Full Judgment Text
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CASE NO.:
Appeal (civil) 5392 of 1997
PETITIONER:
NARAYANARU THRIVIKRANARU
Vs.
RESPONDENT:
V.MADHAVAN POTTY AND OTHERS
DATE OF JUDGMENT: 10/02/2000
BENCH:
D.P. Wadhwa & Syed Shah Mohammad Quadri
JUDGMENT:
Thomas J.
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Appellant won the cause at all the tiers in the judicial
hierarchy during trial stage but the fruits of the decree
which he earned thereby are still eluding him. The decree
is practically rendered nonest during execution stage as the
High Court upheld t he contentions of the contesting
respondents in disregard of the contrary findings made
during trial stage. The order so passed by a learned single
judge of the High Court of Kerala is now being challenged in
this appeal by special leave.
Facts, spread over to a wide range of period covering
more than half a century by now, can be stated as follows:
In 1943 a document (Ex. P1) was executed styling it as
"Otti and Kuzhikanam" in favour of the first respondent in
respect of the suit propert es. In fact those properties
were outstanding on lease with the respondent before the
execution of Ex.P1. A suit for redemption of mortgage was
filed by the appellant, claiming to be entitled to redeem
the mortgage, on the premise that Ex. P1 was a us fructuary
mortgage. First respondent, after admitting the execution
of Ex.P1, contended that it was not meant to terminate the
earlier lease arrangement and hence he continued to be a
lessee of the property notwithstanding the execution of
Ex.P1. The t ial court found that first respondent was in
possession of the land as mortgagee and not as lessee. On
the strength of such a finding the trial court passed a
decree for redemption of the mortgage on condition that the
mortgage amount and value of the i provements effected by
the first respondent on the property should be paid to him.
First respondent filed a regular appeal against the said
judgment before the sub-Court and that court upheld the
decree passed by the trial court. He then filed a second
appeal before the High Court of Kerala. As per the judgment
dated 12.1.1967 the Hi gh Court dismissed the second appeal.
Thus, the decree for redemption of the mortgage became
final.
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It was in the second round of the litigation, when
appellant moved for execution of the decree after depositing
the entire amount due thereunder that he had to face harder
hurdles. The Kerala Land Reforms Act (for short the Act)
came into force in the m eanwhile which conferred fixity of
tenure on tenants of agricultural lands. First respondent
raised a contention, in the execution court, that he is a
tenant on the land and is hence entitled to the protection
envisaged in the Act. The execution court eferred the said
question to the Land Tribunal as provided in Section 125(3)
of the Act for a decision on the aforesaid claim of the
first respondent. The Land Tribunal answered the reference
against the first respondent and forwarded the records of
the case back to the execution court. On the strength of
the finding so recorded by the Land Tribunal the execution
court directed delivery of the suit property to be given to
the appellant as per its order dated 30.11.1995.
First respondent filed a revision before the High Court
challenging the said order of the executing court. The
revision was allowed by the High Court as per order dated
12.1.1996 rendered by a learned single judge who set aside
the order of the executio n court, which is being challenged
now.
We heard the arguments of Mr. C.S.Vaidyanathan, Senior
Advocate for the appellant and Mr. P. Krishnamurthy,
Senior Advocate for the first respondent. Another written
submission has been put in by the advocate on behalf of
respondent Nos. 3 and 4, thoug h they did not contest the
case at any earlier stage. All of them were duly considered
by us.
Learned single judge, in the impugned order, held that
the earlier lease (which existed prior to Ex.P1) in favour
of the first respondent did not come to an end despite
execution of Ex.P1. The following are the main reasoning
adopted by the learned sing le judge:
"There is nothing on record to show that they had agreed
to surrender tenancy right on the execution of the mortgage
deed. Lease was a valuable right. In the case of mortgage,
mortgagor was having the right to redeem the mortgage.
There is nothing on ecord to show that the lessees in the
instant case were conscious of the possibility of redemption
of the mortgage by the mortgagor when they executed
Ottikuzhikanam deed in 1943. So also, there is no clear
statement in the Ottikuzhikanam deed of 1943 t at parties
wanted to terminate their earlier relationship of landlord
and tenant. The fact that parties were aware that for the
termination of leasehold right a document to that effect has
to be executed is evident by the execution of document
No.1159 o 1943 when they wanted to terminate leasehold
interest in respect of 53 cents of properties comprised in
Sy.No.43. In such a situation, if they had intended to
terminate leasehold interest in respect of the decree
schedule properties, there should have een a release deed of
leasehold interest or should have made necessary statements
in the Ottikuzhikanam deed expressing their clear intention
to give an end to the lease arrangement. In the absence of
such clear statements in the Ottikuzhikanam deed, I ind it
difficult to hold that the leasehold interest was terminated
by the execution of document No.1158 of 1943."
It was not open to the High Court to consider at this
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stage, whether Ex.P1 did not come into force or whether the
earlier lease survived the transaction covered by the said
document. Those were the points hotly disputed during trial
stage of the same li tigation and definite findings have
been made thereon by the trial court. Those findings were
against the first respondent which were confirmed in appeal
and they have become final. However, learned counsel for
the first respondent contended that Secti n 12(1) of the Act
enabled the parties to re-agitate such issues
notwithstanding any finding made in the judgment. We will,
therefore examine the said provision. Section 12(1) of the
Act reads thus:
"12. Right to prove real nature of transaction.- (1)
Notwithstanding anything in the Indian Evidence Act, 1872,
or in any other law for the time being in force, or in any
judgement, decree or order of court, any person interested
in any land may prove hat a transaction purporting to be a
mortgage, otti karipanayam, panayam, nerpanayam or licence
of that land is in substance a transaction by way of kanam,
kanam-kuzhikanam, Kuzhikanam, verumpattam or other lease,
under which the transferee is entitled t fixity of tenure in
accordance with the provisions of section 13 and to the
other rights of a tenant under this Act."
