lease conveys a covenant for quiet enjoyment. But the landlord
is entitled to recover the rent for the period prior to the dispossession
by virtue of sec. 116 of the Evidence Act iParkash Kttar v. Gian Chand,
A.I.R. 1940 Lah. 341, 191 I.C. 555. But the mere institution of a suit for
possession by a person having a title paramount in law does not amount
to such eviction Amrita La? v. Uttam Lai, I.L.R. (1938) 2 Cal. 559,
A.I.R. 1989 Cal. 216, 181 I.C. 529. A considerable portion of land was
given by A in lease, but out of it 61 acres belonged to another owner B
who dispossessed the tenant. Later on A brought a rent suit against
C, B s wife, who had acquired the tenure as purchaser at an execution
sale of a decree against the tenant. Seeing that she had not obtained
possession of the land included in the tenure, C claimed an abatement
in the rent: held that C was entitled to the abatement /ot/ndrfl v.
Uday, A.I.R. 1931 P.C. 104 (105, 107), 58 Cal. 1281, 58 I.A. 141, 35
C.W.N. 583, 131 I.C. 309. As to the meaning and instance of eviction
by title paramount see Narayan v. Gokuldas, A.I.R. 1947 Nag. 48, I.L.R.
1946 Nag. 568. Where a lessee is evicted from his tenancy by a person
having a title paramount to his lessor, he can recover from the latter
the consideration of the lease and also the pecuniary loss he has suffer-
ed, that is, the cost of defending the suit for ejectment and any sum
recovered against him as costs or as mesne profits ibid. But the para-
mount title of a third party does not necessarily connote want of title of
the lessor. And the lessee cannot claim abatement of rent by reason of
being deprived of a portion of the lands owing to tire Government hav-
ing a paramount title thereto, unless he can establish his lessors defect
of title to that portion of the lands. Thus, where the Government made
a survey of certain khas mahal lands adjoining the lands occupied by the
lessee, and fixed the boundaries in such a way as to lessen the amount
of the lessees lands, he cannot claim an abatement of rent from his
lessor,, because it cannot be said that the lessee has been evicted from
a portion of the lands by reason of any defect of title in his lessor Indu
Bhusan v. Chowdhury Moazam, 33 C.W.N. 106 (109), 117 I.C. 838, A.I.R.
1929 Cal. 272. Eviction by title paramount means an eviction due to
the fact that the lessor had no title to grant the term, and the paramount
title is the title paramount to the lessor which destroys the effect of the
121
962 TRANSFER OF PROPERTY [ SEC. 108
grant and with it the corresponding liability for payment of rent ^er
Lord Buckmaster in Malthey v. Curling, [1922] A.C. 130.
ment by the landlord and the third party dispossesses the trespasser, the
ouster amounts to dispossession of the tenant Abdul v. Homed, A.I.R.
1933 Cal, 898, 38 C.JV-M. 61. If there is an interruption to the tenants
enjoyment of the property, his obligation to pay the rent ceases. And
die tenant enjoys this immunity from the payment of rent until the land'
lord again permits him to have quiet enjoyment Meenakshi v. Chidam-
baram, 23 M.L.J. 119, 15 I.C. 711 (714); Dhunput v. Mahomed Kazim,
24 Cal. 296; Jyoti Prasad v. Seldon, 19 Pat. 433, A.I.R. 1940 Pat. 516
(523-524), 192 I.C. 17. Substantial interference, short of actual dispos-
session, by the landlord with the quiet possession of the tenant entitles
the tenant to claim suspension or abatement B. Ahmed Marocair v.
Muihuvalliappa Chettiar, A.I.R. 1961 Mad. 28. Where the land is sub-let
by the tenant and the landlord starts collecting rent from the subtenants
the tenant can claim total suspension even if the lessor fails to collect
the entire rent from tlie subtenants Ibid. H the landlord keeps logs
of wood in one room of the house let out to the great inconvenience
of the tenant die entire rent can be suspended until the mischief is
removed Jatindra v. Raimohan, A.I.R. 1961 Assam 52. Tlie doctrine
of suspension of rent has no application in India if the landlord fails
to give possession of a part of the demised premises Surendra Nath v,
Stephen Covrt, 63 C.W.N. 922. There will be suspension of rent in
cases where the landlord has by his action dispossessed or where the
lessee has not, owing to his action, been able to take possession of a
part of the holding /oj/rcm v. Bishnu Charan, A.I.R, 1925 CaJ. 805, 85
I.C, 781. If the tenant is evicted from a portion of the property, the
tenant is entitied to rescind the lease; but if instead of tlirowing up the
lease, he elects to retain possession of the remaining portion, he cannot
refuse to pay rent for tiiat portion; he is bound to pay the rent for the
portion retained, and is entitled to sue for damages in respect of the
portion of which he has been deprived Meenakshi v. Chidambaram, 23
M.L.J. 119, 15 I.C. 711 (716, 718). In other words, the tenant is not
entitled to claim total suspension of rent, but can claim only a pro-
portionate abatement of tlie rent in respect of the portion from which he
has been evicted. It should be noted that this rule of proportionate
abatement of rent applies only where the rent is fixed at a certain rate
per bigha; but where the rent is fixed in a lump sum for the whole land
leased, treated as an indivisible subject, the tenant is discharged from
the payment of the whole rent if he is evicted from any portion of the
land Kafyani v. Udoy Kumar, 52 Cal. 417 (P.C.), 30 C.W.N. 1. 88 I.C. 410,
A.I.R. 1925 P.C, 97; Dhirendra v. Bhabatarini, A.I.R. 1929 Cal, 395
(396), 33 C.W.N. 367, 119 I.C. 297; Deoki Kaiir v. Shiva Prasad, A.I.R. 1939
Pat. 356, 1939 P.W.N. 263, 22 P.L.T. 378, But see Ram Lai v. Dhirendra
Nath, 47i C.W.N. 489 (P.C.) where it-has been laid down that as a matter
of broad general principle, the law of India no longer' proceeds upon the
notion that where a contract is for an entire sum, there is a necessity of
reason which prevents a party from recovering anything where his full
obligations under a special contract have not been discharged". Where
the lessee does not deny that he actually possesses the land which is
depicted in the plan attached to the lease deed, nor is there any doubt
that the land is within the boundaries, if there is a question between
boundaries and area, the former should prevail Keshabji v. PiramaU,
964 TRANSFER OF PROPERTY
[Sec. 108
42 C.W.N. 405, 67 C.L.J. 521, A.I.R. 1939 Cal. 129; sqe also Bara Kalim
V. Rajendra Nath, A.I.B.. 1920 Cal. 865, 64 I.C. 751 and Gossain Das v.
Mrittunjoy, 18 C.L.J. 541. In later decisions it has, however, been held
that if a landlord dispossesses a tenant from a portion of the tenure, he
is not entitled to recover any rent from the tenant unless he restores the
portion to him, and it makes no difference that at some time the tenant
is found to be in possession of some more lands, but not the entire tenure
Krishna v. Surendra, A.I.R. 1932 Cal. 385, 36 C.W.N. 72, 137 I.C. 696;
Hajira Bibi v. Abrar Hussain, A.I.R. 1964 All. 343. The mere obtaining
of a decree by the tenant for possession is not sufficient to defeat a
tenant s right to suspension of the entire rent for eviction from a portion
of the demised premises. That right continues until effective steps are
taken by the landlord to restore possession of the land Reshee Case v.
Satish, A.I.R. 1931 Cal. 397 (400), 35 C.W.N.'46, 132 I.C. 81. The evic-
tion whether from part or whole entails a suspension of the entire rent
while the eviction lasts whether the tenant remains in possession of the
residue or not. Perhaps, the sound course is to determine what is
equitable in tlie particular case and that might range from the apportion-
ment of rent per bigha where the dispossession is trivial or slight in a
rapidly rising gradient to entire suspension where the interference with
the enjoyment of the tenancy is considerable Dalip v. Suraj, A.I.R.
1935 Pat. 38 (39), 14 Pat. 323, 153 I.C. 298. Tenants would not be
entitled to a suspension of rent simply because of a mistake of the land-
lord in including certain portion of the land in a previous decree not
comprising the subject-matter of that suit, and consequently having it
sold, as the tenant could have corrected the mistake in a subsequent
smtSiseswar v. Kali Charon, A.I.R. 1926 Cal. 908 (910), 44 C.L.J. 27,
94 I.C. 418. Where a tenant claims suspension of rent owing to an
encroachment of a few inches on the leased premises by the erection of
a platform, the question was, did tlie landlord do something of a' grave
and permanent character with the intention of permanently depriving
the plaintiff of a portion of the subject-matter of the demise Nishi B^anta
V. Ezra, A.I.R. 1936 Cal. 135 (138), 166 I.C. 299. In a rent suit for the
apphcabihty of the doctrine of suspension of rent on account of dispos-
session from a portion of the tenancy in respect of which a lump rental
is payable, it must be shown that the landlord has deliberately set out
to dispossess the tenant Sukhraj v. Dip Narain, A.I.R. 1942 Pat. 266, 8
B.R. 153, 197 I.C. 160; Hakim Saxdot BaJHadur v. Tej Prakash Singh,
A.I.R. 1962 Punj. 385. Consequently, where by mistake a small portion
of the tenancy has gone out of possession of the tenant, because it was
inserted by mistake in a kabuliyat executed by the landlord in favour
of a third person, the plea of suspension of rent cannot prevail Ibid.
If the laridlord fails to give possession of one out of three bed rooms
of demised premises, the tenant cannot suspend rent, but must pay
proportionate lent Surendra Nath v. Stephen Court Ltd., A.I.R. 1966
S.C. 1361.
SEC. lOS]
run against the landlord during tlie currency of the tenancy Funjaram
V. Ramu, I.L.R. 1940 Nag. 348 (F.B.), A.I.R. 1940 Nag. 49, 1940 N.L.J.
121 relying on Katyayoni v. Udoy, 52 I.A. 160, 52 Cal. 417, A.I.R. 1925
P.C. 97! A tenant cannot recover the premium paid on the ground of
disturbance by a trespasser Dr. Prabhu Norciiii v. Kamla. Ftasad, A.I.R.
1964 Pat. 59.
Since the accretions become a part and parcel of the original tenure,
the landlord cannot treat the accreted lands as a separate tenure altogether
in order to claim compensation for use and occupation of such lands;
but he is, of course, entitled to an additional rent which must be fixed
after investigation into the value of the increment due to the accretion
Assanvllah v. Moliini Mohan, 26 Cal. 739.
The rule in this clause does not apply where the tenant encroaches
upon the land of his landlord. In such a case it is in the option of the
landlord either to treat him as a trespasser (and tlms to eject him out of
the encroached lands) or to treat him as a tenant in respect of those lands.
The tenant has no right to compel the landlord to treat him as tenant^
It would seem strange, if, as a matter of law, a tenant were allowed,
without the landlords permission, to appropriate any land which ad-
joins his owm tenure, and then when the landlord complained of the
trespass and required him to give the land up, he were allowed to take
advantage of his own wrong and to insist upon retaining possession of it
until the expiration of his tenure Naddyar Chand v. Meajan, 10 Cal.
820. But once the landlord has accepted him as a tenant for some time
in respect of the encroached lands, he cannot afterwards turn back and
treat the tenant as a trespasser Khondar Abdvl Hamid v. Mohini Kant, 4
C.W.N. 508.
[Sec. ios
lessor, and as the latter cannot have the right o enjoyment o an ease-
ment as of right against himself, so neither can his tenant against him
Adani Chander v. Baikonta, 29 Cal. 363; UdU Singh v. Kashi Ram, 14
All. 185; Jeenab Ali v. Allabuddin, 1 G.W-N. 151.
Sue. 108]
If the rent of the whole period of tlie lease had been paid in ad-
vance, but before the expiry of the period tlie le.Tsed property is destroyed
by fire, tlie lessee is entitled to a refund of a proportionate part of the
rent paid in advance, under sec. 65 of the Contract Act Dhuramsey v.
Almedbiwy, 23 Bom. 15.
[Sec. 108
Lai V. Shamshad Ahmad, A.I.R. 1968 AH. 225; Jitoanlal & Co. v. Manot
& Co., 64 C.W.N. 932. Even if a house is destroyed wholly, the lease
is not terminated unless the lessee s6 chooses Jkvanlal v. Manot & Co.,
64 C.W.N. 932.
Even if the lessor was imder an obhgation to effect repairs and fails
to comply ivith die request of the lessee, the latter is not entitled to
terminate the tenancy. He can excute the repairs himself after giving
reasonable notice to the lessor and recover the amount e-\pended by him
by deducting it from the rent of otherwise Bijay v. Howrah Amata Light
Ry., 38 C.L.J. 177, 72 I.C. 98, A.I.R. 1923 Cal. 524.
Hie tenant is entitled to deduct from the rent the expenses of neces-
saiy repairs done by liim, even thougli there is a covenant in the lease
to pay rent ivithout deduction Graham v. Colonial Government, 12
C.L.J. 351, 6 I.C. 131. See in tliis connection Abdul v. China, A.I.R.
1951 Ass. 62 and Augustine v. Chandi, A-.I.R. 1953 Tr.-Coch. 462. Where
the landlord fails to carry out the repairs which the Rent Act requires
him to do, the tenant is not entitled to suspension or abatement of rent
N. M. Industries Ltd. v. Birendra Nath, A.I.R. 1957 Cal. .232.
Sec. lOS]
The tenant can deduct from the rent the e.vpcnscs of only tho.sc
repairs which the landlord was bound to execute, and it is for the tenant
to establish that the landlord was bound to execute them. It is not
enough to show that the landlord had executed similar repairs in ijrcvi-
ous years Bolton v. Donald, 3 A.L.J. 134.
Where the tenant pays Corporation rates due by the owner on receipt
of a demand notice from the Corporation under sec. 246, Calcutta Muni-
cipal Act, 1951 the amount so paid can be adjusted against rent if there
is an understanding between the parties for such adjustment Wffs/n'hfln
Bibi V. Parul Bala Duita, 62 C.W.N. 778.
122
[Sec. lOS
579. Clause (h) ^JRemoral of trees, fixtures : Tlie old clause ran
thus: "Tlie lessee may remove at any time during the continuance of
the lease, all things, etc. Tliat is, this clause only allowed the tenant
to remove during the continuance of the lease, aU things which he
might have attached to the land, and nothing was said as to the rights
of the parties in respect of such things after the determination of the
lease, if tliey had not already been removed by the tenant. Tlie ques-
tion arose whetlier the tenant forfeited all his rights in such things if
he had not so removed them ; and it was held that according to local
usage, the option was witli tlie lessor either to take the building on pay-
ing compensation, or if he was unwilling to pay compensation, to allow
the tenant to remove tlie building Ispiai Kani v. Nazarali, 27 Mad. 211
(217 ) ; Angammal v. Aslami Sahib, 38 Mad. 710 (735) ; Kanai -Lai v,
Ras1k Lai, 19 C.W.N. 361, 23 I.C. 762. Wiere the terms of the lease
did not provide for payment of compensation to the tenant, the Court
had a discretion, in a proper case, to allow reasonable time to the ten-
ant after the expiry of the tenancy to remove his superstructure from
the land Raja Avergal v. Noor Mohomed, 66 I.C. 48, A.I.R. 1922 Mad.
349 ; Angummal v. Aslami Sahib, 38 Mad. 710 (736) ; Gacinda v.
Ch^rusila, 60 Cal. 1042, 37 C.W.N. 791 (795), A.I.R. 1 933' Cal. 875. Where
after die termination of the tenancy, the tenant took no steps for 2 years
to remove his structures, and after 2 years brought a suit to remove
the structures or to recover compensation, his claim must be disallowed
jGovinda v. Charusila, supra.
The amended clause has introduced no new principle but has only
extended the period within which the tenant could remove, beyond the
continuance of die lease to any furdier time during which he is in posses-
sion of die property leased. Tlie old clause (h) limited the tenants right
to remove as a right to be exercised during the term, but it failed to
notice that cases of hardship might arise where a tenancy was suddenly
determined, e.g., by a mortgagees sale or by Land Acquisition proceed-
ings. These difiiculties have been removed in the amended clause by
an extension of the period Gooinda v. Charusila, 60 Cal. 1042, 37
C.W.N. 791 (796). If die tenant once quits possession, the fixtures be-
come the property of the lessor Khimjee v. Pioneer Fibre Co., d3 Bom.
L.R. 576, A.I.R. 1941 Bom. 337 (338). But see India Electric Works Ltd.
V. B. S. Maniosh, A.I.R. 1956 Cal. 148, wherein it has been laid doivn
that clause (h) "is not a clause of forfeiture and it is not declared dierein
that after the expiry of the term of the lease or after the lessee has ceas-
ed to be in possession his title to the fixtures will be forfeited.
Sec. i08]
Where the lessees lost their right by a decree in a mortgage suit not
having given them an opportunity to remove the building, they were
allowed to remove tliem unless tlie lessor chose to take them on pay-
ment of compensation Kanai v. Rasik, 19 C.W.N. 361, A sub-lessee is
entitled to the benefit of cl. (h) and can remove a structure made by him
'Mana Devi v. Malki Ram, A.I.R. 1961 All. 84.
If after the tenant has erected buildings on the land, the lease turns
out to be invalid, the tenant is only entitled to have the superstructure
removed by him, and not to any compensation Govindasami v. Ethir-
ajammal, (1916) 1 M.W.N. 180, 34 I.C. 1. A tenant cannot claim compen-
sation for improvements, but he is entitled to remove the materials
Smt. Chapala Devi v. Rakhal Chandra Sen, A.I.R. 1964 Pat. 363. If
[Sec. 108
Tliis clause should be read with the clause (o), and the meaning
of the two clauses read together is that the lessee is entitled to remove
those trees and buildings which he himself has attached to the earth,
and that he is prohibited from removing the trees and buildings which
he has not himself attached to the earth and which stood on the land
at the time of lease Vasudeva v. Valia, 24 Mad. 47 (53) ; Gangamma
V. Bhomakka, 33 Mad. 253 ; Kedar l^ath v. Govinda, 32 C.W.N. 366 (371),
108 I.G. 242. As regards trees planted by the mulgeni tenant himself
since the grant of the lease, the tenant has every right to cut them whe-
ther diey are timber trees or otherwise Ganesh v. Hanmairf, A.I.R. 1952
Bom. 100, 53 Bom. L.R. 800. The lessee is not entitled to fell or sell
timber trees but he can make use of non-timber trees and utilise its
usufiruct as a person of ordinary precedence ibid. As regards the spon-
taneous growth after the lease was granted, the lessee cannot cut timber
trees, but he can cut tlie non-timber trees and put them to any other
use as he pleases ibid.
The principle underlying sec. 108 can be invoked in the ci\se of
agricultural leases in the absence of special custom to the contrarj'. Con-
sequently in the case of a perpetual lease of land for agricultural i^urposes,
the lessee is, in the absence of special custom to the contrary not entitled
to claim timber of trees which has spontaneously grown on the land
Gur Prasad v. Mehdi Husain, A.I.R. 1942 Oudh 460 (462), (1942) O.W.N.
435, 201 1.C. 728. See also Ganesh v. Hanmant, supra. l^Hiere no under-
proprietary rights have been conferred upon the lessee, he cannot claim
o\vnership of such trees as mentioned above Ibid.
Attached to the earth: ^For the meaning of this term, see Note
20 under sec, 3 and Note 78 under sec. 8,
A tenant who has planted trees on the land has Ihe right of cutting
down and making use of them Sitabai v. Shambhti, 38 Bom. 716. A
lessee may remove trees which he has himself planted and buildings
which he has himself erected, provided he leaves the property in the state
in which he received itVasudcoa v. Valia, 24 Mad. 47 (53) (F.B.). See
in this connection Velu v. Lakshmi, A.I,R. 1953 Tr.Coch. 584. A trespas-
ser is not entitled to any compensation for the trees planted by him
Rev. Father K. C. Alexander v. State of Kerala, A.I.R. 1966 Ker, 72.
579A. Clause (i) Growing crops ; ^Compare the last para of sec. 51,
and see Notes 8 and 78, ante. IWiere the effect of an award and the
Sec. 108]
decree passed thereon in a suit for possession of land was that if X did
not deposit the money payable to Y before certain date, Y was entitled
to remain in possession and he raised crops on the land: held that Y
was entitled to tlie benefit of this clause and X was not entitled to in-
sist that Y should make over possession of the crops to X along with the
land or pay the value of die crops Gangamma v. Mahabala, A.I.R. 1937
Mad. 879 (882), 46 M.L.W. 676.
[Sec. 108
Where the grantee of a lease transfers the whole of his term to the
See. 108]
A lessee cannot make an underlease for a longer term than his own
lease. If an underlease mentions no term, it cannot be construed to have
effect beyond the interest of the grantor Harish Chundcr v. Srcc Kali, 22
W.R. 274. During the subsistence of tenancy the tenant A brought B
on the land as a sub-tenant. After tlic expirj' of lease of A, B continued
possessing the property exclusively. A sold her interest to C. B never
paid rent to C nor was recognized as tenant by him: held, as soon as
the interest of A came to an end, the interest of B as sub-tenant also
came to an end and B could not subsequently rank as tenant of C.
Hence C could not sue B in ejectment as tenant after sern'ce of a notice
to quit Biraja Stindari v. Mahamaya, A.l.R. 1941 Cal. 599. Wicn the
original lease has not been determined, the lessor cannot treat the sub-
lessee, holding under a v.alid sub-lease, as if he u'as his tenant and not
[Sec, 108
the tenant of his sub-lessor, and sue him directly for rent Ganges Mflnfg.
Co. V. RadJiaram, A.I.R. 1945 Cal. 89, 49 C.W.N. 63. As purchaser in
the lessees interest at an execution sale, the lessor would no doubt be
entitled to realise rent direct from the sub-lessee, but the rent would be
the rent which the sub-lessee was liable to pay under the sub-lease ibid.
It is elementary that as between the lessor and the sub-lessee tliere is
neither privity of contract nor privity of estate and the sub-lessee would
not be bound by the covenants of tlie principal lease Jagadish v. Md.
Bukhtiyar, A.I.R. 1953 Pat. 409; covenants of the principal lease /agcdfe/i
V. Md. Bukhtiyar, A.I.R. 1953 Pat, 409; Bohan v. Champabai, A.I.R. 1949
Nag. 336, I.L.R. 1949 Nag. 432. Permission granted by the tenant to
others to use the premises does not amount to sub-letting Petroleum
Workers Union v. A. Mohamed & Co. A.I.R. 1967 Mad. 33.
This clause provides that the liability of the lessee shall not cease by
reason only of the transfer. Tlierefore, a lessee does not cease
to be liable to pay rent to his landlord even after he (lessee) has transferred
his interest in the property leased Bhola Nath v. Durga Prosad, 12
C.W.N. 724; Manmatha v. Balai, 70 I.C. Ill, A.I.R. 1924 Cal. 359;
Manmatlm v. Nalinalisha, A.I.R. 1925 Cal. 423; Ardeshar v. K. D. Bros.,
A.I.R. 1925 Bom. 330, 27 Bom. L.R. 553, 88 I.C. 79, and it is
no answer to a suit for rent brought by the landlord against the lessee,
that the transferee from the lessee is willing to pay the rent Akrurmani
V. Madhab Chandra, 47 I.C, 800 (Cal.). A mere assignment of a lease
does not release the lessee from his liability under the personal covenant.
Tliere must be actual substitution of the assignee as tlie person liable on
the personal covenant. Tlius, a judgment against the assignee for the
rent due which remains unsatisfied is no bar to a subsequent claim against
the lessees for the amount unpaid, the causes of action being different
Municipal Corporation of Bombay v. VasantlaJ, I.L.R. (1938) Bom. 471,
A.I.R. 1938 Bom. 360, 40 Bom, L.R. 497. Tliere is no consistency whatever
between the liability oS the original lessee on his covenant and that of the
assignee by reason of privity of estate, though the several liabilities are in
respect' of the same subject-matter Ibid. Wiere there is a direct coven-
ant by the lessee to pay to the lessor die rent; mere acceptance of rent from
an assignee of the lessee by the lessor will not relieve the lessee from his
personal covenant. Hie English rule of reddendum does not apply to
such cases Abdul v. Phiroz, A.I.R. 1936 Bom. 88 (89), 60 Bom. 394, 161
Sec. 108 ]
I.C. 57. Where the lease provides that the lessee is not competent to
transfer his ijara riglit, tliat such transfer, if made, shall not bind the lessor
and that if by operation of law such transfer becomes binding on the lessor
even then the lessee shall remain bound to pay the rent so long as the
transferee shall not furnish security to be fixed by the lessor for the pay-
ment of rent, the lessor is not bound to fix the security for the due pay-
ment of rent by the transferee whenever the lessep chooses to transfer his
right and the lessees personal liability to pay rent shall continue even
after transfer Satyaniranjan v. Sarjubala, 33 C.W.N. 865 (871) ; affirmed
33 C.W.N. at p. 872 (P.C.). The lessees liability (e.g., to pay rent) does
not cease even though he gives notice of .the transfer to the landlord, un-
less the lessor consents to it Sashi BJiushan v. Tara Lai, 22 Cal. 494 (500);
Satyaniranjan v. Sarajubala, 33 C.W.N. 865 (870); affirmed S3 C.W.N. at
p. 872 (P.C.); Deoidas Bhotfa v. Ratnakar Rao, (1965) 1 Mys. L.J. 731.
123
[Sec. 108
A mining lease is not mere sale of the land or minerals, but also
pailakes the character of a lease Jyoti Prasad v. Seldon, 19 Pat. 433,
A.I.R. 1940 Pat. 516, 192 I.C. 17; see also Falakrishna v. Laganmthi 59
Cal. 1814, 36 C.W.N. 709, A.I.R. 1932 Cal. 775. In the case of assign-
ment of a share of such leased premises the lessor is entitled to sue the
assignees for the whole rent. The assignees are liable jointly and
severally with the lessee Jyoti Prasad v. Seldon, supra.
It has been held by tlie Laliore High Court that there being no
privity of contract between the original lessor and a sub-lessee, the for-
mer is not entitled to claim rent from the later, his remedy being only
against tlie lessee with whom he made the contract Jetha Nand v. Udlip
Das, A.I.R. 1931 Lah. 614, 131 I.C. 121. But the liability of thq assignee
of a lease to pay rent to the landlord arises by reason of the privity of
estate and this privity of estate is created by the transfer to him and not
by his obtaining possession. Similarly, when the assignee in turn assigns
over, his privity of estate ceases and consequently his liability also ceases
in respect of breaches of covenant committed after he has assigned over
Sal^nha v. Svbraya-, 30 Mad. 410 ; Mehta Godadhar, 37 Cal. 683.
Sec. 108]
TRANSFER OF PROPERTY 979
[Sec. 108
581. Clause (k) Compare d. (5) (fl) of sec. 55, The distinctioh
between sec. 55 and the present section is that while under the earlier
section the non-disdosure amounts to fraud on the part of the purchaser
and entitles ^e vendor to rescind the contract of sale, a non-disclosure
under this clause has no such serious effect but only entitles the lessor
to sue for compensation.
