Full Judgment Text
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PETITIONER:
PATEL NARANBHAI MARGHABHAI AND ORS.
Vs.
RESPONDENT:
DECEASED DHULABHAI GALBABHAI AND ORS.
DATE OF JUDGMENT15/05/1992
BENCH:
RAMASWAMY, K.
BENCH:
RAMASWAMY, K.
KASLIWAL, N.M. (J)
CITATION:
1992 AIR 2009 1992 SCR (3) 384
1992 SCC (4) 264 JT 1992 (4) 381
1992 SCALE (1)1304
ACT:
Bombay Agricultural Debtors Relief Act, 1947-Sections
32(2)(v), 38(3), 51-A read with sections 27, 3, Schedule
Limitation Act-Suit for recovery of possession of property-
Limitation-Determination-Nonprescription of period of
limitation-Legislative intention of-Whether Section 27
applicable.
Constitution of India 1950-Article 136-Appeal under-
Appreciation of evidence-Plea of auction-Purchase of
hypothica, adverse possession-Proof of-Award of mesne profit
by executing Court-Legality of.
HEADNOTE:
The predecessor of the respondents mortgaged the suit-
lands to the predecessor of the appellants, under the
provisions of the Bombay Agricultural Debtors Relief
Act,1947.
The mortgagor/debtor committed default in the payment.
The mortgagee initiated an execution to realise the debt due
amount of Rs. 3000/-, whereunder a compromise was effected.
Pursuant to compromise, though the debt was discharged, the
mortgagee continued in possession.
The respondents, the legal representatives of the
mortgagor laid execution for recovery of the possession of
the hypothica.
The appellants, the legal representatives of the
mortgagee raised objections that the award was barred by
limitation; that the mortgagee perfected title by adverse
possession; that the lands were sold by the Collector for
the recovery of octroi duty in which the mortgagee purchased
the property; and that the character of the mortgagee stood
transferred into an ownership and thereby the appellants
were not liable to surrender possessions.
The Civil Court allowing the application of the
respondents, directed the appellants to deliver the
possession and to pay mesne profit at the rate of Rs. 5000
per year from three years preceding the date of application
till
385
the date of delivery of possession.
When the appellants moved the High Court against the
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order of the lower Court, the High Court declined to
interfere with the finding of the Civil Court.
The appellants challenged the High Court’s judgment in
the present appeal by special leave, contending that the
evidence disclosed that the mortgagee purchased the
hypothica at an auction conducted by the Collector and
thereby he became the owner and the appellants were not
liable to deliver possession of the lands to the
respondents; that the appellants perfected their title by
adverse possession; that for possession, the execution
should be laid within 12 years and as the respondents laid
execution after 22 years, the execution was barred by
limitation; and that the executing court had no power to
award mesne profits.
Dismissing the appeal, this Court,
HELD: 1.01. When a person is obliged to institute a
suit for possession of any property then by operation of
section 27 of the Limitation Act at the determination of the
period thereby limited his right to such property shall be
extinguished. Section 3 of the Limitation Act bars
institution of his suit after the prescribed period and the
suit shall be dismissed though limitation has not been set
up as a defence. [390H]
1.02. The right to any property would be extinguished
only when limitation in that behalf has been prescribed and
the owner or person entitled to possession failed to lay the
suit by presentation of a plaint to the proper officer
within the prescribed period by the schedule to the
Limitation Act.[391C]
1.03. The suit for possession under section 27 of the
Limitation Act is a suit in respect of which the period of
limitation has been prescribed i.e. computed as per the
provisions of the Limitation Act. It is clear from the words
‘period hereby limited’ in section 27 that it would be
applicable to a suit and that the limitation prescribed is
the one in the schedule to the Limitation Act. Section 27,
therefore, does apply to the suit for possession laid in the
specified Civil Court under the Act.[391D]
1.04. The words in section 27 that at the determination
of the ‘period hereby limited’ to any person for instituting
a suit for possession would
386
imply that the limitation has begun to run against a person
for instituting a suit under s.9 of C.P.C. and had expired.