It enables any person interested in the land to prove
that a transaction purporting to be a mortgage is, in
substance, a transaction by way of lease. The non-obstante
limb of the Section insulates a transaction which purports
to be a mortgage, from any other law or judgment or decree.
What is saved thereby is "the transaction purporting to be a
mortgage." But that saving clause is not a carte blanche for
ignoring the transaction altogether. Section 12 of the Act
does not permit the court to superse e the findings made by
the Court to the effect that the earlier lease came to an
end with the execution of the transaction which purports to
be a mortgage. In other words, what section 12 entitles a
person is to prove the real substance of the transacti n
covered by Ex.P1, albeit the ostensible tenor of the
document. Hence the finding of the High Court in the
impugned order cannot be salvaged with the aid of Section 12
of the Act.
Learned counsel for the first respondent then contended
that even apart from the reasoning made in the impugned
order first respondent can establish that Ex.P1 is really a
lease. On the language of Section 12 of the Act it is
possible to concede such a right to the first respondent,
but the question is whether first respondent succeeded in
establishing that the transaction covered by Ex.P1 is really
a lease or that first respondent is a tenant of the suit
properties.
A "tenant" is defined in Section 2(57) of the Act as
including an "Ottikuzhikanamdar." This item was inserted in
the inclusive definition of "tenant" as per Act 35 of 1969.
It means that a person holding land under Ottikuzhikanam
arrangement would be a tenant. Now it is necessary to know
what is meant by "Ottikuzhikanam." That expression is
defined in Section 2 (39A) as under: 39A. Ottikuzhikanam
means a transfer for consideration by a person to another of
any land other than nilam for the enjoyment of that land and
for the purpose of making improvements thereon, but shall
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not include a mortgage within the meaning of the Trans er of
Property Act, 1882."
The above definition recognises that there are two types
of "Ottikuzhikanam." One type would be a mortgage within the
meaning of Transfer of Property Act. It is clear that the
said type of "Ottikuzhikanam" is specifically excluded from
the ambit of th definition. It is the other category of
non-mortgage "Ottikuzhikanam" alone has been brought within
the purview of the definition. So, even if the nomenclature
of the transaction is "Ottikuzhikanam" it should not be a
mortgage, if the transaction is t fall within the purview of
the definition.
In this context it is pertinent to remind that the
finding entered by all the courts during the trial stage in
this case is that Ex.P1 is a mortgage. Such a finding is
binding on the parties to this lis as a normal rule, but
Section 12 of the Act enable d the first respondent to prove
that Ex.P1, in substance, is not a mortgage even in spite of
such a finding. However, first respondent has only
endeavoured to show that the earlier lease survived Ex.P1
and not that Ex.P1 is not a mortgage.
One question is to be answered, if the parties wanted
the earlier relationship to continue; Why should they have
changed from lease to "Otti and Kuzhikanam" in 1943 by the
execution of Ex.P1? We did not get any satisfactory answer
to the said question. In this context we cannot forget the
fact that during the said period of 1943 a lease of land,
whether it was agricultural land or otherwise, had no
special protection either legislative or otherwise. A
usufructuary mortgage was during then comparative y more
durable than a lease since a mortgagee could continue in
possession until the mortgage debt was paid off. A lessee,
during those period was vulnerable to eviction by the
landlord at any time. A tenancy right acquired superior
position vis-Ã -vis he usufructuary mortgage only many years
later. Thus usufructuary mortgagee was in a better position
than a lessee during 1943. Hence when parties decided to
change from lease to "Ottikuzhikanam" in 1943 it must have
been because they definitely meant or the change.
The mortgage amount stipulated in Ex.P1 was Rs.850/-.
Learned single judge of the High Court highlighted the cash
payment made on the date of execution of the deed as
Rs.100/- and observed that "the amount so advanced is
negligible when compared with th e value of 1.78 acres
covered by the document." The said reasoning is very tenuous
as the actual mortgage amount reserved in the document was
Rs.850/- out of which the mortgagor had acknowledged receipt
of Rs.750/- which was payable by him to the mortga ee by way
of value of improvements. The said amount of Rs.850/- could
not be described as negligible by any standard during the
year 1943 in respect of an agricultural land comprising of
1.78 acres situated in a rural area.
Another feature to be noticed is that in Ex.P1 there was
no stipulation to pay rent to the landowner. The mortgagee
was permitted to utilize the property on the strength of
Rs.850/- which the mortgagor had acknowledged to be the debt
due from him to the mortgagee. This feature has to be
juxtaposed with the recital in the earlier lease deed that
the lessee should pay rent to the landlord.
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Thus, the recital in Ex.P1 including its nomenclature,
and the amount of mortgage debt are poignantly in favour of
holding the transaction to be a mortgage and not a lessee.
Hence, the finding made by the Court in this case during
the trial stage, which is binding on the parties, cannot be
disturbed. The decree holder is, therefore, entitled to the
fruits of his hard-earned decree. The impugned order of the
High Court is li able to be set aside. In the result we
allow this appeal and set aside the order of the High Court
now under challenge and the revision petition filed by the
first respondent in the High Court would, therefore, stand
dismissed.
CHEERANTHOODIKA AHMMEDKUTTY AND ANR. VS PARAMBUR MARIAKUTTY UMMA AND OTHERS