In India rent does not accrue from day to day, but according to
kistsi Ram v. Harihar, A.I.R. 1937 Pat. 237, 16 Pat. 184, 168 I.C. 502.
Where there is no assignment by the lessor and the lessee pays the
Sec. 168]'
transfer of property 8i
Where the lessor has no title to the property and the lessee is ejected
by die true owner, the lessee is not bound to pay any rent to the lessor
Moti Lai v. Yar Mohammad, A.I.R. 1925 All. 275, 47 All. 63, 85 LC.
756. But a sub-tenant who remains in possession even after die passing
of a decree for eviction against the head lessee is bound' to pay rent to
the head lessee for the period during which he remains in possession
after the decree National Jewellery Works v. Diana Printing Works,
63 C.W.N. 192. In order to sustain the defence to a rent suit, founded
upon eviction by title paramount, two diings must be proved by die
defendant, namely, (i) that Ke has been evicted by a diird person, and
(ii) the third person had ^ paramount title, superior to the tide of his
lessor. Though physical expulsion is not necessary, the mere assertion
by the third person diat he has better tide to the knowledge of die
lessor and the lessee, is not a defence to a rent suit instituted by the
lessor against the lessee, even if this assertion be a true assertion. It
is essential that the iierson asserting such tide should take possession
or should be taken in the eye of law to have taken possession of the
demised premises. The mere institation of a suit for possession by a
person having title paramount ill law does not amoimt to such eviction
Amritalal. v. Uttamlal, A.I.R. 1939 Cal. 216 (218), I.L.R. (1938) 2 Cal. 559,
per R. C. Mitter and Edgley, JJ.
[Sec. 1o8
Wliere tiie lease discloses a joint demise, no one of tlie lessors widi
or witliout the consent of his co-lessors can sue for an aliquot part of
the whole; tlie suit must be for the whole of the interest demised, else
it fails Baraboni Coal Concern v. Gopinath Jiu, A.I.R. 1934 P.C. 58 (59),
61 Cal. 313, 61 I.A. 35, 38 C.W.N. 325, 147 I.C. 884. An inter se parti-
tion of the mokaiTari interest amongst tlie mokarraridars does not affect
theii- liability, qua the lessor, for pa}'ment of the whole rent, as several
tenants of a tenancy constitute in law but a single tenant. Such is the
case also in a lakhiraj holding subject to a mokarrari interest Badri
Narain v. Rameshwar, A.I.R. 1951 S.C. 186, 1951 S.C.J. 252, 30 Pat. 664.
See also Krishna v. Narayana, A.I.R. 1949 Mad. 618, (1949) M.L.J. 191.
A co-sharer can file a suit for the entire rent by impleading the other
co-sharers as defendants. But a suit for a iiroiiortionate part of the
rent is not maintainable in the absence of a contract to that effect be-
tween the tenant and the co-sharer landlords Vijai Kumar Tandon v.
Ganga Devi Rather, 1969 All. L.J. 403.
A stipulation that if a tenant does not pay rent on the due data
interest shall be charged on the arreras, is enforceable Bhyruh v. Meet
Ameerooddeen, 17 W.R. 173; and tlie mere omission to claim interest
for some time cannot amount to a waiver of tlie landlords right to claim
interest at the stipulated rate Shtjama Charan v. Heron Mollah, 26 Cal.
160; Jahoory v. Bullah, 5 Cal. 102. ^loreover, the Court has no power
to reduce die stipulated rate of interest payable upon non-payment of
rent in due time Sayed Shahid Hussain v. Jagmohan, 2 P.L.T. 276,
A.I.R. 1921 Pat. 301.
Where die plaintiff prays for rent in his one third sliare maknig the
co-sharers proforma defendant the suit is not maintainable because the
contract for payment of rent cannot be split up at the will of a co-sharer
iDhanestcar v. Subodh Kumar, A.LR. 1967 Cal. 334. If the tenant pur-
chase the interest of one of the landlords, others can get only a decree
for joint possession and proportionate rent in a suit for eviction and for
rent in anears Hflri Rratap v. Ramgopal, A.I.R. 1961 Raj,- IS.
Sec, 108]
If the lessor realises only a part of the rent from the sub-lessees and
the claim against the latter becomes barred by hmitation he cannot real-
ise the balance from the lessee Ibid.
583. Clause (m) ; The provisions of the Act can not be applied
by analogy to patni taluqs and a patnidar is competent to use or lease
out land for manufacture of bricks Surendra v. Bijoy, A.I.R. 1925 Cal.
962 (964), 52 Cal. 655, 30 C.W.N. 233, 41 C.L.J. 527.
This clause which directs tlie lessee to restore the property in the
same condition in which it was let, subject to the change caused by
reasonable wear and tear or by any irresistible force, has no application
where the parties have fixed their own terms ^and made their own
bargain. Tlius, where the lessee covenanted to keep the premises wind
and water tight and in habitable condition" and the premises were sub-
sequently damaged by an earthquake, held that as the parties had made
their own terms as to the condition in which the lessee was to keep
the house and in which it was to be delivered up at the end of the
term, the lessee was bound by his contract to make good the damage,
irrespective of whetlier or not the damage was caused by earthquake
or any other irresistible force Heckle v. Tellertj, 4 C.W.N. 521. But
in such a case the lessee is not liable to do all and everj' repair that is
necessary by reason of the earthquake, but only to make the damage to
tlie extent of making the premises wind and water tight and in habitable
condition Ibid. AH that the lessee is bound to do is to i3ut the premises
in such repair as having regard to the age, character and locality of
tlie house, would make it reasonably fit for the occupation of a tenant
of the class who would be likely to take it Proudfood \-. Hart, 2-5
Q.B.D. 42, cited in tlie above case. When there is a covenant in a lease
to leave the premises in reiiair at the end of the term, and such coi'enant
is broken, tlie lessee must pay what the lessor proves to be a reasonable
and proper amount for putting the premises into the stale of repair in
whidi they ought to be left Sarafali v. Suhraya, 20 Bom. 439 following
Joymer v. Weeks, [1891] 2 Q.B. 31 (43).
Sec. 108]
Clause (n) ; ^This clause throws a duty upon the lessee in order tliat
the lessor may, if he' chooses, protect his own interest and may be safe-
guarded against the results of a collusive eviction submitted to by the
lessee Indu Bhusan v. Choiodhury Moazam, 33 C.W.N. 106 (111).
585. Clause (o) Scope : ^This clause deals with the ordinary rights
of a lessee in an ordinary lease, and its terms cannot be held to cut down
the right to work a mineral expressly conveyed Satya Niranjan v. Ram
Lai, 4 Pat. 244 (P.C.), 29 C.W.N. 725, 86 I.C. 712, A.I.R. 1925 P.C. 42.
If certain premises are let out as a go-down but the tenant sublets it for
residential purpose and the premises are destroyed by fire, the tenant is
prime fade liable for. damages caused to the premises and the onus is
upon him to show that there %vas no negligence either on his part or on
the part of the sub-tenant Gtirupada Haidar v. Haripada Mukherjee,
A.I.R. 1962 Cal. 263.
This clause means no more than that a tenant is to use the demised
premises in a good tenant-like manner, and to effect all repairs which are
necessary to be effected in order to prevent tire building from falling
124
[Sec. 108
into ruin or at any rate give the landlord notice of the detection of any
serious danger of tliat kind Bflf Monghibai v. Doongersetj, 43 I.C, 273,
19 Bom. L.R. 887. Ordinarily, a tenant can make improvements on his
holding, but has no authority to use it for any purpose inconsistent with
the purpose for which the land has been given to him Binda Prasad v.
Behari Teivari, A.I.R. 1936 Oudli 816, 163 I.C. 186. Where the lease is
for residential purpose the tenant may be restrained by an injunction
from r unnin g a flour mill in the demised property Behari Lai v. Chan-
drawati, A.I.R. 1966 All. 541. Storing of cloth in premises let out for
selling cloth does not amount to use for a different purpose Mahmadu-
mar Abdul Rahim v. Firm of Shah Manilal Gokuldas, 9 Guj. L.R. 104.
Where the appellant had got a right from tlie Government to win
and get oil from a well site and he let it to the respondent for tapping
oil who sank weUs, got no oil but gas came out which he enclosed in
pipes and used for his purposes, it was held that the word oil did not
include gas and there is nothing inconsistent witli the terms of this sec-
tion in the use of the gas which is set free by reason of the sinking of
the oil well for tlie respondents purposes without doing any damage or
injury to tlie property U Po v. Burma Oil Co., A.I.R. 1929 P.C. 108
(110), 33 C.W.N. 545,' 7 Rang. 157, 56 I.A. 140, 115 I.C. 705.
Hie "right to enjoy such property in sec. 105 means the right to
enjoy the property in the manner in which that propeity can be enjoyed.
If tlie subject-matter of the lease is coal land, it can only bq enjoyed and
occupied by the lessee by working it as indicated in section 108 which
regulates fully the rights and liabilities of lessors and lessees in tills
country Commissioner of Income Tax v. Kamakshya Narain, 20 Pat
13 (S.B.), 21 P.L.T. 897, A.I.R. 1940 Pat 633 (647). Where land is leas-
ed for tile purpose of cultivation and settling tenants thereon, the lessee
is only entitled to a reasonable right of user in the soil, but he has no
right to dig or quarry stone or to collect and sell surplus stones. Hie
right to collect them can be established only by custom Kusum. Kajnini
V. Jagadish Chandra, A.I.R. 1941 Pat. 13 relying on BefOy Singh v. Sur-
endra Narain, 55 LA. 320, 56 Cal. 1, A.I.R. 1928 P.C. 234 and Bhupen-
dranarayan v. Rafeswar Prasad, 58 I.A. 228, 59 Cal. 80, A.I.R. 1931 P.C.
162. As to custom referred to above see Tucker v. Linger, 21 Cli.D. 18
affd. in 8 App. Gal. 508. A tenant has a right to take electric connection
in the portion let out to him to improve the premises Sheodayal v.
Daluram Agarwala, A.I.R. 1965 Pat. 413.
Sec. 108]
Tlie words belonging to the lessor have been added to tliis clause
by the amendment of 1929.
Jack trees are both timber and fruit trees, and the lessee cannot cut
tliem Gangamma v. Bhommakka, 33 Mad. 253 (254). Trees of sponta-
neous growth on the land belong to the owner, A.I.R. 1955 Andhra 62.
Timber includes bamboos ^JB. L. Mehra v. State, 1957 All. L.J. 917.
(a) Felling the timber (see the section); cutting down, destroying
or tapping all trees which are timber either by the general law or by the
particular custom of tlie country, is waste ^WoodfaU, 16th Edn., p.
660. See also Mahauaratja Vdpa v. Dasa Tantri, A.I.R. 1964 Mys. 179.
(c) Working mines or quarries not open when the lease was granted
(see die section); In re Furmandas, 7 Bom. 109; Christian v, Tekaitni,
19 C.W.N. 796 ;
(d) Converting arable land into woods and conversely meadow into
arable land; suflFering houses to be uncovered, whereby tlie rafters or
other timber of the houses become rotten ; permitting the walls of houses
to decay for defaults of plastering ; suffering die house to be wasted and
then felling down timber to repair the same, etc. ^Woodralls Landlord
and Tenant;
(e) Making bricks upon land not specially let for the purpose
Anund v. Bissonath, 17 W.R. 416.
(b) Planting cocoanut trees in land cultivated with ragi and paddy
Tlie prohibition under this clause does not apply when according
to the contract of the parties the land is let for the erection of a dwell-
ing house or a shop thereon Ismai v. Nazarali, 27 Mad. 211 (216). See
also Chandi Charan v. Ashutosh, 40 C.W.N. 52 ; Alterations may be
material even though they may hot cause any damage to the premises or
substantially diminish their value Manmohan Das v. Bishun Das, A.I,R.
1967 S.C. 643.
If a tenant transfers the house built by him with the landlords per-
mission on agricultural land the transferee acquires right to tlie materials
of the house but not to the site, because his right to occupy the site is
personal Chhaju Singh v, Kanhai, 1881 A.W.N. 144 (F.B.) ; Amir Begam
V. Balak, 1900 A.W.N. 182; Sri Girdhariji v. Chote Lai, 20 All. 248.
A structure witli walls of bricks and roof of comigated sheets is a per-
manent structure Surya Properties (P) Lid. v. Bimalendu Nath Sarkar,
A.I.R. 1965 Cal. 408. Wliether a structure is permanent or not is a
question of fact Properties (P) Ltd. v. Bimalendu, A.I.R. 1964
Cal. 1 (S.B.) ; Atul Sonatan, A.I.R. 1962 Cal. 78.
Sec. 108]
in anotiier case of the same Court that ordinarily the proper me-
asure of damages is twice the amount of rent payable by. the tenant'
Sundar Singh v. Ram Saran, A.I.R. 1933 Lah. 61 (64), 14 Lab. 137, 142
I.C. 754. Yet in another case it was held that the court has the discre-
tion not to penalise the tenant Narain v. Dharam, A.I.R. 1932 Lah. 275.
If the property is in the possession of a sub-lessee, and the lessee does
not turn him out, the landlord may maintain a suit for ejectment against
the sub-lessee and recover damages from the lessee including the cost of
ejecting the sub-lessee Henderson v. Squire, L.R. 4 Q.B. 170 ; Abdul
Qayum v. Md. Fazal Azim, A.I.R. 1937 Lah. 121 (124). If B, a Icssco
of land with a house under A creates a sublease in favour of C and C,
after the destruction of the house by fire constructs a hut with the irer-
mission of A, B is entitled to recover possession of the land and the hut
from C without paying the value of the hut to C, who, however, is entitl-
ed to remove the hut Munnustvamy v. Muniramiah, A.I.R. 1965 And.
Pr. 167. Where the demised premises are in the occupation of a tres-
passer and the tenant has not been included upon them, the landlord
cannot recover damages from the tenant who has relinquished his tenancy
after informing the landlord about the trespassers possession SaJi Sfiff
Ram v. Syed Md. Mehdi-, A.I.R. 1959 Pat. 139.
If the landlord wrongfully refuses to take possession when asked to
do so, the tenants liability to pay ceases. For the subsequent re-entry of
other persons the tenant incurs no liability, though landlord can recover
from persons in occupation Ibid, at pp. 124, 1^.
Where the lease provides for the purchase of tlie building erected
by the lessee on the termination of die lease tire building is to be valued
according to the cost of reproducing the building after deducting dejire-
ciation and cost of repairs. No special value can be demanded for a
cinema hall Ethirajulu v. Ranganatham, A.I.R. 1942 Mad. 156, (1941) 2
M.L.J. 711, 1941 M.W.N. 938.
If the tenant had encroached upon any land and made it a part of
his tenancy, he is bound, after tire determination of tenancy, to give up
those lands to his landlord Indu Bhushan v. Aful Chandra, 42 C.L.J.
276, A.I.R. 1925 Cal. 1114 (1116), 67 I.C. 630. On the failure of a suit
for ejectment based on the relationship of landlord and tenant it may
be decreed on the plaintiffs tide Kafamasioamy v. Ramayyu Pantxdu,
A.I.R. 1958 Andli. Pra. 755.
which it was mixed up, equal to its annual value Dugappa v. Tirthasatni,
6 Mad. 263 ; Istnail Khan v. Broughton, 5 C.W,N. 846.
Where a lease for a certain term confers an option to the lessee for
renewal of the lease, but no lime is fixed wthin which such option is to
be exercised, and the lessee after the expiry of the term continues in
possession, the landlord is bound to give notice to the original lessee
for exercising his option of renewal Hemanta Kumari v. Safaftilla, 37
C.W.N. 9. '^ere the covenant of renewal was applicable to the whole,
it did not permit renewal of a portion Secretary of State v. Volkart
Brothers, A.I.R. 1928 P.C. 258, 51 Mad. 885, 55 I.A. 423, 111 I.C. 404.
Wliere tliere is a clause for renewal subject to such fair and equitable
enhancement as the lessor shall determine the lease is not void for un-
certainly, nor is the court precluded from considering whether the
enhancement is fair and equitable Damodhar Ttikaratn v. State of
Bombay, A.I.R. 1959 S.C. 639. Wliere a lease for 10 years contains a
provision that after the exiriry of the period of the lease the lessee is
entitled to remain in tlie suit land on a new Bandobasta only, the ten-
ant is entitled to renewal on the original terms on payment of a fair rent
Ramesh v. Atul, A.I.R. 1959 Assam 22,
If the option in a lease does not state the terms of renewal, the new
lease will be for the same period and on the same tenns as the original
lease in respect of all essential conditions except as to the covenant
for renewal Prodyot Kumar v. Maynuddin, A.I.R. 1938 Cal. 724 (727) ;
Srish Chandra v. Doa Muhammad, A.I.R. 1939 Cal. 77, 68 C.L.J. 128,
179 I.C. 813 ; Secretary of State v. Digambar, 27 C.L.J. 443, 45 I.C. 939.
If a lease is given for three years and tlie lessee is given the right to take
new settlement, he is entitled to one renewal for three years ; he cannot
claim a lease for an unlimited period Srish Chandra v. Doa Moham-
mad, supra, at p. 78, Tlie leaning of Court is always against perpetual
renewal, in order to establish that, the intention has to be unequivocally
expressed Ibid.
contract to the contrary, shall possess all the rights, and, if the
Sec. 109]
Frincipfll : ^The latter portion of the first para which lays down that
the lessor shall not, by reason of transfer of his interest, cease to be sub-
ject to the liabilities unless the lessee elects to treat the transferee as his
landlord, is an illustration of the equitable principle tliat a man
cannot assign obligations (t.e., cannot substitute some one else as the per-
former of his duties), without the consent or the authority of those to
whom the duties are owing* jjer Innes,' J., in Cheru Kotnen v. Goven-
den, 6 M.H.C.R. 146 (at p. 151).
include rights of die lessor under covenants affecting the propertj^ that
is, ^to use the English expression ^under covenants which run with the
land and that no other rights pass. A purely personal right against the
original lessee who has parted with the land is not a right of the lessor
as to the property Abdul v. Phiroz, A.I.R. 1936 Bom. 88 (90, 91), 60
Bom. 394, 161 I.C. 57.
Tlie assignee is also subject to all the liabilities of the lessor. Tlius,
a covenant to renew a lease is a covenant which runs witli the land, and
which according to tliis section creates a liability enforceable against
the lessors transferee Ramasami v. Chinnan, 24 Mad. 449. Tlie e.vpres-
sion if the lessee so elects, be subject to all the liabilities is taken to
mean the burden of all the covenants running with the land, such as
covenant for quiet enjoyment. IVliere there is a breach of such a covenant
and the lessee treats tlie transferee of the lessor as liable, he cannot turn
round and charge the lessor in respect of the coi^enant as he having once
made the election it is final Isicara v. Ramappa, A.I.R. 1934 Mad. 65S
(662), 152 I.C. 201. Open plots belonging to the Municipalit) were let
out to A, who erected structures and let out the structures to tenants.
The Municipality filed a suit for ejectment against A and a consent decree
was passed providing inter aha that A was to give up possession of the
plots with structures. Hie tenants resisted execution and tliereafter filed
a suit under Order 21, r, 103 contending that they had become tenants
of the Municipahty by reason of sec. 109, T.P. Act and therefore the decree
for eviction against A could not be e.\ecuted against them. Held: S. 109
did not apply as on the date of the so called transfer A had no interest
in the property sold. Held further that tlie effect of the lease terminating
was not a transfer from A to tlie Municipality Ratn Bhagwan Das v.
Bombay Corporation, A.I.R. 1956 Bom. 364. A promise by the lessee to
pay rent to the ahenee from the landlord and his continued occupation
with notice of the ahenation amounts to attornment Munavar Basha v.
Narayanan, A.I.R. 1961 Mad. 200.
Sec. 109]
after the transfer, if tlie lessee had, witlioul notice of the transfer, already
paid sudi rent to the original lessor. Although the title of the assignee
of tlie lease is complete upon execution and registration of the deed of
assignment and is not postponed till notice has been given to the tenant,
still the tenant is not bound to pay rent to him until he gets notice of the
assignment. The tenant is thus able to escape the liability to the assignee
if he alleges and establishes that he has paid rent to the assignor in good
faith before he had notice of the assignment Feary IM v. Madhoji, 17
C.L.J. 372, 19 I.C. 865. But the lessee becomes liable to the assignee
as soon as he has notice of tlie assignment Rffisudiiin. v. Kliodu, 12
C.P.L.H. 479. Tlierefore, if the tenant pays rent to the assignor after he
receives notice of the transfer, the payment is of no avail Peary Lai v.
MadJioji, 17 C.L.J. 372, 19 I.C. 865. So also, if the lessee surrenders his
holding on the expiiy of the term to the original lessor after the transfer
and there is nothing to show that he had no notice of the assignment, the
surrender is not valid and binding on the assignee who can claim rent
from tlie lessee on the ground of his holding over after the expiry of the
lease Rama Chandra v. Sheik Hussain, 3 Bom. L.R. 679.
The mere fact that tlie notice of the transfer of the leased property
was not given by the assignee to the tenant shall not lead the Court to
assume that the tenant did not become the tenant of the assignee, and
that the assignee was not entitled to recover any rent from the tenant.
Tliis section provides no penalty for want of notice except the loss of rent
already paid .by the lessee to the original lessor. That is, if the tenant
does not receive any notice of the transfer and therefore pays rent to the
original lessor, tlie assignee of the lessor cannot recover the rent from the
tenant twice over B/jofc Nath v. Supper, 72 I.C. 86, A.I.R. 1923 Lah. 389.
125
[Sec. no
In such a case, he must give the tenant due notice to that efifect, and then
if an apportionment of the rent cannot be made by amicable arrangement
between all the parties concerned, the pmrchaser may bring a suit against
the tenant for the purpose of having the rent apportioned, making ^ the
other co-sharers parties to the suit Ishwar Chandra v. Ramkrishna, 5 Cal.
902. And the apportionment may take place in respect of the arrears of
rent alleged due as well as the future rent Rajnarain v. Ekadasi, 27 Cal.
479. Wliere the tenant knows that inspite of the assignment, the assignor
is holding himself out as his landlord in all proceedings in court to which
the tenant is a party, the tenant is not liable to pay rent to the assignee
Pulin Rehary v. Miss Lila Dey, A.I.R. 1957 Cal. 627. If on the death
of die landlord the tenant makes an attornment in favoiur of a person
having no tide to the reversion die attornment is not effective as against
a third person claiming tide to the reversion unless the attornment is
followed by pa3Tnent of rent and the person in whose favour such attorn-
ment has been made cannot be regarded as in possession through the
tenant -iV. Satyanarayanaraju v. J. Hanumayamma, A.I.R. 1967 S.C. 174.
When a lessor sells a portion of his property, the rule of sec. 37 will
be applied, and the tenants will be bound to pay to each of the owners
his proportionate share of the rent. They are not bound to perform
the various obligations imposed on them as lessees, wholly in favour of
eidier the lessor or his transferee, if such obligation is capable of severance
and such performance will not be to their prejudice. Hiey are also
boimd, on the determination of the tenancy to put the lessor in possession
of only so much of the property as he has not transferred. The rent
payable and the property to be surrendered, unless all die parties agree,
can only be ascertained in a suit to which all die lessors and the lessees
are parties Sri Raja Simhadri v. Prattipati Ramayya, 29 Mad. 29 (36).
Sec. 110]
that "in computing tlie period of limitation, the day from which such
period is to be computed shall be excluded. Compare also sec. 9 (a) of
the General Clauses Act which enacts that wherever the word from is
used, the first in a series of days or any other period of time should bo
excluded.
[Sec. no
midnight o the 30th September and not on tlie 1st October i
Gnanopfokosam v. Vaz, 60 M.L.J. 293, A.I.R. 1931 Mad. 352 (353).
The rule in tliis section applies not only in computing the time for
the duration of a lease but also in computing the time from which a
notice to quit commences; so that the day on which the notice is given
is excluded from calculation. Thus, where the landlord served a notice
on the tenant on the 16th of a month, requiring him to quit the land' on
the 30th of the same month, held that tlie day on which the notice was
served (i.e., the 16th) was to be excluded, and the tenant had therefore
only 14 days notice, which was invalid Subadini v. Diirga Charan, 28
Cal. 118.
Sec. Ill]
Determination of lease.
nates on, or his power to dispose of the same extends only to,
the happening of any event ^by the happening of such event :
A lessee accepts from his lessor a new lease of the property leased,
to take effect during the continuance of the existing lease. This is an
implied surrender of the former lease and such lease determines there-
upon.
Amendment ; Clause (g) has been amended by sec. 57^ of the T. P.
Amendment Act (XX of 1929). See Notes 597, 599A and 600 below.
do not apply to the North Western Frontier Province Ishar Das v. Qazi
m., A.I.R. 1945 Pesh. 16. .
Where the lease was created .long before 1929 the incidents of the
tenancy could not be governed by the amended sec. 111. In such a case
all that is necessary to constitute forfeiture is disclaimer by the tenant
and some act by the lessor indicating his intention- to determine the
lease Krishna Prasad v. Adyanath, A.I.R. 1944 Pat. 77, 22 Pat. 513. A
mere non-payment of rent does not of itself determine the tenancy
Kamala v. Mf. Nashin, A.I.R. 1951 H.P. 65.
The' provision relating to notice under this section does not apply
to a case of ejectment under the Rent Control Order Md, Gous v.
Karimunnissa, A.I.R. 1951 Hyd. Ill, see also Baijnath v. Ram Prasad,
A.I.R. 1951 Pat. 529, 30 Pat. 366 ; SUnkavally v. Singarajii, A,I.R. 1950
Mad. 60, (1949) 2 M.L.J. 339. Kfirsandas v. Kara^onji, A.hR. 1953
Sau. 113.
593. Clause (a) Expiry of term : Under this clause, a lease comes
to an end upon the expiry of the term for which it was granted. But
if there is a covenant for renewal, the lessee may claim enforcement of
Ed 111]
tkansper op property W )
. CL (a) has to be read with sec. 116- Where before the determination
of the lease by efflux of time the lessee applies to the custodian for
confirmation of the lease under sec. 5A, East Punjab Evacuees (Adminis-
tration of Property) Act, 1947 and the Custodian impliedly assents to
his continuing in possession, the lessee does not become a trespasser
Thakar Das v. Custodian, A.I.R. 1950 E.P. 175.
[Sec. Ill
For the distinction between a forfeiture under cl. (b) and that under
cl. (g) see In re Srinath Zamindary, A.I.R. 1952 Cal. 207, where it has
been pointed out that in cl. (b) the term is fixed conditionally and
depends upon the happening of a future event. In cl. (g) on the other
hand the term is brought to an end by a defeasance clause. A lease for
99 years granted to a company provided inter alia that in case the
company goes into liquidation voluntarily or otherwise, it will cease
to be operative. The company went into liquidation: Held that cl. (b)
did not apply ibid. Where a lease for 40 years contained a clause that
if the lessee carried on any business other than manufacture of salt the
lease would stand cancelled ; Held that cl. (b) did not apply Krishnd
Chandra v. National Chemical etc., A.I.R. 1957 Orissa 35. Where an
employee of the landlord occupying a building is liable to be evicted
on his ceasing to be in emplo 5 rment, the tenancy is governed by sec. Ill
(b), T. P. Act and no notice under sec. 106, T. P. Act is necessary for
terminating the tenancy Tata Iron and Steel Co., Ltd. v. Couribala Devi,
I.L.R. 47 Pat. 359.