The Legislature advisedly did not prescribe any period of
limitation for recovery of the possession under the Act
which is a beneficial legislation. Section 51A expressly
bars the jurisdiction of the Civil Court. It would follow
that where a person could not or need not have suit for
possession, there is no question of any determination of the
period of limitation to his instituting a preceding or a
suit for possession. Consequently, no question of the
applicability of section 27 would arise. Thereby the
legislature manifested, by necessary implication, that the
period of limitation is not applicable to an application for
recovery of possession under the Act. The application for
possession is not barred limitation. [392B-D]
2.01. The best evidence, namely the notification to
conduct sale for arrears; the sale proceedings and the
certificate of sale have not been placed on record. When
the sale alleged to have been made for recovery of the dues,
it would be governed by the Revenue Recovery Act and the
procedure prescribed therein should be followed and the sale
certificate would have been issued. This material evidence
which clearly establishes that the said sale was withheld by
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the appellants and an adverse inference should be drawn
against the appellants. The resultant position would be
that the appellants remained in possession as the
mortgagees. Once a mortgagee always a mortgagee.
Admittedly there is a charge on the property created in the
award. Therefore, till the debt is discharged the property
remains to be subject to the charge and the mortgagee is
entitled to retain possession. [389F-390A]
2.02. There is no evidence as to when the appellants
asserted adverse title to the property to the knowledge of
the respondents and that they acquiesced to it. There is no
period of limitation prescribed under the Act for
execution.[390B]
2.03. A suit for possession by the owner of any
property will not be barred if the possession of the
defendant is not adverse to him. So hostile title to the
knowledge of the plaintiff must be asserted and proved.
[392D]
2.04. The appellants as successors in interest of the
mortgagee continued in possession after the discharge of
the debt by the mortgagor, They enjoyed the property and the
Civil Court found as a fact that the income derived would be
Rs. 5,000 per year. There is no material contra
387
placed on record. The charge created by the award stands
terminanted from the date of payment of the award amount.
Thereafter the respondents became entitled to claim mesne
profits from the appellants from the next day of the
discharge of the debt. [393B]
2.05. The Civil Court awarded from a period of three
years preceding the date of the application till date of
possession. No appeal or proceedings under Art. 226 or 227
was taken by the respondent. Payment of mesne profit is
consequential to the execution of the award for unlawful
retention of the possession. Thus the court has power and
jurisdiction to award mesne profits as a concomitant of
order for delivery of the possession.
[393C]
Ramanbhai Trikamlal v. Vaghri Vaghabhai Oghabhai &
Anr., (1979) 20 GLR 268, overruled.
Madhav Laxman Vaikunthe v. State of Mysore, [1962] 1
SCR 886, referred to.
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal No.2413 of
1992.
From the Judgment and Order dated 20.11.1990 of the
Gujarat High Court in Special Civil Application No. 6852 of
1990.
R.P. Bhatt and H.J. Jhaveri for the Appellants.
B. Dutta (NP), P.H. Parekh and B.N. Agarwal for the
Respondents.
The Judgment of the Court was delivered by
K. RAMASWAMY, J. Special leave granted.
This appeal by special leave arises against the order
of the Gujarat High Court dated November 20, 1990 made in
Special Civil Application No. 6852 of 1990. The appellants
are the legal representatives of Naranbhai Marghabhai - the
mortgagee. The respondents are the legal representatives of
Dhulabhai Galbabhai - the mortgagor, agriculturist. The
lands bearing survey No. 572/2 admeasuring IA.31 Gs. and
survey No.354 admeasuring IA.23 Gs. situated in Bhadra
village in Kheda district were hypothecated by the mortgagor
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to the mortgagee. The mortgage is governed by the Bombay
Agricultural Debtors Relief Act 1947 for short
388
"the Act". Under Section 31 of the Act the debt payable by
an agriculturist shall be scaled down in the manner laid in
the Act. The debt in excess thereof stands extinguished
under section 34. The amount of debt determined after
scaling down is an award under section 34 and shall be
registered as prescribed under section 38 if a charge of the
debt has been created on the properties of the debtors.