593B. Clause (c) : If the lessor holds the property for his own
life or for the life of another, the lease would terminate on, the death
of himself or that other person. A lease granted by a Hindu widow
would fall under this clause. Such a lease is, however, voidable and
not void bn the grantors death Madhu Sudan v. Rooke, 25 Cal- 1 (8)
24 LA:. 164; Bifoy Copal v. Krishna Mahishi, 34 Cal. 329 (333), 34
LA. 87.
This clause does not mean that if in the exercise of his power of
due management the mortgagee has entered into an agreement of
tenancy, on the mere redemption of the mortgage the tenancy would
automatically lapse Hardie v, Wahid, A.I.R. 1954 All. 16. A lease;
from year to year granted by the manager of a temple in course of
management does not come to an end with the expiry of the office of
Sec. Ill]
594. Clause (d) Merger: Under this clause a merger takes place
when the tenant acquires the immediate reversion, and the greater estate
and the less coincide in the same person without anj' intermediate estate
Sitraj Chandra v. Behari Lai, I.L.R. (1939) 2 Cal. 551, A.I.R. 1939 Cal.
692 (695), 43 C.W.N. 1126- Where a lessee has purchased the equity
of redemption belonging to the lessor, the existence of a mortgage on the
superior right, even if it cannot be held to be an intermediate estate
which would prevent merger, would certainly constitute a criterion to
determine the lessees intention. In the absence of evidence to the
contrary the lessee cannot have intended a coalescence of the t\s-o rights
which is manifestly to his prejudice Ibid at p. 696. This clause is an
embodiment of the maxim nemo potest esse tenens et donunus, i.e.,
nobody can be botli landlord and tenant at the same time (in respect
of the same property). Thus, if a patnidar purchases the Zemindari
rights in the mahal, his rights as patnidar would be merged Prosonno
v. fagut Chtmder, 3 C.L.R. 159. The principle of merger enunciated in
this clause equally applies where the merger takes place by virtue of
transfers by operation of law. Thus, a patni interest determines when
the same is purchased by the Zemindar at an execution sale Promotho
Nath V. Kali Prosonno, 28 Cal. 744, but see Bijoy v. Tarini, 39 C.W.N.
694 where it was held that if a tenure created before the Act is acquired
by the holder of the superior interest after the Act, the clause (d) being
excluded by sec. 2 (c) would not apply and there will be no merger of
the tenure in the superior interest by operation of law if the holder
keeps tlie two separate. The same view has been taken by Nasim AH
and Remfry, J.J. in the recent case of Kumar Chandra v. Sarat Chandra,
A.I.R. 1938 Cal. 128 (129).
For constituting merger within this clause the interest of the lessor
and the lessee in the entire property should become vested in the same
person at the same time in the same right. Thus where the acquisition
of the dar-patni interest by the patnidar did not have the effect of extin-
guishing the dar-patni interest, there was no merger in the eye of law
Maya Debi v. Rajlakshmi, A.I.R. 1950 Cal. 1. Where the lessor purchases
the lessees interest, the lease no doubt is extinguished, for the same
person cannot at the same time be both a landlord and a tenant. But
where one of several lessees purchases only a part of the lessors interest,
there is no extinction of the lease Badri Narain v. Rameshwar, A.I.R.
1951 S.C. 186, 1951 S.C.J. 252, 30 Pat. 664. As an instance of merger,
see Ram Narain v, G. G. in Council, A.I.R, 1947 Pat. 263, 13 B.R. 34.
126
coming into the same hands as the Zemihdary interest Jibami Nath v.
Gokool Chunder, 19 Cal. 760.
Sec. Ill 1
A sale of the demised property to the tenant terminates the lease even
though there is a condition for repurchase and the possession of the
tenant after reconveyance of the property in the absence of a fresh
tenancy is wrongful Reoti Saran v. Harzu Lai, A.I.R. 1964 All, 542.
[Sec. Ill
Sec, 111]
[Sec. Ill
apply both to tenancies created before the Act came into force and to
tliose excepted from its operation. There can be no forfeiture by dis-
claimer in cases not covered by the Act unless the disclaimer is q matter
of record. Tlie power of the Court in India to relieve against forfeiture
arising by disclaimer on grounds of justice, equity and good conscience
is not necessarily limited to the cases where the tenant proves that the
denial was occasioned by fraud, mistake or accident of the landlord and
the tenant himself was neither careless nor negligent Rachotappa v.
Konlvpr, A.I.R. 1937 Bom. 41, 59 Bom. 194, 155 I.C. 516. Tliere are how-
ever no provisions for relief against forfeiture when the lessee renounces
hisT character by setting up a title in himself or any other person Anand
V. Taiyab, A.I.R. 1943 All. 279. Forfeiture ensues when the tenant fads
to admit that he is holding the property as such ibid. To entitle the
plaintiff to a decree for ejectment on the ground of determination of the
lease by forfeiture, there must be both disclaimer and manifestation of
intention to determine the lease before institution of the suit Salla v.
Jainat, A.I.R. 1953 Nag. 353. If the defendant simply denies the title of
the plaintiff who is not the lessor but claims as heir of the lessor, there
is no disclaimer ibid.
Sec. 111.]
[Sec. Ill
Unless there is an express provision for re-entry for breach of any covenant
in it, the lessor wU not be entitled to treat the lease as forfeited and to
eject the tenant Kishori Mohun v. Nvnd Kumar, 24 Cal. 720 (724).
Thus, where the lease merely contained a covenant on the part of the
lessee not to alienate the property, but there was no provision for re-entry
by the lessor in tlie event of such alienation, held that an ahenation by
the lessee in breach of such a covenant would not entitle the landlord to
consider the lease as forfeited or to treat the alienation as void and to
sue the tenant in ejectment. Tire relief of the landlord would be by way
of damages for breach of the covenant against alienation Narayan v.
Mi Saiba, 18 Bom. 603j Madar Buksh v. Sannabaica, 21 Bom. 195. Timapa
v. Timaya, 7 Bom. 262 (265); XJdipi v. Seshamma, 43 Mad. 503, 61 I.C.
658; Parmeshri v. Vittappa, 26 Mad. 157; Nilmadhab v. Narotam, 17 Cal.
826; Mahananda v. Saratmani, 14 C.L.J. 585 ; Basarai v. Martirulla, 36
Cal. 745; Netrapal v. Kallyan, 28 All. 400; Shankar Dayal v. Vinayak,
A.I.R. 1924 Oudh 305 (306), 79 I.C. 695, 27 O.C. 1; Krishna Chandra v.
National Chemical etc., A.I.R. 1957 Orissa 35. See Note 92 under sec.
10. So also, in the absence of an express condition as regards forfeiture,
a lease cannot come to an end merely because the lease-money is not
paid by the lessee Mahadoo v, Jainarayan, 62 I.C. 850. Similarly,
where there was a stipulation in the lease against sub-letting but the lease
contained no stipulation giving a right of rq-entry to the lessor upon sub-
letting by the lessee, Jijsld that the mere prohibition against sub-letting
was in the nature of a threat, and in the absencq of a iJrovision for re-
entry, the tenant could not lie -ejected on the ground of sub-letting
Gordon Stuart & Co. v. Taylors, W.R. 9 (F.B.); SUal Prosad v. Dildar Mi,
1 P.L.J. 1. 33 I.C. 408; Pramatha Nath v. Prabiilla Chandra, A.I.R. 1960
Assam 105. Where a lease is in favour of several persons jointly and
the share of each is sxjecified, and tliere is a covenant for re-entry on
transfer of the property or even a portion of it and one of the lessees
transfers his share, the landlord is entitled only to re-enter on such lessees
share but not on the whole property in tlie absence of an e.xpress clause
empowering him to do so Pancham v. Pramatha, supra, at p. 455.
Sec. Ill ]
Mahalaxtni, A.I.R. 1947 Mad. 441, (1947) 1 M.L.J. 229. See also Souza
V. Louis, A.I.R. 1947 Mad. 119 (1946) 2 M.L.J. 362. \Vliere a lease con-
tains a eovenant prohibiting assignment without a previous mitten
consent of the landlord and sucli consent is not to be unreasonably with-
held in case of a respectable or responsible person, an assignment by the
tenant to a respectable person mthout the landlords consent does not
amount to a breach of covenant KamaJa Ranjan v. Baiinath, A.I.R. 1951
S.C. 1, 1951 S.C.J. 13. An alienation in favour of a co-lessee is not an
alienation witliin tlie clause, but a sale by a lessee to his daughter is
Koragalm v. Jakri, A.I.R. 1927 Mad. 261, 52 M.L.J. 8, 99 l.C. 700. If a
term is granted subject to a condition against assignment, an assignment
by the lessee will be void; but if the restraint is by covenant only, the
lessee by assigning commits a breach of covenant, but the assignment
itself is not void though the landlord can put an end to it as soon as the
assignment comes to his knowledge if the lease contains a power of re-
entry Sreedhar v. Kusum Kximari, A.I.R. 1938 Cal. 478 (479), 42 C.W.N.
932. Tlius, where a clause in a maurasi makarari provides that in the
case of a transfer, the transferee shall pay one-fourth of the consideration
money to tlie landlord and also that in default of such payment tlie
transfer shall not be valid; this clause is not in the nature of a covenant,
but it is in effect a rastrictive condition which h'mits the power of aliena-
tion,- and a transfer in breach of it is void Ibid. A mortgage by con-
ditional sale followed by a decree for foreclosure and the taking of posses-
sion thereunder constitutes a transfer within the meaning of such a stipula-
tion which is binding as between the parties and tlieir representatives.
Consequently on failure to pay the transfer-fee on the date of the decree
for foreclosure the landlord becomes entitled to get a decree for eviction
of the transferee Chandi Charan v. Taranath, (1942) 46 C.W.N. 6, 75
C.L.J. 434. In this particular case their Lordships (Biswas and Akram,
JJ.) relieved the transferee against eviction by directing him to pay the
amount of transfer-fee with interest. Wlien a landlord is entitled to
re-enter by reason for forfeiture, he is also entitled to claim rent or mesne
profits up to the date of obtaining possession and tlie fact tliat he claims
in a suit for ejectment rent or mesne profits till he gets possession cannot
be said to be a waiver of the right to re-enter Koragalva v. Jakri, supra.
The mere fact- that the landlord refrained from enforcing his right on
one or more previous occasions, whetlier for consideration or not does
not amount to a surrender of liis right to enforce it when a subsequent
occasion arises Dayal Singh v. Pramatha, A.I.R. 1936 Pat. 493 (495), 15
Pat. 673, 164 l.C. 811. The landlord is entitled to eject transferees from
the original tenant against whom an ex parte decree for ejectment has
been passed Ibid. A pmchaser from a permanent lessee who has
covenanted not to alienate, if recognized by tlie lessor, is not, however,
bound by the covenant against alienation KJietra Nath v. Bahar Ali,
A.I.R. 1929 Cal. 228,- 49 C.L.J. 89, 116 l.C. 153.
127
[Sec. Ill
of the leasehold rights but subject to the sanction of the Board of Eevenue.
It was also provided that in the meantime the intended vendee should
act as the agent for the company in respect of the lasehold rights in the
quarries, that he should pay to the company the royalties and oth^-
sums payable by it to the Government and that he should be entitled to
work the quarries for his owm benefit. The contract, though the value of
the interest created was more than Rs. 100, was not registered; Held
that the transaction created an agency coupled with an interest and did
not amount to sub-letting. The transaction, however, amounted to a
transfer of an interest in the leasehold property [on this point reversing
Kuchwar Lime & Stone Co. v. Secretary of State, A.I.R. 1936 Pat. 372, 15
Pat, 460, 163 I.C. 501 which is to be read in this connection]. But the
contract not being registered, the transfer was not effective, and hence
there was no -forfeiture of the lease Secretary of State v. Kuchwar Lime
& Stone Co., A.I.R. 1938 P.C. 20 (22), 17 Pat. 69, 65 I.A. 46, 42 C.W.N.
593, 66 C.LJ. 485, 172 I.C. 443.
Where the terms of a lease provided that the lessee was entitled to
imderlet but not to assign liis right in any way, and then the lessee
mortgaged the said lease by way of sub-demise, held that the word
assign irieant 'part with absolutely', i.e., the parties intended and agreed
that the lessee should be entitled to part with possession of the land
and premises by way of sub-demise or otherwise, so long as he did not
absolutely transfer the whole of his right, title and interest therein; con-
sequently, the mortgage did not operate as a forfeiture of the lease per
Page, J., in Bejoy Lai v. B^narasidas, 54 Cal. 948, 110 I.C. 296, A,I,R.
1928 Cal. 99 (101). And this view has been affirmed by the Privy Council
in Hansraj v. Bejoy Lai, 57 Cal. 1176, 34 C.W.N. 342 (347), 122 I.C. 20,
A.I.R. 1930 P.C. 59, reversing the judgment of tlie Division Bench in
Bejoy Lai v. Benarsidas, 32 C.W.N. 353, A.I.R. 1928 Cal. 681, 114 I.C.
786. By creating the mortgage, the lessee has merely deposited the lease
as a security, which it was competent for him to do so. There is no
parting with the' interest absolutely, because the lessee might at any time
redeem the indenture by paying off the incumbi'ance upon it Doe v.
Hogg. (1824) 4 Dow. & Ry. 226.
The forfeiture clause in the lease enures not only for the benefit of
SEC. Ill]
the lessor but also ol his representatives and assigns. Tims, where a
lease contained a covenant resening to the lessor a power of rc-cntr>',
on default of pajnnent of rent, and there was no mention in such covenant
of a similar power being also rescrscd to the lessors lieirs, successors
or assigns, and the lessee sold his rights in the leased proiicrly to third
persons, it was held that although- re-entry was reser\'cd only to the lessor,
yet the vendees of the lessor could lake advantage of the covenant
Kristo Nctth v. Brown, 14 Cal. 176; Vishveshwar v. Hahablcshwnr, -1-3
Bom. 28 (31), 47 I.C. 330. A mineral lease under the Mines and Minerals
(Regulation and Development Act) 1957 is outside the operation of the
T. P. Act; hence secs. 111(g) and 114 T. P. Act do not apply to a mineral
lease Serajuddin Md. v. State of Orissa, A.I.R. 1969 Orissa 152.
"Or the lease shall become void : ^Tliese words occurring in the old '
clause (g) have now been omitted because a lessor cannot rc-cnlci- on
the breach of any condition in a lease unless tliere is an c.vprcss stipula-
tion to that effect.
598. Denial of landlords title J ^In the absence of any law, usage
or custom to the contrary the principles of Chapter V apply to leases
for agricultural purposes as rules of justice, equity and good conscience.
Consequently, such leases are forfeited by repudiation by the tenant of
the tenancy by claiming title in himself Faqiria v. Kalu Mai, A.I.R.
1952 Funj. 52. See also Tati/a v. Yeshwani, A.I.R. 1951 Bom. 283, I.L.R.
1951 Bom. 293. In cases - where this Act does not apijly, clear and
unambiguous denial of the lessors title would be enougli to entail for-
feiture, and the landlord is not required to show his intention to de-
termine the lease Ramachandra v. Mahadevi, A.I.R. 1916 Mad. 57, (194.5)
A tenant who denies his landlords title renders the lease liable to
forfeiture, notwithstanding that tire lease is permanent Kally Das v.
Monmohini, 24 Cal. 440; Abhiram Goswami v. Shtjama Charan, 36 Cal.
1003 (P.C.); Ananda v. Abrahim, 4 C.W.N. 42; Mela Ram v. Sandhi, 13
Lah. 796, 141 I.C. 825, A.I.R. 1933 Lah. 221; Ramji v. Shib Cluaran, A.I.R.
1930 All. 479 (481), (1930) A.L.J. 908. 'Tliis is an application of the general
principle of law that a man cannot blow hot and cold, I.e., cannot both
approbate and reprobate.
A tenant who has been let into possession cannot deny his landlords
title however defective it may be, so long he has not openly restored
[Sec. Ill
possession by suixender to his landlord v. Desraj, 37 All. 55 (P.C.);
Shankar v. Jagatmath, A.I.R. 1928 Bom. 265, 30 Bom. L.R. 741, 111 I.C.
911; Krishnarao v. Ghamon, supra; Krishna Rao v. Mungara, A.I.R. 1932
Mad. 298 (299), 55 Mad. 601, 138 I.C. 34.
Sec. iil]
TfiANSFER OF PROPERTY 1013
The denial of landlords title by the original lessee will not work
as a forfeiture against the assignee of the lessee Gopal v. Shriniu-as, 42
Bom. 734.
[Sec. ill
Where in a suit for rent brought by the lessor against the lessee the
latter denied the tide of the lessor, and the suit was dismisesd on the
ground that the relationship of landlord and tenant did not subsist be-
tween them, and the. lessor then brought another suit to eject the lessee,
held that it was not open to the lessee in die latter suit to set up the
tenancy which he had denied in the previous suit, and that by repudiat-
ing his landlords tide in the previous suit he had rendered himself liable
to ejectment Khaiar Mistri v. Sadruddi, 34 Cal. 922 ; Nilmadhah v.
Ananba, 2 C.W.N. 755 ; Fayi Dhali v. Aftabuddin, 6 C.W.N. 575 ; Mai-
lika v.-Makhanlal, 9 C.W.N. 928. Ramgafi v. Pranhari, 3 C.L.J. 201;
Sheik Miadhar v. Rajanikant, 14 C.W.N. 339, 5 I.C. 708 ; Ekbar v. Hara,
15 C.W.N. 335, 13 C.L.J. 1, 8 I.C. 660. ' ' . .
Wliere a tenant who is entided to notice denies the tide of the land-
lord, no notice is necessary to eject him >Karam Chand v. Amar Nath,
A.I.II. 1933 Lah. 377 (378), 145 I.C. 922. See also Ratneswar v. Mongdli,
A.I.R. 1951 Ass. 70, (1950) 2 Ass. 166, But after the amendment in clause
(g) it is apprehended, a notice in writing of the lessors intention to
determine &e lease is necessary. Since this observation was made by die
editor in die previous edition, it has been held that as a result of amend-
ment of sec. Ill (g) in 1929, it is incumbent on die lessor to give notice
in writing to the lessee of his intention to determine the lease before a
suit can be instituted for eviction of the lessee Tatya v. Yeshjjoant,
A.I.R. 1951 Bom. 283, I.L.R. 1951 Bom. 293. See also Jai Narain v.
All Murtaza, A.I.R. 1951 Pat. 190. But see Gajadhar Lodha, v. K/ias
Mahptadih Colliery Co., A.I.R. 1959 Pat. 562,
599. What does not amount to denial of title : ^If the tenant has
never denied his liability to pay the rent fixed but has asserted a higher
status as lessee than what was admitted by the landlord, such an assertion
does not amount to denial of title of the landlord or claiming title for
himself jAttI' Krishna v. Nazir Hasan, 14 Luck. 723, A.I,R. 1939 Oudli
257, 1939 O.W.N, 825. A denial of the landlords title to enhance die
rent or the setting up of -a permanent tenancy is not necessarily a dis-
EC. Ill]
claimer of his title as landlord Kali Krishna v. Golam Ali, 13 Cal. 248 ;
Haidri Begum v. Natlw, 17 All. 45 ; Parshotam v. Daiiairaija, 10 Bom.
669 ; Vithu v. Dhondi, 15 Bom. 407 ; Lain Cagal v. Bai Moian, 17
Bom. 631 ; Dodhu v. Madhavrao, 18 Bom. 110 ; Venkaji v. Lakshman,
20 Bom. 354 (F.B.) ; Suba y. Nagappa, 12 Mad. 353 ; Unhamma v.
Vaikunta, 17 Mad. 218. Tlie setting up of a muls^ni right by the tenant
is not a disclaimer of the landlords title; it only amounts to a denial
of the particular kind of tenancy under which the tenant holds possession
and the setting up of a different kind of tenancy, but it does not amount
to a denial of title of the landlord Unhamma v. Vaikunta, 17 Mad. 218.
Similarly, an assertion by a tenant from year to year that he is a perman-
ent tenant is not tantamount to a denial of the landlords iitle Gol Dap
V. Dod Laxman, 22 Bom. L.R. 648, 58 I.C. 226.
Where after the death of the original lessor the tenant did not direct-
ly deny the claimants title, but refused to pay rent until he knew who
was the real owner, and it appeared that the succession was at that time
disputed, it was held that there was no denial of the landlords title
Jones V. Mills, 10 C.B. (N.S.) 788. But see Ramdas v. Ram Lakshman,
A.I.R. 1953 All. 797 where it has been held that if the title of tlie lessor's
heir is denied, the denial causes forfeiture' of the tenancy. A tenants
plea that "as the plaintiff and a third person both claim rent from him,
he is ready to pay either when the Court finds who is entitled to, is not
tantamount to a disclaimer Rakmini v. Ratjaji, A.I.R. 1924 Bom. 454,
48 Bom. 541, 83 I.C. 45. Where the tenant denies the plaintiffs title to
recover rent fi'om him, bona fide for tlie purpose of seeing such title
established in a Court of law in ordei' to protect himself, he is not to
be charged with disclaiming the plaintiffs title Hatimullali v. Maham-
mad Arju, 32 C.W.N. 391 (395), A.LR. 1928 Cal. 312, 113 I.C. 13. Simi-
larly, there is no disclaimer of the relationship of landlord and tenant,
where the tenant merely puts the landlord to the proof of his title by
purchase Mallika v. Makhan Lai, 9 C.W.N. 928 ; Venkatachariar v.
Rangastoami, 36 M.L.J. 532, 51 I.C. 709 ; Ram Das v. Ladi. Janki,
I.L.R. (1962) 2 All. 554. 'The denial by the tenant of the right of an
assignee from the original lessor does not work a forfeiture of the ten-
ancy. Where there was no specific? denial of the title of the original lessor
but the tenant merely denied the right of the purchaser, and set up the
right of one of the heirs of the original lessor, Jipld that this could not
work as a forfeiture Abdulla v. Md. Muslim, A.I.R. 1926 Cal. 1205, 96
I.C. 1056 ; Somti Prakash v. Natha, I.L.R. (1964) 1 Punj. 616 ; Ram Das
V. Lach. Jpnki, I.L.R. (1962) 2 All. 554; Sugga Bai v. Hiralal, A.I.R.
1969 Madh. Pra. 32.
[Sec. ill
Sec. iii i
words does some act showing his intention to determine the lease.
The words in the old clause left it uncertain as to what act the lessor
should do showing his intention to determine the lease. It was held in
some cases that the mere filing of a suit for ejectment by the landlord
did not amount to doing some act showing the intention of the landlord
to determine the tenancy Prag Narain v. Kadir Baksh, 35 All. 145, 18
I.C. 728 ; Matilal v. Chandra Kumar, 24 C.W.N. 1064, 60 I.C. 312 ;
Nowrang v. Janardan, 45 Cal. 469, 41 I.C. 952 ; Padmanabhai/a v. Ranga,
34 Mad. 161 (164), 0 I.C. 447 ; Shib Charan v. Kharka, 4n AH. 348, A.I.R.
1925 All. 346, 86 I.C. 174; KadiV Baksh v. Pragh'Narain, 9 A.L.J. 794,
14 I.C. 747 ; Anandamoyi v. Lakhi Chandra, 33 Cal. 339 ; Sheikh Yusuf
V. Jyotish, A.I.R. 1932 Cal. 241, 85 C.W.N. 1132, 59 Cal. 739, 137 I.C. 139;
Greet v. Gangaraf, A.I.R. 1937 Cal. 129 (139), I.L.R. (1937) Cal. 203, 170
I.C. 214 (and the cases cited in this case). The Bombay High Court
however held in Isabali v. Mahadii, 42 Bom. 195, 43 I.C. 851 (followed
in Prokash v. Rajendra, 58 Cal. 1359, 85 C.W.N. 823, at p. 828), that the
institution of a suit for ejectment was a sufficient manifestation of such
an intention. It was also held that the act showing intention to determine
the lease need not be a formal notice to quit, and may be a demand for
possession, oral or written d^aurang v. Janardan, supra. In a Madras
case, a lawyers notice was held to be sufficient Sivarama v. Alagappa,
1915 M.W.N; 845, 31 I.C. 211. So also the withdrawal of an ejectment
suit with the liberty to institute a fresh suit on the same cause of action
Ramnath v. Sibasundari, 25 C.L.J. 332, 40 I.C. 348; Mazoor v.
Padiapurayil, 8 M.L.T. 99, 6 I.C. 264; or tiie lessors act of taking possession
of the leased premises was held to be an act showing an intention to
determine the lease Cook & Co. v. Phillips, 34 C.W.N. 785 (788), 130
I.C. 222, A.I.R. 1931 Cal. 133. But where the landlord after withdrawal
of' his suit, in whicli his title had been denied by the tenant, did nothing
for 9 years to show his intention to determine the lease, and tlien filed
another suit in ejectment, it was held that in the circumstances there was
no forfeiture Shib Charan v. Kharka, A.I.R. 1925 All. 346, 47 All. 348,
86 I.C. 174. It was necessary that the lessor should do some act showing
his intention to determine the lease Ramp v. Shib Charan, A.I.R. 1930
AH. 479 (481), (1930) A.L.J. 908. Oral notice was sufficient before the
amendment Sripada v. Raoikanta, A.I.R. 1935 Mad. 454, 157 I.C. 804.
Tliis uncertainty has now been set at rest, and the doubt as to the
nature of the act which the lessor must do has been removed by requiring
the lessor to give notice in writing of his intention to determine the lease,
and this notice should be given before a right to institute a suit can arise.
Now the giving of notice in writing is an essential condition of forfeiture
taking effect in law. In fact the act of the lessee renoimcing his character
as such makes the lease only voidable. A lessor cannot file a suit for
ejectment until after he has given notice, because till then the relationship
of lessor and lessee subsists Saheb Din v. Caitri Shankar, 15 Luck. 92,
A.I.R. 1940 Oudh 92, 1939 O.W.N. 980. When the lessor sues in ejectment
without giving such notice, a plea of want of notice going to the very
root of tlie case can be entertained for the first time in second appeal
Ibid. Under the present cl. (g) read mth sec. 114A only one notice to
quit is necessary and not two, but when tlie breach is capable of remedy,
the lessor should require the lessee to remedy it and to give him reasonable
128
[Sec. Ill
time to do so, wliile when the breach is one not capable of remedy, he
has simply to give a witten notice conveynig his election to forfeit the
tenancy. No particular form of notice is required in the latter case, but
in die former a notice to quit forthwith would be a bad notice Provat
V. Bengal Central Bank, A.I.R. 1938 Cal. 589, 42 C.W.N. 761. Ihe land-
lord may give one notice combining the elements of notices under sec.
111(g) and sec. 114A Kshiroda Sundari v. Bhupendra Mohan; A.I.R.
1961 Assam 70. Where a lease. provides for re-entry on assignment and
the tenant assigns, the landlord must serve a notice under sec. ll^g)
though he is not required to serve any notice under sec. 114A Chandra
Nath v. Clvulai Pashi, A.I.R. 1960 Cal. 40.
In the absence of any such act on the part of tlie landlord, a mere
denial of the landlord s title by the tenant does not entail forfeiture
Bamasami v. Thayammal, 26 Mad. 488; Dyamappa Btrtti v. Somappa,
A.I.R. 1969 Mys. 252. So also, the failure by the tenant to renew a lease
for a term in compliance with the provision for renewal contained therein,
does not operate as a forfeiture relieving the tenant from liability to pay
rent, urJess the lessor does some act showing his intention to determine
the lease Bourammiah v. Mallammal, 4 M.L.T. 315.
Wliere there are several lessors, all the lessors must act together.
If all of them have not shown their intention to deteiniine the lease, e.g.,
if all the co-owners in the land have not joined in giving the notice, they
cannot succeed. See Gopal Ram v. Dhakestvar, 35 Cal. 807 (811); Motilal
v. Chandra Kumar, 24 C.W.N. 1064 and Panchu v. Benode 39 C.W.N.
246. But the Madras High Court is of opinion that one of several joint
lessors who has become separately entitled to his share of the lands
leased, is entitled to enforce the forfeiture clause in the lease-deed
separately as regards his share of the lands, as if he had given a separate
lease of his own share alone originally to die lessee Korapalu v. Narayana,
38 Mad. 445 (447), following Sri Raja Simhadh v. Prattipcrti Ramayya, 29
Mad. 29, and dissenting from Gopal Ram v. Dhakesioar, supra. It is not
open to a landlord to treat the tenancy as forfeited in part and- subsisting
as to the remainder VaddapaHi v. Vodoori, A.I.R. 1936 Mad. 252 (255).
If the notice is served on one of tlie joint tenants and similar notices
correctly addressed are posted to the others, seivice on one is prima fade
evidence of service on others 'Bhusan Chandra Paul v. Bengal Coal Co.
Ltd., A.I.R. 1966 Cal. 63.
Sec. illj
and communicates to the lessee his intention accordingly, that is, when
he elects to waive the forfeiture, his election is also irrevocable Chengiah
V. Raja of Kalahajsti, 24 M.L.J. 263, 15 I.C. 445. As to what amounts
to waiver of forfeiture, see section 112. Where a deed of lease contains
a clause for forfeiture for non-payment of rent for three months and the
lessor gives notice on three months default forfeiting the lease and asking
the tenant to quit and vacate on the expiry of June, 1951 the notice is
one under sec. Ill (g) and not imder sec. 106 Lia'mi Spinning & Weaving
MilJs V. Ibrahim^ A.I.R. 1958 Cal. 428. Where no notice under sec. Ill (g)
is given forfeiting the lease for non-payment of rent, the lease subsists
even though the lease provides for automatic termination on non-payment
of rent Ramniranjan v. Gajadhar, A.I.R. 1960 Pat. 525.
This clause, however, does not apply to leases created prior to the
passing of this Act. See sec. 2 (c). In case of sudi leases, it is not
necessary that the lessor should, prior to the action for ejectment, give
notice of his intention to determine the lease. The institution of an
action on the ground of forfeiture itself amounts to a manifestation of the
lessors intention to determine the tenancy Padmanahhaija v. Range, 24
Mad. 161 (166), 6 I.C. 447; Venkatachariar v. Rangastoami, 36 M.L.J.
532, 51 I.C. 709; Ramkrislina v. Baburaya, 23 M.L.J. 715, 24 I.C. 139.
In Venkataramam v. Gundaratja, 31 Mad. 403, however, the principle of
this clause was applied to a lease created before the passing of tlie
Transfer of Property Act.
Where the defendant has failed to prove his tenancy, he is not entitled
to a notice to quit Shiha Prasad v. Chamru Ptisi, A.I.R. 1939 Pat. 167
(168), 178 I.C, 362. Where a tenant after termination of the lease con-
tinues in possession of the house without the landlord s assent, his position
is no better than that of a trespasser and he can be turned out of the
house without any notice to quit pLahmat Ullah, v. Md. Husain, A.I.R.
1940 All. 444, 1940 A.L.J. 502, 191 I.C. 223, If a tenancy is terminated,
by two co-sharer landlords- any one o{ them is competent to sue for evic-
tion even though the other co-sharer does not join Motilal v. Basant Lai,
A.I.R. 1956 All. 175. Where a monthly tenant spends money on tlie
improvement of the site, he does so at his own risk and on his ejectment,
he is not entitled to compensation-^Goyc v. Debarchan, A.I.R. 1939 Pat.
155 (156), 19 P.L.T. 663, 180 I.C. 159.
Sec. 112]
602A. This section has been enacted for the benefit of the tenant, and
hence Woodfall gives the follotving warning to the landlords : "Courts of law
always lean against forfeiture ; therefore whenever a landlord means to
take advantage of any breach of covenant or condition so that it should
operate as a forfeiture of the lease, he must take care not to do an}dfaing
which may be deemed an acknowledgment of the continuance of the
tenancy and so operate as a waiver of the forfeiture Landlord and Tenant,
9th Edn., p. 367. The principle of the section is this: The landlord
may elect to avoid a lease and bring ejectment when his tenant has com-
mitted a forfeiture. If, with knowledge of the forfeiture, by receipt of rent
or other unequivocal act he shows his intention to treat the lease as
subsisting, he has determined his election for ever, and can no longer
avoid' the lease. On the other hand, if by bringing ejectment he
unequivocally shows his intention to treat the lease as void, he has
determined his election, and cannot afterwards waive the forfeiture
per Mellor, J. in Clough v. London and N. W. Ry. Co., (1871) 7 Ex. 26
(34). See also Shiva Prasad v. Mandira Kumari, A.I.R. 1940 Pat. 478,
21 P.L.T. 257, 186 I.(Z. 686. This, however, does not mean that the land-
lord for ever waived his right to claim forfeiture against the tenant.
Waiver could operate only in respect of a particular breach Md. Hasan v.
Baidyanath, A.I.R. 1940 Pat. 140, 21 P.L.T. 117, 184 I.C. 605.
[Sec. 114
Sec. 112]
825. The protest is altogether inoperative because the lessor had no right
at all to take the money unless he took it as rent ; ha cannot be allowed
to say that he wrongfully took it on some other account ; and if he took
it as rent, the legal consequences of such act must follow, however much j
he may repudiate them Croft v. Lumley, 6 H.L.C. 672. Therefore, accept- |
ance of rent constitutes waiver of forfeiture, notwithstanding that the lessor
expressly states that he accepts the money as compensation for use and ,
occupation and not as rent Ibid- A conditional acceptance of rent by the !
lessor after default involving forfeitiure is none the less a waiver Sripada
V. Ravikanti, supra. Where a deed of lease provides for forfeiture on the
breach of any one of the conditions of the lease and at the same time says
that the lease will be renewed on the observance of all the conditions of
the lease, then, if the tenant incurs forfeiture by breaking a condition but
the landlord waives the forfeiture by accepting rent after the breach, such
waiver does not disentitle the landlord to refuse renewal on the ground of
non-fulfilment of all the conditions of the lease State of Bihar v. Indian
Copper Corporation Ltd., I.L.R. 38 Pat. 1160.
Where, two persons have jointly leased out a land, and have sub-
sequently become divided, one of them may enforce the forfeiture clause
in the lease with respect to his moiety of the land, notwithstanding that
the owner of the other moiety has waived his .right to enforce the same
by receiving his moiety of the rent Korapalu v. Narayan, 38 Mad. 445,
20 I.C. 930. ,
[Sec. 114
8 M.L.T. 238, 8 I.C. 309. If the landlord elects not to take advantage of
the forfeiture, it is waived. The election may be express or implied
Baddaparti v. Vodoori, A.I.R. 1936 Mad. 252 (255).
1st Proviso : There can be no waiver unless the lessor has acted
with notice or actual knowledge of the forfeiture. It is not enough for the
lessee to prove merely an act of the lessor showing recognition of the
tenancy or to show that the lessors ignorance of the breach has not been
proved. The onus is on the lessee to prove positively that the lessor had
knowledge of the breach and yet continued to recognise the' tenancy
Swamamoyee v. Royajaddi, 36 C.W.N. 819 (822), 139 I.C. 239, A.I.R. 1932
Cal. 787 ; Mathews v. Smallwood, [1910] 1 Ch. 777 ; Fatalal v. Dayalal,
A.I.R. 1949 Nag. 218, I.L.R. 1949 Nag. 167.
Sec. 113]
Illustrations.
(a) A, the lessor, gives B, the lessee, notice to quit the property leased.
The notice expires, B tenders, and A accepts, rent which has become due
in respect of the property since the expiration of the notice. The notice
is waived.
(b) A, the lessor, gives B, the lessee, notice to quit the property
leased. The notice expires, and B remains in possession, A gives to B
as lessee a second notice to quit. The first notice is waived.
606. Scope of section : This section deals with the waiver of notice
to quit just as the last section deals with the waiver of forfeiture. But the
distinction between the two lies in this: a forfeiture can be waived without
the lessee being a consenting party thereto ; it is entirely at the option of
the lessor to waive the forfeiture or not. But in a waiver of a notice lo
quit the express or implied consent of the lessee is necessary ; in other
words, a notice to quit cannot be waived without the assent of both the
lessor and lessee Blyth v. Dennett, (1853) 13 C.B. 178 (180), Thus under
this section a notice is waived by an act showing the person giving notice
showing an intention to treat the lease as subsisting provided there co-
exists the express or implied consent of the person to whom it is given.
When both the landlord and tenant contends that by acceptance of rent
the old tenancy on old terms continued then the old tenancy within the
default clause also continued Ran jit v. Mohitosh, A.I.R. 1969 S.C. 1187.
The parties must be ad idem in making a new agreement Navnitlal v.
Baburao, A.I.R. 1945 Bom. 132, I.L.R. 1945 Bom. 68. Secs. 113 and 116
have not made the Indian law different from the English law ibid. Sec
also Murdlidhar V. Tara Dye, A.I.R. 1953 Cal. 349 where in the eircumstances
of the case it was held that a letter sent by the lessor after notice to quit,
demanding possession of the permises did not constitute waiver of the
notice ; nor was there any waiver because the lessee was allowed to collect
rent and pay taxes. See also Hindusing v. Nihalkaranji, infra. The parties
must come to a definite agreement ; otherwise there can be no waiver.
The mere fact that negotiations and discussions which did not come to
anything took place between the parties, subsequent to the notice to quit,
does not show that there was waiver Thei Un v. Mahomed Ajnm, 6 Ilur.
L]. 164. 104 I.C. 335, A.I.R. 1927 Rang. 276 (277).
129
Where after the notice to quit has been served and the ejectment
proceeding instituted, the landlord has claimed and accepted rent which
has accrued after the expiration of the notice, such claim and acceptance
of rent would amount to a waiver of the notice to quit. But a
claim for arrears of rent due prior to the ejectment, proceedings, even
though such claim is made after the notice to quit was served, does not
constitute a waiver of the notice to quit Shah Wali Ahmad v. Hussaini
Begum, 2 P.L.J. 595, 42 I.C. 655. See also Khumdni Saktey Lai, A.LR.
1952 A. 579 ; Kamlapat v. Manho Bibi, A.LR. 1948 Oudh 127 ; Ilahibux v.
Munir Khan, A.LR. 1953 Nag. 219, 1953 N.L.J. 147. The question of
waiver is a question of fact Maharana Shri Bhagwali Singhjee v. Keshulal,
A.I. R. 1963 Raj 113.
Sec. 113]
Pulin Bihari v. Lila, A.I.R. 1956 Cal. 106. This view was accepted on
appeal Pwim v. Lila, A.I.R. 1957 Cal. 627. Illustration (a) to s. 113 is
not applicable to a lease governed by control laws Naraijam Iyengar v.
Subba Rao, A.I.R. 1958 Mys. 113.
If within the time fixed in the notice to quit rent already due from
the lessee for a period prior to the date on which he has to vacate is
accepted by the lessor, such acceptance does not amount a waiver
Ram Sarup v. Gayatri Devi, A.I.R. 1952 All. 863. Where by an arrange-
ment between the lessor and the lessee municipal taxes paid by the latter
would be set off against the rent, any tax paid by the lessee after service
of the notice to quit would not constitute a waiver of the notice Sant
Kuer V. Ganesh, A.I.R. 1949 Pat. 137, 27 Pat. 695. Withdrawal of rent
deposited by a statutory tenant does not operate as waiver Bhagat Ram
V. Keshabdeo, A.I.R. 1965 Assam 55. Acceptance of rent from a statu-
tory tenant , for a period subsequent to the period of the notice to quit
does not amount to a waiver of the. notice to quit Hari Shankar v.
Chaitanya Kumar, 1968 All. L.J. 387.
Illustration (a) shows that the rent accepted must be for a period
after the notice. The effect of a second notice to quit and of a waiver
of forfeiture is that the determination of the lease under els. and (h)
of sec. Ill does not take effect. The tenancy that runs after the waiver
is not a fresh tenancy Chotey Lai v. Sheo Shankar, A.I.R. 19151 All. 478.
The mere fact that a second notice to quit is given when the first notice
is found defective or is waived does not affect the permission granted
under the U. P. Act III of 1947 ibid. See in this connection Ram Sarup
v. Gayotri Devi, supra. If a tenant on receipt of a notice on April 11,
1959 requiring him to pay arrears within one month and asking him to
vacate by April 30, 1959 sends a cheque on June 25, for arrears of rent
and also for rent upto June and the landlord after accepting the cheque
sends a second notice to quit on July. 9 asking the tenant to vacate by
the end of July, suit on second notice is competent Mangilal v. Sugan
Chand. A.I.R. 1965 S.C. 101.
[Sec. 114
Scope : ^This Act does not apply to agricultural lease, but the
principle of this section may be acted upon in case of such lease. A
condition in a lease which enables the landlord to re-enter on non-payment
of rent is regarded as penal, and should be relieved against by the Court,
even though the case does not fall under this Act Vaguran v. Rangay-
yanger, 15 Mad. 125 (126) ; S. K. Shaw v. Brij Raj, supra. This section
will apply to relieve the tenant against forfeiture even though the case is
governed by the special provisions of the Calcutta Rent Act. The Transfer
of Property Act miist not be deemed to have been abrogated by the provi-
sions of the Calcutta Rent Act which is an Act of a Local Government
Ahindra v. Twiss, 49 Cal. 150 (160), A.I.R. 1922 Cal. 394, 70 I.C. 75.
Sec. 114 ]
This section has been enacted to relieve the tenant from the extreme
penalty of forfeiture to which the literal enforcement of his contract
might have otherwise exposed him. Under this section the Court has a
discretion to relieve him against forfeiture and not to make a decree for
ejectment, if the lessee pays or tenders the rent in arrears with interest
and full costs of suit Kmdan v. Kallu, 12 A.L.J. 650, 24 I.C. 79. Provi-
sions for forfeiture of leases for non-payment of rent, are intended merely
as a security for the non-payment of rent, and a Court of Equity will
relieve the lessee and set aside a forfeiture, on his bringing the rent into
Court. The principle of English law has been recognized by the Legis-
lature in sec. 114 of the T. P. ActMegh Lai v. Raj Kumar, 34 Cal. 358
(368). Thus, where the landlord had taken a large sum by way of
premium under a registered lease for ten years, and the rent was payable
on the first of every lunar month failing which the lease was to stand
cancelled, held that it was against equity and good conscience to allow
the landlord to cancel the lease, after having taken a large sum as
premium, simply on account of a few days delay in payment of rent,
especially in a case in which the lessee had not even then taken possession
of the leased premises Kalian v. Jawahir, 5 Lah.L.J. 99, 71 I.C. 837,
A.I.R. 1924 Lah. 49 (50). And this section gives the lessee the last chance
of saving himself from the operation of the forfeiture clause.
, having regard to the conduct of the tenant and to any equities that may
have arisen between the date of forfeiture an the application for relief
Debendra v. Cohen, 54 Cal. 485, A.I.R. 1927 Cal. 908 (910), 106 I.C. 477 ;
Gopinath Auddy v. Thakers Press and Directories Ltd., 66 C.W.N. 449.
The discretion has to be exercised on proper judicial grounds, and if the
Court of first instance- has exercised that discretion, and there is nothing-
to show that there was anything wrong in principle, the Appellate Court
should not interfere. But if the Appellate Court finds that the discretion
[Sec. 114
The mere fact that the lessee pleads payment of rent which he fails
to prove does not in itself disentitle him to the relief given under this
section Ramdkrishna v. Baburaya, 23 M.L.J. 715, 24 LC. 139 (141).
Although this section does not apply to agricultural leases, still the
Court has got power to relieve against forfeiture in case of such leases
independently of this section, on such conditions as may appear equitable
on the facts of each particular case, and is not bound by the conditions
of this section Rama Krishna v. Fernandez, A.I.R. 1927 Mad. 239, 93
LC. 851. An appellate Court has also power to grant relief against
forfeiture when this section does not in terms apply to the case
Shrikishanlal v. Ramnath, A.I.R. 1944 Nag. 229, I.L.R. 1944 Nag. 877.
Sec. 114]
If the tenant deposits the rent with the Rent Controller, under the
provisions of the Calcutta Rent Act, that would be a sufficient compliance
with the provisions Of this section and would relieve the tenant against
forfeiture Aftzncfra v, Twiss, 49 CaI. 150, A.I.R. 1922 Cal. 394, 70 I-C. 75.
The lessee is not entitled to the benefit of this section when he omits
to make any tender before suit, or to pay the money into Court, and on
the contrary pleads payment unsuccessfully Narayam v. Handti, 15
M.L.J. 210.
The rent to be tendered under this section need not be the rent
stipulated in the lease ; if a standard rent has been fixed by the Rent
Controller under the Calcutta Rent Act, the tenant may deposit that rent,
and by so doing will be entitled to relief against forfeiture Ahindra v.
Twiss, supra.
The rent in arrear means not only the rent claimed in the suit but
includes all that is due to the lessor up to the date when the application
for ejectment is heard Dhurrumtolia Properties Ltd. v. Dhimbai, 58 Cal.
311, A.I.R. 1931 Cal. 457, 133 I.C. 87. Rent includes the entire amount
which the tenant is liable to pay upto the date of tender Nursing Das v.
Peremshwari Das, A.I.R. 1962 All. 65.
609. Forfeiture and nullity : In the old clause (g) of sec. Ill, it was
stated that forfeiture could take place upon the breach of an express
condition which provided that on breach thereof the lessor may re-enter',
or the lease shall become void. So that, no distinction was made between
a case in which a lessor could re-enter on breach of an express condition"
and a case in which the lease became void on breach of the condition. In
other words, the Act made no difference between a condition of forfeiture
and a clause of nullity. And in either case the Court could grant relief
under sec. 114. Therefore, where there was a covenant in a lease that
on failure to pay rent the lease shall become null and void, this section
operated to relieve against the forfeiture, in spite of the nullity clause,
and protected the tenant from ejectment for non-payment of rent, if he
paid the rent in Court Hiranandan v. Ramdhar, 1 Pat 363, A.I.R. 1922
Pat. 528, 69 I.C. 88'6.
In the present clause (g) of sec. Ill, however, the words or the
lease shall become void have been omitted, and the ruling of the above
Patna case is no longer of any importance.
And the Court will not grant any relief under this section where a period
of grace has already been allowed by the lease itself for the payment of
rent. Thus, where the lease contains a provision to pay rent on the
15th of April, but no forfeiture is provided for on account of default of
such payment, and it further provides that if the default continues until
December then the lease is to be forfeited, held that the lease provides a
sufficiently long period of grace, and that if the tenant fails to pay within
December and the landlord has consequently to sue for ejectment upon
forfeiture, the Court will not grant relief to the lessee by allowing him
to pay the rent during the hearing of the suit Narayana v. Vesudevn,
28 Mad. 389 ; Narayana v. Handti, 15 M.L.J. 210 ; Mahalakshmi v,
Lakshmi, 21 M.L.J. 960, 12 I.C, 456 ; Adhiragi v. Billa, 20 M.L.J. 944, 6 I.C.
438 ; Arju v. Narayana, 19 N.L.R. 50, 71 I.C. 445, A.I.R. 1923 Nag. 193.
But the Bombay High Court does not favour this view, and holds that the
tenant should be relieved against forfeiture, even though the rent was not
paid within the period of grace allo%ved by the lease Krishnaji v. Sitaram,
45 Bom. 300, 59 I.C. 769, 22 Bom.LR. 1439. In some other cases the Madras
High Court has said that the question whether a tenant is entitled to relief
against forfeiture for non-payment of rent must depend upon the iacts of
the particular case, and that the Courts have power to grant relief even
in cases where a period of grace is allowed for payment of the rent. The
condition of forfeiture of a tenancy should be regarded as penal in its
nature and the equitable provision of sec. 114 should generally be given,
effect to Ramabrahman v. Rami Reddi, 1927 M.W.N. 305, A.I.R. 1928
Mad. 250 (252), 108 I.C. 273 ; Appayya v. Mahomed Behari, 29 M.L.J. 381,
30 I.C. 596. This holds good equally in the case of a lease for agricultural
purposes Tripura v. Venkateswarlu, A.I.R. 1949 Mad. 841, (1949) 1
M.L.J. 586. Sec. 114 is not applicable to a forfeiture on account of default
under the West Bengal Premises Tenancy Act, 1956 Canesh Chandra
Nandy v. Chatterjee Brothers, 70 C.W.N. 676. Sec. 114 has no application
in a suit on a notice to quit Ram Pakhpal v. Dropodi Devi, 1965 All.
L.J. 249 . Relief under this section cannot be invoked on principles of
ccpiityTippayya v. Rama Narayana, A.I.R. 1961 Mys. 131. When there
is no forfeiture under sec. Ill (g), no relief under sec. '114 can be given
Ibid.
611. Which Court can grant relief : Besides the original Court, the
Appellate Court also can grant relief against forfeiture incurred for non-
payment of rent, on the tenant making the payment or tender of the arrears
of rent at the hearing of the appeal, even though such offer was not made
in the lower ComtPraduman Kumar v. Virendra, A.I.R. 1969 S.C. 1349;
Vidyapurna v. Rangappaya, 25 M.L.J. 486, 21 I.C. 405 ; Janab Vellathi v.
K, Kaderval Thayammal, A.I.R. 1958 Mad. 232. Relief against forfeiture
can be given even in the case of an agricultural lease and the court is not
bound by the condition laid down in this section /nnwi Vellathi v. K.
Kaderval Thayammal, A.I.R. 1958 Mad. 232. -
Relief after decree : ^The execution Court also has power to grant
relief against forfeiture, if the decree is a consent decree. Thus, where a
compromise decree contained a stipulation that on failure by the defendant
to pay the rent within the time fixed for each year, the lease was to be
forfeited, and the defendant not having tendered the rent for a particular
Sec. 114A]
year, the decree-holder applied for possession of the lands according to the
terms of the decree, whereupon the defendant contended that relief ought
to be given to him, held that it was competent to the Court to relieve the
defendant against Ae forfeiture by allowing him to pay the rent Nagappa
V. Venkat Rao, 24 Mad. 165 ; Krishnabai v. Hari, 31 Bom. 15 (F.B.) (over-
ruling Shirekulli v. Mahabyla, 10 Bom. 435). See also Gajanan v. Pandiirang,
A.I.R. 1951 Bom. 290, I.L.R. 1951 Bom. 240 ; Ladhuram v. Chimmiram,
A.I.R. 1947 Bom. 36, 48 Bom. L.R. 608. If a decree, which is not a consent
decree, was to the effect that if the defendant pays to the plaintiffs the
arrears of rent together with interest and costs on or before the 20th
February, he be relieved as against forfeiture, and in case of default, the
defendant be evicted and plaintiffs be put into possession of the respective
land, and the defendant failed to pay within 20th February, whereupon
the plaintiffs applied for getting possession of the property, held that the
decree not being a consent decree, no relief could be granted, even though
it appeared that the defendant made some' payments after 20th February
which were accepted by the plaintiffs Giridhamdoss v. Para Appadurai, 51
Mad. 157, 54 M.L.I. 316, A.I.R. 1928 Mad. 193 (194), 107 I.C. 792. See also
Perdan v. Sarasvoati, A.I.R. 1951 Raj. 148. In Krishna Rao v. Balwant, 27
Bom. L.R. 678, 89 I.C. 217, A.I.R. 1925 Bom. 404, relief was granted on
the special facts of the case, although it was not a consent decree.
and the lessee fails, within a reasonable time from the date of
the service of the notice, to remedy the breach, if it is capable of
remedy.
Nothing in this section shall apply tp an express condition
against the assigning, under-letting, parting with the possession,
or disposing, of the property leered, or to an express condition
relating to forfeiture in case of non-payment of rent.
. Prior to the enactment of this section it was held that the Court
130
[Sec. 114A
could not give relief where tlie forfeituie took pkce by reason of breach
of condition in the lease, e.g., breach of a covenant to repair Debendm
V. Cohen, 54 Cal. 485, A.I.R. 1927 Cal. 908 <910), 106 I.C. 477. The
present section would give relief to the tenant in such cases.
The Act is not in force in the Punjab and the technical provisions of
tliis section do not apply to that Province Md. Hussain v. Secretary of
State, A.I.R. 1939 Lah. 330 (338), 41 P.L.R. 895, 186 I.C. 45.
The jjro vis ions of this section have no retrospective effect and can-
not govern suits instituted before its enactment Ibid. See also Note
lA, ante.
The second para lays down that this section does not apply to a
case of breach of an express covenant against assigning the jiroperty leased.
See sec. 14 (6), Conveyancing Act, 1881, reproduced in sec. 146 (8), Law
of Property Act, 1925, Tlie reason is obvious: relief can be given against
forfeiture for breach of a condition, when the breach is capable of remedy,
but when it it incapable of remedy by reason of tlie fact that at die time
the relief is asked for the position of parties has been altered, and die
interests of third parties have intervened, die relief cannot be given, for
to do so would be to cause injury to third parties rNewbolt) v. Bingham,
(1895) 72 L.T. 852; Stanhope v. Hanworth, (1886) 3 T.L.R. 34. In a
Sec. 115 ]
Madras case, it was likewise held, following the English law, that there
was no relief where the tenant forfeited the tenancy by reason of an
alienation of the leasehold interest without the consent of the landlord
Krishna Shetti v. Gilbert Pinto^ 42 Mad. 654 (659).
Two transactions, one a sale and the other a lease, took place in
respect of the same property on the same date. Under the first the pur-
chaser was to pay the price in certain instalments, and in case of dcfatilt
in respect of any instalment, the seller would have the option to c.xtcnd
the time for payment of the instalment up to three months; but if he did
not extend the time or if tlie instalment was not paid within the time
exended, the entire balance due would become immediately payable and
if the purchaser did not pay the same witliin a month of being called
upon to do so, the seller would have the right to rescind the agreement,
forfeit the instalment paid and sue either for specific performance or for
damages. The lease provided that in case of default in the payment of
any instalment under the agreement for sale, the landlord would have the
right to re-enter : held that the dates for payment of the instalments were
of the essence of the contract and non-payment of any instalment on the
due date was a breach incapable of remedy. Accordingly, on the occur-
rence of such a breach a notice teminating the lease forthwith was a good
notice Provat v. Bengal Central Bank, A.I.R. 1938 Cal. 589, 42 C.W.N.