Under clause (iii) of sub-section (3) of section 38 the
award shall be executed as if the court passed an order.
Under section 32(2)(v) the court may "pass an order for the
delivery of possession of any property, notwithstanding any
law or contract to the contrary". "Award" has been defined
under section 2(1) to mean an Award made under sub-section
(4) of Section 8 or sections 9, 32 or 33 or as confirmed or
modified by the court in appeal. "Court" has been defined
to mean the Court of the Civil Judge (Sr. Division) having
ordinary jurisdiction in the area where the debtor
ordinarily resides and if there is no such Civil Judge the
Court of the Civil Judge (Jr. Division) having such
jurisdiction and includes any Court to which an application
may be referred for desposal under section 13 A. Thus it is
clear that notwithstanding any law or contract to the
contrary the award for delivery of the possession of any
property charged or hypothecated shall be executed as if it
is the order of the Civil Court.
Section 46 provides "save as otherwise expressly
provided in this Act, the provisions of the Code of Civil
Procedure, 1908 (V of 1908) shall apply to all proceedings
under this chapter." Sections 32 and 38 are part of this
chapter of the Act. Section 51A envisages that except as
otherwise provided by the Act, and notwithstanding anything
contained in any other law, no Civil Court shall entertain
or proceed with any suit or proceeding in respect of (i) any
matter pending before the Court under the Act, or (ii) the
validity of any procedure or the legality of any award,
order or decision of the Board established under section 4
of the repealed Act or of the court, or (iii) the recovery
of any debt made payable under such award. The Act,
therefore, is a complete Code in itself as regards the
determination of the debt; the liability fastened thereunder
and the recovery of the debt due or the possession of the
agricultural lands pursuant to the award. Only the mode of
execution has been relegated to the procedure provided in
the Civil Procedure Code. The Civil Court found that the
award was registered at the behest of the mortgagee and the
debt was payable in six annual instalments carrying
interest at 6% . The debt due was Rs. 3,000 when the
mortgagor/debtor committed default in the payment and
execu
389
tion was laid whereunder a compromise was effected pursuant
to which the debt was completely discharged. Yet the
mortgagee continued in possession till date. The
respondents laid execution for recovery of the possession of
the hypothica. Several objections were raised but we are
concerned in respect of three, namely that the award is
barred by limitation, (ii) the mortgagee perfected title by
adverse possession, and (iii) the lands were sold by the
Collector for the recovery of octroi duty in which the
mortgagee purchased the property. The character of the
mortgagee stands transferred into an ownership and thereby
they are not liable to surrender possession. These
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contentions were negatived by the Civil Court. The Civil
Court while directing delivery of the possession, ordered to
pay mesne profit at the rate of Rs.5,000 per year from three
years preceding the date of application till date of
delivery of possession. The High Court declined to
interfere on the finding that "it is eminently just and
proper order".
Shri Bhatt, the learned senior counsel for the
appellant raised three contentions before us. It is
firstly contended that the evidence do disclose that the
mortgagee purchased the hypotheca at an auction conducted by
the Collector and thereby he became the owner and the
appellants are not liable to deliver possession of the lands
to the respondents. We find no force in the contention. It
is to note that from Exh. 40 and 41 challans, it would
appear that a sum of Rs. 1,968 and Rs. 657 respectively was
deposited. But as pointed out by the Civil Court it is not
clear that the said payments were made towards the sale
price or pursuant to the alleged auction of suit property.
The best evidence namely the notification to conduct sale
for arrears; the sale proceedings and the certificate of
sale have not been placed on record. A letter of 1964
purported to have been written long after the alleged sale
made in 1955 that there was no need for issue of sale
certificate as the appellants remained in possession. It
is difficult to accept this letter. When the sale alleged
to have been made for recovery of the dues, it would be
governed by the Revenue Recovery Act and the procedure
prescribed therein should be followed and the sale
certificate would have been issued. As stated earlier this
material evidence which clearly establishes that the said
sale was withheld by the appellants and an adverse
inference should be drawn against the appellants. The Civil
Court, therefore, was justified in rejecting the contentions
of the appellants. The resultant position would be that the
appellants remained in possession as the mortgagees. Once a
mortgagee always a mortgagee. Admittedly
390
there is a charge on the property created in the award.