761.
[Sec. iis
Under this section, tiie sub-lease becomes void when the original
lease becomes prfeited Sheikh Yusuf v. Jyotish, A.I.R. 1932 Cal. 241;
if the interest of the original lessee is not forfeited but merelj^ sold in
execution of a decree obtained against him by his lessor for arrears of
rent, die interest of die sub-lessee is not affected by such sale Vishnu
Atmaram v. Anant Vishnu, 14 Bom. 384. In case of JForfeiture of a lease
the under-leases become extinguished inspite of any contract to die con-
trary between the lessor and die lessee Bhupatrai Hirachand v. Choondal
Chunder, 70 C.W.N. 62.
IVhatever rights the sub-lessee may have against die lessee, do not
affect the rights of die landlord. So far as the landlord is .concerned, the
Sec. 116]
sub-lessee does not exist at all, and any proceedings by wbidi llic land-
lord has got a decree against the lessee would bind the siib-Icssce
Devaraju v. V. S. Raja, A.I.R. 1953 Mad. 356, (1952) 2 M.L.J. 179. Wlicn
the landlord acquired a riglit to evict his tenant under see. 7 of the
Madras Act XV of 1946 after giving a valid notice to iiiit, the sub-tenant
who cannot claim Iiigher rights than the tenant is liable to be cviclexl.
The fact that he was not made a party to the proceedings before the Rent
Controller does not aflect the question, as he would Ijc bound by the
order passed against the tenant obtained without any fraud or collusion
Varthasaraihy v. Krhhnamoorthij, A.I.R. 1949 Mad. 387, (1948) 2 M.L.J.
391.
Where a decree for ejectment is passed against the tenant and the
sub-tenant, the latter has a right of appeal ; but if the decree has become
final as against the tenant, the sub-tenant would be botind iiy the decree
on the second para of this section, and the appeal by the sub-tenant alone
would be incompetent Shankarrao v. KisaitJal, A.I.R. 1950 M.B. 19.
Illuslraiions.
Scope : ^For the apph'cation of this section two things are necess-
ary : (1) the lessee must be in possession after e.xpirj'^ of the lease ; and
(2) the lessor or his representative should accept rent or othcnaisc assent
to the lessees continuing in possession. MHiat is contemplated is that
the payment of rent and its acceptance should be made at such a time
and in such a manner as to be equivalent to the landlord assenting to
the continuance in possession Karnani Industrial Bank v. Province of
Bengal, A.I.R. 1951 S.C. 285, 1951 S.C.J. 407, on appeal from A.I.R. 1919
Cal. 47, 53 C.W.N. 195. Wiiere the landlord had accepted rent for a
period subsequent to tlie determination of the lease nearly a year before
its expirj', the landlords consent to the tenant's continuing in possession
could not be inferred ibid.
Tliis section has to be read along with cl. (a) of sec. Ill whicii deals
with the termination of a tenancy by efflux of time. This section does
not affect the rightsaof the landlord and tenant as contained in secs. 112
[Sec. 116
and 113Noonitlal v. Baburao, A.I.R. 1945 Bom. 182, I.L.R. 1945 Bom.
68. The principles are applicable to an agricultural lease AnaiUmal v.
Lala, A.i.R. 1964 Raj. 88.
This section does not apply to matters arising under the Rent Con-
trol Act where after an order for eviction of the tenant, but pending an
appeal therefrom and the stay order, the landlord accepts cheques sent
by the tenant as rent, the latter does not acquire any fresh right to con-
tinue in possession Kuppustvami v. Mahadeva, A.I.R. 1950 Mad. 746
I.L.R. 1950 Mad. 844. See also Ghulam v. Raja Rao, A.I.R. 1947 Mad.
436, (1947) 1 M.L.J. 354. Where the person in occupation is not a tenant
but a sub-lessee, the doctrine of holding over does not apply Nawabali
V. Md. Ramzan, A.I.R. 1944 Nag. 141, I.L.R. 1944 Nag. 267.
By cl. (]) of sec. 108 tlie lessees right to sublet the whole or part of
his interest has been recognized. Where on expiry of the lease the lessor
finds a number of sub-lessees continuing in occupation and accepts rent
from one or more of them, sec. 116 will apply Kaildmslvroo v. Bat Jer-
bia, A.I.R. 1949 F.C. 124, 53 C.W.N. (F.R.) 73, per Patanjali Sastri, J. .
In the case of a lease governed by sec. 107 and not by sec. 106 when
there is no acceptance of rent by the lessor after the determinaion of the
lease or any agreement by him that the former lessee should remain -in
possession without the execution of a fresh lease, this section is not
applicable Thakur v. Jagdambika Pratap, A.I.R. 1942 Ohdh 93 (95),
1941 O.W.N. 1065, 196 I.C. 694.
613. English and Indian law : ^The rule embodied in this section
difi^ers from the English law in this respect that wliile under this section
(he term of the new tenancy is decided according to the purpose for
tohicli the property is leased, under the English law the tenancy is deem-
ed to continue according to tlie terms of the original tenancy. Thus,
where a lease of land was granted for a term of years, and the property
leased was not used for agricultural or manufacturing puiposes and
was held over by the lessee after the expiration of the term, held accord-
ing to Indian law that the lessee must be deemed to be a tenant from
month to month (sec. 106) and entitled only to 15 days notice to quit
Troilokya v. Sarat Chandra, 32 Cal. 123 ; Bijoy Chandra v. HowraJt
Amta Light Ry., 38 G.L.J. 177, 72 I.C. 98, A.I.R. 1923 Cal. 524. See in
this cohnectiofi Khater v. Gopal, A.LR. 1930 Cal. 262, 33 C.W.N. 1207,
125 I.C. 654. Tlie Patna High Court has, however, held that when the
tenant is found to be continuing in possession, he will be presumed to be
a tenant from year to year in the absence of any evidence that he holds
on a different tenure Ramsundar v. Duthjn, A.I.R. 1935 Pat. 271, 155
I.C. 367. The Allahabad High Court has also held in a recent case that
when the lessee holds over after the expiry of the term fixed by the lease,
the relations between the parties are governed by the same terms' as
are embodied in the original lease Badal v. Ram Bharosa, A.I.R 1938.
All. 649 (650), (1938) A.L.J. 983. Under the English law, where a ten-
ant for a term of years holds over after the expiration of lease a
new tenancy from year to year is thereby created upon the same. terms
and conditions as those 'contained in tlie expired lease so far as the same
is applicable to and not inconsistent with the yearly tenancy In
Sec. 116]
the absence of any evidence one way or the other, it seems that upon the
holding over and payment of rent, the Jury would be directed to find
a tenancy on tile tenns of tlie expired lease ^Woodfalls Landlord and
Tenant, 17th Ed., p. 246.
[Sec. 116
continues witli tlie consent o the landlord and is therefore not wrong-
ful, and he cannot be ejected without due notice Chaturi v. Mukund,
7 CaL 710 ; Bose A. L. v. Sayed Nayyur Abbas, A.I.R. 1967 All. 209.
This section enacts that if after the termination of the lease, the
tenant continues in possession, and the landlord accepts rent or other-
wise gives consent to his remaining in possession, such action has the
effect of converting the tenant by sufferance into a tenant-at-will. But
this rule applies only to the original tenant, and not his represeniatioes.
Therefore, tie original tenant dies and his representative enters into
possession, he does so as a trespasser, and the landlord cannot, by mere
assent under this section, convert such representative into a tenant, un-
less a new tenancy is created by the consent of both parties yadapalli
V. Dronamraju, 31 Mad. 163. Section 116 deals with the effect of hold-
ing over by a lessee, and with die creation of a fresh tenancy by impli-
cation. Hie kind of tenancy under section 116 is only created by law
in favour of the original leassee. Therefore section 116 appHes only to
the case of a lease fixed for a term of years and not a lease for
Me. The representatives as assignees of the tenant for Me will not
become tenants from year to year, without the formahties of sed. 107;
that is, they can become tenants from year to year only by means of a
registered document. Tliey may, of course, become tenants-at-will or
for a year without any registered document, that is, by verbal contract
(Ram Rachhya v. Kamakhya Narayan, 4 Pat. 139, A.I.R. 1925 Pat. 216,
84 I.C. 586, 6 P.L.T. 12. And so, wdiefe after the death of the original
mukarraridars, who were tenants for Me, die heirs remained in possession
and paid rent to die lessor, but the receipts were given- in the mar-
fatdari form, and the lessor refused to give receipts to the persons pay-
ing die rent in their own name, held Aat die lessor did not recognize
the heirs of die mukarraridars as tenants from year to year, that there
was not even any relationship of landlord and tenant between the parties,
and that sec. 116 did not apply Kamakhya Narayan v. Ram. Raksha, 7
Pat. 649 (P.C.), 9 P.L.T. 501, 32 C.W.N. 897 (901, 902, 905), Ad.R. 1928
P.C. 146, 109 LC. 663, affirming Ram Rachyya v. Kamakhya Narayan,
supra. Section 116 does not contemplate the holding over by the heirs
of the original lessee, and therefore the heirs cannot, by continuing in
possession, acquire the status of a tenant holding over after the deter-
Sec. 116]
131
[Sec. 116
The burden of proving that the landlord has assented to the con-
tinuance of possession lies on the tenant. Although it is a general pre-
sumption of law that when the existence of a relationship is once proved
such relationship continues till it is shown to have ceased, still when it
appears that the relationship of the parties is such that, but for the ex-
istence of some special contract, the landlord would have had a right to
ej'ect the tenant, the burden of proving that the latter is entitled
to resist ejectment lies on the tenant Keshav v. Piiran, 1 N.L.R. 32;
Zaffar v. Mahabir, A.I.R. 1957 Pat. 206.
The assent referred to in diis section is the assent of the lessor and
not diat of the lessee. The option of giving an assent is one that is con-
ferred on the lessot and not on the lessee Maghji v. Dayalji, 48 Bom.
341 (345), A.I.R. 1924 Bom. 322, 80 I.C 507, 26 Bom. L.R. 231.
Sec. 116]
after expiry of the lease results in the relation being that of landlord and
tenant under a year to year tenancy terminable by 6 months notice
Gcoderham & Works Ltd. v. Canadian Broadcasting Corpn., A.LR; 1949
P.C.-90. But where a tenant, under an unregistered lease of a shop for
manufacturing purposes for one year which fixes only monthly rent, held
over, the tenancy was held to be from month to month Kishan Lai v.
Ram Chander, A.I.R. 1952 All. 634. It is worthy of note that when a
tenant holds over, tlie lease is renewed not in accordance with tlie terms
of the original grant, but in accordance with the purpose for which the
grant had been made Matilal v. Darjeeling Municipality, 17 C.L.J. 167,
18 I.C. 844 (846); Lalit Mohan Dey v. Satadalbasini Dasi, ^ C.W.N. 1036.
A tenancy created by holding over is a tenancy on the same conditions
as those on wluch the original tenancy was created, subject only to the
modification under this section that it would be a tenancy from month
to month or from year to year according to the purpose for which the
land was let Khu^ Baksh v. Abid Husain, 12 O.C. 279. This section
lays down that in the absence of a contract to the contrary, the duration
of the renewed lease shall be regulated according to tlie puipose of the
lease, irrespective of the term of the original lease. Thus, if a lessee,
under a lease (for non-agricultural purpose) granted for one year or for
a term of years was allowed to hold over after the e^iry of the term of
the lease, the renewed lease would not be a lease from year to year, but
one from mpnth to month under sec. 106, and terminable by 15 days'
notice Matilal v. Darjeeling Mtinicipality, supra; Troilokya v. Sarat
Chandra, 32 Cal, 123; Gobinda v. Dwarka, 19 C.W.N. 489 (492), 26 LC.
962. Durgi Nikarini v. Gobordhan, 19 C.W.N. 525 (529), 24 I.C. 183;
Meghji Vallabhdas v. Da^ali & Co., 48 Bom. 341 (344), 80 I.C. 507, A.LR.
1924 Bom. 322; and this is so, even though after the expiry of the original
term the rent was being paid per year and not from month to month ^
Secy, of State v. Madhu Sudan, 36 C.W.N, 918 (920), A tenant of home-
stead land within a town, holding over after the expiry of a ten years
lease, must be deemed a monthly tenant, and not entitled to six montlis
notice Manmatha v. Teary Mohan, 23 C.W.N. 596, 52 I.C. 180. Where
a tenant took a lease for 10 years from the mutxoali of a mosque with a
covenant for renewal, and it was found that the covenant for renewal
was ultra vires, tire tenant holding over must be deemed to be holding
on a monthly tenancy Gajendra Nath v, Ashraf Hossain, 27 C.W.N. 159,
A.I.R, 1923 Cal, 130, 69 I.C. 707. If the lease is granted for agricultural
purposes, the tenant holding over after the expired lease ^viIl be deemed
to hold from year to yean FaJdra v. Leakut Hussain, 18 C.W.N. 858, 23
I.C. 318; Administrator-General v. Asraf Ali, 28 Cal. 227; Ram Prosad v,
Debt Prasad, 49 I.C. 974 (Cal.); Stoneivigg v. Kameshwar, 11 P.L.T. 444,
A.I.R. 1923 Pat. 340, 71 I.C. 1022; Mahomed Ayejuddin v. Prodyot Kumar,
25 C.W.N. 13, 61 I-.C. 503. So also, if the original lease was for manu-
facturing purposes, the tenant holding over after the expiry of the lease
will be deemed to hold over on a tenancy from year to year, and will be
entitled to six months notice Jacks & Co. v. Joosab Mahomed, 48 Bom.
38 (41), A.I.R. 1924 Bom; 115. Where 'the' tenant continues in possession
by virtue of Rent Control Legislation after- the expiry of the lease by
efflux of time or determination by notice to ' quit no new tenancy by
holding over is created by paynient and acceptance of rent and no notice
ito quit is required to sue for eviction Ganga Dutt v. Kcirtik Ghandro,
A.I.R. 1961 S.C. 1067. There is no recognition of tenancy by holding
over if tlie landlord obtains a decree for recovery of municipal taxes
against tlie tenant in respect of the period subsequent to the expiry of
the lease Ramesh v. Jajnesimr, 65 C.W.N. 488. It heirs of a tenant
continuing in possession after the termination of the tenancy by efflux of
time transfer their right, a suit for the eviction of the transferee by the
sons of the lessor more than fifty years after the tennination of tlie lease
must fail as tlie transferee from the heirs of the original tenant cannot be
regarded as a tenant by holding over Sadaram v. Sundorlal, A.I.R. 1968
All. 363. A tenant continuing in possession after the etxpiry of the lease
as a trespasser is liable to pay mesne profits but not double the rent as in
England Hindustan Steel Pvt. Ltd. v. Sm. Usha Roni Gupta, A.I.R.
1969 Delhi 59.
In all other respects, viz., the rate of rent, rate of interest, etc., the
ten^t continues to hold on the same stipulations as are mentioned in tlie
original lease Kishore v. Administrator-General, 2 C.W.N. 303. Krishna
. Chandra v. Nitya Sundari, A.I.R. 1926 Cal. 1239; Allah Bibee v. Joogul,
25 W.R. 234; Rangaswami v. Jainabu, A.I.R. 1942 Mad. 507, (1942) 1
M.L.J. 448, 1942 M.W.N. 282; ' Sanjeevi v. Chettibabu, A.I.R. 1953 Mad.
473, (1953) 1 M.L.J. 260. The stipulation in an expired lease providing
a security or creating a charge for the outstanding rent is a term of the
lease within the meaning of this section and tlie landlord can enforce the
security or charge during the currency of the lease created by holding
over jbeoofct Amma v. Krishna Kammathi, A.I.R. 1955 Trav.- Co. 146
(F.B.); Aryam Satti Rafu v. Sri Ragha Venkata Mahipali, 69 Mad. L.W.
(Andh.) 156. The stipulation in the original lease that at the expiration
of the term, the lessee is to give up possession without notice cannot be
imported into the new; tenancy by holding over Sarasioali R. v. Pedapa-
raju, (1967) 1 Andh. L.T. 137. The new tenancy will be deemed to have
commenced on the same day of the year as the original lease, and notice
to quit shall be given accor^ngly iWoodfalls Landlord and Tenant, 17th
Edn., p. 246; Deo v. Samuel, 5 Esp. 173. But in some cases governed by
the Bengal Tenancy Act, it has been held that although the tenant agreed
to pay interest at the rate of 75 per cent, per annum under the original
lease, (which was created before .the Act came into operation), still if the
lease expired after the passing of tliat Act, and that tenant continued to
hold over, the landlord was not entitled to recover interest at more than
12/2 per cent., that being the maximum rate fixed by the Bengal Tenancy
Act (sec.. 67) Administrator General v. Asraf Ali, 28 Cal. 227; Ali Mamiid
v. Blwgbali, 2 C.W.N. 525. Alim v. Satis Chunder, 24 Cal. 47. On the
expiry of a written lease for one year from 7.4.45 there was a monthly
tenancy by holding over. Hold drat die tenancy by holding over was
1046 TRANSFER OR PROPSRfV [ SeC. 11?
from the 8tli of one month to the 7th of the next month Baidyanathv.Nir-
mala Bala, A.I.R. 1957 Cal. 649.
Wliere after tlie expiiy of die jieriod fixed in a lease the tenant con-
tinues in possession as tenant on the same tenns expressed in the lease,
he cannot claim adveise possession Chandi'ika v. B. B. & C. I. By. Co.,
A.I.R. 1935 P.C. 59 (62), 39 C.W.N. 552, 154 I.C. 945. As to distinction
between a tenancy by holding over and a tenancy under a renewal clause,
see Lain Mohan Dey v. Satadalbasini Dasi, 68 C.W.N. 1036.
617. . Agricultural leases ; Before the passmg of this Act, there was
no distinction between agricultural and non-agricultural tenancies. See
MadJwb Chand v. Bejoy Chand, 4 C.W.N. 574. Tlie distinction is for the
first time recognised in this Act. Where a tenancy was granted for resi-
dential purposes' before the passing of the Bengal Tenancy Act in favour
of a non-agriculturist, a suit for recovery of possession of land on which
stood a homestead was governed by tlie T. P. Act and it was not main-
tainable without service of notice Bamoarl v. Gonal, A.I.R. 1933 Cal. 643
(644), 37 C.W.N. 471, 146 I.C. 540.
Sec. 117 1
Pat. 404, 86 I.C. 597, A.I.R. 1925 Pat. 421. An agiicultural lease can be
created by a Kabuliyat or even orally Mt. 'Ttipcsara Kuer v. Kalap Rajioar,
A.I.R. 1957 Pat. 92.
[Sec. 11:?
It has been held by tlie Madras High Court tliat in tliis section, the
word agriculture is used in its more general sense as comprehending
the raising of vegetables, fruits and garden products as good for man
and beast, though some of them may be regarded in England as pro-
ducts of horticulture as distinguished from agriculture 'Murugesa v.
Chfimathambi, 24 Mad. 421. In Panadai Pathan v. Ramasami, 45 Mad.
710 (714), A.I.R. 1922 Mad. 351, 70 I.C. 657, it has been held tliat the
term agriculture should not' be taken as limited to the raising of food
product but should be interpreted in a wider sense so as to include cul-
tivation of fibrous plants such as cotton, jute and linen and aU plants
used for dying pvupose such as indigo, etc., and aH timber trees and
flowering plants.
Sec. 117]
cultural lease and is outside tlie scope of the T. P. Act and is governed
by die Bengal Tenancy Act See Gopal Chandra v. Bhutnoth, 42 C.L.J.
520, A.I.R. 1938 Cal. 312 (313]. Horticulture, which means -the cultiva-
tion of gardens qr orchards, is a species of agriculture in its primary and
more general sense Murugesa v- Chinnathambi, 24 Mad. 421 (423). But
the mere fact that in a lease for residential purposes, there is given a
right to take fruit from the trees on tlie land and to plant other fruit
trees and take tlieir fruits, does not convert the lease into a lease for
horticultural purposes Gopal Chandra v. Bhvtnoth, supra. So, where a
lease expressly stated that it was for residential purposes and the land
had always been used for that purpose, the fact that it was described as
feogaf or that damages in respect of the arrears of rent and cesses were
claimed, or that it was advertised for sale as a non-transferable occupancy
holding, cannot, in the absence of estoppel, be said to have altered the
original non-agricultmal purpose Udayiara v. flahibar Bahaman, 42
C.W.N, 771 per Mukherjea, J. A tenancy created for the purpose of
gatliering and enjoying fruits from trees standing on the land of the ten-
ancy is governed not by the Bengal Tenancy Act, but by the Transfer of
Property Act Sailendra v. A. CoCo, 44 C.W.N. 582.
132
t Sec. 117
. In Kunhayan v. Haji Mayan, 17 Mad. 98, it was held that the lease
of a coflfee-garden was not an agricultural lease; but the decision was
held to be wrong by Shephard, J., in Murugesa v. Chinnathambi, 24
Mad. 421.
Wliere an entire village was leased out to the lessee who was put
in possession and authorised to let out the land to tenants and make
collections, but he was not to cultivate the lands himself; further, the.
lessee was not entitled to plant groves on the land, and was abo to be
responsible for the payment of Government revenues and cesses, held
that it was impossible to say that the primary object of the transaction
was agriculture. The mere fact tliat it was open to tlie lessee to culti-
vate any particular land if he so desired would not make the lease an
agricultural one, because agriculture was the secondary and not the pri-
mary object Ballabha v. Murat Narain, 48 All. 385, 95 I.C. 1048, A.I.R.
1926 All. 432. Where the land is a homestead land within a Municipal-
ity, in which there is a house which the tenant has enjoyed for a long
time, tlie mere fact that in the record-of-rights some portions of the lands
are shown as bagan lands does not necessarily indicate that the lease is
one for agricultural or horticultural puiposes, especially where the ten-
ants are not shown to be agriculturists or culHvators Safar Ali v. Abdul
Mojid, 31 C.W.N. 282 (284), 100 I.C. 614, A.I.R. 1927 Cal. 279. A lease
of land for building purposes and for establishing a coal deiiot is not a
lease for agricultural purposes Raniganj Coal Association v. Jiidoonath,
. 19 Cal. 489.
Sec. Il8]
In cases governed by diis Act no suit for setdement of rent hes, for
the Court has no power to make a contract for the parties in such cases.
An aggrieved landlords remedy against a trespasser in possession is by
way of ejectment Kripa Sankar v. Janki Prasa^ A.I.R. 1942 Pat. 86 (87).
CHAPTER VI.
Of Exchanges.
[Sec. ll8 ^
Fateh Singh v. Piithi Singh, A.I.R. 1930 All. 426 (427), (1930) A.L.J. 1312,
124 I.C. 557, P. R. Srinivasan v. The Corporation of the City of Bangalore]
I.L.R. (1957) Mys. 167. No hard and fast rule can, however, be laid
down as to when transactions amount to a sale or to an exchange. If
the consideration is not paid in cash, but is paid by the transfer of
ownership of some property, it would be an exchange and not a sale.
The mere fact that the value of the property transferred has been
fixed does not convert the transaction into one of sale. It is not the
name or form of the transaction, but the nature of the consideration
paid for the transfer which determines the nature of the transfer itself
Ram Badan v. Kunwar Singh, A.I.R. 1938 All. 229 (230, 231), (1938)
A.L.J. 52, 175 I.C. 618. Where one of the parties has failed to execute
the document of exchange, the mere fact of exchange of possession is
not sufficient to the passing of title in favour of each other, especially
when the properties are each worth more than Rs. 100 Kama v. Krishna,
supra.
5 C.W.N. 725.
Sec. 118]
Where a husband transfers a land to his wife for her use during her
lifetime and the wife gives up her right to future maintenance, the trans-
action is not an exchange, because 'the husband does not transfer the
ownership of the land (but simply gives a life-interest in the property)
and the wife also does not transfer the ownership of anything. She does
not purport to transfer an3rthing nor had she anything which she could
transfer within the meaning of this section Madam Pillai v. Badrakali,
45 Mad. 612 (618) (F.B.).
It should be noted that sec. 53A applies to those cases in which there
is a document in icriting (though it is unregistered) and not to cases in
which there is no document at all. In 29 Bom. L.R. 1419 and 40 All. 187
there was no written document at all ; the exchange took place by parol
agreement. Nevertheless the doctrine of part-performance was applied.
These' cases were decided prior to the enactment of sec. 53 A. Henceforth,
the doctrine will not be applied unless there is a written document. In
Chidambara v. Vaidilinga, 38 Mad. 519 (521), the Court refused to apply
the doctrine of part-performance, because the exchange was made bj' oral
transfer.
But it is clear that the estoppel arising out of the equitable doctrine of
part-performance will not create title in the plaintiff, and if he seeks to
recover possession on the strength of his title, he cannot succeed when there
has been no transfer by a registered deed such as is necessary under this
Sec. 119]
section read with sec. 54 Kalipada v. Fort Gloster Jute Co. Ltd., 31 C.W.N.
348, A.I.R. 1927 Cal. 365 (370), 100 I.C. 866. See Notes under sec. 53A
ante.
value is protected under the amended section also. See however Chidam-
bara v. Swaminatha, infra.
Scope Under the amended section the ri^t to the return of the thing
transferred in exchange is limited to the three classes of persons mentioned
therein and so long as they were in possession of the same. Where A is
deprived of a portion of the property got by him in exchange from B,
but the property transferred has passed into the possession of a trespasser,
A is not entitled to the return of the property under this section. His
only remedy is to claim compensation from 'Q-Sitara7niah v. Kanakaiali,
A.I.R. 1952 Mad. 602. The statutory right of buyer and seller created
by sec. 55 (2) was outside the scope of sec. 119. Sec. 120 could not be to
confer on an assignee of the party within the meaning of sec. 119, rights
which this section conferred upon that party Narayanaswmny v. Muthra-
thnam, A.I.R. 1949 Mad. 715, (1949) 1 M.L.J. 620.
622. This section affirms in distinct terms that each party warrants
his title to the things which he transfers. This rule is based on equity and
good conscience and may apply to exchanges effected prior to this Act
Balusa Veeraraghavalu v. Boppanna, 31 M-L.J. 380, 35 I.C. 92..^
But a covenant saying that neither party has after to-day any claim
against the other contrary to the exchange, and whatever proprietary rights
each had in his own land will be owned by the other party" is not a con-
tract to the contrary. It is rather a recital of the legal incidents of an
exchange, and does not exclude the operation of this section Sdlabat v.
Abdul Rahaman, 51 P.R. 1917, 41 I.C. 248.
Under this section it is not open to a transferee from one of the parties
Sec. 120:]
to the exchange- deed to set up the plea of a bona fide purchase for value,
as the transferee can get no better title than that which his transferor had.
Although tlie section does not explicitly say that a party to the exchange
is entitled to the return even when the property has passed into the hands'
of an innocent purchaser, there is nothing in the section which rules out
such a contingency Chidambara v. Swaminatha, A.I.R. 1940 Mad. 426,
(1940) 1 M.L.J. 248, 1940 M.W.N. 290.
But this section does not exclude the operation of sec. 43 ; so that
if the party having a defective title afterwards acquires full title, the other
party will be entitled to its benefit. Thus, A obtained a certain property
from B in exchange. B At the time of exchange had only a half share in
the property but he subsequently acquired the other half. Held that as
soon as the title to the whole was perfected, the benefit thereof accrued to
A. Though the assignment was of a defective title' yet as the assignot
afterwards acquired good title, the Court would make that good title avail-
able to make the assignment effectual Bhairab v. Jiban, 33 C.L.J. 184, 60
I.C. 810.
Rights and liabilities party has the rights and is subject to the
of parties. liabilities of . a seller as to that which he
625. Rights and liabilities The rights and liabilities of the buyer
and seller, so far as immoveable property is concerned, are set forth in
sec. 55. If the property is moveable, the case will be governed by the
Sale of Goods Act, III of 1930.
This section implies the exchange of one property for another property
and not for money. Having regard to the definition given in sec. 118, no
question of money is involved in a transaction of exchange. Even if there
be a stipulation to pay money in addition in order to make up the deficiency
of the property, and that money remains unpaid, the other party cannot
have any charge on the exchanged property for the money remaining un-
paid, on the principle of sec. 55 (4) (6). He will only get a simple money-
decree Krishna Nair v. Kundu Near, 1912 M.WN. 535, 16 I.C. 109. So
also, if the exchange-transaction turns out to be invalid, no charge can
arise as under sec. 55 (6) (ft) for the value of land exchanged Cftfdumftura
V. Vaidilinga, 38 Mad. 519 (522), 30 I.C. 408. The effect of a decree direct-
ing the return of the thing transferred is not to declare that the exchange
was void from 'the outset. The effect of "such a decree is to -divest the
title -of- one of' the parties to the exchange and to vest it in the original
133
1058 TRANSFER Of PROPERTY
[Sec. 122
owner. It follows that till the date of the directing the return of the
property, the title thereto remains with the person to whom the same
was given in exchange. It is therefore manifest that the exchange holds
good till the date of the decree Alitnulla v. Md. Khalil, A.I.R. 1940 All.
478, 1940 A.L.J. 569, 191 I.C. 385.
given by him.
CHAPTER VII.
Of Gifts.
122. 'Gift is the transfer of certain existing moveable
Sec. 122]
[Sec. 122
Wliere one pays a sum of money to his brother, it does not amount
to a gift, if the money is paid in consideration of the latter giving up his
plaim^ however imaginary, to the property of tlie former Abdul v. Vish-
tvanathan, A.I.R. 1950 Mys. 33 (F.B.). Wliere the husband deposited
certain ornaments with a bank for safe custody in the .joint names of
himself and his wife, with direction to be delivered to be either or sur-
vivor, it did not amount to a gift, as tlie husband retained dominion over
the property Chandramani v. Rama Shankar, A.I.R. 1951 All. 529, 1950
A.L.J. 932. Wliere a purchase has been made in tlie name of a concu-
bine with tlie funds of her paramour, it is for the concubine to prove
that it was made for her, as the doctrine of advancement does not apply
in India Skioa Kumari v. Udeya Partap, A.I.R. 1947 All. 314, 1947 A.L.J.
144. See also Chandramani v. Rama Shankar, supra. WTiere a person
keeps money in fixed deposit in the name of his niece, brought up and
given in marriage by him, there is an inference of gift in favour of the
niece Raghiiraj Kishore v. Uitam Devi, I.L.R. (1966) 1 All. 111.
Ec. hi]
[Sec. 122
the deed that the transaction was a real and bona fide one, and was
understood by the lady, that she had opportunity to take independent
advice and that she was a free agent and executed tlie deed ot her own
free will Mahomed Bakhsh v. Hosseini Bibi, 15 Cal. 584 (P.C.); Wazid
KJjan V. Ewaz AH Khan, 18 Cal. 545 (P.C.); KJiafija v. Ismail, 12 Mad.
380; Mariam Bibi v. Sakina, 14 All. 8; Hakim M'ohammad v. Najiban, 20
If tlie donor be an old and infirm woman, the burden will lie very
heavily upon the donee to show that the deed of gift was volimtarily
executed by her with the full knowledge of its contents, and that she did
so \vithout any pressure or solicitations which might amount to an exercise
of undue influence on her Rajaram v, Khandu, 14 Bom. L.R. 340, 15 I.C.
529. The law as to undue influence is the same in the case of a gift as
in the case of a contract; Snbhas Chandra v. Ganga Prosad, A.I.R. 1967
S. C. 878. But where it was found tliat the donor was fully able to manage
her own business and transacted all her business herself, and even went
to the Court and to the Registration Office in connection \vith. litigation
and registration of deeds, the mere fact that she was a very old woman
with the natural infirmity incident to her age ought not to raise any pre-
sumption of undue influence in respect of a deed of gift executed by her
Ismail Mussafee v. Hafiz, 33 Cal. 773 (783) (P.C.).
- 628. Who can be a donee : ^'Tlie word donee in this section means
Sec. 122]
Wliat the law requires is acceptance of the gift after. its execution,
though the deed may not be registered. Anterior negotiations or talks
about the gift would not amount to acceptance. The acceptance may be
implied, but the facts relied on must be acts of positive conduct of the
donee or persons acting on his behalf and not merely passive acquiescence
such as standing by when the deed was executed or registered Venkata-
subbamma v. Narayanaswami, A.I.R. 1954 Mad. 215. Acceptance must
be made before die death of the donor Kesaca Kunip v. Thomas Jdichia,
A.I.R. 1969 Ker. 21,
[Sec. i22
Under tliis section, the acceptance may be made while the donor is
still capable of giving, and during his lifetime. It is therefore unnecessarj'
that the acceptance should take place immediately.
Sec. i22]
The mere custody by the donor of the deed of gift does not lead to
any adverse conclusion against the donee, especially where tlie entire
conduct of the donee shows that he accepted the gift and thq document
was kept in the family-box to which the donee also had access Anbomma
V. Narasayyq, A.I.R. 1947 Mad. 127, (1946) 2 M.L.J. 357. Tlie acceptance
of a gift can be inferred not from the donees present possession of the
deed of gift, but from the fact of the deed having been handed over to
him by the donor and his having accepted the same. Where the donee
was living as an inmate of tlie donors family being in league with the
donors daughter, it is quite possible for him to take hold of the deed of
gift without the donors knowledge and intention Ram Chander v. Sital
Prasad, A.I.R. 1948 Pat. 130.
134
[Sec. 123
630. Scope of section : Tlie Allahabad High Court has laid down
that this section applies to religious gifts, and in the absence of a
registered deed of gift, the dedication of property to an idol is invalid-r
Mannu Lai v. Radha Kishenji, 36 I.C. 989 (All.), See also Shaukat Begam
V. Thakuifi, A.I.R. 1931 Oudh 14, l31 1.C. 442, where it has been held diat
the provisions of this section apply to gifts direct as well as to gifts through
the intervention of a trust, and title, tiierefore, in an endo^vment^ proper-
ly passes on to the idol (who must be treated as a juridical person) on
the execution of a deed of endowment by the donor. "Their Lordships
cannot adopt such a narrow construction of the term gift as would
exclude any gift where the donor's bounty passes to his intended bene-
ficiary through the medium of a trust so that while a gift by A to C
direct would be governed by the Mahomedan law, a gift by A to B in
trust for C would be governed by some other law. So to hold would,
they think, defeat the plain purpose and object of this section of the
statute Sadik Husain v. Hashim Alt, 38 All. 627 (645) (P.C.). Tlie Patna
High Court likewise holds that the Hindu law in the case of gifts has
been expre.s.<!ly abrogated by sec. 129, and a- gift under the Hindu law
must be made in accordance with sec. 123 by a registered document
Debi Saran y. Nandalal, A.I.R. 1929 Pat. 591 (593). But the Madras High
Court holds that the Chapter relating to gifts can have no application
to gifts by dedication, because a dedication to an idol is not a gift to a
sentient being, but to God, Consequently, a dedication to a temple or idol
of a small portion of the property on the occasion of a marriage or sradh
ceremoney need not be in writing registered, but may be made orally.
But if it is made in writing it must be registered. If the dedication is
made by giving the property to the trustees of the temple, it must be
in writing registered Ramalinga v. Sivachidamhara, 42 Mad. 440 (442,
444). And it has been ruled by tlie Privy Coimcil that a dedication of a
portion of the family property (including the. immoveable property) for
the purpose of a religious charity (e.g,, for erecting a choultry or charity.
Sec. 123]
house for Brahmans) may, according to Hindu law, he validly made with-
out any instrument in writing Gangi Reddi v. Tammi Rcddi, 50 Mad.
421 (P.C.), 52 M.L.J. 524, 31 C.WJ\^ 799, A.I.R. 1927 P.C. SO (82), 101
I.C. 79. But tliis decision was given without any reference to the T. P.
Act. The law is tlierefore unsettled on this subject. It should also be
noticed that since the Transfer of Ptoperty Act contemplates only a transfer
from one living person to another living person (sec. 5), a gift to an idol
does not fall under this Act (and need not be in writing registered), be-
cause an idol, tliough recognised in law as a juristic person, is not strictly
speaking a living person Narasimhasicami v. Vekatalingavi, 50 Mad. 6S7
(F.B.), 53 M.L.J. 203, 103 I.C. 302, A.I.R. 1927 Mad. 636 (638) 4 Harihar
V. Gtiru Grdnth Saheb, 11 P.L.T. 658, 128 I.C. 791, A.I.R. 1930 Pat. 610
(612). See also Birendra v. Bahuria, A.I.R. 1924 Pat. 612 (614), 13 Pat.
356. Moreover, the new definition of lixong person as given in sec. 5
does not include an idol.
This section does not apply to partition, for partition is not a gift,
and no writing or registration is necessary to effect it Laxman v. Tatjya,
51 I.C. 93, 15 N-L-R. 93 ; Ma Sein v. Maim U., 25 I.C. 498. At a parti-
tion bet\veen the members of a joint Hindu faimly consisting of a fatlier
and his sons, they purported to include the second defendant who was
admittedly not a member of the joint family, and to allot to liim a pro-
portionate share of the joint properties. There was, however, no regis-
tered instrument though the property allotted was over Rs. 100 in value.
H'eld that the transaction, by which a portion of the property' was given
to a person who was not a member of the family, ^vas a gift and not a par-
tition, and not being made by a registered iiistrument, was invalid. The
parties cannot evade the formal requirements of the Transfer of Propertj'
Act by calling a transaction by a different name Mare Gouda v. Chenne
Gouda, 49 M.L.J. 150, A.I.R. 1925 Mad. 1174, 90 I.C. 131. A deed of
release may operate as a deed of gift A.I.R. 1967 S.C. 1395.
[Sec. hi
remained in possession, to whicli the donee never objected, and the do-
nor subsequently sold the property to other persons, held that the gift
was not complete in spite of registration of the deed Lakshimoni v, NU-
tayananda, 20 Col. 464.
Hiis Act was not applied to Berar until 1907. So a gift of immove-
able property made prior to that date was governed by the Hindu law
and delivery of possession was essential to make a gift ^'alid. A gift by
a registered deed without delivery of possession in such a case was in-
valid and did not convey a valid title to the donee Chaiidrabhaga v.
Anandrao, A.I.R. 1938 Nag. 142, 173 I.C. '85.
Wliere a deed of gift was duly made, registered and accepted, the
mere fact that the deed of gift remained with the donor did not make
tlie gift any the less complete Amrithammal v. Ponmisami, 17 M.L.J. 386j
Sec. 123]
[Sec. 123 .
633. Baddhist law : ^It has been held that athough the rule of Bud-
dhist law requires delivery of possession as essential to the validity of a
gift, such rule is abrogated by the provisions of the Transfer of Property
Act, just as this Act has abrogated tiie rule of Hindu law as to die neces-
sity of delivery of possession U. Pandwan v. U. Sandima, 2 Rang. 131
(134), 83 I.C. 557, A.I.R. 1924 Rang. 309 ; Mi Hla Zan v. Pa Pa Ye, 3
Bur. L.J. Ill, A.I.R. 1924 Rang. 353 ; Ma Thin v. Maing Gyi, A.I.R. 1924
Rang. 13 (14), 75 I.C. 166.
The compliance with secs. 34, 35, 58 and 59 of die Registration Act
constitutes registration of die document and not the presence of cerdficate
under sec. .60 of that Act Sobhnath v. Pirthipal, A.I.R. 1948 Oudh 223.
In this case it was held that the document must be deemed to have been
duly registered though there were some defects in die formalities of
registration.
Sec. 123 ] .
Tlie law on this subject has been thus stated by their Lordships of
the Judicial Committee : When the instrument of gift has been handed
over by tlie donor to the donee and accepted by him, the former has done
eveiytliing in his power to complete the donation and to make it efiFective.
Registmtion does not depend upon his consent, but is the act of an officer
appointed for the purpose, who if the deed is executed by or on behalf
of the donor and is attested by at least two witnesses, must register it. if
it is presented by a person having the necessary interest within the pres-
cribed period. Neither death nor the express revocation by the donor is
a ground for refusing registration, if the otlier conditions are complied
with Kahjanasundaram v. Karuppa, 50 Mad. 193 (P.C.), 52 M.L.J. 346,
100 I.C. 105, 31 C.W.N. 509, A.I.R. 1927 P.C. 42; Ven/cat Subba v. Subba
Rama, 52 Bom. 313 (P.C.), 30 Bom. L.R. 827, 32 C.W.N. 708, 108 1.0/367,
A.I.R. 1928 P.C. 86 (87); see also Svdhir v. Tarangini, 41 C.W.N. 1201.
transferring the villages to the donees name, and on the same date the
donee also presented a petition to the Collector reciting the gift of the
villages and asked for the transfer of them to his name on the register,
held that as there was no deed of gift in writing registered, the mere
recitals in the petition could not be used as evidence of the gift Varada
PlUai V. Jeevarathmmmal, 43 Mad. 244 (249) (P.C.) But the Rangoon and
Calcutta High Courts lay down a more equitable principle. Thus, the
Rangoon High Court is of opinion that where an immoveable property
was transferred with possession orally as a gift and the donor allowed
the donees in possession to deal with it as their absolute property (e.g., to
mortgage it, to re-mortgage it, to purchase other properties with die pro-
ceeds of the mortgages), the donor would not be allowed to take advantage
ol the non-registration of the gift and to take back the property. To allow
the donor to do so would be to permit this Act to be used to perpetrate
a fraud in a manner which could not be recognised Ma Htay v. U Tha
Hline, 2 Rang. 649 (652, 653), 88 I.C. 66, A.I.R. 1925 Rang. 184. Where
the donor made an oral gift of certain lands, and reported to the revenue
authorities for effecting a mutation in the name of the donee, and the
donee was in possession since the date of the gift, held that though the
gift did not convey any title to the donee, by reason of not being made
by a registered deed, stiU as tlie donor had clearly divested himself of
the ownership of these lands, neither the donor nor any person claiming
through him was entitled to bring a suit to take back the properties, and
Ihe donee could resist the suit on the ground of estoppel M. P. L. M. P.
Chetttj V. Ma Ngwe Sin, 1 Rang. 665, 79 I.C. 485, A.I.R. 1924 Rang. 200
(201); Ma Shin v. MaungHman, 1 Rang. 651, A.I.R. 1924 Rang. 102 (103),
79 I.C. 579. Similarly, where in pursuance of an ante-nuptial agreement,
a father made a gift of his house to his daughter and put her in possession,
under an unregistered deed, and she held such possession for a number
of years, and the donor afterwards sued for recovery of possession of the
house, held that the donor was esto] 7 ped from bringing the suit Pran
Mohan v. Hari Mohan, 52 Cal. 425, 29 C.W.N. 889 (891), A.I.R. 1925 Cal.
856 (following Mahomed Musa v. Aghore Kumar, 42 Cal. 801 (P.C.). It
is apprehended by the present editor tliat the above cases of the Rangoon
and tlie Calcutta High Courts are no longer good law in view of the de-
cision of the Judicial Committee in Ariff v. Jadimatlv, 58 I.A. 91, 58 Cal.
1235, 35 C.W.N. 550, A.I.R. 1931 P.C. 79.
If, under the oral gift, the donee remains in possession for more than
12 years, his title will be perfected by adverse possession, and it will not
be in the power of the donor to take back the property Varada Pillai v.
Jeeoarathnammal, 43 Mad. 244 (260) (P.C.).
[Sec, 123
Signed ; Tlie deed of gift must be signed either by the donor him-
self or by someone on his behalf. As to what is or is not a valid signature,
see the analogous cases of mortgage cited in Note 350 under sec. 59.
The Calcutta and Allahabad High Courts as well as the Oudh Chief
Court are of opinion that an attesting witness, if he is illiterate, can put
his mark to the instrument, and this would be sufficient attestation. See
Sashi Bhtishan v. Chandra, 33 Cal. 861; Litl Bahadur v. Ratncshtcar, 3
Luck. 113, A.I.R. 1927 Oudh 510 (511); Chirangi Lai v. Puma, 12 A.L.J.
1114, 26 I.C. 84. But the Madras High Court is of opinion that under
the new definition of attested in sec. 3, which is taken from sec. 63 (old
sec. 50) of tlie Indian Succession Act, attestation by mark is not a valid
attestation. This definition enables the executant to "sign or affix his
mark to the instrument, but uses no such alternative expression in the
case of wntnesses but simply speaks of their having "signed the instru-
ment. 'Tlie conclusion is that the attesting whicss must sign the docu-
ment, and a person who cannot sign his name is not comijetent to attest
a document by means of a mark Venkataramaijija v. Nagamma, 35 L.W.
233, 136 I.C. 343, A.I.R. 1932 Mad. 272 (274). See also Nityagojjal v.
Nagendra, 11 Cal, 429 (relating to a will). Contra i^aganvna v. Venkaia-
rammayya, A.I.R. 1935 Mad. 178, 58 Mad. 220, 154 I.C. 777.
SEa 123]
should add the word witness after his signature. Thou^ prima facie the
scribes signature on a deed is not that of an attesting witness, stiU if
there is sufficient evidence to show that lie signed not as a writer but as
an attesting witness after the execution of the document, there is no reason
why he should not be considered as one of the attesting witnesses -Ma.
Kin V. Maung Kija, 10 Bur. L.T. 106, 35 I.C. 275. 'fhis subject is elabor-
ately discussed in Note 852 under sec. 69.
Since this section does not apply to Mahomedans, a deed of gift ex-
ecuted by a Mahomedan would be valid even if it be not validly attested
according to tlie requirements of this section Karant llahm v. Sharfuddin,
38 All. 212 (213), 35 I.C. 114, But of course there should be delivery of
possession.'
[Sec. 123
Sec. 124]
638. Gift when takes effect : A gift takes effect from the date of
execution of the deed of gift and not from the date of its registration
V'enhata Svbba v. Subba Rama 52 Bom. 313 (P.C.), 30 Bom. L.R. 827,
A.I.R. 1928 P.C. 86 (87), 108 I.C. 367. Thus, where a person executed
a deed of gift in favour of a cliarity on the 9th September, adopted a son
on the 10th and registered the deed on the 15th, held that die gift was
complete on the 9th, and the adopted son had no claim to the pro-
perties comprised in the gift, though the deed was registered subsequent
to his adoption Kalyansundaram v. Krislmasioami, 11 L.W. 187, 62 I.C.
280; Kalymasundaram v. Karuppa, 17 L-W. 232, 73 I.C, 206, A.I.R. 1923
Mad. 282; Kalyanasundaram v. Karuppa. 50 Mad. 193 (P.C.), 52 M.L.J.
346, 100 I.C. 105, 31 C.W.N. 509, A.I.R. 1927 P.C. 42. In other words,
a gift takes effect, as soon as tiie instrument of gift, duly executed and
attested, is handed over to the donee, and die gift has been accepted by
the donee. The view once taken by the Madras High Court in Rama-
mirtha v. Gopala, 19 Mad. 433 (434) that a gift is not complete until it has
been registered and that it operates only upon registration, has been
overruled by Venkati Rama Reddi v. Pillati Rama Reddi, 40 Mad. 204
(21T) (F.B.), where it is distinctly laid down that upon registration the
gift takes effect from the date of its execution.
latter.
[Sec. 126
he accepted.
The above rule of English law' w'as applied by the Privy Council in
a case of gift executed prior to die passing of this Act. Tlius, where a
gift W'as made by a widow' to her daughter and the daughters husband
joindy, Riid tiie gift w'as invalid as to the husband (ow'ing to a custom of
the tillage as to the right of inheritance) held that the daughter took
die whole estate Nandi Singh v. Sita Ram, 16 Cal. 677 (682). (P.C.).
126. The donor and donee may agree that on the happen-
Illustrations.
Sec. 126]
641 . Revocation : ^The first para lays down the conditions under
whidi a gift may be revoked under an agreement'between the donor and
the donee; and the second para lays down under what circumstances a
gift may be revoked without any previous agreement.
Tire first para enumerates the broad general rule that there is no gift
at all wherr a person purports to give and at the same time retains the
liberty of revoking the gift at his pleasure. See Moss v. Ma Nyein, A.I.R.
1933 Rang. 418. But this rule is subject to an exception, viz., drat a
power of revocation would be valid if the event on the happening of
which the gift can be revoked does not depend upon the will of dre donor.
Where the donor has the power of revocation of a gift and validly
revokes it, he becomes the absolute owner of the property intended to be
gifted. If he has no such power he ceases to have any interest or right
in the property ^fted away, in which case there is iro question of the
donor contimring to be an ostensible owner within sec. 41 Ankamma v.
Narasayya, A.I.R. 1947 Mad. 127, (1946) 2 M.L.J. 357. A donor can
revoke the gift if the donee agreeing to maintain the doiror till death fails
to do so Siruxirtm v. Baiyu, 1965 M.P.L.J. (Notes) 59. But see Tito
Betca v. Mana Bewa, A.I.R. 1962 Orissa 130, where a contrary view has
been taken. Where an old lady executes a deed of gift of her entire
property in favour of one, not a member of the family, and the latter
on the same day executes another deed accepting the gift and agreeing
to maintain the lady till death, the gift can be revoked if the donee
neglects to maintain the donor Pumima Kumari v. Manindra Nath
Mahanti, A.I.R. 1968 Assam 50.
[Sec. 126
Baijnath v. Biraj Koer, 2 Pat. 52 (64), 4 P.L.T. 239, A.I.R. 1922 Pat. 514;
see also Mt. Aziztmnissa v. Siraj Hussain, A.I.R. 1934 All. 507, 152 I.C. 146.
But the right survives to tlte heirs of the donor Ghumma v. Ram
Chandra, 47 All. 619, 83 I.C. 411, A.I.R. 1925 All. 437. Contra, Mt.
Azizuniiissa v. Siraj Hussain, supra. A right to have a gift set aside for
fraud or undue influence does not cease on the death of the donor, but
passes to his legal representatives and executors AUcard v. Skinner,
(1887) 36 Ch. D. 145 (per Lord Lindley); Morley v. Louglman, [1893] 1
Ch. 736.
Event which does not depend on the will of "the donor^ : k gift
cannot be revoked at the mere will of the donor. .And if the parties
agree that the gift shall be revocable at the will of the donor, it is really
no gift at aU and is void Nawab Ibrahim v. Ummatul, 19 All. 267
(P.C.). Tliis section recognises the validity of a power of revocation in
the case of a gift, provided the event on die happeriing of which the
gift can be revoked does not depend on the will of the donor. Thus,
where the defendants made a gift of certain property to the plaintiff, on
condition that the land would be liable to be taken back in the event
of the plaintiff's transferring it, it, was held that as die event on which
the power of revocation was to be exercised did not depend upon the
win of the donor, the condition of revocation was dierefore valid
Makund v. Rajrup, 4 A.L.J. 708. Similarly, where a person executed a
deed of gift to the donee, and on the same day the donee executed
another registered deed by which he agreed not to transfer die property
without die consent of the donor, and that if he did so he would return
the propeity to die donor, held that this agreement was valid under the
first para of this section, because the donee agreed that the gift would
be revocable on the happening of an event (transfer of the property by
the donee) which did not depend upon the will of the donor Ma Yin
v. Ma Chit, 7 Rang. 306, A.I.R. 1929 Rang. 226 (227), 119 I.C. 737.
SEC. 126]
Thus, the grounds on which a gift may ordinarily be set aside arc
coercion, undue influence, fraud, mistake or misrcpresontah'on Bcltarilal
V. Sindhubala, 45 Cal. 434, 22 C.W.N. 210 (212), 41 I.C. S7S, and the
onus of proving that the gift is revocable on any of the above grounds
136
[Sec, 126
lies on tiie parly who wants to get the gift set aside. The law is that
anybody of full age and sound mind who has executed a voluntary deed
by which he has denuded himself of his own property, is bound by his
own act, and if he himself comes to have the deed set aside, especially
if he comes a long time afterwards, he must prove some substantial
reason why the deed should be set aside per Kay J. in Henry v.
Armstrong, (1881) 18 Ch. D. 668; Mastonamma v. G. Adinarayana, (1964)
2 Andh. L.T. 405. A mere mistake of law would not however be
sufficient to revoke a deed of gift Narasingh v. Radhakant, A.I.R, 1951
Or. 132, I.L.R. 1950 Cut. 374.
But where the donor is an old and infirm woman, the burden lies
heavily on the donee to show that the donor executed the deed with
full knowledge of its contents, and iliat she did so willingly and without
any pressure or solicitation, which might amount to exercise of undue
influence Rajaram v. Khandu, 14 Bom. L.R. 340, 15 I.C. 529. So also,
if gifts are made by a pca'adanashin lady, the strongest and most satis-
factory evidence ought to be given, by the person who claims under
the gift from her, that the transaction was real and hona fide and was
fuUy understood by the lady whose property is dealt with Thakurdeen
V. Ali Hossein, 13 B.L.R. 427 (P.C.); Wazid KJian v. Ewaz AU Khan, 18
Cal. 545 (P.C.). Similarly, if the person in whose favour the gift is
executed stood at the time in a position of active confidence to the
donor, e.g., an agent, the law throws the burden of proving the good
faith of the transaction on the donee rPhtilchand v. Lakkiw, 25 AIL 358.
A gift by a person to his lawyers ^vife is not liable to be set aside if the
gift is spontaneous Bireswar Sen v. Ashalata Ghose, A.I.R. 1969 Cal.
111. "V^en the donor who was a man of weak heaMi settled the bulk
of his property on the defendant who was his' family priest and who had
a considerable influence over the mind of the donor, the burden of prov-
ing thiit tlie settlor understood the legal effect of the settlement {viz.,
that it was irrevocable) was on the defendant; and the defendant having
failed to do so, the deed must be set aside Bai Manigavri v. Narondas,
15 Bom. 549. The donee was in iUicit connection with the donors only
daughter and was residing with the donor and liis daugter: Held (1)
the daughter and her paramour, the donee, have been in a position to
dominate the donors will; (2) the gift of the entire property to tlie donee
ignoring the daughter and her daughter made the transaction uncon-
scionable, and (3) the above two circumstances conjointly raised die
presumption that the gift deed was brought about by undue influence
Ram Chander v. Sital Prasad, A.I.R. 1948 Pat. 130, 1947 P.W.N. 42.