Therefore, till the debt is discharged the property remains
to be subject to the charge and the mortgagee is entitled to
retain possession. The contention that the appellants are
owners is not tenable and rightly was rejected by the Civil
Court.
The further contention that the appellants perfected
their title by adverse possession lacks force. There is no
evidence as to when the appellants asserted adverse title to
the property to the knowledge of the respondents and that
they acqiesced to it. There is no period of limitation
prescribed under the Act for execution. The contention
placing reliance on a full bench judgment of Gujarat High
Court in Ramanbhai Trikamlal v. Vaghri Vaghabhai Oghabhai &
Anr., (1979) 20 GLR 268 that for possession, the execution
shall be laid within 12 years and the respondents laid their
applications after 22 years; no relief for possession was
asked and that the execution after 22 years is barred by
limitation. We find no force in the contention.
Section 29(2) of the Limitation Act 1963 provides thus:
"Where any special or local law prescribes for any
suit, appeal or application a period of limitation
different from the period prescribed by the
Schedule, the provisions of section 3 shall apply
as if such period were the period prescribed by the
Schedule and for the purpose of determining any
period of limitation prescribed for any suit,
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appeal or application by any special or local law,
the provisions contained in sections 4 to 24
(inclusive) shall apply only in so far as, and to
the extent to which, they are not expressly
excluded by such special or local law".
Therefore, the special or local law should prescribe its
own period of limitation different from the one prescribed
by the schedule of the Limitation Act. To a prescription of
such limitation, section 3 would apply by fiction as if it
was prescribed in the schedule. In that event period of
limitation prescribed in the local or special law to the
suit, appeal or application, sections 4 to 24 inclusive
would apply. When a person is obliged to institute a suit
for possession of any property then by operation of section
27 at the determination of the period thereby limited his
right to such property shall be extinguished. Section 3 of
the Limitation Act bars
391
institution of his suit after the prescribed period and the
suit shall be dismissed though limitation has not been set
up as a defence. The word ‘suit for possession’ referred to
in section 27 is a suit in respect of which the period of
limitation is prescribed by the schedule to the Limitation
Act.
Under Section 2(1) of the Limitation Act suit does not
include application. Section 3(2)(i) amplifies that for the
purpose of Limitation Act a suit is instituted in an
ordinary course when the plaint is presented to proper
officer. Section 27 extinguishes the right to property at
the determination of the period ‘hereby limited’ for
instituting a suit for possession of any property. Under
section 2(i) period of limitation means the period of
limitation prescribed for any suit by this schedule. In
other words the right to any property would be extinguished
only when limitation in that behalf has been prescribed and
the owner or person entitled to possession failed to lay the
suit by presentation of a plaint to the proper officer
within the prescribed period by the schedule to the
Limitation Act. The suit for possession under section 27 of
the Limitation Act is a suit in respect of which the period
of limitation has been prescribed i.e. computed as per the
provisions of the Limitation Act. It is clear from the
words ‘period hereby limited’ in section 27 that it would be
applicable to a suit and that the limitation prescribed is
one in the schedule to the Limitation Act. Section 27,
therefore, does apply to the suit for possession laid in the
specified Civil Court.
Section 43 of the Act provides a right to appeal
against specified orders notwithstanding anything contained
in any other law. No appeal from an award under section 32
or 38 was provided for. Sub-section (2) of section 43
prescribes limitation for filing the appeal which reads thus
:
"The appeal from the court shall lie to the
District Court and the appeal shall be made within
60 days from the date of coming into force of the
Bombay Agricultural Debtors Relief (Amendment) Act,
1948, or from the date of order or award, as the
case may be, whichever is latter. In computing the
period of 60 days the provisions contained in Ss.