Sec. 126]-
This para presupposes that the gift is voidable and not void ab initio.
If it is void ab initio, it is not necessary to have it set aside by a suit
Ghumna v. Ram Chandra, 47 All. 619, A.I.R. 1925 All. 437 (438); Baif
Nath V. Biraj Kuer, 2 Pat. 52 (65).
Even if a . donor might have made a gift imder undue influence, yet
if he had subsequently acquiesced in it, he cannot afterwards impeach it
Seetharamaraja y. Bayanna, 17 Mad. 275.
[Sec. 127
Illustrations.
64S. Principle : The prmciple of the first para of this section is that
he who accepts the benefit of a transaction must also accept tlie burden of
the same: Qui sentit commodum sentire debet et onus. And so it was
observed in an English case (which related to a ^viIl) that no man shall
claim any benefit under a will withouC conforming so far as he is able and
giving effect to every thing contained in it whereby any disposition is made
shewing an intention that such a thing shall take place Whistler v.
Webster, 2 Ves. 367. This section lays down a rule of election that where
a gift consists of several things some of which are burdened witli an obliga-
tion, he is put to his election either to accept the whole gift or not to
accept anything at all. He cannot pick up the benefits of the transaction
and reject the burdens. This rule applies only where the donor has by
one inseparable transaction made the gift and burdened it wth an obliga-
tion. But where a gift is in the form of two or more separate and
independent transfers, some of which are so burdened, no question of
election arises, and the donee is at liberty to accept any or all of them.
[Sec. 128
to the donee to maintain the donor, the direction is only a pious wish.
On th^ other hand, if the gift deed starts with a statement that it is made
with the object of providing for maintenance of the donor and it is followed
by the operative clause, the gift is subject to tlie liability to maintain the
donor Gangadhara v. Kulathu, A.I.R. 1952 Tr.-Coch. 47.
due by and liabilities of the donor at the time of the gift to the
extent of the property comprised therein.
Sec. 128]
for liersclf did not derogate from the universal nature of tin* donn-s
[Sec. 129
remedy may be had under this section. And so the Law Commissioners
observe : "Gifts of ones whole property to a relation or fileud are not
uncommon before an execution or in anticipation of insolvency. For such
cases of fraud, sec. 53 suj^a provides, when the property is land. But
an universal gift may conceivably be honest and comprise moveable pro-
perty. Section 128 therefore specially provides for sudi gifts.
The rule in this section is different from tliat in England. Under the
English law, a universal donee is not bound to discharge the doner s debt
except on tlie latters death or insolvency or when the transfer has been
made with intent to defraud creditors.
This section, as it stood before the amendment, kept the rules of Hindu
law unaffected by anything contained in this Chapter Forman Ali v. Uzir
Ali, A.I.R. 1938 Cal. 157 (159), 42 C.W.N. 14, 66 C.L.J. 125, 175 I.C. 712.
Sec. 129]
templation of death when a man who is ill and expects to die shortly of
illness delivers to another the possession of any moveable property to keep
,as a ^ in case the donor shall die of that iUness. Such a gift may be
resumed by the .giver and shall not take effect if he recovers from die
-illness during which it was made, nor if he survives the person to whom
it was made. Section 191, Indian Succession Act, 1925.
The distinction between a gift and a donatio mortis causa is tliat the
former .takes effect .immediately, while the latter takes effect only on die
death of the donor ; the latter is revocable at the will of the donor, but
the fbnner .is not. ,
Where the deceased, a few hours before his death, and in contempla-
tion of death, caused certain Government papers to be fetched and him-
self gave tliem into the hands of the plaintiff with the intention of passing
the property to him, but could not make the endorsement because he was
too weak . to do so, held that under the circumstances the gift amounted
to a valid donatio mortis causa Kumar Vpendra Krishna v. Nabin
Krishna, 3. B.L.R. O.C. 113.
** -I
j. 648. Shall not .-affect: ^Tl^ section- does not mean that the pro-
visions of this Chapter' shall not at all apply to Maliomedans, but it only
lays down that its provisions shall not affect any rule of Mahomendan
Law. In other words, wheriever the provisions of tliis Chapter shall
conflict -with those of Mahomedan law, the latter shall prev^. Thus,
under, the Mahomedan lavv, a gift of immoveable property may be made
orally by simple delivery of possession, but this Qiapter lays dowm that
such a gift must, be made -by a- registered instrument. Hence tliere is
a conflict,- and the Mahomedan law must therefore prevail. So again,
the rules of Mahomedan law as' to revocation of gifts are entirely different
from, the rule enacted in. sec. 126, and therefore &e Mahomedan law shall
prevail. See Note 632 under sec. 123 and Note 644 under sec, 126.
But in so far as the rules of this Chapter are founded upon equity
and reason, tliey-do not Conflict with -any' rule of Mahomedan law. Thus,
137
[Sec. 129
Giji under Mahomedan law : ^For a valid gift inter vivos under the
Mahomedan law, observe their Lordships of the Privy Council, three
conditions are necessary (a) manifestation of the wish to give on the part
of the donor, (h) the acceptance of the donee, and (c) the taking of posses-
sion of the subject-matter of the gift by the donee, either actually or con-
structively. The taking of possession of any part of a Zemindary pro-
perty is constructively a taking possession of the whole Md. Adbul v.
Fakhr Johan Begum, 49 I.A. 195 (209 10) ; Amjad v. Ashrai, A.I.R. 1929
PvC. 14Sf (151), 4 Luck. 305, 56 I.A. 213, 33 C.W.N. 753, 116 I.C. 405. No
transaction of which the above are not the ingredients is or is to be treated
as a gift under the Mahomedan law. A gift may be heba simple or
heba^il-ewaz (gift for an exchange or a return gift) or a heba-ba-shart-
ui-ewz (a gift with a stipulation for an exchange or a return gift) ; but in
each case and of every variation of a gift the transaction is a heba under
the Mahomedan law Sharifuddin v. Mahiuddin, A.I.R. 1927 Cal. 808
(814), 54 Cal. 754, 31 C.W.N. 1068, 105 I.C. 67. For an explanation of
the different kinds of heba and the doctrine of musha see this case.
Under the Shia law a gift is a contract between two parties. The ele-
ments of proposal and acceptance are the essential constituents of a contract
of gift. Seisin is also an essential element of a gift. A gift in favour, of
a person who has not come into existence must fail for the absence of
acceptance and the presence of contingency or futurity Stn/ v. Mushaf,
A.I.R, 1922 Oudh 93, 65 I.C. 132.
Lah. 705 (707) where it has been held that the provisions of the
Mahomedan law applicable to gifts do not apply to a so-called gift made
in heu of dower-debt, that" is hib'a-bil-ewaz which is really of fhe nature
of a sale. A gift by a Mahomedan to a Hindu is governed by Mahomedan
lawSomeshtoar y. Barkat UJMi, A.I.R. 1963 All. 469.
Sec. 129]
the deed may not be admissible in evidence for want of rcgistratinn, Iml
the oral gift would be vah'd noftWllistaiiding Kuhvm v. S/iinrn
Sunday, supra, and Nasih Alt, v. Wajed Alt, A.l.R. 1927 Cal. 197, -J 1 C.L.J.
490, 100 1.C, 296. If a gift is reduced to writing it requires lo be rt ^ish r-
ed6. Chinna Budha Salieb v. Raja Subbamtna, (195-1) 2 M.L.J. (Aiulli.)
113. A gift is not complete in the absence of delivery of possession or
relinquishment of control over the property by the donor A/uva A/fya v.
Kader Bux, A.I.E. 1938 P.C. lOS, 32 C.AV.N. 733, 55 I.A. 171, 53 IJom.
316, 169 I.C. 31 ; Sadik Hussain v. Hashim AU, 3S All. 627 (P.C.). Gam
Mia V. Wajed Alt, 39 C.W.N. 882. According to Mahoincdan law"
observe tlieir Lordships of the Prisy Council, "a holder of properly may
in his life-time give away the whole or part of it if he conqilics with
certain forms, but it is incumbent on those who seek to set up such a
transaction to prove that those forms have been complied wilh, and this
will be so whether the gift be made with or without consideration. If
the latter, then unless it be accompained by delivery' of the thing given,
so far as it is capable of delivery, it will be invalid.. If tlio former,
delivery of possession is not necessary, but actual payment of the con-
sideration must be proved, and the bona fide intention of the donor to
divest himself in preesenti of die property and to confer it upon the
donee must also be proved [Mehdi Hasan v. Hd. Hasan, 28 All. 4-39
(449), 33 LA. 68 (76)]. Tlie case of Ranee Khajoaroonnessa v. Roicshan
Jehan, 3 I. A. 294 (305) supports this statement of the law " Sadik Husain
V. Hashim Ali, supra, at pp. 645-46,
Areeat under tire Mahomedan law for a fixed period being wilid, it
follows that the gift of the usufruct of the property for tlie life-time of
the donee is valid as areeat, tliough it would not be included in the term
hiba Naziruddin v. KJiairat Ali, A.I.R. 1938 Oudh 51 (53, 54), 172 I.C.
884.
CHAPTER VIII.
Illustrations.
(ii) A effects a. policy on liis own life with an Insurance Company and
assigns it to a Bank for securing tlie payment of an existing or future debt.
If A dies the Bank is- entitled to receive the amount of the policy and to
sue on it witliout the concurrence of As executor, subject to the proviso in
sub-section'll) of section 130 and to the provisions of section 132.
In Ihe E.\-ception of this section the last few words within inverted
commas were added by the Insurance Act IV of 1938, s. 121.
As to what are and what are not actionable claims, see Note 21 under
sec. 3.
[Sec. 130
Bom. L.R, 752. The word transfer means not only an absolute transfer,
but also covers transfer of actionable claims by way of mortgage Mulra]
V. Yisioamah, 37 Bom. 198 (P.C.), 17 C.W.N. 209, 17 I.C. 627 ; Mutlm
Krishna v, Veeraraghava, 38 Mad. 297, 21 I.C. 316 ; V enhitachalam. v.
Svhramanya, 14 I.C. 144, 1912 M.W.N. 461 ; Kali Mohan v. Empire of
India Life Assurance Co., 44 C.W-N. 593 ; Official Assignee v. Hukum
Chand, A.I.R. 1941 Mad. 147, (1940) 2 M.L.J. 891, 1940 M^W.N. 1290.
Section 134 provides for die transfer of a debt by way of mortgage.
Where a person hypothecates all his book-debts, present and future, as
security for the balance of his account, the hypothecation creates a valid
charge on, or to use the term familiar in English law, assignment .of, the
future book-debts of the debtor. But nothing passes under such an
assignment until the property comes into present existence Balthazar &
Son, Ltd. V. Official Assignee, A.I.R. 1938 Rang. 426, (1938) R.L.R. 480...
In a Madras case it was held, following the English law, that the
transfer of a debt must be of the whole debt, and that a transfer of a
portion of a debt is not recognised Doraisami v. Doraisami, 48 M.L.J.
432, A.I.R. 1925 Mad. 753 (756), following Durham v. Roberfson, (1S9S)
1 Q.B. 765. But in a subsequent case of the same High Court it has been
ruled tliat although a transfer of a part of a debt was not recognised in
English Common Law, the assignment of a part of a debt has always been
held to. be good in Equity, and is deemed to pass the property in that
portion of die debt. In enforcing sudi claim it would be neeessaty to
implead the owner of the other portion of the debt, but ajiart from that
there is no objection in equity to the enforcement of a claim for part
parent of a 'debt Rafamiet v. Subramaniam, A.l.R. 1928 Mad. 1201
(1207),- following In re Steel Wing Co., [1921] 1 Qi. 549, and virtually
dissenting from Doraisami v. Doraisami, supra ; Rajamier v. Subramaniam,
has been followed .in Official Liquidator,' Travancore N. B. S. Co, v.
Official Liquidator, Travancore N. & Q. Bank, supra. Relying upon the
earlier Madras case, the Calcutta High Court has held that an assignment
of a debt to be valid must be of the whole debt, ^^'here parhicrs in a
firm became insolvent and there was also a minor partner, the assignment
by the Official Assignee of debt due to tiie firm could not be said to be
of the whole debt, because the minors interest in the partnership could
not be assigned Ghisulal v. GumbJ$rmull, A.I.R. 1938 Cal. 3/ 1 (381), 62
Cal. 510,' 89 CW.N. 606, 164 I.C. 111. Following this case it has been
held that where tire debt is a joint debt, an assignment by one of the
joint creditors would not enable the assignee to enforce die pa>Tncnt of
the whole debt In re A. K. Fazlaf Huq, A.l.R. 193/ Cal. 532. In Biln
Haliman v. Bihi Umadatunnissa, A.I.R. 1939 Pat. 506 (SOS), 181 I.C. 3/,
Wort, J. of tire Patna High Court has- held (obiter) that a part of a debt
or part of a chose in action is not assignable. But in a later case Harris,
C.J. and Fad AK, J.' of the same High Court have held that the T. P.
Act does not recognize any distinction betw'een the whole debt and p.rrt
of a debt. Both may be transferred under the Act if they ramc under
the category of '"actionable claim as an actionable claim is propcrlj .
Or. 2, r. 2, C. P. Code being a rule of procedure does not affect the right
[Sec. 156
of transfer. It does, howevef, bar the right of suit in certain cases 'and
it may prevent the transferee of a part of a debt enforcing his- claim and
thereby make the transfer nugatory, as under Or. 2, r. 2, G. P. Code a
single cause of action cannot be allowed to be spilt up into several causes
of action' Durgi Singh v. Kesho ImI, 18 Pat. 839, A.LR. 1940 Pat. 170,'
185 I.C. 514. Hie same view has been taken by the Lahore High Court
in Ram Kishen\ v. Gurdial, A.I.R. 1941 Lab. 337, where it has been' further
held tliat an action can be maintained for a part of a debt transferred
provided the transferee makes the transferor and the other transferees
concerned parties to the suit. Such a suit cannot fail merely because
on the objection of the debtor the other assignees were struck off the
record Ibid.
As this Act is not in force in tlie Punjab, the technical rule requiring,
an assignment of an actionable claim to be mad in writing is not appli-
cable to tliat province. Consequently, an oral assignment of a promissoty
note is valid Loc/m Ram y. Hem Raj, 33 P.L.R. 120, 134 LC. 121. Sec-
tion ISO can, however, be invoked to justify the assignment of a debt as'
an actionable claim, as the principles of the Act as distinct from its techni-
calities should be applied to the Punjab Ram Kishen v. Gurdial, supra'.
In provinces where the Act does not apply, a Iwndi can be assigned orally
subject to all equities as a chose in action independent of the Negotiable'
Instruments Act XXXVI of 1881, so as to give the assignee locus standi\
to sue thereon KaZ Ram v. Feroze Slwh, A.LR. 1941 Pesh. 45 j Ram'
Rattan v. Qobind Ram, A.I.R. 1939 Lab. 501, 185 I.C. 426. , .
Effect of clause (1) : The effect of cl. (1) in the cases which it covers '
is to confer without notice to the debtor a legal title on thctransferee as
opposed to an '.equitable title 'oiJy But' it cannot be too strongly eih-
Sec. 1301
138
1098 TRANSFER OF PEOPEETY
[Seg. 13o
[Sec. l30
. 651 . Notice : ^Tlie vahdily of die transfer does not de^jend upon the
giving of notice to the debtor, although it may be necessary for tlie trans-
feree to give notice to prevent the debtor from dealing %vith tlie debt to
die prejudice oJ[ the transferee Visioanttth v. Mtdraj, 13 Bom. L.R. 590,
11 I.C. 964 ; Kaika Prashad v. Chandan, 10 All. 20. Notice of transfer is
not essential to perfect the title of die assignee of an actionable claim,
but until the debtor receives notice of die assignment, his dealings \vith
the original creditor will be protected. In other words, if the' debtor pays
the debt to the original creditor ndthout having any notice of die transfer,
he will not be bound to pay it over again to the assignee Gopala KrisJma
V. Gopala Krishna, 33 Mad. 123 ; Basanf Singh v. Burma Raihoatys Co. 8
L.B.R. 288 ; Bnlihazar Son Lid., v. Ofjicial Assignee, A.I.R'. 1938 Rang.
426, (1938) R.L.R. 480, But any payment by the debtor to. the original
creditor, ajjter notice of the transfer, is made at the risk of the debtor and
will not absolve him from liability to the transferee Gopala Krishna v.
Gopala Krishna, S3 Mad. 123. Tliis subject has been thus elaborately ex-
plained in .a Calcutta case : ^It fe well settled according to English law
that it is not necessary to the validity of an assignment of a debt as
between the assignor and assignee that notice should be given to die
debtor. The assignment, therefore, is perfectly valid though no notice
is given. But die title of die assignee as against third ' persons is hot
complete until he has given notice, arid the reason is this: As between
the debtor and assignor die liability' on the part of die' debtor is still
Sec. 130]'
subsisting, and the debtor may pay the assignor, or the assignor may
afterwards assign to a third party who gives notice and thereby acquires
priority. Notice, therefore, ought to be given by the assignee to protect
himself, and for tliis purpose only. It is immaterial to the debtor whether
he pays his money to the original creditor or to some third person claim-
ing through such creditor, so long as he gets a disch.arge for his debt. If
he pays' the assignor, having no notice of the assignment he is protected.
The assignment does not in any way affect the liability of the debtor to
discharge his debt, but- the assignee should take care to let tlic debtor
know that it is he and not the original creditor who is entitled to be paid.
It 'is therefore only for the protection of the assignee that notice ought to
be given per Mitter and Agnew, J.J. in Lola Jagdeo v. Brij Behari, 12
Cal. 505 (509, 510). The assignment is not however valid as against the
debtor' until he in fact has notice of the assignment and therefore any
pajment by the debtor of the debt due from him to his original creditor
is valid as against the assignee until notice of the assigunent is given
Tata Iron & Steel Co. v. Baidtjanath, A.I.II. 1924 Tat. 118 (119), 2 Pat. 754,
76 I.C. 55. A debtor cannot after notice of the assignment pay a portion
of the debt, even under the Courts order in a case to which the assignee
was not a party, so as to protect him from paying it over again to the
assignee Burmah Shell Oil Storage & Co. v. Official Receiver, A.LR. 19-J.3
Mad. 244, (1942) 2 M.L.J. 661. It is not incumbent upon the assignee of
a promissory note to issu,e notice to the promisor fortlnrith after the
assignment. "Where therefore tlie assignee issued such notice nearly a
year after the assignment, there was no negligence on the part of the
assignee Krishaiali v. Manikyaraw, A.I.R. 1948 Mad. 171, (1947) 2 M.LJ.
196. Where after the notice of assignment of a debt to the debtor by the
heirs of a deceased creditor, the assignors obtained succession certificate
and! recovered the debt from the detbor by virtue thereof, the debtor
obtains a valid discharge of the debt Keshaoji v. Nanji, A.I.R. 1950 Kutch
49 (1). .
Where there are ~ two transferees, the transferee who first gh'cs
notice to the debtor does not acquire any prioritj' over die other trans-
feree, but the transferees take in die order of the date of transfer
Vishtcanafh.v. Mttlraj, 13 Bom. L.R. 590, 11 I.C. 964.
[Sec; 130
feror had an interest jointly with the transferee in which case- a decree
could be passed in favour of the transferor plaintiff and the transferee-
ibid. As to the case of a collusion between the transferee and the debtor
for defeating the rights of the transferor, see this case.
From the date of assignment, all the rights of the transferor in the
actionable claim vest in the transferee. If a debt is transfeired by way
of the sale, but tlie transferor in spite of the sale realises the amount of
such debt, it is just and equitable that the vendee should be allowed credit
for tlie amount so realised, out of the consideration Ramdas v. Dtoarka^
A.I.R. 1930 All. 875 (S76), 128 I.G. 763. Even prior to the enactment of
sec. 38 (7) of the Insurance Act, 1938, an assignment of a life policy on
condition that tlie policy should revert to the assured if the assignee pre-
deceased him before maturity was valid in law. On such a conditional
assignment an immediate vested interest is created in the assignee and such
an assignment is not revocable. It completely divests the assignor of .any
right under the policy. Tlie assignment, however, becomes imperative on
the happening of die condition In re Khairunnissa- Begum & Others,
A.LR. 1955 Mad. 459,
652. Sub-section (2)* who can sue after transfer ; ^The transferee
is die only person who can sue for the debt after transfer Arunachalam
V. Madaswami, 27 M.L.T. 269; MuthukrisJma v. Veeraraghava, 38 Mad.
297, 21 I.C. 316. He can sue in his own name and it is not necessary for
him to obtain the transferor's consent, or to make him a party to the suit.
In a Madras case, it has been held tiiat although sec. 130 lays down .that
when an actionable claim is transferred, all the rights and remedies of the
transferor are transferred to the transferee, still die transferor may main-
tain an action on die claim for the benefit of the transferee, and hand over
the amount when coUectecT to the transferee Chandrasekaralingam v.
NagabJiushanam, 53 M.L.J. 342, A.I.R. 1927 Mad, 817, 104 I.C. 409. An
unqualified endorsement on a railway receipt transfers to die endorsee
the property in the goods covered by the receipt as well as the right and
benefit of the contract of carriage and die endorsee can enforce the per-
formance of die contract by a suit in his own name Shah Mulji Deoji v.
Union of India, A.I.R. 1957 Nag. 31. But see Commissioners, Port of
Calcutta V. General Trading Corporation, 68 C.W.N. 410 where it has'
been held diat a mere endorsement and delivery of the railway receipt,
without any consideration, is not intended to confer any proprietary riglit in
the goods on the indorsee and that such an endorsee cannot sue the railway
for die loss of goods or damages to tiiem. See also Ibrahim v. Union of
India, A.I.R. 1966 Gujrat 6 where it has been held tiiat a mere endorsee
of a Railway receipt cannot sue the Railway for short delivery and that
a Railway receipt is not an actionable claim.
Sec. 131 ],
(3) . Where the insured person has parted with or lost his
interest in the subject matter insured, and has not, before or at
the time of so doing, expressly or impliedly agreed to assign the
policy, any subsequent assignment of the policy is inoperative :
.654. Ess entials of notice ; ^The notice to be given to the debtor must
be an express notice, and not mei'ely constructive ; see para 2 of sec. 130.
The old section 132 (before the amendment of 1900) contained the
words **Every such notice miust b^ in writing signed by the person making
fhe transfer or by his agent duly authorised in this behalf. Tliat is, it con-
tained no provisions as to giving of notice by the transferee. And so it
was held that as this section did not provide for the assignee giving notice
in a particular way, all that was required of him was to make the debtor
somehow aware of the transfer. And therefore the service of the summons
[Sec, 132-
on the debtor in a, suit by the assignee against him was held to be sufficient
notice 'flagho v. Narayan, 21 Bom. 60 (63). In this case, Fawan, C.J.- ex-
pressed the opinion that the duty of giving notice should be cast upon
the transferee. Before the passing of the Transfer of Property Act, it
was the assignee upon whom, it was incumbent for his own protection to
give notice of the assignment to the debtor. There is no particular reason
why die assignor shoidd give it. We cannot help thinking that there has
been a sKp made in sec. 132 (now 131) in dirowing upon the person making
the transfer the obligation of giving express notice to the debtor ,..The
vision for die giving of die notice by the transferee. But stiU: the Legis-
lature has cast the duty of giving notice primarily upon the transferor, and
it is only when he refuses to give the notice that the transferee may give it.
The notice which the transferor gives must be a valid and sufficient notice ;
if the transferee finds it insufficient, he is entided to give a notice of his
own Gopald Krishna v. Gopala Krishna, 33 Mad. 123.
The notice must contain the name and address of the transferee.
Tlie reason is thus stated by the Select Committee : A notice in general
terms not stating the name and address of the transferee' would not be
sufficient as a safeguard against fraud. A debtor is, we thiiik, entided to
know the name and address Of the person to whom he becomes liable on a
transfer of the claim against him. Though there be a valid transfer of a
debt between the transferor and the bransferee, the person bound to pay
the debt is not bound by the transfer unless he receives an e.xpress notice
in writing conforming to the provisions of sec, 131, from the transferor,
or if he refuses to sign, from the transferee, slating the name and address
of the transferee Basant Singh v. Burma By. Co. Ltd. 8 Bur. L.T. 266,
30 I.C. 278. Wliere the notice given by the transferor did not contain
the address of the transferee, it was held to be insufficient Hansraj v.
Nathoo, 9 Bom. L.R. 838. So also, a notice which did not state the
address of the assignee but -his solidtors address, was held to be defec-r
tiveSadasook v. Hoare Miller & Co., 27 C.W.N. 733, A.I.R. 1923 Cal.
719 (720), 41 G.L.J. 176. .
Illustrations. . , .
(i) A transfers to> C a debt due to him by B, A' being then indebted
Sec. 132]
The debtor has a right to set off any counter-claim against the assignee
which he could have done against the assignor Kahn a7i v. Lvckhij Kant,
' 10 W.R. 32 (F.B.) ; Ram Bhaj v. Ram Das, 3 Lab. 414, 69 I.C. 720, A.I.R.
1923 Lah. 261 ; Krista Ramani v. Kedar 'Nath, 16 Cal. 619 ; and tliis the
debtor can do even when the amount claimed to be set off is due under a
transaction independent of and unconnected with the claim assigned to the
plaintiff nArunflcheffam v. Subramania, 30 Mad. 235; Suhramanian v.
Kiradadasan, 1912 M.W.N. 1235, 16 I.C. 686. Such a set-off is enforceable
even thou^ the plaintiff was the purchaser of the actionable claim in
Court auction : though the Act does not apply of itself to a transferee
who purchases in a Court-sale, still the principle of this section will apply
to such transfers Suhramanian v. Kiradadsan, 1912 M.W.N. 1235, 16 I.C.
686. See also Ram Bhaj v. Ram Das, 3 Lah. 414, where the plaintiff pur-
chased the debt in Court auction. Where a debtor on receiwng notice of
the assi^ment of the debt, sees tliat die assignee is deceived and yet
stands by and allows the assignee to be- defrauded, he will not be allowcd
to set up an equity which he has against the assignor Brahmatjya v. K.
P, Thangavelu Nadar, A.I.R. 1956 Mad. 570.
The debtor is entitled to set off against the tmasferee not only a coun-
ter claim wliich existed at the time of Ae assignment, but also a claim which
accrued to him after the assignment, provided the assignee had notice of
such claim. TIius, A obtains a decree against B for Rs. 5,000. B then sues
A for Rs. 2,000. Pending Bs suit A transfers his decree to C who has
notice of Bs suit. A decree is then passed in Bs suit. C applies for
execution against B of the decree for Rs. 5,000. B will be entitled to set
off his decree for Rs. 2,000 which he has obtfiined against the assignor A,
as C is a transferee wdth notice of Bs suit. C will therefore be not entitled
to execute for more than Rs. 3,000 Krisfo Ramani v. Kedar Nath, 16 Cal.
619. Tliis principle however has not been applied to an assignment of a
139
[Sec. 133
656. This section does not make it compulsorj' on the part of the
assignor to give the assignee any warranty as to the solvency of the'
debtor, non does it mean that in every assignment of an actionable claim
there shall be implied a covenant by the assignor to warant tlie solvency
of the debtor. Tliis section merely lays down a rule of construction to be
applied only when the assignor actually gives such warranty to the
assignee. If the assignor gives the warranty, it means that tlie debtor is
solvent at tlie date of the transfer. Tlie insolvency of the debtor after
the date of the transfer does not entail any liability on the transferor. But
the assignor should do nothing in derogation o^ his deed, which may pre-
Sec. 134]
657. Scope : ^This section does not allow the transferor to recover
the debt. Accordingly, after the transfer no decree can be passed in
favour of the transferor in a suit by him even if the transferee is implead-
ed as a deSendantSanfuram v, Tru^ of India Assurance Co., A.I.R. 1945
Bom. 11, 46 Bom. L.R. 752. A debt can be transferred apart from the
security, though the debt can be realized by enforcing the security by the
mortgagee or the assignee from him. It is equally partible. So under the
Hindu Women s Rights to Property Act, 1937, before its amendment by
Act XXVI of 1947 a Hindu widow was entitled to a share in a mortgage
debt secured on both agricultural and other movable properties
Veeratjamma v. Venkamma, A.I.R. 1951 Mad. 809, (1951) 1 M.L.J. 364.
Bengal National Batik, 59 Cal. 377 (P.C.), 35 C.W.N. 1034 (1040), A.I.11.
1931 P.C. 245.
For the original sec. 135 this new section has been substituted by the
Transfer of Property (Amendment) Act VI of 1944.
(2) Where the insurer pays for a total loss, either of the
whole, orr in the case of goods, of any apportionable part, of the
subject-matter insured, he thereupon becomes entitled to take
over the interest of the insured person in whatever may remain
of the subject matter so paid for, and he is thereby subrogated
to all the rights and remedies of the insured person in and in
respect of that subject matter as from tlrd time of the casualty
causing the loss.
Sec.
T&anSfer of propektv ll09
[Sec. 156
659. Scope of section : ^The law under die old section (before the
amendment by die T. P. Amendment Act of 1900) stood thus : No Judge,
pleader, mukhtar, cleric, baihff, dr other oflBcer concerned with Courts of
Justice can buy any actionable claim falling under the jurisdiction of the
Court in wliich he exercises liis functions. Thus, it appears that under the
original section die prohibition was not so extensive as it now is ; under
that section, the persons specified dierein were forbidden to purchase only
such claims as fell under die jurisdiction of die Court in which they ex-
ercised their function. Tlierefore, a pleader or an officer who did not
habitually practise or exercise his functions in die Court by which the
actionable claim was cognizable was not prevented from purchasing it
Appasami v, Scott, 9 Mad. 5 ; Rathnasami v. Subramanya, 11 Mad. 56 (61);
Singaracharlu v. Sioahai, 11 Mad. 498 ; Suhharayudu v. EPtayya, 15 Mai,
389. But haidng regard to the fact diat diere are constant changes of
Judges as well as officers, and that legal practitioners from all parts of the
country may from time to time plead and appear in any court, it was
thought desirable to make die prohibition absolute as regards diem all.
Consequendy the section w'as amended in 1900, and it now prohibits die
lawyers and officers of any Court from purchasing an actionable claim, and
the above cases should be regarded as overruled. '
The word Tiuj^ refers to private sales and not to sales in execution ;
therefore, there is iiotiiing to prevent a pleader from purchasiiig the pro-
pertj'^ of liis client sold in Court, although no doubt the Courts mtU always
look askance at such a transaction Aghore Nath v. Ram Churn, 23 Cal.
805; Subbarayyudu v. Kofayya, 15 Mad. 389; National Insurance Co. v.
Haridas, 46 QL-J. 225, A.I.R. 1927 CaL 691 ; and die onus uuU lie very
heavily on him to show that die transaction was free from suspicion
Subbarayyudu v. Kotayya, 15 hlad. 389. Hie only persons who are for-
EC. 135' 3
transfer oP PROPEAfY HU
and a pleader does not fall under the category of those persons Alosiri-
[Sec. 137
is that in the case of an assignment, the assignee will acquhe no more than
the right,! title and interest of his assignor, i.e., subject to all the
liabilities
and equities to which the assignor was subject (sec. 132), whereas in the
case of an endorsement, the endorsee \vill have aU the rights and advan-
tages of a holder in due course, and not subject to the liabilities and
equities of his transferor Maliammad Khumhar AM v. Ranga Rao, 24 Mad.
654 ; Muthar Sahib v. Kadit Sahiv, 28: Mad. 544 Raman Chetty v. Naga,-
rafna, 11 M.L.T. 246, 15 1.C. 380 ; Akhoy Kumar v. Haridas, 18 C.W.N. 494.
Sec. 13?]
140
CEC. 137
of the bank irrespective of the fact that there was no notice to the carrier
Mercantile Bank v. Official Assignee, A.I.R. 1933 Mad. 207 (209), 56 Mad.
177, 64 M.LJ. 320. The railway receipt is in effect closed \vith aU the
essential characteristics of negotiability thou^ it may not be a negotiable
instrument' in the strictest sense Shah Mulji Deoji v. Union of India,
A.I;R. 1957 Nag. 31. Where there is a series of indorsements on the rail-
way receipt the last endorsee can sue in his own name Jbid. But see
Commissioners for the Port of Calcutta v. General Trading Corporation,
68 C.W.N. 410 where it has been held that the railway receipt is not
like a negotiable instrument.
SCH.]
THE SCHEDULE
^ftA^lSFER OF PROPERTY 1115
(a) Statutes
Subject *
1 Extent of repeal
Uses
The whole.
13 Eliz. c. S
Fraudulent
Conveyances.
! The whftle
27 Eliz. c. 4
Fraudulent
Conveyances.
The whole.
4 Wm & Mary. c. 16
Clandestine Mortgages.
The whole.
1 Subject
i Extent of repeal
IX of 1842
The whole.
XXXI of 1854
Modes of conveying
lands.
Section 17.
XI of 1855
improvements.
XXVII of 1866
Section 31.
IV of 1872
XX of 1875
Central Provinces
Laws Act.
Regulation I of 1798 and XVII
of 1806
I of 1877
Cc) Regulations
Subject
Extent of repeal
Bengal Regulation I of
1798.
Bengal Regulation of i
XVII of 1806. ^
Conditional Sales.
Redemption.
Bombay Regulation V j
of 1827.
Adtnowledgment of
debts ;
Interest ; .
Mortgagees in
Possession.
Section 15.
APPENDIX
(ACT V OF 1908)
ORDER XXXIV
,1. Parties to suits for foreclosure, sale and redemption Subject to the
povisions of this Code, all persons having an interest either in the mortgage
security
or in the right of redemption shall be joined as parties to any suit relating to
the mortgage.
Explanation. pujsne mortgagee may sue for foreclosure or for sale without
making the prior mortgagee a party to the suit; and a prior mortgagee need not
be joined in a suit to redeem a subsequent mortgage.
(a) ordering that an account be taken of what was due to the plaintiff at
the date of such decree for
{Hi) the costs, charges and expenses properly incurred by him up to that date
in respect of his mortgage-security, together with interest thereon ; or
(1) that, if the defendant pays into Court the amount so found or declared
due on or before such date as the Court may ffx within six months from the date
on which the Court confirms and countersigns the account taken under clause (a),
or from that date on which such amount is declared in Court under clause (b),
as the case may be, and thereafter pays such amount as may be adjudged due in
respect of subsequent costs, charges and expenses as provided in rule 10, together
with subsequent interest on such sums respectively as provided in rule 11, the
plaintiff shall deliver up to the defendant, or to such person as the defendant
appoints, all documents in his possession or power relating to the mortgagea
poperty, and shall, if so required, retransfer the property to the defendant at his
cost free from the mortgage and from all incumbrances created by the plaintiff
or any person claiming under him, or, where the plaintiff claims by derived title,
by those under whom he. claims, and shall also if necessary, put the defendant
in possession of the property ; and
(if) that, if pajment of the amount found or declared due under or by the
preliminary decree is not made on or before the date so fixed, or the defendant
fails to pay, within such time as the Court may fix, the amount adjudged due in
respect of subsequent costs, charges, expenses and interest, the plaintiff shall be
entitled to apply for a final decree debarring the defendant from all rights to
to redeem the property.
(2) The Court may, on good cause shown and upon terms to be fixed by the
Court, from time to time, at any time before a final decree is passed, extend the
time fixed for the payment of the amount found or declared due under sub-rule>
(1) or of the amount adjudged due in respect of subsequent costs, charges, expenses
and interest.
Patna In sub-rule (2) after the words the Court may" insert the words
of its own motion or (7.1.1936).
APP.]
(2) ^ere payment in accordance with sub-ruic ff) has not been made, the
Court shall, on application made by the plaintiff in this behalf, pass a final
decree declaring that the defendant and all persons claiming through or under
turn are debarred from all rights to redeem the mortgaged property and also,
if necessary, ordering the defendant to put the plaintiff in possession of the
property.
(3) On the passing of a final decree under sub-rule (2), all liabilities to
which the defendant is subject in respect of the mortgage or on account of the
suit shall be deemed to have been discharged.
4. Preliminary decree in suit for .sale fP Tn a suit for sale, if the plaintiff
succeeds, the Court shall pass a preliminary decree to the effect mentioned in
clauses (al. (b) and fc) (i) of sub-rule (1) of rule 2, and further directing that,
in
default of the defendant paying as therein mentioned, the plaintiff shall be
entitled to apply for a final decree directing that the mortgaged propertv or a
sufficient part thereof be sold and the proceeds of the sale after deduction there-
from of the expenses of the sale be paid into Court and applied in pajment of
what has been found or declared under or by the preliminary decree due to the
plaintiff, together tvith such amount as may have been adjudged due in respect
of subsequent costs, charges, expenses and interest and the balance, if any, be
paid to the defendant or other persons entitled to receive the same.
(2) The Court may, on good cause shown and unon terms to be fixed bv
the Court, from time to time, at any time before a final decree for sale is passed,
extend the time fixed for the pavment of the amount found or declared due under
sub-rule (1) or of the amount adjudged due jn respect of subsequent costs, charges,
expenses and interest.
(3) Power to decree sale in foreclosure suit . In a suit for foreclosure in the
case of an anomalous mortgage, if the plaintiff succeeds, the Court may at the
instance of any party to the suit or of any other person interested in the mortgage
.security or the right of redemption, pass a like decree (in lieu of a decree for
foreclosure) on such terms as it thinks fit. including the deposit in Court of a
reasonable sum fixed by the Court to meet the expenses of the sale and to secure
the performance of the terms.
(41 Where, in a suit for a sale or a suit for foreclosure in which sale is
ordered, subsequent mortgagees or persons deriving title from, or subrogated to
the rights of, any such mortgagees are joined as parties, the prcliminarj decree
referred to in sub-rule (1) shall provide for the adjudication of the rcspccti%'e
rights and liabilities of the parties to the suit in the manner and form set forth
in Form No. 9, Form No. 10 or Form No. 11. as the case may be, of Appendix D
with such variations as the circumstances of the case may require.
Allahabad. In sub-rule (21 after the words "the Court May insert the words
"of its otvn motion, or, (24.7.1926).
Calcntta, Re-number sub-rules (31 and (4), as sub-rules (4) and (5) respsclivel>,
and insert the following as sub-rule (3) : . , , , , -r
(3) The Court may in its discretion direct in the decree for sale that i
the proceeds of the sale are not sufficient to pay the mortgage debt the mort-
gagor shall pay the balance personally. (3.2.1933).
East-Pakisthan. 5'awc as in Calcutta.
5. Final decree in suit for sale (1) Where, on or before the day of
at any time before the confirmation of a sale made in pursuance of a final
passed under sub-rule (3) of this rule, the defendant makes
of all amounts due from h m under sub-rule (11 of 4. the Court shall, on
application made by the defendant in this behalf, pass a final decree or, if such
decree has been passed, an order, .
preliminary decree.
t App.
and, if necessary,
(6) ordering him to transfer the mortgaged property as directed in the said '
decree,
(2) Where the mortgaged property or part thereof has been sold in pursuance
of a decree passed under sub-rule (3) of this rule, the Court shall not pass an
order
under sub-rule (1) of this rule unless the defendant, in addition to the amount
mentioned in sub-rule (1), deposit in Court for payment to the purchaser a sum
equal to five per cent of the amount of the purchase-money pmd into Court by
the purchaser.
Where such deposit has been made, the purchaser shall be entitled to an
order for repayment of the' amount of the purchase-money paid into Court 'by
him, together with a sum equal to five per cent, thereof.
(3) Where payment in accordance with sub-rule (1) has not been made,
the Court shall, on application made by the plaintiff, pass a final decree
directing
that the mortgaged property or a suffident part thereof be sold, and that the pro-
ceeds of the sale be d^t with* .in the manner provided in sub-rule (1) of rule 4.
Madras. ^In sub-rule (3) between the words *|in this behalf and pass a final
decree insert the words "after notice to aU parties. (20.8.31).
(a) ordering that an account be taken of what was due to the defendant
(c) directing
(i) that, if the plaintiff pays into Court the amount so found or declar-
ed due on or before such date as the Court may fix within six
months from the date on which the Court confirms and counter-
signs the accoimt taken under clause (a), or from the date on
which such amount is declared in Court under clause (b)/as the
case may be, and thereafter pays such amount as may be adjudged
due in respect of subsequent costs, charges and expenses as pro-
vided in Rule 10, together with su'bsequent interest on such sums
respectively as provided in Rule 11, the defendant shall deliver up
to the plaintiff, or to such person as the plaintiff appoints, all
documents in his possession or power relating to the mortgaged
property, and shall, if so required, re-transfer the property to the
plaintiff at his cost free from the mortgage and from all incum-
brances created by -toe defendant or any person claiming under
him, or, where the defendant claims by derived title, by those
under whom he claims, and shall also, if necessary, put &e plaintiff
in possession of the property ; and
App.]
The 5'^^ y* good cause shown and upon terms to be fixed bv the
Court, from fame to time, at any fame before the passing of a final decree for
fore-
closure or sale, as the case may be, extend the time fixed for the payment of the
plainfaff from all nght to redeem the mortgaged property has been passed
under sub-rule (3) of this rule, the plaintiff makes payment into Court of all
amounte dw from, him under suli-rule (1) of rule 7, the Court shall, on application
made by the plaintiff in this behalf, pass a final decree or, if- such decree has
been passed, an order
(f>) ordering him to re-transfer at the cost of the plaintiff the mortgaged
property as directed in the said decree,
and, also; if necessary,
(2) Where the mortgaged property or a part thereof has been sold in pur-
suance of a decree passed under sub-rule (3) of this rule, the Court shall not pass
an order under sub-rule (1) of this rule, unless the plaintiff, in addition to the
amount mentioned in sub-rule (1), deposits in Court for payment to' the purchaser
a sum equal to five per cent of the amount of the purchase-money paid Into Court
by the purchaser.
Where such deposit has been made, the purchaser shall be entitled to
an order for repayment of the amount of the purchase money paid into Court
by him, together with a sum equal to five per cent thereof.
(3) Where payment in accordance with sub-rule (1) has not been made,
the Court shall, on application made by the defendant in this behalf,
(b) in the case of any other mortgage, not being a usufructuary mortgage,
pass a final decree that" the mortgaged property or a sufScient part thereof be
sold, and -Ae proceeds of the sale (after deduction therefrom of. the expenses
of the sale) be paid into Court and applied in payment of what is found due to the
defendant, and the balance, if any, be paid to'the plaintiff or other persons
entitled
to receive the same.
9. Decree where nothing is ftfund due or where mortgage has been ovetpaid.
^Notwithstanding anything hereinbefore contained, if it appea. npo taking
the account referred to in rule 7, that nothing is due to the defendant or that
he has been overpaid, the court shall pass a decree directing th^e defendant, if so
required, to re-transfer the property and to pay to the plainfaff the amounut
may be found due to him ; and the plaintiff shall, if necessary, be put in
possession
of the mortgaged property. . . u
[App.
11. Payment of interest. ^In any decree passed in a suit for foreclosure,
sale or redemption, where interest is legally recoverable, the Court may order
payment of interest to the mortgagee as follows, namely:
(ill) on the amount adjudged due to the mortgagee for costs, charges, and
expenses properly incurred by the mortgagee in respect of the mortgage-security
up to the date of the prelimina^ decree and added to the mortgage-money, at
the rate agreed between the parties, or, failing such rate, at the same rate as was
payable on the prificipal, or falling such rate at such rate not exceeding six per
cent per annum as the Court deems reasonable ; and
12. Sale of property subject to prior mortgage. Where any property tte
sale of which is directed under this Order is subject to a prior mortgage, the
Court may, with the consent of the prior motgagee, direct that the property be
sold free from the same, giving to such prior mortgagee the same interest in the
proceeds of the sale as he had in the property sold.
13. Application of proceeds. (1) Such proceeds shall be brought into Court
and applied as follows :
lastly, the residue (if any) shall be paid to the person proving himself to be
interested in the property sold, or if there are more such persons than one, then
to such persons according to their respective interests therein or upon their joint
receipt
(2) Nothing in this rule or in rule 12 shall be deemed to affect the powers
conferred by section 57 of the Transfer of Property Act, 1882 (IV of 1882).
14. Suit for sale necessary for bringing mortgaged property to sale. ^1)
Where a mortgagee has obtained a decree for the payment of money in satisfaction
of a claim arising under the mortgage, he shall not be entitled to bring the mort-
gaged property to sale otherwise than by instituting a suit for sale in enforce-
ment of the mortgage, and he may institute such suit notwithstanding anything
contained in Order II, rule 2.
- (2) Nothing in sub-rule (1) shall apply to any territories to which the Transfer
of Property Act, 1882 (IV of 1882), has not been extended.
15. Mortgages by the deposit of title-deeds and charges. ^All the provisions
contained in this Order which apply to a simple mortgage shall, so far as may be,
apply to a mortgage by deposit of title-deeds within the meaning of section 58, and
^lahabad. ^Read the present Rule 15 as Rule 15(1) and add as sub-rule (2),
the following:
INDEX
The figure within [ ] bracket indicates the number of notes and ilic figure
ACCELERATION
mortgaged
1121
AGENT
notice to
AGREEMENT OF REPURCHASE IN
sale deed, [337], 497, [338], 502
AGRICULTURAL FIXTURES
transfer of agricultural lands and, [78], 109
AGRICULTURAL LEASE
INDEX 1]23
ANOMALOUS MORTGAGE
payment to lessor by lessee without notice of, by lessor, [217], 266, [489], 993
rii^ts under marine or fire policy Insurance (Sec, J3S), 1108
ATTACaiED TO THE EARTH
ATTESTATION OF DEED
AUCTION PURCHASER
BABUANA LAND
CANTONMENTS
INDEX 1125
CHARGE (contd.)
CLASS
[452], 716
COMPROMISE
CONSENT
index 1127
CONTRACT ACT
CROWN GRANTS
DEBT
INDEX 1129
E
EARNEST MONEY .
142
INDEX 1131
EXPENSES BY MORTGAGEE {comd.)
FACTORY
FRAUD
FRAUD (con/rf.)
GIFT
INDEX 1133
GIFT (cantd.)
when one of several donees does not accept (See. 12.5) [640] 1078
applicability of Sec. 123 to, [629], 1066
attestation of, an essential requisite, [636] 1074
class, gift to, [129], 160
HIGH COURT
transfer of
IMMORAL OBJECT
instances of, [17], 19, [18], 22, [243], 308, [284], 400, [547], 908
meaning of, [17], 19, [633A1, 1070
transfer of
bonafide bolder making imder defective title, [220], 267, [221], 268
circumstances entitling a person to, [222], 270, [223], 272, [224], 275
compensation for, [228], 283
definition of, [226], 281
INQUIRY
index 1135
INTANGIBLE PROPERTY
instances of, [285J, 401
mode of sale of, [28S], 401
registration if necessary for transfer of, [285], 401
INTEREST
cMsation of, ^ter tender and deposit of mortgage money. [473], 741, [510], 803
high rate of, if a clog on redemption, [363], S82
mortgage money, on, [331], 488
post diem, [331], 489
suit for, before principal money under mortgage due, [404], 657
JOINT GRANT
KABULIAT
suit by, when trespasser dispossesses tenant during tenanej, [574A], 964
LEASE
pre-act leases, if covered by Act, [10], 11, [594], 1001, [600], 1019, (541A], 889
premature determination of, [597], 990
termination of
INDEX 1137
LEGACY
duty of
LICENCE
all decrees in suits for i mm ovable properly covered by, [242], 306
amendment of See. 52, if retrospective, {231A], 286
any other properly, meaning of, P46], 315, [250], 325
application of doctrine in suits
compromised, [242], 305
decreed exparte, [242], 305
review of, effect, [240], 304
revival of, effect, [239], 303
application of doctrine in suits for
administration, [244], 314
claim suit, [238], 303
contribution, P35A], 298
dedaiation of charge, [244], 314
dower, [244], 314
enforcement of charge, [233A], 293
interpleader suit, [244], 316
maintenance suit, [244], 312
movable property, [243], 308
partition suit, [244], 3II
preemption suit, [235], 296
redemption suit, p34], 296
rent suit, [244], 311
143
MOHAMEDAN LAW
right of, if lost when property sold for legal necessity, [173], 207
transfer of property when third party entitled to, [173], 198
MARINE POLICY
assignment of rights under (Sec. 1S5A), 1108
MARKETABLE TITLE
MARRIAGE
MERGER
prior mortgage and subsequent merger of, [535], 875, [535C]. 876
subsequent mortgagee paying off prior mortgage, [537], 881
MESNE PROFITS
MINERAL
MORTGAGE
index 1141
mortgaged property (coHtd.)
mortgagees right to spend money on, [439], 709, [440], 709, [442], 7l0
no foreclosure or sale on portion of, [413], 669
power of sale without intervention of court, [427], 693
preservation from forfeiture or sale, [443], 710
receipts from, application of, [472], 737
receipts from, in lieu of interest (Sec. 77), [475], 743
redemption of portion of, [375], 603
revenue sale of, mortgagees remedy, [453], 717
MORTGAGEE
mortgagee taiung possession in any other capacity, duty of, [464], 722, [465], 724
right of, to grant lease, [465], 724
talcing possession, what amounts to, [464], 722
effect of, [464], 723
MORTGAGE MONEY
due, meaning of, [259], 568
interest, if included within, [331], 488, [369], 592
meaning of, [369], 592, [403], 657
payable, when, [339], 506, [404], 657
MORTGAGOR
NEGLIGENCE
KonCE (fontd.)
occupancy right
OTTI
PALA
any person claiming under him, meaning of, [272C], 386 '
contract in, [272B], 384
doctrine of {Sec. 53A), [270], 311
application of, [271A], 378
essentials of, [270A], 373
limitation, in application if any, [272], 382
moveable property, if attracted by, [273B], 389
oral agreement, if attracted by, [273], 387
scope, explained, [271], 273
void agreement, if attracted by, [272B], 384
possession in, [272B], 385
previous law as to, [270], 371
registration, law of, if superseded by, [271AJ, 386
retrospective effect, if, [272A], 383
PERMANENT STRUCTURE
permanent tenure
INDEX 1145
permanent lease
instance of, to pay the mortgage money, [416], 677, [417], 680
PERSONAL ENJOYMENT
mortgagee, having the power if can appoint a Receiver, [Sec. ODA), 699
notice of sale to mortgagor before sale, [428], 695
persons competent to exercise, [427], 694
on assignment, [427], 695
sale proceeds, appropriation of, [433], 698
simple mortgagee's right to exercise, [336], 495, [427], 693
PREAMBLE
PREEMPTION
144
PREEMPTION
sale invalid under Act but valid under Mohamedan Law and, [274], 401
stipulation for in deed of sale, if void, [91], 123
PREFERENCE
one creditor to another, [263], 352
PRICE
PRIORITY OF RIGHTS
documents executed and registered at different time and, [21 3], 261
suits in which ri^U to, directly and specifically in issue, [244], 309
transferability of, when restricted to personal enjoyment, [50], 71
PROVISO AND EXCEPTIONS
isnrx 1147
RAILWAY
rateable apportionment
REDEMFnON (fiontd.)
condition of, in lease deed when, transfer of lease, [92], 125, [597J, lOOff
transferability of, [48], 70
REGISTRATION
registration act
INDEX 1149
REMUNERATION
bona fide paid to transferor, without notice of transfer, [216], 265, [217] 266
covenant for payment of, by mortgagor, [395], 644 *
payment of, to lessor without notice of latters transfer, [21 8], 267
suit for, after transfer by lessor, [ 219 ], 267
liability to lessee to pay, [582], 980
mortgagee in possession
REVENUE
mortgagees charge on proceeds when property sold for arrears of, [451], 715
mortgagee in possession, payment of, by, [467], 727
SALE
index 1151
- SALE (fiontd.')
creates interest or charge, if, [294], 410
registrable, if, [319], 462
subsequent mortgagee paying off prior mortgage, if entitled to, [516], 823
when can claim [518A], 840
suretys ri^t of, [516A], 829
third party, when can claim right of, [518], 834
SUBSEQUENT CREDITOR
SUBSEQUENT TRANSFEREE
prior transfer with intent to defraud and right of, [268], 370, [269], 370
SUB SOIL RIGHTS
grant of, incidents, [78], 113
SUBSTITUTED SECURITY
TACKING
INDEX 1153
TENANCY AT WILL
actual production, if necessary to make [367], 590, [498], 783, [509], 797
before suit for redemption, [368], 591
cessation of interest on mortgage money after, [473], 741, [509], 798, [510], 800
effect of, and deposit of mortgage money, [473], 741, [510], 800
mortgagee's agent, tender to, effect {Sec. lOZ), [884]
mode of, [509], 797
notice of, made to minor mortgagee, [540], 886
TENURE
TITLE
covenant for
145
forbidden
by law, when, [62], S8, [202], 246
opposed to public policy, when, [64], 90
\yith immoral object, when, [63], 89
future property, of, [39], 56
inquiry as to necessity of, [170], 194
limits of, [171], 196
to himself, [40], 57 .
Crown grants and maintenance grant, exemptions from, [15], 16, [16], 17, [570], 953
extent of, [8], 7
history of, [1], 1
Mahomedan law, if affected by, [14], 16, [632], 1069, [644], 1084, [648], 1089
pending proceeding, if affected by, [12], 14
procedure not saved by, [11], 13
transfer by act of parties. Act restricted to, [36] 51
^ retrospective effect, if, [10], 10
trespasser
rNDEx 1155
trespasser (conrrf.)
TRUSTEE
ULTERIOR TRANSFER
UNDIVIDED SHARE
VESTED INTEREST
WAIVER
forfeiture of lease, of
WASTE
by lessee
WRITING
ZURIPESHGI LEASE