4, 5 and 12 of the Indian Limitation Act 1908,
shall, so far as may be, applied. Thus, the
legislature prescribe a special limitation for the
purpose of the appeal and the period of limitation
of 60 days was to be computed after taking the aid
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of Ss. 4, 5 and 12 of the Limita-
392
tion Act. To that extent only the provision of the
Limitation Act stands extended. The applicability
of the other provisions, by necessary implication
stands excluded....
Moreover, the words in section 27 that at the
determination of the ‘period herby limited’ to any person
for instituting a suit for possession would imply that the
limitation has begun to run against a person for instituting
a suit under s.9 of C.P.C. and had expired. The Legislature
advisedly did not prescribe any period of limitation for
recovery of the possession under the Act which is a
beneficial legislation. Section 51A expressly bars the
jurisdiction of the Civil Court. It would follow that where
a person could not or need not have suit for possession,
there is no question of any determination of the period of
limitation to his instituting a proceeding or a suit for
possession. Consequently, no question of the applicability
of section 27 would arise. Thereby the legislature
manifested, by necessary implication, that the period of
limitation is not applicable to an application for recovery
of possession under the Act. The application for possession
is not barred by limitation. Moreover, a suit for possession
by the owner of any property will not be barred if the
possession of the defendant is not adverse to him. So
hostile title to the knowledge of the plaintiff must be
asserted and proved. The contention, therefore, that the
appellants perfected title by adverse possession is devoid
of substance. Remanbhai Trikamlal’s case concerns limitation
to recover the debt crystalised in the award. The Full Bench
held that the limitation prescribed under Art. 136 of the
Limitation Act, 1963 applies to all awards under the Act
whether it relates to an award to recover the money or
possession. In Madhav Laxman Vaikunthe v. State of Mysore,
[1962] 1 SCR 886 this Court held that to recover arrears of
salary the period of limitation of three years would be
applicable. In a suit, to recover a sum due whether based on
contract or tort or under Art. 226 in a master and servant
relationship, in the absence of special rule of limitation,
this court applied three years’ limitation. That may proprio
vigor would be applicable to recover the debt under the Act.
The Full Bench ratio would, therefore, apply to recover
money due under the Award. But it would not lead to the
conclusion that the doctrine of adverse possession and the
period of 12 years prescribed in the Limitation Act to
recover possession need be extended to the proceedings to
recover possession under the Act when the legislature
advisedly omitted to prescribe any such limitations to
recover possession of the hypothica or the lands charged in
the award. The view of the Full
393
Bench in the second part that Art.136 of the limitation Act,
1963 would apply to all awards including "a possession
award" is not correct law.
It is next contended that the executing court has no
power to award mesne profits. Admittedly, the appellants as
successors in interest of the mortgagee continued in
possession after the discharge of the debt by the mortgagor.
They enjoyed the property and the Civil Court found as a
fact that the income derived would be Rs. 5000 per year.
There is no material contra placed on record. The charge
created by the award stands terminated from the date of
payment of the award amount. Thereafter the respondents
became entitled to claim mesne profits from the appellants
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from the next day of the discharge of the debt. The Civil
Court awarded from a period of three years preceding the
date of the application till date of possession. No appeal
or proceedings under Art. 226 or 227 was taken by the
respondent. Payment of mesne profit is consequential to the
execution of the award for unlawful retention of the
possession. Thus the court has power and jurisdiction to
award mesne profits as a concomitant of order for delivery
of the possession. Viewed from this perspective we hold that
the civil court is right to award mesne profits as integral
power to order delivery of possession as this would arise
only due to non-delivery of possession. Accordingly the
appellants are liable to pay mesne profits.
The appeal is accordingly dismissed with costs
quantified at Rs. 3,000. The appellants are directed to pay
the said cost to the Supreme Court Legal Aid Committee
within a period of three months from today. In default the
civil court suo motu should execute the decree for cost and
make over the amount to the credit of the Supreme Court
Legal Aid Committee.
V.P.R. Appeal dismissed.
394